Agence France-Presse
October 26, 2014 5:37am
Ex-IMF chief Rato: fallen angel of Spanish finance
Fraud
allegations have driven a spectacular fall from grace for Rodrigo Rato,
the man credited with Spain's one-time economic boom and now destroyed
by its bust.
The 65-year-old former finance
minister was hailed for kicking off a golden decade of growth in Spain's
economy from the late 1990s and later led the International Monetary
Fund.
Now, six years after the financial crisis
started, the toxic fallout from it has landed him in court and turned
him into a hate figure for many ordinary Spaniards.
On
October 16 a judge questioned him over alleged spending sprees on
company credit cards by him and other ex-managers in the bailed-out
finance group Bankia.
He had already been
questioned on suspicion of fraud in an ongoing probe into the stock
market launch of Bankia, which was rescued by the Spanish government in
2012.
He has denied wrongdoing in both cases.
"Rato
always came across as someone brilliant and efficient but also very
clever," said political consultant Antoni Gutierrez Rubi.
The
charges now hanging over him reflect "the great decline, the great
downfall of the professional and ethical icon that was Rato".
- 'Economic miracle' -
The prime minister at the time, Jose Maria Aznar, in 2010 called Rato the "best economy minister" in Spain's modern history.
But
when asked by reporters about him after the credit cards revelations
this month, Prime Minister Mariano Rajoy would not even speak Rato's
name.
The allegations that Rato and more than 80
others spent a total of more than 15 million euros, reportedly on
luxuries such as nightclubs and safaris, embarrassed Rajoy's Popular
Party (PP) and sparked a string of resignations.
"It
alarms and outrages us," said the current leader of the party, Maria
Dolores de Cospedal, who just last year had called prominent PP member
Rato "the star of Spain's economic miracle".
Rato
was thought a natural successor to Aznar and was expected to run for
prime minister in 2004, but mistimed his bid. Rajoy beat him to the
candidacy but lost the election.
Rato promptly
left Spain to become managing director of the International Monetary
Fund, the global emergency lender that later played a key role in
tackling the eurozone debt crisis.
He 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.
He oversaw the stock market
listing of Bankia in 2011, seen as a triumph after the previous three
years of financial turbulence. But the euphoria did not last.
In
May 2012 the government had to nationalise Bankia to save it from ruin.
Spain then had to turn to the eurozone for a 41-billion-euro bailout to
save its whole banking sector.
- 'Thief, go to jail!' -
Seven
months after Bankia was rescued, Rato found himself walking into court
for questioning. Furious customers who said the bank had lost their
savings yelled at him: "Thief! Go to jail!"
The
scene was repeated last week when he went before a judge over alleged
corporate crimes in the credit card scandal. The court made him pay a
three-million-euro bond while it investigates further.
"The impact of the charges is much bigger this time round," said political expert Rubi.
"In
2012 all we knew was that Bankia had been badly managed. Now we know it
was badly managed by people with no scruples, ethically speaking."
The
credit card affair has damaged not only Rato's image but that of his
party ahead of regional elections due next year, Rubi said.
In a previously "unthinkable" move, Rato has suspended his membership of the PP.
"He
has no political future," said Rubi. "There is a feeling that Rato has
destroyed his shining reputation. He had a halo of superiority and
triumph everywhere he went. Now he has fallen."
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