Former head of bankrupt Portuguese bank taken into custody

Lisbon - The former head of a financially troubled Portuguese bank, Banco Portugues de Negocios (BPN), is in custody accused of fraud, money laundering and embezzlement, Portuguese media reported Saturday.

Jose Oliveira e Costa, 73, who stepped down from his role leading the bank in February, was taken into investigative custody on a judge's orders. He had run the bank for ten years.

The state's attorney's office, which is pressing the case against Costa, says he let the bank slide to the brink of bankruptcy, with accumulated losses of 700 million euros (876 million dollars). The government opted to nationalize the bank earlier this year to save it from collapse.

Costa worked in Portugal's finance ministry from 1986 to 1992 during the conservative administration of Anibal Cavaco Silva, who was then prime minister and is currently Portugal's president.

Portuguese media have speculated that other conservative politicians might be linked to the BPN scandal. dpa