Cuba would have been swimming in Parmalat milk

Saturday, January 3, 2004

MILAN, Italy: As details emerge of the fictitious and fraudulent transactions that masked the true financial state of affairs at bankrupt Italian food giant Pamalat, one of the most bizarre to date is the purported sale by a Cayman Islands-registered Parmalat subsidiary of enough milk to Cuba to provide every Cuban with about 250 litres of milk a year. 

On January 31, letters were purportedly sent to Empresa Cubana Importadora de Alimentos, a Havana food importer seeking to confirm the purchase by Empresa Cubana, a state-owned import company, of US$620 million of powdered milk. The purchase was recorded as a credit on the balance sheet of Bonlat Financing Cop., one of Parmalat's many Cayman Islands companies.

Bonlat claimed the sale was for 300,000 tonnes, said a former executive, which would produce the equivalent of 2.8 billion litres. Pedro Alvarez, president of Alimport, as the Cuban company is known, denied the transaction, which prosecutors say was fake.

"That is totally false, untrue and calumnious," he said. If the figures were true, "we would be swimming in milk". 

He added that Alimport had never sent a letter to Bonlat's auditors, Grant Thornton, confirming a $US620 million debt. Alvarez said Alimport's only current dealings were with Parmalat Chile for the importation of 600 to 700 tonnes of powdered milk a month. He said the contract, valued at US$700,000 to US$800,000 a month, continued.

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