Parmalat chief 'plundered £350m'

PARMALAT founder Calisto Tanzi may have moved up to e500m (£352m) into tourism companies owned by his family, it emerged today in a twist to the scandal engulfing the Italian food giant.

Meanwhile, in a separate development, Tanzi's son, Stefano, a Parmalat board member and chairman of football team Parma, was also questioned by magistrates for the first time in his home town of Parma. Details of the line of questioning were unknown.

Earlier, speaking outside Milan's San Vittore jail, defence lawyer Fabio Belloni said his client told magistrates he had funnelled the money into a number of firms, including a family-owned holiday operator, Parmatour.

Belloni said Tanzi's defence team would now have to analyse the companies one by one 'to verify the cashflows'. Parmalat insisted it does not own any holiday firms.

The revelation came after US regulators launched their own probe and described the crisis as 'one of the largest and most brazen corporate financial frauds in history'.

Italian authorities have accused Tanzi of embezzling more than e800m from his family-controlled food empire in the past decade. Investigators believe the hole in the firm's accounts amounts to nearly e11bn.

According to Italian prosecutors, losses and liabilities at Parmalat were hidden behind a network of offshore shell companies.

Tanzi was arrested at the weekend and is now behind bars in San Vittore, facing a third day of questioning, this time over accusations that the former Parmalat chief executive had falsified group accounts and misled markets.

Parmalat employs 35,000 people in more than 20 countries and the fallout from the scandal is being felt around the world.

The US Securities and Exchange Commission (SEC) charged the firm with misleading investors. Its allegations relate to $100m (£56.4m) of bonds the company offered between August and November. It claims Parmalat cheated investors by 'materially overstating the company's assets and materially understating its liabilities'.

The complaint, filed in a New York federal court, says Parmalat also lied to investors and regulators when it claimed that it had repurchased nearly $4bn in outstanding bonds.

The company 'had not repurchased those debt obligations and they remained outstanding', the SEC said.

Bloomberg today reported that the Italian government has begun looking at creating a new regulator, modelled on the SEC or Britain's Financial Services Authority to prevent such a crisis being repeated.

Italy's President Silvio Berlusconi said, meanwhile, that various elements of his country's regulatory system failed to communicate.