28. 06. 10. - 15:00

HGAA investigators eye 20 suspects

Ministry experts investigating the scam of nationalised Hypo Group Alpe Adria (HGAA) said they have focused on 20 suspects.

Bernhard Gaber, head of the SoKo Hypo – a special commission set up by People’s Party (ÖVP) Finance Minister Josef Pröll – said today (Mon): "We are carrying out investigations against 20 accused."

Gaber added his 15-member team had also examined business connections across Europe which could have to do with the former Carinthian provincial bank’s controversial activities abroad.

"We are collecting data about people and companies in Austria and abroad. So far, we have found 1,700 links which could possibly play a role," he said, adding that the Soko Hypo’s investigations protocol was 50,000 pages strong.

Former bosses of the bank and Germany’s BayernLB (Bayerische Landesbank) as well as political decision-makers could face charges of accounting fraud and embezzlement.

HGAA was nationalised in December 2009 after it emerged the bank faced annual losses of around one billion Euros or more. Austrian and German media claimed the institute engaged in loose bank lending in former Yugoslavia and could have financially supported political parties.

Press reports claimed former HGAA managers cooperated with businessmen linked to the Mafia in Croatia and other countries.

A former tax advisor of late Carinthian Alliance for the Future of Austria (BZÖ) Governor Jörg Haider is accused of having received six million Euros for giving a 40-page opinion over whether HGAA should be sold before it was snapped up by BayernLB in 2007.

The Munich-based banking house suffered losses of around 3.7 billion Euros by taking over HGAA. Prosecutors in Klagenfurt and Munich are currently trying to find out whether former BayernLB chiefs had been aware of the bad state the bank was in.

Seventeen raids in offices and homes have taken place over the past few months.

Pröll defended the Austrian government’s decision to nationalise HGAA. The finance minister claimed Austria’s other leading banks as well as the country’s whole financial market would have been negatively affected if the coalition decided not to support the bank with an immediate 900-million-Euro boost.

The minister further highlighted that thousands of jobs would have been at risk if the bank had gone bust.

The European Commission (EC) only last week gave the green light for further state aid – but expressed doubts that HGAA will ever be profitable again considering its debts and credit responsibilities.

New bank CEO Gottwald Kranebitter announced recently the plan was to get HGAA back in the black and to sell it with a profit in a few years time.