Felix Stalder on Thu, 4 Oct 2018 12:39:17 +0200 (CEST)

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<nettime> Spain court confirms jail sentence for former IMF chief Rato

All possibilities of appeal are exhausted, one of the most high-profile
bankers of Spain needs to go to jail now. This makes Spain only the
second country (after Iceland) where any prominent banker were sent to
jail following the 2008 financial crisis. What this article fails to
mention, like all others I found, is that the trial and conviction was
due to an unprecedented citzien's campaign (led by people such as Simona
Levi), which raised funds, hired lawyers and organized leaks to gather
evidence. More on this aspect in an (older) article in The Nation.




Spain’s Supreme Court on Wednesday confirmed former IMF chief Rodrigo
Rato’s jail sentence of four years and six months for misusing funds in
a case that sparked outrage when it was uncovered at the height of the
country’s economic crisis.

In February 2017, Rato was found guilty by the Madrid-based National
Court of paying for personal expenses with credit cards put at his
disposal when he was the boss of Caja Madrid and Bankia, at a time when
both banks were in difficulty.

The 69-year-old, who is also a former Spanish economy minister, had
since then been free on bail pending an appeal.

The case shocked Spain, where it was uncovered at the height of the
crisis that left many people struggling financially. Bankia later had to
be nationalised.

Far-left party Podemos welcomed the court ruling, saying Spaniards had
long demanded justice “for those who robbed public money, for those who
ripped off thousands of families, for those who burdened us with debt
for life”.

“We applaud the fact that some of those responsible, like Rodrigo Rato,
get at least part of what they deserve,” it said in a tweet.

– Misuse of 12 million euros –

Rato was tried with 64 other former executives and board members at both
banks accused of misusing a total of 12 million euros ($13.8 million)
between 2003 and 2012 in personal expenses.

Those included petrol for their cars, supermarket shopping, pricey
holidays, luxury bags or parties in nightclubs.

One of the executives, Miguel Blesa — Rato’s predecessor at Caja Madrid
— was sentenced to six years in jail.

In July 2017, Blesa was found dead with a gunshot wound to his chest at
a private hunting estate in southern Spain.

An autopsy ruled it was suicide.

– Second trial –

The Supreme Court will now notify the National Court of its decision,
which will then summon Rato and give him a deadline — usually 10 to 15
days — to allow him to pick a prison and go there voluntarily.

Authorities will issue an arrest warrant against him if he does not.

Rato was economy minister and deputy prime minister in the conservative
government of Jose Maria Aznar from 1996 to 2004, before going on to
head up the International Monetary Fund until 2007.

His subsequent career as a banker in Spain was short-lived — from 2010
to 2012. But apart from the case of the undeclared credit cards, it also
led to another banking scandal considered the country’s biggest.

Thousands of small-scale investors lost their money after they were
persuaded to convert their savings to shares ahead of the flotation of
Bankia in 2011, with Rato at the reins.

Less than a year later, he resigned as it became known that Bankia was
in dire straits.

The state injected billions of euros but faced with the scale of
Bankia’s losses and trouble in other banks, it asked the European Union
for a bailout for the entire banking sector and eventually received 41
billion euros.

Rato is due to stand trial over the case, accused of falsifying
information about Bankia’s finances to encourage investors to buy into
its stock market listing.

He is the third former IMF chief to get into trouble with the law.

His successor Dominique Strauss-Kahn was tried in 2015 on pimping
charges in a lurid sex scandal, and was acquitted.

And Christine Lagarde, who took over from Strauss-Kahn and is the
current IMF chief, was found guilty of negligence over a state payout to
a tycoon when she was French finance minister, though she received no

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