International audit networks Deloitte Global and Grant Thornton
International (GTI) face fresh legal challenges in Italy that are
expected to be brought forward by a group of more than 4,000
European Parmalat investors.

The lawsuit, which also targets several major banks, is set to
be filed in Milan by European shareholder group Deminor and Italian
consumer rights group Altroconsumo. Deminor said it advised its
clients to bring a new civil action in Italy against Deloitte &
Touche (US and International), Grant Thornton (US and
International), Citibank, Bank of America, UBS, Nextra, Morgan
Stanley and Deutsche Bank.

In a press statement, Deminor claimed that “pieces of evidence”
proved Deloitte Global and GTI participated in numerous schemes
aimed at defrauding Parmalat investors.

The investor advocate alleged the two international networks hid
information on the real financial status of the Parmalat group and
the situation was allowed to deteriorate as the dairy company
pursued a number of transactions.

A GTI spokesperson said the network remained very confident of
its position in the Parmalat matter. “Grant Thornton International
and Grant Thornton US would defend any case brought against them,
however Grant Thornton International is a non-practising,
not-for-profit umbrella organisation and neither Grant Thornton
International nor Grant Thornton US provided audit services to
Parmalat,” she said.

Deloitte Global declined to comment as the suit had not been

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In a separate case, Parmalat initiated proceedings against GTI
and Deloitte Global in 2004 after defaulting on more than €14
billion (then worth $17.2 billion) in debt – the largest bankruptcy
case in European history.

A judge in the District Court for the Southern District of New
York dismissed these claims against Deloitte Global, GTI and the
networks’ US firms in July 2007. He ruled foreign investors could
not take part in the US-based class action filed against the two
audit networks.

Nicholas Moody