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Callisto Tanzi, Parmalat founder convicted over huge 2003 bankruptcy, dies at 83 -Breaking

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© Reuters. FILEPHOTO: Calisto, the jailed founder of Parmalat and ex-chief executive of that failed Italian food company, is shown in Calisto’s garden near Parma on September 27, 2004. REUTERS/Daniele La Monaca

By Philip Pullella

ROME, (Reuters) – Callisto Tani, a former businessman, was killed on Saturday at the age of 83. He transformed a small milk company into he multi-national Parmalat.

According to his family, Tanzi passed away from pneumonia in Parma (the city in central Italy that he made his fortune), on March 31, 2010.

Parmalat was bankrupted when its balance sheet revealed a 14 million euro gap. The bankruptcy also decimated the savings of thousands more small investors.

Overstating profits and sales by the company for several years led to an international lawsuit against banks.

Along with prominent bankers and company executives, Tanzi was subject to a number of trials. He was found guilty of fraudulent bankruptcy, market manipulation and several other offenses and was sentenced to multiple jail terms.

He was born in Collecchio in 1938. At the age of 22, he purchased his grandfather’s milk business. Parmalat had more than 130 manufacturing plants around the globe that made milk and yogurt.

A first-division soccer club, a travel company, and a TV network were all part of his business galaxy. The company also sponsors Formula One and ski racing teams.

Parmalat’s crisis began in 2003, when Parmalat claimed that a bank account worth 4 billion euros held by a Cayman Islands company was not valid. Management had to file for bankruptcy protection. This triggered a criminal fraud investigation.

However, the investment-grade rating of the company at the time was not a concern. There were also concerns over the company’s inability to show why cash from its balance sheet wasn’t used to pay down debt.

Later, authorities discovered that Tanzi was hiding art treasures from masters like Pablo Picasso and Claude Monet in the homes of friends. In 2019, the art was sold.

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