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Parmalat investigation widened

ROME -- Prosecutors probing the Parmalat scandal added to a list of suspects two officials of auditor Deloitte & Touche's Italian branch and an ex-Bank of America employee who worked as a consultant at the food giant, a judicial official in Milan said yesterday.

The official, speaking on condition of anonymity, said Deloitte & Touche employees Adolfo Mamoli and Giuseppe Rovelli had been placed on a list of 25 suspects, none of whom has been charged. Also on the list was a former Bank of America official, Luca Sala.

Eight people, including Parmalat founder Calisto Tanzi, have been arrested in the case, which involves manipulation of balance sheets to hide a huge hole in the company's accounts.

Milan prosecutors are investigating charges of market-rigging and false communication. Prosecutors in Parma are investigating charges of fraudulent bankruptcy.

Deloitte & Touche officials in Milan said they had not received confirmation that two employees were under investigation, but said Mamoli had signed off on Parmalat Finanziaria balance sheets from 1999-2001, while Rovelli did so after that date.

Parmalat Finanziaria, the parent company now in bankruptcy protection and under new management, removed Deloitte & Touche as auditor yesterday. Deloitte & Touche took over as auditor after 1999.

The Bank of America press office in London had no comment on the investigation, but said Sala had worked for the company until he resigned last summer.

Among the eight arrested last month are two officials from Grant Thornton auditors, who are accused of helping rig balance sheets.

London-based Grant Thornton International, an umbrella organization that includes dozens of international member firms, said yesterday it had expelled the Italian branch, Grant Thornton SpA, as a result of the Parmalat scandal.

"Grant Thornton SpA has been unable to provide sufficient assurances or access to the appropriate information and people in an acceptable timeframe," chief executive David McDonnell said.

Grant Thornton's Italian branch was Parmalat's chief auditor until 1999 and after that date it continued to audit many key Parmalat subsidiaries, including the offshore entity that falsely claimed to have the 3.95 billion euro account that Parmalat has acknowledged doesn't exist.

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