Banque Cantonale de Genève mismanagement in 1990s: ready for trial but lawyers angry at leak

Update 14:00  Geneva, Switzerland (GenevLunch) – Geneva’s public prosecutor, Daniel Zapelli, has now prepared his case against the key people responsible for the collapse of Geneva’s cantonal bank (BCGE), reported the Tribune de Genève 1 October. The article gives a detailed account of the bank’s scandal 10 years ago, based on Zapelli’s 600-page indictment, which the Tribune obtained. Lawyers and government officials have expressed anger in the wake of the article, that a newspaper should have obtained a copy of the indictment before the parties concerned, reports 20 Minutes.

The debacle cost the canton CHF2  billion, and a foundation had to be created to pay off its debts. Hearings in the case began in 2000 and ended only in 2008: they resulted in 3,700 pages of recorded hearings, 40 binders for general information and 1,500 binders of documents related to the hearings, according to an article Le Temps wrote in 2007 about the lengthy judicial process for the case.

This is one of several cases that led to a revision of federal law, which goes into effect in 2010 and will force court cases to take less time and to cost less as a result.

Three top bank officials and two outside auditors from Ernst & Young “massaged” the accounts from 1996 to 1998 to show profits while in reality there were “colossal losses” and the bankers were paid big bonuses, today’s report in the Tribune credits the indictment with stating.

Background: Geneva bank debacle buried, GenevaLunch, 14 September 2007

Comments

  1. Ivo Cerckel says:

    Yes, it’s easy for Geneva’s public prosecutor, Daniel Zapelli, to indict three top bank officials and two outside auditors from Ernst & Young.

    Et ils touchaient des bonus…,
    And they cashed in on big bonuses …,
    subtitles la Tribune.

    Sounds familiar these days!

    How come banking is the only industry where executives can overpay themselves and their shareholders?

    Can you spell “irredeemable, at least unbacked, paper money” and “fractional-reserve banking”? . . .