Giuseppe Orsi arrest highlights Italian politics' odd relationship with business

Finmeccanica chief arrested.

Giuseppe Orsi, the chairman of Italian giant defence and aerospace group Finmeccanica, was arrested on Tuesday on suspicion of corruption.

The investigation relates to the sale of 12 helicopters to the Indian government by AgustaWestland, the high tech helicopter unit of Finmeccanica back in 2010, at which time Orsi was at the division’s helm.

He now stands accused of bribing the Indian government to secure the sale. And he is not alone: the current managing director of AgustaWestland is under house arrest, an option not considered for Orsi, who judges said could potentially pervert the course of justice.

Unsurprisingly, Finmeccanica shares have tanked after initially being suspended, falling by more than 9 per cent to €4.236.

And this is merely the first layer of a complex story. According to the judge, bribery was “part of the firm’s philosophy” – hardly a compliment, but definitely less flattering considering the fact that the State is a 30 per cent shareholder in the business.

Finmeccanica has expressed solidarity with Mr Orsi, but Prime Minister Mario Monti declared, in his understated manner, that “there is a problem with respect to Finmeccanica governance that we will have to tackle”.

That’s certainly a good idea. But it is worth considering that it was Monti himself that appointed Mr Orsi as chairman at the end of 2011, following investigations into the practices of previous chairman Pier Francesco Guarguaglini and his wife, then head of another Finmeccanica subsidiary.

Orsi’s arrest comes just one day after the resignation of the Pope and it is possibly one of the few stories capable of pushing that news down to second place on Italian newspapers… Primarily because there is an election around the corner, and the German-born Vatican resident tends not to be active in local politics.

It’s election time, which has proven to be during the years intense and tiring time for the judiciary.

Investigations are still ongoing on Monte dei Paschi di Siena, the oldest bank in the world and the third largest in Italy by assets.

Not to be outdone, the head of State-owned energy company Eni Paolo Scaroni has received notice that he is under investigation for bribery.

And let’s not forget, that Italy’s technocrat saviour, and whose appointee is under arrest - Mario Monti - is running for office, as is the man most synonymous with Italian political intrigue - Silvio Berlusconi.

So, are we likely to see major changes and a clean up as a result of these elections? God knows! Or does he… It’s hard to tell now his spokesperson has thrown in the towel.

Giuseppe Orsi. Photograph: Getty Images

Sara Perria is the Assistant Editor for Banking and Payments, VRL Financial News

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The problems with ending encryption to fight terrorism

Forcing tech firms to create a "backdoor" to access messages would be a gift to cyber-hackers.

The UK has endured its worst terrorist atrocity since 7 July 2005 and the threat level has been raised to "critical" for the first time in a decade. Though election campaigning has been suspended, the debate over potential new powers has already begun.

Today's Sun reports that the Conservatives will seek to force technology companies to hand over encrypted messages to the police and security services. The new Technical Capability Notices were proposed by Amber Rudd following the Westminster terrorist attack and a month-long consultation closed last week. A Tory minister told the Sun: "We will do this as soon as we can after the election, as long as we get back in. The level of threat clearly proves there is no more time to waste now. The social media companies have been laughing in our faces for too long."

Put that way, the plan sounds reasonable (orders would be approved by the home secretary and a senior judge). But there are irrefutable problems. Encryption means tech firms such as WhatsApp and Apple can't simply "hand over" suspect messages - they can't access them at all. The technology is designed precisely so that conversations are genuinely private (unless a suspect's device is obtained or hacked into). Were companies to create an encryption "backdoor", as the government proposes, they would also create new opportunities for criminals and cyberhackers (as in the case of the recent NHS attack).

Ian Levy, the technical director of the National Cyber Security, told the New Statesman's Will Dunn earlier this year: "Nobody in this organisation or our parent organisation will ever ask for a 'back door' in a large-scale encryption system, because it's dumb."

But there is a more profound problem: once created, a technology cannot be uninvented. Should large tech firms end encryption, terrorists will merely turn to other, lesser-known platforms. The only means of barring UK citizens from using the service would be a Chinese-style "great firewall", cutting Britain off from the rest of the internet. In 2015, before entering the cabinet, Brexit Secretary David Davis warned of ending encryption: "Such a move would have had devastating consequences for all financial transactions and online commerce, not to mention the security of all personal data. Its consequences for the City do not bear thinking about."

Labour's manifesto pledged to "provide our security agencies with the resources and the powers they need to protect our country and keep us all safe." But added: "We will also ensure that such powers do not weaken our individual rights or civil liberties". The Liberal Democrats have vowed to "oppose Conservative attempts to undermine encryption."

But with a large Conservative majority inevitable, according to polls, ministers will be confident of winning parliamentary support for the plan. Only a rebellion led by Davis-esque liberals is likely to stop them.

George Eaton is political editor of the New Statesman.

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