May 22, 2013 / 4:14 PM / 6 years ago

Monte Paschi director accused of insider trading

Monte Dei Paschi bank headquarters is pictured in Siena January 25, 2013. REUTERS/Stefano Rellandini

MILAN (Reuters) - A board member at Italy’s troubled lender Monte dei Paschi di Siena (BMPS.MI) is being investigated over allegations of breaking insider trading rules and has been suspended, the bank said on Wednesday.

The bank’s statement confirmed an earlier story by Reuters based on a judicial source.

Prosecutors in Siena allege that the board member, Michele Briamonte, leaked to the press the content of a board meeting during which it was decided to seek damages from two former executives as well as investment banks Nomura (8604.T) and Deutsche Bank (DBKGn.DE) over losses on financial derivatives contracts, the source said.

The bank said Briamonte was served by the Siena court with an injunction barring him from carrying out his functions on the bank’s board.

The bank reserves the right to take further action on the matter when the investigation has been completed, it said.

Lawyers for Briamonte said in an e-mailed statement the allegations against their client were groundless and the measures taken against him wrongful.

The judicial source said Briamonte would initially be suspended for two months.

Reporting By Silvia Ognibene and Silvia Aloisi; Editing by Greg Mahlich

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