BES boss and sidekick to face dock

 In Banks, News

The former chairman of Banco Espírito Santo, Ricardo Salgado and his right-hand man Amílcar Pires are to go to trial along with 23 other legal suspects on varying charges of capital laundering, fraud and embezzlement in a case dubbed the ‘Espirito Santo Universe’.

In a communiqué sent to newspaper editors and TV stations on Tuesday, the State Prosecutor’s office states that: “Portugal’s criminal investigation department DCIAP has issued an accusation against 25 suspects, 18 individuals and seven companies, both national and foreign, over crimes and losses worth over €8.8Bn”.
All told, 18 people and seven companies stand accused of charges outlined in the Public Ministry document which runs into 4,117 pages.
The charge document reads, “An accusation has been made for the crime of criminal association (regarding 12 of the individual persons and five companies) and for the crimes of active and passive corruption in the private sector, falsifying documents, lack of faith, market manipulation, capital laundering, and qualified fraud against individuals and companies,” for the rest.
In other word the Espírito Santo family used various entities of the group from BES to Rioforte and ESFG (Espírito Santo Financial Group) to mask a gigantic financial black hole which led to the bank’s collapse in 2014.
The police inquiry, says the public prosecutor “stemmed from a notice dated 03.08.2014 on a measure to wind up what was then BES, and which aimed to discover the facts behind a number of alleged losses suffered by ESPÍRITO SANTO bank clients. The winding up and liquidation of a number of entities belonging to the then Espírito Santo Group in Luxembourg, Switzerland, Dubai and Panama was subsequently reported, as well as the insolvency of various companies belonging to the same group in Portugal”
According to the State procurator, the “main case involves 242 inquiries based on complaints from 300 people, individuals and companies, resident in Portugal and overseas”.
The Banco Espírito Santo banking empire collapsed in 2014 ruining hundreds of small depositor investors, many of them pensioners, who had invested a large part of their life savings in BES-issued bonds and shares they believed to be secure, offering a guaranteed return.
These ‘lesados’ or ‘financial victims of fraud’ who lost their life savings in the BES collapse have been allowed to become assistants in the case. The victims have been calling for the 41 bankers to sit in the dock, as well as charges to be brought against the State, Bank of Portugal and market regulators CMVM.
The ´lesados’ lawyer Miguel Reis says he wants the Public Ministry to investigate the directors of the Bank of Portugal, the Resolution Fund (whose members are the country’s banks) and the CMVM.
The victims say that after all these years “we are facing a real attempt to stifle the responsibilities of the State and regulators” in this banking fiasco” says Reis.
It is as if “everyone was a chorister and Ricardo Salgado the only monster who caused all the misfortune that victims have had to endure,” an argument that Salgado himself, who allegedly once said he was “the owner of the whole lot” has been arguing for years.
Ricardo Salgado also stands accused of creating a network “without the knowledge of most of the BES management team and supervisory entities, namely the Bank of Portugal and stock market supervisor CMVM to “commit crimes in an organised manner”, the objective of which was to hide and bankroll debts in the family’s businesses.
According to ECO Insider: “The defendants in this case — particularly Ricardo Salgado and Amílcar Morais Pires (a former BES director who has been condemned by the Bank of Portugal over three ‘offences’ involving BES’ bank in Angola) — have already been notified that they will have to face the case being led by the Public Ministry and that they now have 10 days to answer, if they understand this.
The alleged ‘fraudulent strategy’ would have been in place from 2009 until mid-2014, ECO concludes.