Parmalat finance chief grilled by prosecutors

PROSECUTORS unravelling one of the world’s biggest corporate scandals interrogated a former Parmalat finance chief on Monday as the crippled food group’s new management prepared to ask banks for emergency credit.

With justice authorities in New York stepping up a probe into the role of US banks in the multi-billion-euro case, Italian prosecutors have accused former chief financial officer Fausto Tonna of helping construct a web of offshore holding companies with fictitious assets that left the global food and dairy group with an accounting hole that investigators believe could exceed €10 billion.

Parmalat’s crisis exploded just over two weeks ago when its new managers revealed an initial €4 billion gap in its accounts, forcing the company to seek protection from creditors.