'New Bribesville' hits Italy Inc before election

"A week before the vote, citizens are heading for the ballot box through the rubble of a new Tangentopoli," it said in a front-page editorial under the headline "Sins of the Elite."

Weary of corruption, Italians might welcome a crackdown but with an election looming, many have been quick to spot the party connections of some of the major companies involved and to suspect political motives, despite denials from the judiciary.

"Finmeccanica has been under the spotlight for a good 18 months and suddenly there is an arrest," said Luca Caprai, founder of Cruciani, a maker of fashionable macrame bracelets.

"If this is the beginning of a clean-up, it will be good for the country. But I would not want to find out that the company is paying for mistakes it never made."

While Monte dei Paschi, based in Siena, has links to the PD, Finmeccanica chief Giuseppe Orsi was appointed with backing from the Northern League, an ally in the wealthy and populous region around Milan of former conservative premier Silvio Berlusconi.

The media tycoon, who stepped down amid scandal 15 months ago to make way for Monti, chided judges for pursuing Finmeccanica, saying it simply acted like foreign competitors to win sales. Monti in turn said on Friday Berlusconi was being "provincial".

The companies at the centre of the scandals, which account for nearly 30 percent of Italy's blue-chip stocks index, have suffered heavy falls in their share prices in recent weeks.

Finmeccanica lost 11 percent in value in two days after the arrest of Orsi. Centre-right politicians criticised not only the judiciary but also Monti's government, arguing ministers should have replaced Orsi last year when he was first investigated.

CORRUPTION

Italy ranks 72th - between Brazil and Bulgaria - in a Transparency International index that measures corruption in a country as perceived by business managers, one of the worst scores among rich Western nations. Major EU competitors France and Spain rank 22nd and 30th, while Germany is in 13th place.

... contd.

ALSO READ

Investor wealth slides by Rs 1 lakh cr as shares tank

ITC shares tank over 5%, market capitalisation falls by a mammoth Rs 14,895 cr

Pakistan stock markets zoom to record high of 20,000 pts for first time in history

Reliance Mediaworks posts Rs 219 cr loss in quarter