Arrest order lifted against banker |
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Wed, 10 Jan 2007 18:51
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BOGOTA, Colombia (AFX) - Federal prosecutors lifted an arrest order Wednesday against the head of Colombia's largest bank, a day after he took a leave of absence to fight a lawsuit in which he is accused of fraud, lawyers said.Jorge Londono, CEO of Bancolombia SA -- the only Colombian company listed on the New York Stock Exchange -- remains under investigation for allegedly defrauding business partners in the 1997 merger that led to the bank's creation.But prosecutors revoked an order to place Londono and the bank's vice president, Federico Ochoa, under house arrest, Londono's lawyer Ricardo Calvete told Caracol Radio Wednesday.The two executives are suspected of defrauding shareholders during the US$418 million (euro321 million) acquisition of Banco de Colombia SA by Banco Industrial Colombiano, or BIC. The merged bank was then renamed Bancolombia.Bancolombia's eight-member board Tuesday granted a temporary license to Londono and Ochoa so they can dedicate themselves to their defense in the lawsuit. It appointed Jairo Burgos, who was until now the bank's vice president for human resources, as acting CEO.'The board is convinced that the process of acquisition of the Banco de Colombia by the BIC and the subsequent merger were carried out respecting the rules in force at the time, business ethics, and under the constant supervision and approval of the banking regulator and the Central Bank,' the bank's board said.BIC previously won an earlier lawsuit over the same issue three years ago, but the Constitutional Court ordered the case reopened last year after the Gilinski family, who formerly owned Banco de Colombia, appealed the first court decision.The house arrest orders issued last week had not yet been enforced.Copyright 2006 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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