PORTUGAL’S FINANCIAL sector watchdog, the Commission for Market Values, promised it would continue its sweeping investigation into some of the greatest abuses in the country’s financial history.
The announcement came days before BCP said it would appeal against the Comissão do Mercado de Valores Mobiliários’ decision to fine the institution up to three million euros.
Its decision to contest the CMVM ruling means that it will lose the option of having its fine reduced to 500,000 euros.
The CMVM said it was prepared to “forget about 2.5 million euros” if the bank complied with a series of conditions laid down by the financial regulator.
The main condition was that shareholders and clients that had been misled by investing in a number of shady off-shore vehicles should be re-compensated.
The fine, the largest ever against a financial entity in Portugal, was for a series of infractions over “excessive conflicts of interest” essentially involving the bank’s decision to raise its capital stake in 2000 and 20001.
The CMVM accuses the bank of “excessive market manipulation, of not keeping adequate documentation into its activities for at least 10 years, and of having evaded handing over quality detailed information when asked to by the regulator”.
In particular, the CMVM is calling into question the doubtful fundraising techniques of key BCP shareholders in its bid to raise capital in 2000 and 20001.
The CMVM claims that it will “leave no stone unturned” in its ongoing investigations into last year’s other fraudulent and illegal activities by former senior management figures at Millennium bcp.
The assurance was given last week by the regulator’s president, Carlos Tavares, in reply to accusations made by the former chairman and founder of BCP, Jardim Gonçalves who is likely to be the target of an “expected judgement” for his part in a number of financial irregularities, as well as of having “constantly evaded supplying information.”
With regards to information solicited from BCP by the CMVM to help their investigations, Carlos Tavares said: “Neither one nor another was quite exact as is possible to prove.”
Untruthful
BCP, now led by Carlos Santos Ferreira, said that the CMVM findings and the penalties were being “studied by our team of lawyers.”
The CMVM concludes that information asked for about financial operations carried out by BCP in off-shores in the past was “not always complete, genuine or truthful, particularly in respect to the value of its own capital and those holding that capital”.
The financial watchdog added that “it had never yet lost a case because of vices within the investigative process.” (i.e. a reference to never having being corrupted by pressure)
Carlos Tavares’ declarations were made to journalists last week when CMVM presented its new measures to combat and prevent financial market abuse and manipulation in Portugal.
The CMVM presentation took place on the same day in which the business daily Jornal de Negócios revealed that Deutsche Bank had for six months sent incorrect information to the CMVM on some of its trading activities forcing the regulator to remove them from its information site.
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