Fraud trial for Rodrigo Rato over Bankia collapse

13:02 El NACHO 0 Comments

Rodrigo Rato, the former head of the International Monetary Fund, is to face trial for alleged fraud in connection with the spectacular collapse of Spanish lender Bankia.

Rodrigo Rato, chairman of ailing Spanish lender Bankia SA
Rodrigo Rato stepped down as chairman of Bankia on Monday Photo: Reuters
Mr Rato, who quit as chairman of the bank in May just before it was bailed out to the tune of €23.5bn (£18.9bn), is named alongside 32 other Bankia managers in a lawsuit brought by UPyD, one of Spain’s smaller political parties.Hours after the legal probe was announced, Bankia's chief executive Francisco Verdu, abruptly quit, announcing the move in a one sentence regulatory filing.

Spain’s top national court on accepted the suit, alleging fraud, price-fixing, embezzlement and falsifying accounts, though no date has yet been set for the hearings.

Anti-corruption judges had already opened a preliminary investigation into alleged fraud relating to the founding of Bankia, formed from the merger of seven regional savings banks, and its controversial stock market listing last year.

The two-stage Bankia bail-out – an initial €4.5bn swiftly followed by a further €19bn – signalled a dangerous new phase in the Spanish banking crisis.