Turning trash contracts into solid gold
The Brugal case reveals the influence businessman Enrique Ortiz wields in Alicante
O ver the last five years, the inhabitants of Alicante have watched in disbelief as one scandal after another has unfolded in the Valencian province. What began as suspicions over refuse-collection concessions has turned into a major judicial investigation, known as the Brugal case. On June 3, the findings of the court overseeing the case were made public, revealing a network of corruption dating back several years that involves property developers, politicians, and business leaders.
So far, the judges overseeing the investigation have charged 26 people, while the Alicante anti-corruption unit has accused a further 80 individuals. The majority of those charged hold public office within administrations run by the conservative Popular Party (PP). But neither Mariano Rajoy, the PP leader, nor Francisco Camps, the head of the Valencia regional government, have commented on the scandal.
Suspicions over refuse collection became a major judicial investigation
Wiretaps revealed that Ortiz was being granted no end of favors by City Hall
Two of the main figures in the affair, Sonia Castedo and Luis Díaz Alperi, respectively the mayor and former mayor of the city of Alicante, took their seats in the regional parliament last week, following elections in May. They now enjoy parliamentary immunity, and any legal action against them will be dealt with by the Valencia regional Supreme Court. A third accused, José Joaquín Ripoll, has been squeezed out of his post as head of the provincial government after an internal PP dispute.
The origins of this complex web of corruption are to be found in the small town of Orihuela, in Alicante, and relate to the concession of contracts for refuse collection, as well as in the contract to build a garbage-treatment plant in the area known as the Vega Baja.
At the same time, the courts are investigating the way in which the city of Alicante's rezoning plan was carried out. When the court's initial findings were released on June 3, news media reported police recordings between Castedo, Díaz Alperi, and Ortiz discussing in the most blatant terms the way that land would be divided up and who would benefit from rezoning that would allow new construction projects and fat contracts to be awarded.
On June 28, 2008, the powers that be in Alicante were exchanging information about future construction plans in the city. Enrique Ortiz - the property developer who directly and indirectly controls around 70 percent of the land in Alicante that can be built on, as well as being the main shareholder of the city's soccer club, Hércules, and at the same time the Chairman of the Cívica group, a company that supplies the city with a range of services, from refuse collection to cleaning - spent much of that day talking on the telephone with Quesada, the head of the team tasked with drawing up the city's rezoning plan.
Among the topics the pair discussed was the future of Hércules' soccer stadium, which is due to be developed. The conversation took place with the knowledge of the then-mayor, Díaz Alperi. Sonia Castedo, who was head of city planning at the time, also knew about it.
Ortiz then told Ricardo Sala, a lawyer specializing in city planning, about his talk with Quesada. Shortly after, Castedo called Ortiz to arrange a meeting with Quesada the next day at Cívica's offices. Later on the same day, Ortiz would meet with Vicente Sala, the head of the regional CAM savings bank, along with two other property developers. The day would end with a party aboard Ortiz's yacht attended by Díaz Alperi and several PP councilors to celebrate the closing of a case against Ortiz and Díaz Alperi for trying to pervert the course of justice.
But as he toasted his good fortune aboard his yacht that evening, Ortiz was blissfully unaware that an investigating judge in the local court in Orihuela had ordered his telephone to be tapped. That very day, the police had recorded the conversations between Ortiz and senior officials in Alicante City Hall about plans to redevelop the Hércules soccer stadium. They also knew about the party aboard the yacht.
In short, the wiretapping would reveal in the starkest terms that Ortiz was being granted no end of favors by Alicante City Hall. A police money-laundering unit was also listening in on Ortiz' calls. As a result of its efforts, 21 people have been accused of corruption. Ortiz, Alperi and Castedo have been accused of bribery, breaches of confidentiality and corruption.
In short, what the wire-taps have revealed is a vast plan that turned Alicante into a Monopoly board controlled by Ortiz, a man who alternately pressured and bribed politicians. He is estimated to have made at least 120 million eurosout of his illegal activities.
The Brugal case stretches beyond the city of Alicante to the Vega Baja. Two years earlier, in March 2006, Ángel Fenoll - a businessman with long-standing links to the PP in the area who was found guilty of vote-buying for the party - handed over a recording of a conversation with a local councilor about bribing the then-mayor of Orihuela, José Manuel Medina and three other officials. Fenoll's motive was simple: revenge. His bid had been rejected for the refuse-collection contract by the administrations of Alicante and Orihuela respectively, as well as the planned 380-million-euro refuse-treatment center in Vega Baja. Instead, the contracts had gone to - surprise, surprise - Enrique Ortiz.
The first casualty of the revelations was Fenoll himself, who was implicated in the attempted bribery. He ended up in jail. Next to fall was José Joaquín Ripoll, a PP delegate in the provincial government, along with three other PP officials and seven businessmen, all accused of the illegal awarding of refuse-collection contracts, and who still face investigation for possible money laundering, as well as illegally financing their political parties.
Ortiz avoided immediate arrest because he was out of the city at the time, but his friendship with the head of the provincial delegation and the extravagant parties aboard his yacht would soon become public knowledge.
At this point, another character appears on the scene: Rafael Gregori, a close friend of Ripoll whom the police say played a key role in the purchase of apartments to be given to Ripoll for helping Ortiz. Below is part of the police transcript of the conversation:
Rafael Gregori: Hey, listen, I need the documents for the apartments you want.
Joaquín Ripoll: Wait until I have had a chance to look at them, and I'll let you know.
R.G. Have a look, and let me know.
J.R. Wait a second, I've got them right here.
R.G. There were several on the fifth floor, right?
J.R. Yes, I think they were... let's see.
R.G. They were two with a separate elevator, right?
J.R. Yes, they had their own entrances, D and E.
R.G. Okay. Fine. I'll put them aside for you.
The apartments are valued at between 800,000andonemillion euros. All three of those involved have been accused of fraud, bribery, breach of confidentiality, trafficking in favors and business activities that are forbidden for public officials.
The police report concludes: "The constant contact between the businessman and the staff at the urban-planning department is clear." It highlights the links with Isabel Campos, the head of the department's legal service. On at least one occasion, Ortiz ordered one of his employees to draw up a report about a particular project and to send it to Campos, noting: "She has to make it appear as though she has prepared it."
The wire-taps show that Ortiz was in constant contact with Alicante City Hall officials, which the police say shows "the collaboration between urban planning and the businessman." In one taped conversation, Ortiz tells Campos about the need to approve the construction of 13,500 properties he has planned. "It must be discussed at the next City Hall meeting," he says. Campos replies: "At the next meeting? Well, we'll have to hurry up then." The conversation continues:
Enrique Ortiz: Okay darl, speed things up for me if you can.
Isabel Campos. Okay, we'll see what we can do...
E.O. That's it, work for me.
I.C. I was just joking.
Ortiz ends the conversation: "I know, I know."
The following Christmas, Ortiz gave Campos a handbag. Campos called him to say thank you.
I.C. I just wanted to say thank you for the bag.
E.O. That's nice.
I.C. Seriously, it's very nice.
E.O. Do you really like it?
I.C. Yes, yes.
E.O. So when are we going to have lunch?
I.C. Whenever it suits you.
E.O. I need to flatter you a little.
I.C. Whenever you want.
E.O. In the professional sense, in the professional sense.
I.C. I know, I know.
Time and again, the police recordings show how Ortiz worked closely with senior officials to get his way. In June 2008, he called Sonia Castedo: "Try to get the plan and show me it." She replies: "Yes, yes, yes, tomorrow, tomorrow, we'll see each other then."
A month later, he tells another official: "If anybody asks you if you have the plan, tell them no." To which the official replies: "Yes, I know." Ortiz then spells out his instructions: "Look at the plan now, and where our plots are. All of them. Take note, put them in a different color."
In July of 2010, the police searched Ortiz's offices, finding a pen drive with details of Alicante City Hall's rezoning plans.
Ortiz has so far managed to avoid jail. But he now faces several separate cases: the Brugal case, involving refuse in the Vega Baja and the rezoning of Alicante; and the illegal financing of the Popular Party through the Gürtel cash-for-kickbacks network.
In December 2006, Ortiz went on record as saying: "Sadly, I have no power." By that time, he had already established a reputation for his ability to influence events within Alicante City Hall. His fortunes really took off when Díaz Alperi became mayor: he was the first to learn that the mayor had resigned, and the first to be told that Sonia Castedo had taken over as mayor. Alperi called him during a lunch with Francisco Camps, the head of the Valencian regional government. Ortiz was the first to congratulate Castedo on her new job.
Ortiz's approach was simple: "I give them a small present," he said one day to his wife, "and I have them at my disposition." José Joaquín Ripoll's net worth swelled by 1.3 million eurosbetween January 2008 and June 2010. The police say that most of this came from two apartments built in Alicante's upmarket suburbs, along with a similar amount in cash.
The police add to that a 37,500-euro vacation in a private jet to Crete enjoyed by Luis Díaz Alperi and a councilor called Sonia Alegría. Ortiz is suspected of having given three houses to Alperi's children. They also believe that holidays taken by Sonia Castedo were paid for by Ortiz in return for rezoning favors.
Sonia Castedo, who has known Ortiz for 17 years, says that she sees nothing "abnormal" in the 21 meetings over the same number of months with Ortiz, many of them in private. "What has happened here," she says, "is that over time, we are changing something that was always normal into something abnormal."
But as the transcripts of the wire-taps show, there is nothing normal about Ortiz's dealings with Alicante City Hall. In May 2008, Ortiz telephoned Castedo to discuss his plans, asking for a meeting in her office. "No, I don't want you coming here, I'd rather go to yours actually," replies the then-head of urban planning. "Okay, you mean that you don't want me seen there," says Ortiz, to which Castedo replies: "Exactly, I don't want you seen round here."
The tapes show that Ortiz and Castedo enjoyed a close relationship. They discuss numerous projects, among them a proposed branch of the IKEA furniture chain. On several occasions, Ortiz makes it clear that he is not happy at the way the rezoning is going. In other conversations, Ortiz makes some 1,700 references to Castedo, many of them along the lines of: "I'll have to confirm that with Sonia."
On May 22, Sonia Castedo won a landslide in the regional elections, boosting the PP's presence from 15 to 18 delegates in City Hall. It would seem that far from damaging her reputation, her association with Ortiz and the allegations of corruption have only increased her popularity.
Smear tactics against Socialists
In return for the close collaboration of the PP-run Alicante City Hall in pursuing his business interests, it has now emerged that Enrique Ortiz helped the party in its bid to show that the Socialist Party was engaged in illegal funding.
Following the publication of the police report showing the extent of Ortiz's links to Alicante City Hall, and that he had personally funded electoral events by the PP, Ortiz met with the mayor of the city, Sonia Castedo, and David Serra, the deputy secretary of the PP in Valencia, to work out a strategy to discredit the Socialists.
Once the Socialist Party saw that the Valencia regional High Court had refused to investigate police evidence of money laundering by the PP, saying that it was beyond its jurisdiction, it brought charges against companies involved in the illegal financing of the PP. In response, Ortiz and the PP dedicated their energies to looking for evidence that the Socialists were doing the same.
The wire-taps carried out as part of the Brugal case show that Ortiz called other business colleagues to ask for receipts and other documents that could be used to show illegal activities by the local Socialist Party.
"Ask that businessman if he has provided tents for the Socialists, but that other companies have paid for: that's how it works," Ortiz said on one occasion. He knew what he was talking about: as the Gürtel corruption case reveals, this is exactly how the PP opened channels for illegal funding.
Serra called Ortiz on several occasions regarding the publication of the police report into the PP's illegal funding. "You have to get the receipts under control," he warned him on one occasion. The second report, which was handed over to the Madrid Supreme Court in September 2009, refers to nicknames associated with Ortiz.
The conversation between Serra and Ortiz on September 27, 2009 went as follows:
Enrique Ortiz: We're struggling. It's like fighting the tide.
David Serra: We all are.
D.S. Yeah, no scruples. They couldn't care less.
E.O. This week I'm going to find the little angel [supposedly a reference to Ángel Luna, the Socialist Party' spokesman in the Valencia regional parliament who uncovered the PP's illegal financing]. Let's see what's going on. I've been away, and I don't know what's going on.
E.O. My wife didn't want to upset me. I've been in Mexico.
D.S. Yes, I called you...
E.O. Yes, but we couldn't talk, I keep getting calls from numbers I don't recognize.
D.S. It's outrageous.
E.O. They've got a cheek. The stuff I've read in the papers today is enough to sue them.
E.O. They've got a nerve.
The pair continue their conversation, saying that the PP cannot remain silent in the face of the accusations.
They work out a plan aimed at attacking Ángel Luna, who took advantage of every session to ask premier Francisco Camps in parliament about the corruption being unearthed as part of the police Gürtel investigation.
Sonia Castedo asked Ortiz for receipts for work that Luna had done on his house, but Ortiz denied having them. Nevertheless, the PP brought a complaint against Luna on September 20 for alleged bribery. The PP claimed that Luna had work done on his house in 1997 that was paid for by Ortiz.
Ortiz agreed to allow the PP to do this, despite admitting in private that he had not paid for the work on Luna's house. The complaint was not pursued by the courts. Castedo has admitted that the ruse was "less than ethical."