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VIENNA, Austria (AP) - The head of Austria's trade union federation stepped down Monday after revelations that he knew about the use of union funds to underwrite huge losses made by Bank Fuer Arbeit und Wirtschaft AG.
The resignation of Fritz Verzetnitsch came three days after the bank, which is owned by the trade federation, said it incurred losses of just under 1 billion euros ($1.2 billion) through the financing of investment companies mainly engaged in interest rate and currency transactions in the Caribbean.
While officials at the bank, which is known by its acronym BAWAG, say the bank remains financially sound, the affair has further tarnished its image just months after revelations it lent hundreds of millions of dollars to the former head of the New York commodities brokerage Refco Inc.
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