24/03/21

EUROPE: Former IMF chief Rato faces fresh fraud accusations in Spain.

As published on euractiv.com, Wednesday 24 March, 2021.

The former managing director of the International Monetary Fund, Rodrigo Rato, is facing fresh allegations from Spanish anti-corruption prosecutors, including alleged tax fraud, corruption, and document falsification, EURACTIV’s partner EFE reports.

In a statement released on Tuesday (23 March), Spain’s anti-corruption prosecutor’s office outlined 11 allegations against the former politician and banker.

The prosecutor is seeking a sentence of between four and six years for alleged embezzlement, insolvency offences and corrupt business practices, and a further three years for alleged falsification of documents.

The prosecutor says Rato allegedly defrauded Spain’s public coffers of €8.5 million using offshore accounts and claims it found irregular increases in his personal wealth amounting to €15.6 million between 2005 and 2015.

The office further alleged that Rato had hidden capital from Spanish tax authorities using a “multitude” of bank accounts in the Bahamas, Switzerland, Luxembourg, the United Kingdom, and Monaco dating as far back as 1999.

The prosecutor said documents seized in a raid on Rato’s property in 2015 showed he also had accounts in the United States and Switzerland not previously known to Spanish authorities and that he had operated via accounts in low-tax territories such as the Isle of Man, Kuwait, and Curaçao.

Prosecutors accused Rato, 72, of omitting “any reference” to a series of offshore accounts when he was granted a tax amnesty in 2012. Rato joined the IMF as managing director after serving as Spain’s deputy prime minister and economy minister with the erstwhile conservative Popular Party government.

No stranger to scandals, he was convicted in 2017 of embezzlement and ordered to serve a 4.5-year prison term for a case related to his time at the helm of Spanish lender Bankia.

Rato was found guilty of using company credit cards to cover undeclared expenses and fund a lavish lifestyle. The bank Bankia was bailed out by the government in 2012 for some €22 billion.

In 2020, a judge permitted Rato to serve the rest of his sentence in partial liberty.