The police operation that led to the arrest last week of Gerardo Díaz Ferrán - the former head of Spain's largest business association and bankrupt travel group Viajes Marsans, who was detained on charges of money laundering and concealing assets - also netted the lesser-known Ángel de Cabo, a specialist in buying up failed companies and stripping their assets. De Cabo is currently languishing in jail, in lieu of the record 50-million-euro bail set by a judge.
An energetic man despite his portly appearance, De Cabo has a reputation in business circles for playing the big shot, often turning up at meetings with a large retinue of employees and passing them off as his legal team.
Díaz Ferrán turned to De Cabo when he was forced to liquidate Viajes Marsans and other businesses in 2010, after declaring bankruptcy the year before. Prosecutors are accusing Ángel de Cabo of having helped Díaz Ferrán to stash away his assets so that neither his creditors nor his laid-off employees could get hold of them.
Thanks to a sworn statement given by former De Cabo employee Ángel Sutil, investigators are now putting together the pieces of a complex operation that they claim allowed him and Díaz Ferrán to conceal millions of euros abroad. Sutil has also told High Court Judge Pablo Ruz how De Cabo helped keep other companies on the verge of collapse from having to give up their assets.
De Cabo faces charges of extorting, blackmailing and bribing state officials
As well as his relationship with Díaz Ferran, the police are investigating De Cabo's involvement in the dismantling of the Nueva Rumasa group, owned by the Ruiz Mateos family, for which he already faces charges of extorting, blackmailing and bribing state officials and judges, along with "anybody else who might endanger his plans."
According to Sutil, De Cabo's modus operandi was the ransacking of failed companies, thus removing them from bankruptcy proceedings before they could be put up for auction. Any properties or assets he was able to save were later sold, and the profits split between De Cabo and the owners of the bankrupt firm.
According to the police's Economic Crimes and Tax Fraud Unit (UDEF), De Cabo and his men used both "legal and illegal" methods. For example, if a firm was already headed for auction, paperwork would be produced showing false loans, with De Cabo as the beneficiary. The documents would be presented at auction, and he and the owners would try to get the best price for the company ahead of other bidders. To create these false contracts and loans, De Cabo organized ghost companies that had "little or no activity" with false accounting records, according to the court case file. Because they needed to appear authentic, they were formed weeks or months before troubled companies were actually put out to bid.
De Cabo set up Valencia-based law firm Aszentia, which advertises itself as a specialist in refloating companies, using it instead to deliver the coup de grace: among its victims were Teconsa, a company linked to the Gürtel kickbacks for contracts network linked to Popular Party-run municipalities, as well as Viajes Marsans, where the entire workforce was sacked overnight.
He said that he had got the idea for his scams from the film´Pretty Woman´"
Little wonder that the Ruiz Mateos family contacted De Cabo, given that it had to desperately fight off creditors while its tangled web of more than 100 companies that formed Nueva Rumasa was going under.
De Cabo's opportunity to go for the big time came in the mid-1990s, as the Spanish economy took off, fueled by an unprecedented construction boom. At that time, he had a small plumbing company that grew rapidly, supplying fittings and fixtures throughout the Valencia region by subcontracting work out to smaller players.
At some point in the late 1990s, De Cabo expanded his operations, and began taking over companies in difficulties. He first got set up in Valencia, and then moved into Andalusia, taking over construction companies such as Azagra, Marín Hilinger and Vias, Canales, y Puertos.
Shortly before it went bankrupt, Azagra was going to build 13 parking spaces in Seville, and had already taken deposits of 2,000 euros. On the day that the company was due to begin insolvency proceedings, De Cabo and his team of lawyers made an offer to buy the company at a knockdown price, and manage its closure.
The fantasy world of Díaz Ferrán
In the period between being forced to step down as head of the Spanish Employers' Confederation in December 2010 and his arrest at the beginning of this month on charges of fraud and money laundering, Gerardo Díaz Ferrán was, for a few months, often to be found in El Tártaro, a restaurant owned by one of his brothers in Madrid. There, like some old-time mafia don, he would hold court to a diminishing number of friends, colleagues, business leaders and anyone else he thought might be able to help him fend off the judicial onslaught that followed the collapse of his Marsans business empire.
Maintaining the positive outlook he had long been known for, he prepared his counterattack, insisting that he would win the lawsuit against the Argentinean government for re-nationalizing the country's national airline, which he had bought in 2001 for one peseta from the Spanish government. The case is to be decided by the International Court of Arbitration, and if he wins, will net him 900 million euros in compensation. This, he would tell anybody prepared to listen, would allow him to return the money he owes, and return to business.
Díaz Ferrán would tell his ever-fewer guests that if he could just get his hands on some cash in the meantime, he would be able to meet the mounting legal costs he faced. His big house in one of Madrid's most exclusive neighborhoods had been embargoed, along with his summer home in Mallorca, his yacht, the hunting lodge in Toledo... everything. He had even been forced, he claimed, to rent one of his own properties, which was paid for by his children.
But the better-informed among Díaz Ferrán's former friends knew that while his circumstances were considerably more straightened than the times when King Juan Carlos or Esperanza Aguirre, the former head of the Madrid regional government, would accept his invitations to a weekend's hunting, he was still able to attend the opera, or slip abroad for a vacation.
But by the end of the summer, Díaz Ferrán began to spend less time at El Tártaro, and more at home with his lawyers, as well as Ángel de Cabo, the owner of Possibilitum Business, the company used to acquire Teinver, the holding company of Marsans, Air Comet, and many of the other businesses that formed the tangled web built up by Díaz Ferrán and his now-deceased partner Gonzalo Pascual over the years.
Díaz Ferrán is accused of using his position as head of the employers' confederation to continue mismanaging his businesses: he left thousands of Air Comet passengers stranded when the airline went bust over Christmas 2009; he failed to pay back loans, one of which was to Caja Madrid, of whose board he was a member; he continued to sell airline tickets through his travel agency, despite having been banned from doing so by the International Air Transport Association for not paying suppliers; he looted his own companies and kept customers' money; and even went so far as to register himself as an employee in his company so that he could receive unemployment benefit when it went under. He now stands accused of conspiring with Ángel De Cabo to falsely sell off his companies and strip their assets.
He claims that he knew nothing about what was going on in the day-to-day running of his companies, and that his former business associate, Gonzalo Pascual, was responsible. "He should have known what was going on, in which case he should have severed all connections with Pascual," says one businessman.
Even before he was arrested Díaz Ferrán faced serious accusations: of embezzling 4.4 million euros from Marsans, of not paying back a 35-million-euro loan to Caja Madrid, along with non-payment of 45 million euros to AC Hoteles, Meliá, Pullmantur and Orizoni. Other debts include four-years' worth of fees to the Uría y Menéndez law firm.
Aszendia was constantly on the lookout for firms in trouble, and when it found them, De Cabo would then present himself to their distressed owners as a business angel with the right contacts, able to smooth things over - a Mr Fix-it. His appearance - gold watch, smart suits, and surrounded by equally well-dressed acolytes - succeeded in impressing them, but as one lawyer who worked with De Cabo remembers: "As soon as he appeared on the scene, you knew that they were going to get much poorer and he was going to get much richer."
José Tolosa Sanchís, the head of a family-owned group of five wood-products companies in Valencia called Madeplax, contacted De Cabo in 2007 through the law firm that was handling its bankruptcy. Tolosa tasked De Cabo and his team with negotiating an outstanding debt with BBVA, handing over promissory notes worth one million euros from the sale of land. Instead of settling the debt with the bank, De Cabo continued selling off assets belonging to Tolosa's family, according to Tolosa's lawyer, Cristina Oliver, who has brought charges against De Cabo and Aszendia for fraud and theft.
In 2009, De Cabo acquired León-based construction company Teconsa, which employed around 1,000 people, and at the time had a turnover of some 420 million euros. A year after that he bought the Marsans group - which had been turning over four billion euros a year - from Gerardo Díaz Ferrán. And in September 2001 he purchased Nueva Rumasa, whose 100 or so companies employed around 10,000 people.
The shell companies De Cabo used to buy these ailing giants had the minimum capital required of 3,000 euros, and had been set up by Ramón Cerdá, a small-time writer and specialist in creating ready-to-go companies.
"De Cabo was well known in Valencia," remembers a lawyer from the city. "He was always involved in failed compaies. He would buy firms with as many affiliates as possible so as to take advantage of the chaos, and then go about selling their assets. He and his men would give themselves huge salaries so that they could squeeze what little was left out of the company."
A bankruptcy receiver who worked on cases involving De Cabo also saw what was going on, but did nothing. "They would give themselves huge monthly salaries, leverage loans using the company as capital, arrange asset sales, and use their own law firms and then charge exorbitant fees," he says. "They would issue false receipts, say that a power cut had damaged their computer files and send young lawyers with no experience and no knowledge of the case to put judges off...," explains another lawyer. "This all went on at Teconsa."
De Cabo was also prepared to intimidate, says another lawyer. "He would call you up at night, on your home phone number, to let you know that he knew where you lived."
"He started out as a simple administrator of failed companies," says the owner of a legitimate administration firm in Valencia. "Then he moved on to small property developers. He just made it up as he went along. He was given power of attorney, and if there was anything left over after the assets were sold, he would divide it up with the owners. The business grew. But the problem is that he didn't know when to stop, and eventually came up against the big boys."
When De Cabo took over the Marsans group and began asset stripping, he found himself dealing with major law firms hired by banks such as La Caixa, Sabadell, Santander, Banesto and Bankia, as well as companies like Iberojet, Pullmantur, Meliá and NH Hotels.
But De Cabo carried on regardless, unable to resist the temptation of greater spoils, and in June 2011, allegedly in cahoots with Díaz Ferrán, he met with José María Ruiz-Mateos on at least two occasions to convince him that he had the perfect solution to dealing with a long list of failing companies and the need to keep paying out increasingly worthless promissory notes, according to Ruiz-Mateos' right hand man, Joaquín Yvancos.
"I looked into De Cabo's background," says Yvancos. "I visited him at his offices in Valencia on a couple of occasions. The first thing that surprised me was that they were in an industrial estate on the outskirts of the city. During one meeting he told me that he got the idea for his scams from the movie Pretty Woman : the character played by Richard Gere saves ailing companies. He did his best to impress me. He had a warehouse with a gym in it, along with a dining room, a sauna, sports facilities, and several luxury cars - even a limousine: I guess he had acquired them all from bankrupt companies. The whole thing seemed very strange, and I couldn't see why the Ruiz-Mateos family was so set on working with this guy. Then I found out that he had dossiers on each of them."
Sutil later told police that blackmail was among the strategies used to save companies from slipping out of the hands of their bankrupt owners. This involved investigating the sexual practices of judges and judicial administrators, and trying to set them up with prostitutes.
Yvancos says that eventually De Cabo tried threatening him. "He told me that he knew where my daughter lived in Holland, and other things. I am the nephew of a Civil Guard general, and nobody threatens me."
Yvancos says that he was unable to stop the Ruiz-Mateos family from going ahead with the plot, and he found himself isolated. He then found out, as had happened with Marsans, that De Cabo had not paid a cent for Nueva Rumasa, despite press reports that he had purchased the group for 1.8 billion euros. He contacted the authorities to cooperate with their investigation, as well as continuing to find out as much about De Cabo as he could.
De Cabo had underestimated Yvancos, a lawyer who had worked with Ruiz-Mateos since the early 1980s, when the Socialist government of Felipe González expropriated the original Rumasa group. Yvancos used the many contacts he had built up over the years, and even bought the services of men and women who had worked for De Cabo.
He uncovered the money trail that De Cabo had set up to get his money out of Spain and to Peru and Colombia, as well as discovering secret accounts in Switzerland, some of them in branches of Spanish banks.
As a result, the judge overseeing the case has frozen an account containing 4.9 million euros. Yvancos also looked into the affairs of a company called Esser International 21, which De Cabo used to stash money he had extracted from the failed companies he was administering or had bought.
Yvancos also learned of De Cabo's practice of keeping cashier's checks for large amounts of money, which he would renew each month. "It was a way of having money available at a moment's notice in case things went wrong," says Yvancos. The police found two million euros in cash at the homes of several people connected to De Cabo, among them his secretary.
For the moment, De Cabo is refusing to talk to the authorities, but he is also aware that a number of his former employees have not been held by the police, which means that they are cooperating with the investigation.
The police say that De Cabo was not a difficult catch, and that bearing in mind the links to the Gürtel case, bigger fish - with political connections - may yet fall into their net.