ITALY – The latest development in the ongoing saga is that Parmalat has sacked its auditor Grant Thornton, which is thought to have been involved in the creation of at least one bogus finance account.

The Italian branch of Grant Thornton is being investigated by magistrates for the part it played in creating the offshore investment company Bonlat, one of a number of companies that Parmalat used to disguise its massive debts.

The fraud, described by the USA’s Securities and Exchange Commission as “one of the largest and most brazen corporate financial frauds in history”, has threatened to drag a number of big names through the mud.

Investors and banks, such as the Bank of America, are all facing intense scrutiny over exactly what they knew, if anything, about the cover-up.