Bank scandal

IN A further twist to the BPP scandal, it has emerged that the Bank of Portugal, and its then governor António de Sousa, was warned not to allow João Rendeiro to set up Banco Privado Português in 1996.

The bankrupt private investment bank had to be given massive injections of 400 million euros of cash by other Portuguese banks, backed up by state guarantees, earlier this month because of a 750 million euro liquidity black hole.

But Alípio Dias, one-time President of the now-extinct Banco Totta e Açores (BTA), warned the BdP in 1996 not to authorise Rendeiro to set up the bank.

The reasons behind the warning stemmed following an audit on Tottagest and Tottafundos (now MC Fundos) and part of Banco Totta e Açores which detected various irregular operations that resulted in losses of 3.5 million euros during a period when João Rendeiro held posts on the board of directors.

In 1996, the year in which João Rendeiro requested permission to set up BPP, the then President of BTA, which three years later was absorbed into Spanish giant Santander, advised the BdP not to grant Rendeiro a bankers licence because he suspected him of not being completely competent or straight in his dealings.

However, in a statement to Portuguese newspaper Público, João Rendeiro said that “the audit was commissioned by Dr. Alípio Dias during a climate of guerrilla war between myself and him.”

He also added that he had “never at the time been contacted or called to answer questions over the audit by either the Totta Group or the BdP”.

Alípio Dias declined to comment and the Bank of Portugal said there had been “no reasons not to grant the license at the time.”

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