Bank of America, UBS Assets Seized in Italy Swap Probe

December 21, 2010, 7:55 AM EST

By Elisa Martinuzzi

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Dec. 21 (Bloomberg) — Italy’s finance police seized 22 million euros ($29 million) from six lenders including Bank of America Corp. amid allegations of fraud in a probe focusing on the sale of derivatives to five municipalities in central Italy.

Police said they took 15 million euros from Bank of America, and 1.7 million euros each from Deutsche Bank AG and UBS AG, according to an e-mailed statement. The remainder was seized from Natixis SA, Dexia Crediop SpA and Banca Monte Paschi di Siena SpA.

The amount represents the alleged illicit profit the banks made from selling derivatives to the city of Florence, the region of Tuscany and three other municipalities in the region, the police said. The local governments have lost about 123 million euros on the swaps that adjusted payments on 1.4 billion euros of debt, the police said.