Bankers' sentences upheld in Parmalat offshoot trial

Geronzi and Arpe lose on appeals of usury and bankruptcy case

Bankers' sentences upheld in Parmalat offshoot trial

(ANSA) – Bologna, June 7 – An Italian appeals court confirmed the sentences handed down to two top Italian bankers in 2011 for their role in the bankruptcy of a firm linked to the 2003 collapse of the Parmalat dairy giant. Former Banca di Roma head Cesare Geronzi, 78, was convicted of fraudulent bankruptcy and usury over the closure of Parmalat's ex-subsidiary Ciappazzi and received a five-year jail term. Former Capitalia CEO Matteo Arpe's sentence of three years and seven months was also upheld. Judges also confirmed sentences for another six other indicted parties. The 2011 conviction was Geronzi's second. July 2011 he received a four-year term for his role in the the fraudulent bankruptcy of foods conglomerate Cirio. Geronzi, also the former chairman of premier merchant bank Mediobanca, lost his leading role in Italian capitalism when he stepped down from the helm of insurance giant Generali in April 2011. In Italy jail terms do not usually take effect until the appeals process is exhausted, with two appeals granted in each case. Unicredit was also fined 200 million euros for Banca di Roma's role in the Cirio bankruptcy. Founded in the mid-19th century, Cirio was Italy's oldest food canner. Cirio's collapse was followed by that of Parmalat. Parmalat went under in December 2003 in a false accounting scam that resulted in estimated debts of 14.5 billion euros. The dairy multinational's meltdown left more than 150,000 investors with virtually worthless bonds. After his arrest at the end of 2004, Parmalat's disgraced founder and ex-CEO Calisto Tanzi accused Geronzi of "pressuring" him to buy the Eurolat milk company from Cirio at a price far above its market value. Geronzi denied Tanzi's accusations which he said were "self-serving". However, the operation raised some eyebrows because proceeds from the sale were given directly to Banca di Roma, which not only had lent large sums of capital to Cirio but was also involved in placing both Parmalat and Cirio bonds with small investors. Photo: Cesare Geronzi

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