Zurich state prosecutors remanded former Raiffeisen CEO Pierin Vicenz in custody last week after carrying out an early morning search of his house. He has since faced a barrage of questions.
The prosecutor’s office did not offer any further details about the arrest but Vicenz – one of Switzerland’s best-known bankers – is suspected of having lined his own pockets by using insider knowledge during deals he carried out during his time at the head of the heavyweight Raiffeisen group.
According to Swiss daily NZZ, Vicenz used a straw man to buy up stakes in companies that Raiffeisen, or companies part-owned by the Raiffeisen group, later acquired.
The broadsheet said that in 2007 the credit company Aduno, part-owned by Raiffeisen and presided over by Vicenz at the time, purchased a firm for between 6 and 7 million francs. However, Vicenz was actually also the beneficial owner of the firm acquired. In this way, he more than doubled his investment in the company in a short space of time, the NZZ reported.
The former bank chief is suspected of at least one other shady deal: Raiffeisen's purchase of a majority stake in the investment firm Investnet is also under the microscope. Raffeisen severed links with the investment company a week ago.
An incompetent board?
The spotlight has now fallen on the Raiffeisen board of management with questions being asked about its competence. The fact that Vicenz’s wife headed up the group’s legal department has also been called into question.
On Tuesday, University of Bern economics professor Peter V. Kunz told Switzerland’s Blick newspaper that the Swiss Financial Market Supervisory Authority (Finma) had failed to provide proper oversight.
“One of the task of the financial watchdog is to look at the competence of the company boards,” he said.
Vicenz stepped down as CEO of Raiffeisen in May 2016 after 17 years at the helm. Raiffeisen has been the subject of a Finma investigation since autumn 2017.