Italian Court Convicts Three Former Monte Paschi Execs in Derivatives Trial (excerpt)
(Source: Reuters; published October 15, 2020)
By Alfredo Faieta
MILAN --- A Milan court convicted three former executives of Banca Monte dei Paschi di Siena at the end of a long-running false accounting case on Thursday, a result that could hinder Italy’s bid to re-privatise the world’s oldest bank.

Former Monte dei Paschi chairman Alessandro Profumo, former CEO Fabrizio Viola and former president of the supervisory board Carlo Salvadori were accused of not correctly booking two derivative transactions - known as Alexandria and Santorini - between 2012 and 2015.

After years of mismanagement, Rome rescued Monte dei Paschi in 2017, spending 5.4 billion euros ($6.3 billion) on a 68% stake which the European Union said must be sold by mid-2022. Bankers say legal risks hanging over the lender could stand in the way of a potential deal.

Prosecutors in the case had earlier this year asked for an acquittal, but the bank’s minority shareholders sought a conviction.

Profumo, who currently serves as the CEO for state-controlled aerospace and defense group Leonardo, and Viola were each handed a jail sentence of six years, while Salvadori received three-and-a-half years, according to a decision read out in court.

A lawyer representing the defendants said they planned to appeal. (end of excerpt)

Click here for the full story, on the Reuters website.

(EDITOR’S NOTE: Profumo is the fourth successive CEO of Leonardo (formerly Finmeccanica), to face legal problems.
The previous three resigned or were fired by the government, the controlling shareholder.
It is noteworthy to see the company saying it supports him -- even though exactly who issued the unsigned statement below is not clear -- while it dropped his two predecessors when they were convicted or charged.
Profumo’s immediate predecessor, Mauro Moretti, was fired by the government after he was sentenced in 2017 to seven years in jail for a train crash in which 32 people were killed that happened while he was chairman of the Italian railways.
Moretti is appealing his conviction.
In turn, Moretti was appointed CEO when Giuseppe Orsi was arrested and charged with international bribery in the sale of AW101 helicopters to India.
The charges were later shown to have been trumped-up, and he was cleared of any misdeed, along with his successor at AgustaWestland, Bruno Spagnolini, by Italy’s supreme court, which ruled that no offence had been committed.
Orsi, who was formerly CEO of Leonardo subsidiary AgustaWestland, was appointed to replace Pier Francesco Guarguaglini, who resigned as chairman of Finmeccanica in the wake of a wide-ranging corruption probe that was ultimately shelved.)

Story history:
-- Oct. 18, 2020 @ 07:00 CET: Added additional comment to Editor's Note.


Leonardo Statement
(Source: Leonardo; issued Oct. 15, 2020)
ROME --- With regards to the judgement in the first instance of Mr. Alessandro Profumo, relating to his previous role as Chairman of [Monte dei Paschi di Siena], the Company would like to make clear that the conditions do not exist for the cessation of his role as Chief Executive Officer of Leonardo.

The Company expresses its full confidence in the actions of Mr. Profumo and wishes for his continuation in the role.


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