ROME Italy's populist 5-Star Movement is appealing to Europe's highest court to obtain compensation for thousands of people whose savings were all but erased by bailouts at two regional banks.
Italy's largest opposition party, 5-Star has lambasted the government's handling of a string of bank crises triggered by years of economic stagnation, and accused it of making the people pay for bankers' mistakes.
David Borrelli, a 5-Star representative in the European Parliament, said in a blog post on Friday the movement had appointed lawyers to take the case to the European Court of Justice and the legal costs would be covered by a voluntary pay cut for party councillors in the Veneto region.
The state-sponsored rescues of Veneto Banca and Banca Popolare di Vicenza last year wiped out the savings of more than 200,000 - mainly retail - investors.
"People responsible at every level should pay for a complete reimbursement, in the name of justice that is correct, free and equal for everyone," Borrelli said in the blog post.
Both banks are under investigation over allegations they lent money to clients to buy their own shares, artificially boosting their financial strength. New managers at both lenders have said they will work closely with prosecutors.
Borrelli said the central bank and market regulator Consob had failed to supervise and the state had not protected people's savings. "The system is rotten from head to toe," he said.
The Bank of Italy and Consob declined to comment.
A junior minister said last year the scandal showed the Bank of Italy must change its supervision, but Economy Minister Pier Carlo Padoan said he had no reason to be dissatisfied with either the central bank or Consob.
The two banks are due to make an offer of compensation to shareholders on Jan. 9. Borrelli cited Italian press reports that holders could be offered 15 percent of the shares' original value.
(Reporting by Isla Binnie; editing by Mark Heinrich)