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First charges brought in Telekom Austria probes

Wednesday, 3 Oct 2012 | 8:13 AM ET

VIENNA, Oct 3 (Reuters) - Vienna prosecutors brought their first charges against ex-Telekom Austria top managers as they probe multiple allegations of corruption that have damaged the company's image and may have cost it 20 million euros ($26 million).

The prosecutor's office said it had charged three former Telekom Austria managers, one other ex-employee and a banker with price manipulation in relation to a share price surge in 2004 that triggered a payout of 9 million euros for managers.

Telekom Austria, which has been shaken by a web of corruption scandals that include allegations of slush funds and political payoffs, is suing 20 people it suspects of defrauding the company, from whom it hopes to claw back 20 million euros.

Current Chief Executive Hannes Ametsreiter last year paid back a bonus that he had received as a result of the share price rise, and has denied any wrongdoing.

Prosecutors are charging ex-Telekom Austria Chief Executive Heinz Sundt, ex-deputy CEO Rudolf Fischer, ex-Chief Financial Officer Stefano Colombo, and Johann Wanowitz, a banker suspected of having bought Telekom Austria shares to boost the price.

A further, unnamed former employee of the Austrian telecom incumbent was also charged with corruption, the prosecutor's office said on Wednesday.

Wanowitz is suspected of having received payments totaling more than 1.5 million euros between 2004 and 2008 in cash and for fictional business in return for buying the shares on the orders of the three former top managers.

Questioned by a parliamentary committee earlier this year, the three ex-Telekom Austria managers declined directly to answer questions regarding the allegations of share price manipulation.

Wanovitz's investment firm, Euro East, referred a request for comment on Wednesday to his lawyer, who was not immediately available.

The ex-managers, who have 14 days to appeal against the charges, face 10 years in jail if found guilty.

Prosecutors are investigating suspected corruption at Telekom Austria by a total of about 40 individuals.

($1 = 0.7731 euros)

(Reporting by Georgina Prodhan; Editing by Hans-Juergen Peters)

((georgina.prodhan@thomsonreuters.com)(+431 5311 2256)(Reuters Messaging: georgina.prodhan.thomsonreuters.com@reuters.net))

Keywords: TELEKOMAUSTRIA CORRUPTION/CHARGES