German prosecutors probe leading bank

DUESSELDORF – German prosecutors have launched an investigation into one of the country’s leading banks over its financing of the British television rental company Boxclever.

The Duesseldorf state prosecutors office said Thursday it had begun an investigation of managers of WestLB, Germany’s fifth-largest bank, on suspicion of breach of trust.

The German banking regulatory authority BaFin had referred files on the case to prosecutors in June.

WestLB’s chief executive, Juergen Sengera, and another board member resigned after the banking watchdog uncovered serious risk management weaknesses in the 1999 financing of Boxclever.

As a result of the disastrous investment, WestLB, owned mainly by North Rhine-Westphalia state, was plunged deeper than expected into the red, posting a loss of EUR1.7 billion in 2002.

WestLB said the complexity of the case meant it was not unusual for prosecutors to want to investigate. The bank will cooperate with the investigation, it said.

DPA
Subject: German news