In the latest corruption trial to rock Spain, a leading former boss of the IMF was found guilty and handed a sentence of four years and six months.
Rodrigo Rato had previously run two Spanish banks.
Spain's National Court, which deals with corruption and financial crime, ruled that he was guilty of embezzlement when he headed up Caja Madrid and Bankia, at a time when both groups were struggling.
The fraud was committed by using undeclared corporate credit cards which cumulatively siphoned off some €12 million between 2003 and 2012. None of the purchases were declared to the tax office.
Sixty-four other bank executives and board members were included in the judgement of guilt.
Records revealed that the charges were made for expensive holidays, luxury garments, nightclub entertainment and supermarket goods.
During Rato’s time at Bankia, some 200,000 small-scale savers lost their money after having been persuaded to convert their savings into shares in advance of Bankia being floated in 2011.
Rato resigned just before Bankia had to be rescued in 2012 at a cost to the taxpayer of €22 billion. Since then Bankia has paid out €1.2 billion in compensation to the savers.
Rato, 67, denied any wrongdoing, arguing that the credit cards were part of executives’ pay deal.
Before his stint at the banks, Rato had been a minister of the economy followed by his appointment to lead the International Monetary Fund from 2004 to 2007.
The Spanish are all too familiar with corruption in high places, but the timing of this scandal caused particular outrage when the news was reported at the height of the country’s economic crisis.
Rato remains at liberty pending a possible appeal.
