BRUSSELS (Reuters) - Belgian prosecutors have dropped their case against former directors of Fortis, 10 years after the Belgian-Dutch bank’s collapse during the global financial crisis.

FILE PHOTO: Belgian-Dutch financial services group Fortis Chief Executive Herman Verwilst and Chairman of the Board Maurice Lippens (R) attend a group's information session for shareholders in Brussels August 20, 2008. REUTERS/Francois Lenoir

Brussels prosecutors said that they had decided not to pursue charges against seven ex-directors because it had not found sufficient proof that they had wilfully given over-optimistic information to shareholders.

“If we want to prove fraud then we need to show they knowingly attached too low a risk to the sub-primes, in other words were too positive... It is difficult to say that they should have known better,” said prosecutor Ine Van Wymersch.

She noted that Belgian insurer Ageas (AGES.BR), the legal successor to Fortis, was set to pay shareholders 1.3 billion euros by way of compensation.

Part of the reason for the pursuit of the ex-directors was to secure damages for Fortis shareholders who had lost their money.

Seven ex-directors, including former chairman Maurice Lippens and former CEO Jean-Paul Votron, were accused in 2013 of misleading investors during Fortis’s purchase of part of Dutch lender ABN AMRO and before its 2008 collapse.

Allegations by the prosecutors revolved around whether communications to investors about Fortis’s exposure to U.S. sub-prime assets were insufficient or too late, such as at the time of a capital increase when Fortis bought part of ABN AMRO.

The seven would have been the first in Belgium to face trial over banking failures during the crisis, which also forced bailouts for Franco-Belgian group Dexia (DEXI.BR) and Belgian company KBC (KBC.BR).

Fortis, once one of Europe’s largest banks, got into trouble after paying a top-of-the-market 24 billion euros ($27.4 billion) to buy the Dutch operations of ABN AMRO just before the credit crunch struck.

Shareholder groups have complained that Lippens and Votron repeatedly assured markets that Fortis’s balance sheet was strong and that it would not be changing its dividend policy.

In June, 2008, Fortis scrapped its interim dividend and sold new shares to prop itself up before it collapsed and was broken up in October 2008.
Ten years after the collapse of Belgian financial group Fortis in the financial crisis of 2007–2008, the prosecutor in Brussels decides to drop the case against seven former directors. The prosecution argues that it found insufficient evidence that they knowingly misled shareholders with over-optimistic company information.