Spain: Infanta in court over husband’s finances

Spanish Infanta Cristina arrives at the courthouse on the Spanish Balearic Island of Mallorca. Picture: Getty

“I trusted my husband and signed what he asked me to sign,” she told the court in Palma de Mallorca yesterday.

Hundreds of reporters from around the world waited outside the court where the Infanta was questioned for four hours in the morning by Jose Castro, the investigating judge. Live reporting of the case was prohibited but according to one of the 40 lawyers in the courtroom, she replied “I don’t know” or “not that I’m aware” to 95 per cent of the 400 questions put to her during the morning session.

She is an official suspect (imputada) although she has yet to be charged with the offences of tax evasion and money laundering. It is the first time a member of the Spanish royal family has faced criminal charges.

The case revolves around the alleged embezzlement of public funds by Urdangarin and his business partner Diego Torres. The two met when Urdangarin was studying for an MBA at the prestigious ESADE business school in Barcelona where Torres was a professor.

The pair established the not-for-profit Instituto Noos and are accused of pocketing ¤5.8 million in public funds that were channelled through Noos and the family business Aizoon, of which the Infanta is co-owner. The bulk of the money, supposedly destined for sports and other events, came from the regional governments of Valencia and the Balearic Islands, both of whose presidents have faced a string of corruption charges.

Urdangarin and the Infanta are also under investigation over the ¤6 million mansion the couple bought in Barcelona and the further ¤3 million they spent on home improvements. The house has since been embargoed to cover Torres and Urdangarin’s bail of ¤6.1 million. Documents show that on different occasions the Infanta signed herself as both owner and tenant of the palace.

According to her testimony, she was unaware that the domestic help in the house was employed by Aizoon, a company the judge asserts was established as a tax shelter. As joint owner of Aizoon, the Infanta is legally responsible for its activities, whether she was aware of them or not, and would have to pay back half of the ¤1.2 million it is alleged was laundered through the business, with her husband paying the other half.

The judge has claimed that it would have been “difficult for Urdangarin to defraud the inland revenue without his wife’s knowledge and acquiescence,” adding that the Infanta “chose to look the other way.”

Whatever the outcome of the case, these are dark days for the formerly popular Spanish royal family. King Juan Carlos was crowned in 1975, two days after the death of the dictator Franco, and became the darling of the new Spanish democracy when he played a key role in aborting an attempted military coup in 1981.

Then when Cristina married Urdangarin, a former Olympic handball player, in Barcelona in 1997, only weeks after Princess Diana’s death, many in Spain hoped she would fill the Princess’s shoes as the modern face of monarchy. She is the first female member of the royals to have a university degree.

However, even before the financial scandal broke, the royal family’s popularity nosedived two years ago when the king was photographed standing proudly next to the elephant he shot on a hunting trip in Botswana. Not only was the king honorary president of the World Wildlife Fund but embarking on such an expensive trip in a country with more than five million unemployed was to many evidence that the royals were out of touch.

If found guilty, Cristina faces up to six years in prison for laundering and a fine of three times the value of the money laundered, as well as further punishment for tax evasion.

Fall from grace: a right royal mess

Once upon a time, Spain’s Princess Cristina and her husband, Inaki Urdangarin, lived a life of royal splendour. Ensconced in a hillside mansion with a saltwater swimming pool outside Barcelona, they jaunted off to sailing regattas and charity balls with the Spanish elite.

The daughter of the hugely popular King Juan Carlos who is credited with bringing stability to post-Franco Spain, she had enjoyed the admiration of many.

Now the couple and their life is being exposed as something far more familiar to Spaniards: a chimera of wealth and high living built on credit card spending sprees, mortgage debt and, potentially, tax evasion and money laundering.

The appearance of Princess Cristina, 48, is the first time that a direct member of Spain’s royal family has been called to account in such a common way, as she is made to answer questions

about her spending habits before a judge investigating the business dealings of Urdangarin, the Duke of Palma.

In November, the couple lost their home of nine years when it and three other properties were seized for a civil bond of more than 7.3 million euro that Urdangarin and his now-estranged business partner, Diego Torres, were forced to pay as they defended accusations of using royal connections to gain no-bid contracts from Spain’s regional governments to run sports conferences, and then laundering millions of euros in profits offshore.

Even as the case stokes debate about whether Spain’s aristocrats are held to the same judicial standards as others, it has become a morality tale of excess whose themes are common enough in a country where the receding economic tide since 2008 has exposed corruption and mismanagement all around.

In a summary of more than

200 pages, the judge calculated that the remodelling of one floor of the princess’ dream house was paid for with 437,145 euro in credit card charges attached to a real estate company owned by the princess and her husband called Aizoon.

Over the eight years from 2004, he noted, she made purchases from her own pocket for a total of about 2,933 euro. The rest were paid with the company credit card.

The question the judge is investigating is whether some of the money Urdangarin is accused of embezzling, according to investigators, was funnelled to essentially a shell real estate company, which they owned jointly.