Italian court targets UBS in fraud case
Italian prosecutors to charge executives from four foreign banks with fraud against Milan.Milan -- Italian prosecutors will seek to charge executives from four foreign banks with fraud against the city of Milan, a court official told AFP on Tuesday.
The 12 staff from US bank JPMorgan, Germany's Depfa Bank and Deutsche Bank, and Swiss bank UBS are suspected of fraud during the renegotiation of the city's debt.
Two former city officials are also accused in the case.
Prosecutors in Milan have completed their investigation and will request that the accused face charges, the official said.
Milan estimates potential losses from the deal at EUR 300 million (CHF 456 million, USD 425 million), although the city says the full impact will not be known for several years.
The case dates back to 2005, when the northern Italian city took a EUR 1.7 billion loan as part of efforts to restructure its debt.
The charges allege that the banks did not inform the city of the risks carried by the financial derivative products connected with the deal.
In addition, the bankers are accused of falsely promising Milan that the plan would help save money.
The banks allegedly made a EUR 100 million profit from the deal, according to prosecutors.
Milan has said the full cost to the city will only be known in 2035, when the final repayment of the loan is due.
Italian financial investigators in April seized hundreds of millions of euros belonging to the banks and the former officials.
AFP / Expatica