Judge suspends dodgy EDP boss in corruption probe

A Lisbon judge ordered the chief executive of EDP-Energias de Portugal, Antonio Mexia, to be suspended along with the CEO of subsidiary EDP Renovaveis as part of a corruption investigation, a source familiar with the decision said.

The ruling was reported by news website ECO earlier this Monday. Portugal’s public prosecutor indicted Mexia and EDP Renovaveis CEO Joao Manso Neto three years ago on suspicion of corruption in a case that involved former Portuguese Economy Minister Manuel Pinho in 2007. EDP, the two executives and Pinho have always denied any wrongdoing.

Court officials were not immediately available for comment, while EDP declined to comment when contacted press. ECO and other publications, including the Expresso weekly’s website, said the decision to suspend the executives, with immediate effect, was taken by Judge Carlos Alexandre, who is separately presiding over another corruption case involving former Prime Minister Jose Socrates.

Market regulator CMVM suspended trading in shares of both companies and in separate statements said it was waiting for them to disclose relevant information to the market. EDP shares fell 2.4% in afternoon trading while the broader market in Lisbon was up 0.09%.

The public prosecutor suspects that Pinho personally benefited when he approved a scheme to compensate EDP for the early end of fixed multi-annual Power Purchase Agreements (PPA), and a 25-year extension of 27 dam concessions without public tender.

The public prosecutor has said EDP subsequently sponsored a renewable energy course at a major U.S. university, taught by Pinho, as a reward. In a court document seen by press, the two executives rejected the prosecutor’s claims, calling them “fictional narrative” and said the proposed suspension was “illegal” as a manager can only be dismissed by shareholders.