Lawyers: $7bn Parmalat cash traced
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Even if the missing funds are identified, there is no guarantee they can be recovered
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PARMA, Italy (Reuters) -- Lawyers representing a group of Parmalat creditors say they have traced about $7.7 billion of the food group's funds but they had no documented proof.
A legal filing obtained by Reuters said the lawyers representing the Parmalat Creditors Committee had "succeeded in following the 'electronic' trail of about $7.7 billion which was well invested and guaranteed."
The lawyers did not say where the money was being held or whether it was recoverable.
The three lawyers -- Carlo Zauli, Giuseppe Lozupone and Anna Campilii -- said in the five-page filing to be presented to the bankruptcy court in the northern city of Parma they had traced the funds using a group of investigators and "press talk."
"I am using overseas investigators who are working globally, men who are able to spot financial flows, movements of money," Zauli told Reuters by telephone."
But he said it would be an "illusion" to believe documented proof of electronic transfers of the funds could be found.
Parmalat was declared insolvent last month after revealing a hole in its accounts which prosecutors investigating for fraud believe could exceed 10 billion euros.
The three lawyers said in their undated filing that their investigators had traced more than seven billion euros of bonds issued by Parmalat, as well as 510 million euros siphoned off from Parmalat's offshore Epicurum Fund.
In the filing the lawyers said the existence of the funds proved Parmalat had financial resources and should not have been declared insolvent, and that its funds should be sequestered.
Stock market traders said the creditor group's comments was helping to push up Italian banking shares which recently have fallen on concerns about their links to Parmalat, including their loan exposure to the group.
In heavy trading, shares in Italy's biggest bank by assets Banca Intesa were up 4.8 percent and Capitalia was up 4.4 percent at 1402 GMT, recovering from similarly strong losses on Wednesday.
"Given the way the banks are performing, the market believes it," said Fabrizio Tito, an equity traders with Milan brokerage Rasbank, when asked if the market believed the lawyers had traced the funds.
Another trader with a foreign brokerage in Milan said he did not believe the money had been found.
"It's rubbish," said the trader who asked not to be named. "I think people are using the opportunity to push the banks back up a bit."
Earlier on Thursday, the TGfin Web site (www.tgfin.it), controlled by broadcaster Mediaset, said the creditors committee had discovered that a company linked to Parmalat founder Calisto Tanzi held seven billion euros worth of U.S. government bonds.
The TGfin Web site said the bonds were being held in a single account with the Bank of America by a company linked to Tanzi.
Bank of America could not be reached for comment.
The creditors committee's chairman, Mauro Sandri, told Reuters he could not confirm the report, and an investigator said the committee was unknown to Parma prosecutors probing for fraud at Parmalat.
Copyright 2004
Reuters. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
