updated 2/6/2004 9:05:10 AM ET 2004-02-06T14:05:10

Prosecutors looking into the Parmalat scandal ordered that documents be seized at the Milan offices of Swiss bank UBS, the latest in a series of searches at financial institutions that had dealings with the fraud-riddled Italian dairy giant.

A judicial official, speaking on condition of anonymity, said police had been sent to confiscate documents relating to a Parmalat bond issue of over 400 million euros (about $500 million) executed in 2003. The official would not say whether the bank was under suspicion.

A UBS spokesman in London confirmed that the bank had "put together" a 2003 bond offering for Parmalat.

"As expected, we can confirm that Italian investigators have visited our offices in Milan in connection with the investigation into Parmalat," spokesman Dave Walker said. "We are fully cooperating."

The search came a day after Milan judicial officials said investigators were planning to formally place under investigation another 15 people in the case. It said the new suspects were linked to financial institutions but gave no further identification.

Prosecutors in recent weeks have taken documents from Bank of America, Deutsche Bank, Standard & Poor's and Morgan Stanley, among others. None of these institutions has been accused of wrongdoing.

International banks and ratings agencies have faced major scrutiny for helping the dairy giant sell bonds, for extending it credit and for issuing decent ratings despite irregularities in company books. The financial institutions say they were deceived by Parmalat's fraudulent bookkeeping.

Ten people, including the company's founder, have been jailed during the investigations.

The scandal exploded in December after Parmalat admitted it did not have a nearly $5 billion account with Bank of America as the dairy conglomerate had previously stated. Auditors now say the company has about $18 billion in debt _ about eight times what it had previously claimed.

Parmalat's troubles have spread around the world, with international banks exposed to Parmalat debt and thousands of employees and suppliers worried about their livelihoods.

A top Parmalat executive in Brazil said Thursday that its local dairy unit could shut down within days without emergency help from the government, putting tens of thousands out of work, and will probably be sold eventually.

The division, Brazil's second-largest milk buyer, needs an immediate infusion of nearly $26 million to buy raw material and maintain production, Parmalat Brasil chief executive Ricardo Goncalves said in testimony before a congressional committee investigating the firm's finances.

The Italian conglomerate employs 36,000 employees in 30 countries.

Copyright 2004 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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