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Prosecutors seek four-and-a-half years for ex-IMF chief over “black” cards

Source: El Pais - Thu 14th Jan 2016
Prosecutors seek four-and-a-half years for ex-IMF chief over “black” cards

The Anti-corruption Attorney’s Office wants former government official and IMF chief Rodrigo Rato to serve four-and-a-half years in prison over the case involving undeclared credit cards at the Caja Madrid and Bankia banks.

In its written accusation, the prosecutor’s office also wants the man who was once Spain’s Deputy PM with the Popular Party to pay €2.69 million in damages.

The “black” credit card scandal broke in October 2014, when it emerged that 85 executives and board members at the Caja Madrid savings bank and its successor, Bankia, were given secret credit cards that they used to make discretionary purchases between 1999 and 2012.

Bank officials racked up a collective €15.2 million in personal expenses that were paid for by the bank, although the money did not show up as earnings on their income tax filings.

Two other senior managers were targeted in the investigation, including Rato’s predecessor in the post, Miguel Blesa, who set up the system as a way to reward board members and earn their loyalty. Prosecutors want Blesa to serve a six-year prison term and pay back €9.34 million in damages.

A total of 66 former board members and senior executives are being targeted by prosecutors over their use of undeclared cards to pay for expensive meals, personal trips and other items unrelated to their job.

Bankia, the result of the merger of Caja Madrid and six other savings banks at a time when Spain’s financial system was struggling under the effects of the property crash, was ultimately bailed out by the state at a cost of €22.4 billion in public funds.

Rodrigo Rato is also embroiled in two other investigations, one involving charges of tax crimes, money laundering and commercial bribery that saw him briefly arrested on April 16 while his Madrid home and office were raided by police.

The third investigation focuses on Bankia’s stock market flotation and allegations that the lender fudged the figures in order to attract investment money. Thousands of small investors lost their savings as a result.

Recommended Reading :

* Madrid court freezes assets of former IMF chief Rato

* Bankers encouraged to use 'black' credit cards