DOZENS of former executives and board members at Caja Madrid and Bankia, including ex-IMF chief Rodrigo Rato, go on trial in Madrid on Monday.
Rato will stand trial alongside 65 others accused of manipulating a “corrupt system” which permitted them to misappropriate cash and fund their lavish lifestyles.
The case came to light in 2013, when journalist Simona Levi came across a whistle-blowing email.
This contained an exhaustive list of individuals accused of using secret “black credit cards” in addition to claims about what the money was spent on.
Rato was economy minister in the conservative Popular Party (PP) government of Jose Maria Aznar from 1996 to 2004, and was typically credited as being the “mastermind” of Spain’s economic boom before the bubble burst in 2008.
He became International Monetary Fund boss in 2004, but quit the post in 2007, citing “personal reasons,” before being appointed chairman of Bankia in 2010.
On his short-lived watch, the near-collapse of the bank sparked an EU bailout and led to the institution being nationalised at a cost of €22 billion in public money, while thousands of small-scale investors were left out of pocket after being convinced to convert their savings to shares.
Those named on the black credit cards list include top-level representatives of several political parties, unions, a representative to the Spanish royal family and numerous banking executives, including Mr Rato.
They allegedly spent €12 million between 2003 and 2012 using credit cards issued by both Caja Madrid and Bankia, without ever justifying the payments or declaring them to tax authorities.
Monday’s trial is the latest blow to the PP following two indecisive elections and repeated failed attempts to form a government amid a series of corruption scandals.
Prosecutors are seeking a four-and-a-half-year prison sentence and €2.6 million fine for Rato, who denies any wrongdoing despite accusations that he splashed out €99,000 on items such as luxury bags, alcohol and five-star hotel stays during his two-year stint at Bankia.