Urdangarin and partner split earnings at non-profit group, accountant claims

A former accountant for the Nóos Institute testified on Friday that Iñaki Urdangarin and his former business partner Diego Torres evenly split between them the money they made at their purported non-profit organization.

Marco Antonio Tejeiro also told a Balearic courtroom that the real estate company set up by Urdangarin and his wife, Cristina de Borbón, hired ghost employees using the names of their domestic workers and some family members.

I had orders to beef up the earnings of the companies owned by Torres and Urdangarin

Antonio Tejeiro

Tejeiro, who is one of the defendants in the high-profile fraud and embezzlement case built around King Felipe’s brother-in-law and 15 others, including the infanta Cristina, as she is known in Spain, is cooperating with the prosecution in exchange for a suspended two-year jail sentence. This was his second day on the stand.

Urdangarin and Torres are said to have used their non-profit Nóos organization to divert some €6.2 million from public contracts awarded for the organization of sports events.

Urdangarin allegedly used his royal connections to secure no-bid contracts from regional administrations run by the Popular Party (PP), overcharging for his services, prosecutors believe.

Princess Cristina, who sat on the board of directors at the Aizoon real estate company, is also accused of using some of the diverted money for her personal expenses and writing them off as deductions in her 2007 and 2008 tax filings.

Urdangarin faces more than 19 years in prison and his wife up to eight years if convicted.

The infanta is scheduled to take the stand on February 26.

Torres told me that a lawyer representing the royal family said to him that this couldn’t go on because the scandal had been broken by the press

During his testimony, Tejeiro explained that Urdangarin and Torres came up with a scheme in which false invoices were billed to Nóos for services that were never performed. The money was split 50-50 by both men, according to the former accountant.

Tejeiro identified the firms used in the alleged scheme as Instituto Nóos, Nóos Consultoría Estratégica, Intuit, Shiriaimasu and Aizoon, which was the real estate company in which Cristina served as a board member.

“It was the Nóos Institute that received the money but the cross billing with the rest of the companies depended on the distribution of profits, not what was actually listed on the invoices,” he said.

“I had orders to beef up the earnings of the companies owned by Torres and Urdangarin. Torres had asked me to do that, with Urdangarin’s approval.”

As to the alleged ghost employee scheme, Tejeiro – who also explained that he was fired in 2008 because “I was probably costing them too much” – testified that Urdangarin’s three nephews and various domestic workers were put on the Aizoon payroll list and registered with Social Security to increase the firm’s income tax deductions and reduce what it had to pay in corporate taxes.

By 2007, Urdangarin and Torres were “fighting and bickering,” he said.

“Torres told me that a lawyer representing the royal family told him that this couldn’t go on, that he didn’t want Urdangarin tied to any of the activities involving Nóos because the scandal had already been broken by the press,” the witness said.

Tejeiro is expected to continue testifying on Tuesday.

English version by Martin Delfín.