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Spanish banker faces jail in connection with U.S. acquisition

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(Globalpost/GlobalPost)

Madrid, May 16 (EFE).- A Spanish judge on Thursday ordered the arrest of Miguel Blesa, former chairman of Spanish savings bank Caja Madrid, for alleged irregularities in the acquisition of the City National Bank of Florida.

Blesa was chairman in 2008 when Caja Madrid announced the purchase of 83 percent of City National for $927 million, though he had left the post by the time Caja agreed two years later to buy the remaining 17 percent of the U.S. institution for an additional $190 million.

The Florida bank, which was founded in Miami Beach in 1946, had more than $2.75 billion in assets, 400 employees and 18 branches throughout South Florida at the time the initial acquisition was announced in April 2008.

In the warrant for Blesa's arrest, Judge Elpidio Jose Silva cited an April 19 report from Spain's central bank in which inspectors said they believed the acquistion of CNV was carried out in a manner designed to "elude the prescriptive oversight" of the Madrid autonomous community's Economy and Finance department.

Caja Madrid also paid more for CNB than Spain's Banco Popular and Banco Sabadell did for other Miami-based financial institutions, Banco de España said in its report.

Silva, who is hearing a separate case involving alleged irregularities in Caja Madrid's granting of a non-performing 26.6-million-euro ($33 million) loan to travel agency Marsans, issued the arrest warrant after summoning Blesa for questioning.

Marsans went bankrupt in 2010 and its founder, Gerardo Diaz Ferran, and then-owner Angel de Cabo were arrested for alleged fraud and money laundering.

Manos Limpias (Clean Hands), a union representing Spanish public employees and the plaintiff in the Marsans loan case, extended its complaint to also include Caja Madrid's acquisition of the U.S. bank.

In subpoenaing Blesa to appear in court, the judge said that though the same "copious amount of evidence" is not available in the acquisition case as in that of the Marsans loan, "Banco de España has found a connection."

http://www.globalpost.com/dispatch/news/agencia-efe/130516/spanish-banker-faces-jail-connection-us-acquisition