Prosecutors Spell Out Punishment For Swissair Chiefs

February 20, 2007

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Swiss state prosecutors on Monday called for 19 former executives of failed airline Swissair to be handed conditional prison sentences of up to 22 months and fines in Switzerland's biggest-ever economic crime trial.

SAirGroup, Swissair's parent company, collapsed in 2001 with debts of around CHF17 billion Swiss francs (USD$13.64 billion), following a disastrous acquisition campaign that targeted struggling European rivals.

State prosecutors have since charged 19 individuals from Switzerland's business elite with irregularities including defrauding creditors, falsifying documents, breach of trust, and making false statements.

Prosecutors sought conditional prison sentences for many of the executives, meaning that they would not serve any time in jail unless they committed other similar crimes during a period of probation. The fines imposed would also be conditional.

An exception was the group's last executive officer, Mario Corti, for whom prosecutor Christian Weber asked for a conditional sentence of 22 months and a non-conditional sentence of six months, as well as a conditional fine of CHF1.08 million, Swiss media reported.

Eric Honegger, Corti's predecessor, faced a conditional prison sentence of eight months and a conditional fine of CHF90,000, while former CEO Philippe Bruggisser could face a conditional prison sentence of 15 months and a conditional fine of CHF400,000.

Swiss media are closely following the trial, as the country still struggles to come to terms with the sudden demise of Swissair -- a symbol of national reliability, quality and efficiency -- as well as the loss of investment.

So strong is Switzerland's fascination in events leading up to the bankruptcy that a documentary film chronicling Swissair's final days was the most popular domestic movie in cinemas last year.

The prosecutors also said that eight former members of the board of directors should be given conditional prison sentences of between six and 10 months and fines of between CHF38,000 and CHF54,000 each.

The trial is being heard by three judges, with hearings scheduled to run until March 9.

The judges will deliberate in private before delivering their verdict, but possible appeals and three separate civil suits mean their judgement will hardly be the end of the matter.

(Reuters)