A Spanish court began hearing the fraud trial of former International Monetary Fund (IMF) [official website] chief Rodrigo Rato and more than 60 other bankers on Monday concerning allegations the defendants fraudulently used secret credit cards from Bankia bank to pay for personal luxuries. Rato also served as economic minister of Spain, was a member of the Popular Party and headed Bankia until it nearly collapsed in 2012. Prosecutors claim [BBC report] the defendants spent about USD $13.5 million of bank funds on travel, hotels, and entertainment and also failed to report any of the expenses to tax authorities. Prosecutors are seeking a sentence [Terra España report, in Spanish] of up to four years for Rato, while Bankia is requesting that he receive a penalty of six years. The prosecution is also requesting that Rato make restitution payments to Bankia. Officials began investigations [JURIST report] into fraud in 2012, shortly after Bankia requested a government bailout in the amount of USD $24 billion to help lift itself out of financial crisis.
This is the latest of several high-profile corruption cases to come out of Spain in recent years. Last year a Spanish High Court judge ordered [JURIST report] 40 people, including three former ruling party treasurers, to stand trial over a bribes-for-contracts scheme. The scandal is thought to have extended to six regional Popular Party governments between 1999 and 2009, and individuals involved are thought to have taken bribes and rerouted public money in exchange for public contracts. In 2013 the Spanish Provincial Court of Malaga convicted [JURIST report] 53 people for money laundering, bribery and fraud, while 42 people were acquitted. The trial, referred to as the Malaya case, was Spain’s largest ever corruption trial after a total of 199 court sessions.