Vienna - All nine defendants in the Austrian BAWAG bank trial received prison sentences Friday, with the bank's former CEO sentenced to 9.5 years, judge Claudia Bandion-Ortner declared Friday. The high sentence for former BAWAG CEO Helmut Elsner, 73, was the culmination of Austria's biggest banking scandal as eight bank managers and one investor were found responsible for having created and hidden losses from off-shore investments between 1995 and 2000.
Elsner was found guilty of breach of trust and serious fraud, as he had ordered "aggressive and high-risk" investments carried out by US-based investor Wolfgang Floettl, 52, in the Caribbean.
Floettl was sentenced to 2.5 years. He had willingly received funds from Austria's fourth-largest bank with the full knowledge of not being able to pay them back, the court found.
The other BAWAG managers on trial were served terms of between 10 months and five years, pending appeals by the defendants.
Wolfgang Floettl's incarceration will effectively last around seven years, as he has already spent almost two years in custody before and during the trial.
The scandal reverberated beyond the financial sector as the losses of Austria's fourth-biggest bank severely weakened one of its former owners, the Austrian Trade Union Federation.
In December 2006 the ailing BAWAG was sold off to the US-based hedge fund Cerberus.
