Bawag bounders convicted in Austria
Life’s little coincidences. On Thursday, former Refco chief executive officer Phillip R. Bennett was sentenced to 16 years in prison; on Friday, nine former executives and other associates of Bawag, the Austrian bank that was a fully-paid member of the Refco crime syndicate, were convicted of charges related to €1.4 billion in concealed losses incurred in Refco-related and other financial adventures.
Among those ordered to the pokey was Wolfgang Floettl (left, with his wife Anne Eisenhower, granddaughter of the former US president), an alleged hedge fund manager whose Bermuda-based Ross Capital Markets Ltd incurred colossal losses prominent among the cadavers temporarily interred in the Refco and Bawag balance sheets. Floettl (also d/b/a Flöttl) collected a 2½ -year sentence—all but 10 months of it suspended—even after his wife offered to pay €5 million in court costs if he was spared jail time.
Helmut Elsner, Bawag’s former chief executive, was sentenced to 9½ years in prison and ordered to repay €6.8 million in pension benefits. Johann Zwettler, who succeeded Elsner in 2003, was sentenced to five years imprisonment; he changed his plea to guilty during the trial.
According to Reuters, Judge Claudia Bandion-Ortner and her three co-judges heard 104 witnesses in 116 court sessions since proceedings began in Jul. 2007.
Noted with interest: Bawag is now controlled by Cerberus Capital Mgt, which paid €3.2 billion for the bank in May 2007. Austrian banking regulators may want to cast a wary glare at any ‘investments’ Bawag may contemplate in such high-flying Cerberus entities as, say, Chrysler and GMAC.
Austria court convicts bankers over heavy Bawag losses
by Boris Groendahl
Reuters Jul. 4 2008
Refco Banker Elsner, Flottl Convicted in Bawag Case
by Matthias Wabl
Bloomberg Jul. 4 2008
Comments