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 MILAN, Italy (AP) - The indictment on Wednesday of four international banks on criminal charges related to the 2003 failure of the Parmalat dairy empire could help bondholders recoup millions in losses and potentially exposes the banks to a ban from operating in Italy.
The four banks — Citigroup Inc., UBS AG, Deutsche Bank AG and Morgan Stanley — were charged with failing to have procedures in place that would have prevented alleged crimes that contributed to Europe's largest corporate bankruptcy, under a law that seeks to assign institutional responsibility for employee behavior.
Also indicted in the criminal trial are 13 bank employees who were charged with making false statements mostly aimed at rigging the market for Parmalat bonds — some sold as late as the summer of 2003 just before Parmalat's web of financial deception started to unravel.
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