AUSTRIA: Austrian finance minister Karl-Heinz Grasser is under pressure to resign after being dragged into a banking scandal that could endanger the conservative government\'s re-election chances in October.
The dashing Mr Grasser, equally at home in the finance pages and the gossip columns, accepted an invitation from Austrian tycoon Julius Meinl to holiday on his luxury yacht last August. Another guest was Wolfgang Flöttl, a financier who later emerged as a key figure in a scandal surrounding Austrian bank Bawag.
In March, it was revealed that Bawag had lost about €1 billion in high-risk financial dealings in the Caribbean between 1995 and 2000. The bank avoided insolvency thanks to a guarantee bond from its owner, the Austrian Federation of Trade Unions (ÖGB).
Austria\'s Social Democrats (SPÖ) were hit hard by that scandal because of close ties to the bank and the unions, and the scandal appeared to have doomed them to another term on the opposition benches. But the election race has been shaken up by the latest news.
The finance ministry dismissed the holiday speculation as "nonsense" but two days later, after the story appeared in Der Standard newspaper, it said the meeting had taken place but that there had been a miscommunication between Mr Grasser and his press spokesman.
Opposition politicians have accused Mr Grasser of a conflict of interest and of making sure that a 2001 report into Bawag\'s dubious financial deals disappeared.
Mr Grasser denies the allegations, saying he didn\'t know Mr Flöttl and had only engaged in small talk. He rejected the suggestion that accepting the invitation from Mr Meinl, one of Austria\'s leading bankers and a friend of his wife\'s family, was a conflict of interest in his position as finance minister and head of Austria\'s financial regulatory authority.
"Can you tell me what is incongruous about a dinner and two days [ on a yacht]?" said Mr Grasser yesterday, after flying back from a yachting holiday in Sardinia. "If you are invited to dinner in the upper Adriatic Sea near Croatia then you make a short detour and don\'t think too much about it." It\'s just another episode in the eventful career of Mr Grasser, dubbed "Austria\'s favourite son-in-law" and the "Glamour Minister" for his matinee-idol looks, jet-set lifestyle and high-profile love affairs.
He cleared his slate in the eyes of many Austrians - and the tabloid media - last October by marrying the crystal heiress Fiona Swarovski. Seven months earlier, after being photographed kissing Ms Swarovski in public, he broke the news to his girlfriend and former intern Natalia Corrales-Diez. Minutes later she had a dramatic car accident.