New York Post – Bawag, the Austrian bank whose own web of intrigue is beginning to rival Refco’s, is still working feverishly to strike a deal with the defunct future-trading giant’s creditors,according to reports.
Reeling from a month of disclosures detailing well-concealed ties to Refco, Bawag sought to put potential liability behind it prior to being put up for sale by Morgan Stanley.
Refco’s creditors sued Vienna-based Bawag last month for $1.3 billion, alleging that ex-CEO Phillip Bennett illegally transferred that amount to the bank.
As details emerge of Bawag’s shadowy loans to both Refco and a hedge fund controlled by its longtime CEO’s son – which led the bank to hide $1 billion in trading losses – depositors rushed to take money out of the once-sleepy trade union bank.
