UGT union used Caja Madrid “black” credit cards to finance expenses

A member of a bank committee has told a judge how the undeclared funds were used

High Court judge Fernando Andreu is investigating the Caja Madrid credit cards.
High Court judge Fernando Andreu is investigating the Caja Madrid credit cards.GORKA LEJARCEGI

UGT, one of Spain’s two largest labor unions, financed part of its own work with the “black” credit cards issued by Caja Madrid to its top officials, many of whom have come under scrutiny by a court for their use of the available funds.

Rafael Eduardo Torres, who was put forward by UGT to join the failed savings bank’s control committee, has admitted that the €79,076 spent on his personal “black” card paid for posters, signs and trips for union delegates.

Most of that amount went to a printing press named Serviprint, in downtown Madrid, and to the three-star Hotel Sancho, located on Paseo de las Delicias.

Top managers and executives at bailed-out Caja Madrid and its successor, Bankia, racked up expenses totaling €15.5 million over 10 years using company credit cards. The spending was not declared to the Tax Agency.

Between 2003 and 2012 these “black” cards were given to 86 recipients outside of normal expense accounts and were used to pay for, among other things, clothes, meals, supermarket goods, cash withdrawals and trips, according to a court investigation presided by High Court Judge Fernando Andreu.

The case also ensnared former IMF chief and one-time Spanish government minister Rodrigo Rato, who headed Caja Madrid and Bankia between 2010 and 2012. Following intense political pressure, Rato volunteered to have his Popular Party (PP) membership temporarily revoked until his role was cleared up.

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Andreu is now trying to establish whether the allowances on these cards were meant to cover recipients’ job representation costs or whether they were simply a bonus on top of their regular salaries, to spend as they saw fit. Different beneficiaries have provided different versions of what the cards were used for.

Torres, whom UGT selected to represent Caja Madrid’s workers, joined the lender’s control committee in 2003.

This is the first time that a former member of Caja Madrid’s upper management has admitted that the credit card was used to finance the activities of the union, political party or business association that gave them the position.

Until now, all the former bank officials who gave testimony in court claimed that they either used the cards for personal expenses or for representation costs as part of their job.

The first 27 of 82 Caja Madrid and Bankia board members under scrutiny told the judge they didn’t believe they were doing anything wrong, and that the bank was paying the taxes due on their credit card expenses.

Torres’ statements contradict an earlier version of events volunteered by Miguel Abejón, a former organization secretary for UGT who sat on Caja Madrid’s control committee between 2001 and 2012. Abejón stuck to the version upheld by many of his colleagues: that the credit cards were an income supplement that could be spent freely as long as the monthly allowance was not surpassed. Each card recipient had a different allowance.

On Friday, Judge Andreu will continue taking depositions from other former executives and managers who used the suspect credit cards. One of the people scheduled to appear in court is Rafael Spottorno, the former chief of the Royal House.

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