[JURIST] Bank of America (BOA) [corporate website] announced Tuesday that it has reached a settlement [press release] with Parmalat SpA [corporate website; JURIST news archive] in litigation stemming from the 2003 collapse of the Italian dairy giant. Under the terms of the settlement, BOA will pay Pamalat USD $100 million, which includes both cash and non-cash components. The settlement resolves a $10 million lawsuit filed by Parmalat against BOA in 2004 and a counterclaim [JURIST reports] filed by BOA, alleging the company engaged in fraud and is maliciously suing the bank to shift blame. The two companies filed a joint motion to stay proceedings [text, PDF], and further details of the settlement will become available once it has been filed in the US District Court for the Southern District of New York [official website].
In December, an Italian court in Milan sentenced [JURIST report] Parmalat founder Calisto Tanzi [NNDB profile] to 10 years in prison for his role in the company's collapse of the Italian dairy giant. Tanzi was the first executive to be sentenced in connection with the 14 billion fraud scheme in 2003 that bankrupted the company. He was convicted of fraudulent bankruptcy and criminal association for allegedly concealing the company's debt. Seven other defendants were acquitted [Corriere Della Sera report, in Italian], including three former BOA employees and the former head of Parmalat Venezuela. An eighth corporate defendant, former Parmalat auditor Italaudit, was fined 240,000 and had 455,000 confiscated. Tanzi was indicted [JURIST report] along with approximately 20 other executives in July 2007. Parmalat filed for insolvency in December 2003 after discovering accounting discrepancies totaling nearly $5 billion in debt.