A Lugano criminal court sentenced Reto Brunett on Thursday to eight months in prison for his role in the takeover of a bankrupt energy consulting company owned by a friend.
The court also sentenced him to a 25-month suspended term, while fining him 12,000 francs.
The court found that Brunett signed a contract in 2008 with an inflated price — 4.6 million francs— for the takeover of ZET, a company based in Aargau owned by a friend, Roland Zimmerli, to whom he owed money.
Two million francs was paid up front to Zimmerli, who was sentenced to a two-year suspended jail term and fined 20,000 francs for his role in the deal, according to media reports.
The pair were acquitted of corruption and fraud but they were ordered to repay the two million francs shelled out by AET in what was described in court as a “scam,” RSI, the Italian-language broadcaster, said on its website.
Brunett was unrepentant, calling the court’s decision a “shameful judgment”, RSI reported.
He added that the court was “making a fool of itself in front of all of Switzerland”.
Brunett was CEO of AET, owned by the Ticino government, for two years until he was forced out in August 2009.
The board of directors said they were unaware that Brunett was signing the contract to buy ZET and later reported him to authorities.
Brunett has denied this.
In another wrinkle to the affair, Zimmerli paid Brunett 500,000 francs around the time of the controversial deal.
At the time, the CEO was buying a house in Lugano for 2.5 million francs.
However, Brunett told the court Zimmerli was repaying a personal loan and that he had had “other options” for making payments on the house, according to RSI.
AET issued a statement saying the court decision bears witness to the “correctness of the board of directors in having reported the facts to the judiciary”.
The company said it is looking to the future and would not issue any further statements about the case.