Prosecutor suspects of harmful management crimes in CGD

  • ECO News
  • 11 July 2017

The Public Prosecutor suspects of harmful management crimes in CGD because some unpaid credits were not registered as impairments, after the commission's report cleared managers from any fault.

The Public Prosecutor suspects of crimes in credit granting in Caixa Geral de Depósitos (CGD). Authorities say some default credits are not registered as impairments. This decision contradicts the report from the inquiry commission, in which managers are cleared from any fault.

The Prosecutor states that “clients who presented matured transactions, and once they were paid for, they were classified under the ‘credits without default’ segment. Such situation points to the deliberate act of omitting the bank’s liabilities“. The document further mentions there were “repeated changes in the term of the contracts, namely concerning guarantees until 2016”.

These suspicions come up in a decision by the Lisbon Court of Appeal sent to the Parliamentary commission about CGD’s recapitalization. In the document, the Court of Appeal demands the Bank of Portugal hands in the documents comprehended by banking secrecy requested from the Public Prosecutor.

“The evidence gathered in the judicial proceedings sustain the suspicion that CGD was confronted with the need to register impairments  (devaluation of assets) which came from credit granting, violating rational management norms, namely on providing guarantees or other losses mainly on the investment area”, can be read in the sentence signed by the judges Artur Vargues and Filipa Frias de Macedo.

More so: the Public Prosecutor states that if the suspicion is confirmed, these actions could be defined as “harmful management crimes” which were committed within civil service or possible crimes against property. When contacted by ECO, Caixa Geral de Depósitos refrained from commenting on the news.