Rato goes on trial in Spain

MADRID: A major trial harking back to the dark years of Spain’s economic crisis kicked off on Monday over the alleged fraudulent 2011 listing of financial giant Bankia, with former IMF head Rodrigo Rato in the dock.

The Spanish state was forced to step in to prevent the bank’s collapse and then to borrow 41 billion euros ($46.5 billion) from the EU to keep the rest of Spain’s banking sector afloat. The 69-year-old Rato, head of the bank at the time, is accused of falsifying the books and fraud to the detriment of investors.

Prosecutors are seeking a five-year jail sentence for Rato, who in October began serving four-and-a-half years in prison for misusing funds when he was the boss of Caja Madrid, another bank, and of Bankia between 2010 and 2012.

Bankia was formed in 2010 when Caja Madrid and six other unlisted savings banks merged. Rato arrived at the court in San Fernando de Henares, a Madrid suburb, for the trial in a police van out of sight from the glare of the media.

A total of 35 people and companies including Bankia, its parent company BFA and Deloitte consultants are on trial. The opening day of the trial was dominated by procedural issues. Rato is expected to take the stand on Tuesday or Wednesday. The image of a smiling Rato ringing the bell and sipping champagne on July 20, 2011 to mark the start of Bankia’s listing has since become a symbol of the scandal.