A court in Italy convicted and sentenced the chairmen of Piaggio & C. SpA and Capitalia SpA to prison in a case related to the bankruptcy of real estate and hotel company Italcase-Bagaglino.
Capitalia SpA, Italy's fourth-biggest bank, said it suspended Chairman Cesare Geronzi following the decision. Piaggio's Roberto Colaninno was suspended from the Rome-based bank's board of directors but remains chairman and CEO at the Italian powersports company.
The court convicted the men on charges of practicing "preferential bankruptcy" related to Italcase-Bagaglino, which collapsed in the late 1990s following loans by Banca di Roma, Banca Agricola Mantovana and Banca Nazionale dell'Agricoltura. Prosecutors argued that the Italian banks sought to gain properties as collateral and extended loans even though they knew that Italcase-Bagaglino was in financial crisis.
At the time, Colaninno was a board member of Banca Agricola Mantovana, which later was acquired by Banca Monte dei Paschi di Siena SpA.
The court sentenced Colaninno to four years and a month in prison. Geronzi was sentenced to one year and eight months. A third man, Banca Popolare Italiana's CEO Divo Gronchi, was sentenced to one year and 8 months. The sentences can be appealed without jail time.
Read a complete report in the December 25 issue of Powersports Business.
Copyright 2006 Powersports Business