Headlines

Early investigations into the collapse of fashion brand Lisa Ho have found that a combination of questionable operating decisions, bad market conditions and "accounting irregularities" affected the viability and the cashflow of the retailer, which has imploded with debts of nearly $11 million, The Australian reported. Lisa Ho Designs and Lisa Ho Retail went into voluntary administration on May 8, less than a month after the company abandoned a listing on the National Stock Exchange, where funds raised were to have been be used to expand the fashion brand offshore and online.

All the pieces of legislation concerning insolvency will be brought together into one Insolvency Code, and the Romanian Justice Minister Robert Cazanciuc plans to send the draft law of this code to the Government this summer, Romania-Insider.com reported. Cazanciuc cited the unhappiness in the legal system caused by the need to make decisions based on several laws, and the high number of insolvencies recorded in recent years. When creating the Insolvency Code, the ministry will also debate it with representatives of the business environment, the minister said.

A Swedish prosecutor says three former executives of automaker Saab Automobile AB have been arrested on accounting fraud charges, the Associated Press reported. Prosecutor Olof Sahlgren says the three are "suspected of aggravated attempts to avoid tax controls" by allegedly falsifying parts of Saab's accounts between 2010 and 2011 - a crime that carries a sentence of up to four years in prison. Sahlgren wouldn't identify the three, who worked for Saab while it was owned by Dutch luxury car maker Spyker, which had bought the Swedish company off General Motors.

Codere SA, the Spanish gambling company that last week reported its worst earnings in more than two years, sunk to a record after Moody’s downgraded its credit rating on concern it may default on loans by the end of June, Bloomberg reported. Codere, which depends on Argentina for more than one-third of its revenue, reported a 21 percent drop in first-quarter earnings after an anti-smoking law went into effect in that country. Earnings before interest, taxes, depreciation and amortization amounted to 62.1 million euros ($79.9 million), the lowest in 10 quarters.

Saudi contractor Mohammad Al Mojil Group (MMG) said on Monday it had appointed the investment banking arm of Gulf International Bank to advise it on a restructuring of its debts, Reuters reported. No value of the amount of debt being restructured was given in the statement, released to the Saudi stock exchange. MMG Group has been in financial difficulty for some time, with shareholders rejecting a plan to liquidate the company in November after its accumulated losses exceeded 75 percent of its capital at the end of the third quarter.

Portugal’s top bankers have called on Europe’s leaders to stop “playing with fire” and moderate their stance towards the eurozone periphery, or risk instilling alarm among bank depositors in future. In separate interviews, the heads of the country’s two biggest banks – Millennium BCP and Banco Espírito Santo – said they were concerned that the precedent set by Europe’s treatment of Cyprus’s recent troubles had increased nervousness across the eurozone to dangerous levels. “Leaders need to moderate their language.

Many duped savers at Spanish lender Bankia are shunning a state-supervised compensation scheme in favor of expensive lawsuits, prolonging a mis-selling scandal and complicating efforts to restore faith in the banking system, Reuters reported. The disputes over mis-selling at Bankia and other nationalized banks have created a major headache for the government as it tries to take the next step in their rescue, imposing large losses on holders of junior debt.

Spanish judges this week sent the strongest signal yet that they intend to crack down on former executives at bailed-out banks by putting the ex-president of Caja Madrid into custody in the first detention of a top financier since the financial crisis began, the Irish Times reported. Amid intensifying anger at a banking crisis that last year forced Spain to accept a European rescue for its lenders, Miguel Blesa, the 65-year-old former head of the bank, the precursor to the rescued Bankia, will remain in jail ahead of trial until he posts bail of €2.5 million.

Italy's new government took its first concrete steps Friday, announcing some €3 billion ($3.86 billion) in economic measures aimed at offering relief to households and workers amid the country's longest postwar recession, The Wall Street Journal reported. Prime Minister Enrico Letta, who was sworn in last month as head of a coalition cabinet, said an unpopular tax on primary residences would be suspended and an extra €1 billion would be pumped into a wage-supplement program. The measures were the bare minimum of what the new government has pledged.

Central to the Government’s plan to deal with the legacy of personal debt is the creation of a new brand of insolvency professional, due to be registered from next summer. Depending on who you talk to, the Personal Insolvency Practitioner (PIP) will be jumping on the greatest legal gravy train for years, or embarking on a journey that will be far more hassle than it’s worth, the Irish Times reported. What’s certain, according to Lorcan O’Connor, director of the Insolvency Service of Ireland (ISI), is that “if we don’t get the practitioner bit right the system won’t work”.