Italian bank Banca Progetto has been placed under court administration for allegedly lending money to a person arrested under mafia charges, a court document showed.
Prosecutors have alleged the lender granted the financing, which was guaranteed by the Italian State, without conducting the necessary checks on the borrower, the document of which Reuters has obtained a copy showed on October 24.
Banca Progetto, which specialises in state-guaranteed financing had no immediate comment.
Oaktree Capital Management in September had struck a deal to sell the bank to funds managed by private equity firm Centerbridge Partners.
Milan prosecutors took similar action in recent months for companies that were part of both the Armani and LVMH groups amid probes into alleged worker exploitation at some of their suppliers.
Revenue for LVMH, the world’s biggest luxury group, was €19.08 billion for the three months ending in September, a 3 per cent fall on an organic basis, stripping out the effect of currencies, acquisitions and divestitures.
In cases such as Banca Progetto, the Italian court appoints a temporary administrator to help it fix problems while continuing to operate.
No criminal charges have been laid against the bank.
