A long-running criminal probe into diamond sales by Italian banks has uncovered ...
MILAN - A long-running criminal probe into diamond sales by Italian banks has uncovered what prosecutors say is further evidence of corruption by officials at UniCredit, Italy’s largest lender, and smaller rival Banco BPM.
The number of bank officials under suspicion, and the allegations they may face if they are charged, however, are widening. UniCredit said in a statement to Reuters it was cooperating closely with authorities and its policy was not to comment on an ongoing investigation. It would “continue to offer appropriate customer care services to its affected clients”.
Prosecutors also allege that UniCredit and Banco BPM worked out a deal with IDB where, in return for the banks selling IDB’s diamonds, the broker would channel money into their stock, boosting their share capital at a time when it was under pressure from a rising tide of bad debts. In a telephone conversation in early June 2016, a transcript of which was seen by Reuters, the former CEO of IDB complained that Banco Popolare was insisting he invest in the bank’s shares.
Since then, the banks have begun to compensate customers. All except Banco BPM have offered to buy back diamonds at the purchase price. Banco BPM said last month it would compensate clients for their losses but leave them with the stones. In April, it said it had received 18,400 claims for compensation.Investigators allege the banks and the diamond brokers made the diamonds look like a safe investment.
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