Italian police seized €40 million ($54 million) as part of an investigation on Wednesday of Italy's oldest and third-largest bank, the Associated Press reports.
The bank, Monte dei Paschi di Siena, has been under fire recently for what the New York Times describes as as "losses from a series of secret transactions that were used to conceal the scope of the bank's problems." The losses suffered from these transactions add up to around $985 million, the Times said.
The $54 million seized yesterday was connected to possible fraud against the bank, and according to the Times, "Italian news organizations reported that the money was seized from other banks that did business with Monte dei Paschi."
Italian prosecutors have been questioning former managers of the bank, informally known as Montepaschi, "over allegations that the bank overpaid for the Italian bank Antonveneta, which was purchased for €9.3 billion from Spanish bank Santander in 2007," the AP reports.
Italy has been plagued by a series of financial woes since the global financial crisis in 2008 caused the country's economy to shrink by more than 6 percent, according to the New York Times. Apart from Greece, it has the highest amount of government debt in the Euro Zone.
Italy's economic instability has gone hand in hand with political volatility. Former three-time Prime Minister Silvio Berlusconi stepped down in Nov. 2011 after failing to implement enough fiscal reforms, and his successor, economist Mario Monti, stepped down in December 2012 after losing support from Italy's People of Freedom party.
Italian voters will elect a new Prime Minister in election held Feb. 24-25.
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