Firms like teslas are the mainstay of Italian investing and investors are increasingly finding out they can be a little too much of a crook.
This week, Italian authorities launched an investigation into whether the investment fund TESLA has cheated investors out of more than €2.2 billion.
The probe follows the arrest of four former employees of the fund, which was founded by billionaire Gianni Pritzker.
Pritzkers son, Giorgio, was arrested on suspicion of embezzlement and money laundering.
He is currently in jail on suspicion that he may have diverted funds from the fund.
The four former staff members have now been accused of running a complex financial fraud scheme that involved fraudulently claiming their bonuses and then selling them to investors.”TESLA is in the middle of a very complicated legal process,” said Andrea Pascucci, a lawyer at the investment bank Aecio dei Capitoli, which helped the investigation.
“But what is clear is that investors are having to do much more due diligence.”
Aecio Dei Capito (ADC)Investment firm ADC is one of the firms involved in the TESL investigation.
The firm, which manages more than 50,000 shares, said in a statement that it was “extremely disappointed” that the investigation had “not found any wrongdoing.”
“We have always taken our responsibility to invest seriously and have always acted in accordance with our internal procedures,” it said.
Pritzker, who is the son of former President Silvio Berlusconi, is known for his aggressive tactics and has been accused by some investors of being a “bully.”
He has repeatedly denied the allegations.
“If I can be honest, I was not aware of any wrongdoing,” he told The Associated Press in December.
“I was simply following the rules.”
Investors often say that the funds have a lot of value because they are so cheap, especially for people who want to buy bonds, and the fund has historically done well.
But many of those who buy in the scheme are also likely to get a hefty return, with the funds typically being worth a few million euros or more.
The investigation is expected to take months.