It took decades for the Espirito Santo family to build a multinational financial group that was worth about €8 billion and whose fortune was swept away in just a year. Espirito Santo’s financial collapse is one of the worst 21st century banking failures, which has left thousands of creditors stranded and pushed many trustees to find their way through the tangle of cross-funding within the group. Many entities, from the Bank of Portugal to public prosecutors, are currently investigating the causes of the group’s failure and the stakes of being condemned for fraudulent practices or the misuse of company assets are quite high. Unfortunately, Espirito Santo’s Luxembourg holding companies have played an important role in the group’s financial disaster. The controlled management procedures initiated by the Luxembourg entities in 2014 did not prevent their bankruptcy but even paved the way for their inevitable demise.
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