Ex-employer group chief busted for cash laundering and concealing assets

Gerardo Díaz Ferrán, the former head of Spain’s largest employer group, was arrested on Monday on charges of concealing assets and money laundering, the National Police announced.

The police money-laundering squad also detained eight other people in the case, including the liquidator of Díaz Ferrán’s failed travel group Marsans, businessman Ángel de Cabo, and carried out raids in Madrid and Valencia. Officers found 150,000 euros in cash and one kilo of gold at Díaz Ferrán’s home in the Madrid district of Canillas, while police confiscated one million euros from Cabo’s home in Valencia. Police also took 11 luxury vehicles from a warehouse belonging to Cabo in the industrial complex of El Oliveral, in Ribarroja, Valencia.

Díaz Ferrán, who will turn 70 later this month, was president of the Spanish Confederation of Business Organizations (CEOE) from 2007 to 2010. He was expected to spend Monday night in police detention.

As part of an ongoing case that has been dubbed “Operation Cruise Ship,” police said they were not ruling out further arrests. Others detained were identified as Iván M. L. C., Susana M. C., Teodoro G. O., Rafael T. A., Carmelo José E. G., Antonio G. E. and José Enrique P. M.

The arrests took place after an amnesty for tax dodgers expired at the end of last month. The amnesty offered those coming clean the chance to pay just 10 percent tax on the value of previously undeclared assets.

Díaz Ferrán, who is already facing a number of legal proceedings, is also accused of fraudulent bankruptcy and syphoning off assets, besides having used the proceeds from this to channel 4.9 million euros to Switzerland. According to a police report, the funds were diverted through an Irish company that formed part of the Marsans group.

He declared himself as personally bankrupt after being unable to meet demands for 417 million euros

The money was transferred to an account in the name of Ángel de Cabo, who bought Marsans for a nominal amount. He is thought to have been acting as a figurehead for Díaz Ferrán, in exchange for a “substantial sum” of money, judicial sources said.

At the start of the investigation, the High Court ordered an embargo of the assets of Díaz Ferrán, who declared himself as personally bankrupt after being unable to meet demands for 417 million euros related to the failure of Marsans. A report by the prosecutor released in the summer said “the managers of the travel agency unlawfully appropriated sums paid by customers for the purchase of tickets.”

The prosecutor claims he stripped the company of its wealth to the detriment of its creditors in a case that is already being heard by a Madrid commercial court. In his last appearance before the court, Díaz Ferrán accused his business partner, Gonzalo Pascual, who died five months ago, of having led Marsans to its ruin, arguing that he had few executive duties at the company.

Marsans declared itself bankrupt in the summer of 2010, with debts of 400 million euros. The company left 4,700 workers on the street. As his business empire collapsed around him, Díaz Ferrán stepped down as chairman of the CEOE in October that year.