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Caja Madrid officials who used “black” cards targeted in investigation

Source: El Pais - Wed 28th Jan 2015
Caja Madrid officials who used “black” cards targeted in investigation

The High Court has named all the former officials at the Caja Madrid and Bankia banks who used "black credit cards" between 1999 and 2012 as formal targets in the corporate abuse investigation – a total of 78 people.

Three officials who did not use these cards are being called in as witnesses.

Between 1999 and 2012, executives and board members at Caja Madrid, which later merged with other failed lenders to form Bankia, were given credit cards that drew money from a bank fund, but did not show up on any bank documents or job contracts.

Recipients racked up €15.2 million in bills for personal items, and the expenses were never declared to tax authorities even though bank bosses now say they counted as part of their salaries.

The scandal broke in October of last year, triggering a cascade of resignations and party suspensions going all the way up to Rodrigo Rato, the former chief of the International Monetary Fund and a veteran of Spanish politics who headed the lenders between 2010 and 2012.

Under pressure from PM Mariano Rajoy, Rato volunteered to have his own PP membership suspended while the investigation was underway.

In a brief issued on Wednesday, Judge Fernando Andreu said the main thing was now to ascertain the purpose of the credit cards when they were handed out to executives and board members. His goal is to find out whether the cards were meant to cover representation costs, or handed out as a bonus on top of recipients' regular salaries.

The judge's brief notes that there was no contract, charter item or other documentary evidence to support the claim that they were meant to be used to pay for cardholders' representation costs.

The expenses incurred by many of the beneficiaries had nothing to do with such costs, the document adds. The cards thus apparently became "an irregular form of remuneration, so that depending on the position held by the beneficiary, they had a monthly spending limit and could spend their amount freely, without any need to justify the expenses, and all this on top of the fact that, Bankia informs, board members and executives already had another corporate credit card."

However, if the cards were instead an undeclared bonus on top of official salaries, Judge Andreu expressed surprise at the fact that a few beneficiaries declined to use their cards at all, and that most users never fully used their monthly stipend.

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