Finmeccanica denies ’slush fund‘ reports

‚Not served notice of legal action‘, defence giant says

[] Italy’s aeronautics and defence giant Finmeccanica on Friday denied press reports suggesting that it may have set up slush funds to land contracts.

"Regarding today’s press reports, Finmeccanica categorically denies any involvement in setting up slush funds," a statement from the state-controlled group said.

The statement said companies named in the probe had always followed "ethical codes in line with norms and current best practice aimed at preventing mismanagement".

The group stressed that none of its companies or managers had been served notice of legal action.

"Finmeccanica is ready to provide all competent authorities with any and all broader clarification or information that may prove useful," the statement said. Earlier, Finmeccanica shares fell 2.5% on the Milan stock exchange on the newspaper reports which cited alleged "foreign slush funds".

The reports said the suspected ringleader of a giant money laundering scam, Rome businessman Gennaro Mokbel, may have tried to use it to recycle illicit gains.

More than one report stated, however, that Finmeccanica was not aware of his scheming. The probe is an offshoot of one which earlier this year saw telecoms firm Fastweb and Telecom Sparkle face the risk of being placed under administration for their alleged involvement in the suspected two-billion-euro VAT dodging and international money laundering scam.

Both companies took steps to avoid this.

According to Friday’s reports, Finmeccanica and its defence electronics unit Selex Sistemi Integrati (Selex SI) have been placed under investigation.

Investigators in Rome, Milan and Naples, including anti-mafia police, are reportedly trying to trace some eight million euros in alleged slush funds after Mokbel was caught on a police wiretap talking to a Finmeccanica consultant, Lorenzo Cola, said to be close to the group’s Chairman and CEO, Pier Francesco Guarguaglini.

Mokbel and Cola are reported to have tried to channel money through Finmeccanica while Cola is said to have worked for a computer security firm set up by Mokbel, Digint. Other companies in the Finmeccanica group are said to be under investigation in a separate probe into video surveillance work on a motorway between Rome and Salerno.

That probe was opened last month, when Finmeccanica issued a statement saying it was "cooperating fully with the investigation".


Mokbel and scores of other suspects were arrested on February 23 in the money laundering probe which led to the resignation of a rightwing senator, Nicola Di Girolamo, who was found to have been elected with the help of the Calabrian ‚Ndrangheta mafia.

Fastweb founder and ex-CEO Silvio Scaglia, Italy’s 13th-richest man, was detained for three months until his release to house arrest on May 17.

On April 1 Fastweb, Italy’s second-biggest broadband operator, and Telecom Italia’s Web TV unit Sparkle said they had satisfied judges that they did not need to be placed under administration.

Among the measures taken by the two companies, Fastweb CEO Stefano Parisi temporarily stepped down and handed his powers to Chairman Carsten Schloter, CEO of its parent company Swisscom.

Scaglia, who was directly implicated in the probe, resigned from the board in another move aimed at averting administration.

He repeatedly denied wrongdoing in the alleged scam, which concerns suspicious operations during his last years at the helm of the company.

Some 56 people were arrested in the probe including Mokbel, a businessman with a far-right militant past.