Parmalat Founder Is Named in Case

Prosecutors in Milan, Italy, investigating the collapse of dairy company Parmalat on Thursday requested the indictment of Calisto Tanzi, the company’s founder, along with the local unit of Bank of America Corp., Deloitte & Touche and a former branch of Grant Thornton International.

Tanzi, 65, former Chief Financial Officer Fausto Tonna, 52, two auditors of Deloitte Touche Tohmatsu’s Italian member firm and two former Grant Thornton accountants are among the 29 people accused of market manipulation, false statements and obstructing market regulator Consob, prosecutors told reporters.

Prosecutors will try to show that Parmalat’s former management hid losses and created false assets for more than a decade. Investigators suspect that the auditors and some bankers knew the true state of Parmalat’s finances. Its debt reached $17.7 billion at the end of September, almost eight times the amount the company originally reported.

Parmalat collapsed in December after acknowledging that a $4.9-billion Bank of America account didn’t exist.

Thursday’s proposed indictments are the first stemming from the probe by prosecutors in Milan and Parma, Italy, where Tanzi founded the company in 1961. Three former executives at Bank of America’s Milan office were also on the list of those proposed for indictment.