MPS Foundation offices searched, 'insider trading' suspected

(ANSA) - Rome, March 26 - Finance police and agents from market watchdog Consob on Wednesday were inspecting the offices the MPS Foundation, the main shareholder of troubled Italian bank Monte dei Paschi di Siena (MPS). Sources told ANSA police suspect insider trading last December, when MPS delayed a crucial three-billion-euro share sale. Agents are also said to be looking into 12% share sale the foundation made last week. On December 30, Consob launched what they termed "coordinated monitoring" of Siena-based MPS, the world's oldest functioning bank and Italy's third-largest by assets. The bank has suffered a series of losses related to derivatives and has seen earnings eroded by years of economic recession.
    Earlier this month finance police expanded their investigation into what is now believed to be a 90-million-euro fraud at MPS, including new searches in several cities including Siena, Rome, and Milan.
    The latest searches are part of a broader probe targeting alleged members of the so-called "5% gang" - a name given to ex-bank managers suspected of taking 5% payoffs on banking operations under a previous management.
    Investigators believe the fraud occurred between January and October 2013.
    Prosecutors say they hope to eventually bring charges of aggravated criminal conspiracy aimed at defrauding the Sienese bank.
    The case involves funds transferred to offshore accounts, trusts and companies, and investigators are reaching out as far as San Marino, Switzerland, Great Britain and Singapore as they search for suspicious international transactions.
    The Siena prosecutor's office has placed 11 former MPS managers and financial brokers under investigation in the case, including Gianluca Baldassarri, former chief of finance for MPS.
    They are also probing Baldassarri's former deputy, Alessandro Toccafondi, the former head of the MPS London office Matteo Pontone, and former MPS manager Antonio Pantalena.
    Italy's third-largest bank was thrown into crisis in January 2013 when it emerged that a shady series of derivative and structured-finance deals produced losses of 720 million euros.
    Meanwhile, the investigating judge of the court of Siena announced this month the file has been closed into the suicide of David Rossi, the bank's communication manager who threw himself from a window in March 2013.