• Spain's news in English

Home of Ex-IMF chief searched in fraud probe

AFP · 17 Apr 2015, 08:40

Published: 17 Apr 2015 08:40 GMT+02:00

Facebook Twitter Google+ reddit

Spain's state prosecutor ordered the searches as part of an investigation into suspected money laundering, fraud and asset stripping, a source close to the investigation told AFP.

Police escorted Rato, a former economy minister with Spain's ruling conservative party, out of his apartment building in an upscale neighbourhood in central Madrid after searching his flat for nearly four hours.

They took him to his nearby office, which was also searched, before driving him back to his flat just after midnight.

Spanish media reported the probe could be centred on an alleged payment of €6.2 million ($6.6 million) which investment bank Lazard made to Rato in 2011, several years after he worked for the firm as an adviser.

Rato, a former stalwart of Spain's ruling Popular Party who has since be expelled from the group, has already been questioned on suspicion of fraud in an ongoing probe into the stock market launch of bailed-out lender Bankia, which he once chaired.

He is suspected of misrepresenting Bankia's accounts ahead of its doomed stock market listing and has been charged with fraud, embezzlement and forgery.

Rato has also been questioned in court as part of another probe into alleged spending sprees on company credit cards by him and other ex-managers of Bankia. He has denied wrongdoing in both cases.

Bankia nearly collapsed in 2012 and had to be bailed out by the Spanish government for €24 billion

Spain later received €41 billion from international creditors to protect its whole banking sector from collapse, though it avoided having to get a full sovereign bailout like Greece.

Thousands of customers have brought separate lawsuits against the Bankia group, saying they lost their money after being misled into converting their savings into the bank's shares.

'Law same for everyone'

The news that Rato is the target of a fresh corruption investigation comes as Spain is gearing up for regional and municipal elections on May 24th and a year-end general election.

Polls show the Popular Party will suffer heavy losses, in part due to voter anger over a string of graft cases that have tainted top party officials in recent years.

Party officials avoided commenting directly on the latest Rato investigation and stressed instead the measures the government has taken to fight corruption.

Justice Minister Rafael Catala said the probe "is proof that prosecutors investigate, that the law is applied and that the law is the same for everyone".

Story continues below…

The head of the main opposition Socialist Party, Pedro Sanchez, called for the resignation of Budget Minister Cristobal Montoro and for a parliamentary enquiry.

Corruption scandals have tainted both of the main parties and have fuelled the rise of two new challengers that have rallied against graft: anti-austerity party Podemos on the far left and Ciudadanos on the centre-right.

Rato was a finance minister in the conservative government of Jose Maria Aznar, which was in office from 1996 to 2004.

He then led the International Monetary Fund from 2004 to 2007, getting the Washington-based job thanks to his reputation for presiding over the early stages of Spain's construction-led boom.

Rato left the IMF in 2007 for "personal reasons" and was later handed the job of managing Caja Madrid, one of the regional savings banks that fused to form Bankia in 2010.

For more news from Spain, join us on Facebook and Twitter.

Facebook Twitter Google+ reddit

Today's headlines
Recipe: How to make fabada - traditional Asturian bean stew
Photo: Flavio Lorenzo Sánchez/Flickr

The hearty Asturian dish is a perfect lunch on a cold day... and don't forget the crusty bread and cider!

Brit 'paedo' held on Costa del Sol after Most Wanted appeal

One of Britain's most wanted fugitives was arrested on the Costa Del Sol following a tip-off from an expat just hours after his face appeared on a public appeal.

Spain's parliament approves deficit reduction measures
Photo: Images Money/Flickr

Spanish lawmakers approved on Thursday measures to reduce the public deficit and keep it under the target agreed with the European Union.

'Cubism and War' show opens at Barcelona Picasso Museum
Pablo Picasso Harlequin and Woman with a Necklace. Photo: MP

Barcelona's Picasso Museum unveiled an exhibition on "Cubism and War" on Thursday depicting how one of the most influential artistic styles of the 20th century survived the First World War.

Why this bionic limb pioneer doesn't believe in disability
Hugh Herr has been award Spain's top science prize. Photo: FPA

The Local speaks to Hugh Herr on winning Spain's top science prize and how being an amputee doesn't make him disabled.

Dine in the buff at Spain's first nudist restaurant
A buffet of organic food will be served on "human tables". Photo: Innato / Facebook

Spain's first naked dining experience is to arrive on the island of Tenerife following the success of a similar venture in London.

Spain's top court overturns bullfighting ban in Catalonia
Photo: AFP

Spain's Constitutional Court on Thursday cancelled a bullfighting ban in Catalonia in what is likely to exacerbate tensions between Madrid and the separatist region, and between animal activists and fans of the tradition.

Out of the dark: Five years on from Eta ceasefire
Eta members made a ceasefire declaration in January, 2011. Photo: Gara / AFP

Five years after armed separatist group Eta declared a permanent ceasefire, Basque journalist Alberto Letona is still wondering when the dialogue will begin.

Hunt for ten most wanted Brit fugitives hiding out in Spain
Call Crimestoppers if you recognize these faces.

These fugitives from British justice are thought to be hiding out in Spain. Do you recognize anyone?

Eta 'not dead' but Spain focus moves onto jihadism
Archive photo of a pro-mural in the Basque Country. Photo: AFP

Five years after Eta quit violence, the Basque separatist group has yet to dissolve but it poses little threat and authorities have shifted their focus to fight jihadists, says Spain's chief anti-terrorism prosecutor.

Sponsored Article
How to vote absentee from abroad in the US elections
Madrid parish church faces fine over 'too noisy' bells
Sponsored Article
Last chance to vote absentee in the US elections
Celebrate expat life at Madrid’s THRIVE convention
Fury after kids told to bring their own loo roll to school
Sponsored Article
How to vote absentee from abroad in the US elections
Disney announces plans for Don Quixote action movie
Activist tells 8-yr-old matador wannabe with cancer 'just die'
King to make last minute push to avoid third vote in Spain
Amazing photos of Catalonia's 'human tower' contest
What's on in Spain: October 2016
'No way, Jose! You'll never get your hands on our Rock'
Recipe: How to make a classic Spanish tortilla de patatas
Chorizo in paella? Go back to cooking school Jamie Oliver
Spain in eye of a perfect storm after 10 months without govt
Thousands share clips of life for 'Spain in a Day' film
Ten incredible Spain locations for Game of Thrones season 7
Analysis & Opinion
Why moving to Spain could be the best decision of your life
Seven reasons why autumn is the very best season in Spain
Spanish study finds four types of personality. Which are you?
New search underway for civil war grave of poet Lorca
Bison found decapitated on Valencia nature reserve
Forgotten Voices: What Brits in Spain think about Brexit
One dead and 14 injured in blast at Spanish resort
Game of Thrones want extras 'with muscles' to film in Spain
Thousands march in Madrid to push for bullfighting ban
jobs available