A Milan judge on Tuesday dealt a blow to Bank of America's strategy of portraying itself as a victim of the fraud at Parmalat, saying the US group could not receive part of any damages arising from criminal prosecutions.
BofA, which is being targeted by prosecutors in Milan, had added its name to the long list of people and groups seeking financial restitution as civil parties to magistrates' criminal cases.
But a judge excluded the bank from the list on Tuesday, averting the possibility of the bank seeking restitution from its own trial. The bank is still waiting to hear if it will face charges. Milan magistrates have requested that the bank be charged with misleading the market during its work for the collapsed Italian dairy company.
Milan magistrates are also seeking charges against Parmalat's former auditors, and are at an earlier stage in investigations against other banks. Under Italian law, other groups have the right to request that they receive part of any compensation that results from the cases.
BofA said on Tuesday: ?We will carefully analyse today's order. We continue to believe we have a right to be included as a damaged civil party, and we reserve the right to renew our application during the course of the proceeding.?
Tuesday's ruling has no bearing on BofA's standing as a creditor to Parmalat. The acceptance of that application, by a judge in Parma last year, went against the wishes of Enrico Bondi, Parmalat's administrator. It means the bank will be a significant shareholder when the company is relaunched this year.
BofA says it did no wrong in its work for the company. The bank has stated repeatedly that it was a victim of the fraud. Lately the bank has been aggressively seeking to combat Mr Bondi's accusations and lawsuits against it. Last week BofA said it planned to hold discussions with other banks that would be future Parmalat shareholders. It would discuss outstanding litigation, the company's corporate governance and Parmalat's strategic priorities.
No other banks have said yet that they will align with BofA but the possibility of some of Mr Bondi's work being overturned may cause unrest among other future Parmalat shareholders.
Grant Thornton's former Italian arm, which has been expelled from the auditor's global organisation, was also excluded from yesterday's list of civil parties to the Milan case.
The trial of two former Grant Thornton auditors is scheduled to begin in Milan on Thursday.
