Digging the dirt

Spain's anti-corruption prosecutor (surely the busiest legal professional in the country) wants to fine BBVA bank 181 million euros for allegedly hiring a crooked former police chief to perform illegal espionage. The prosecutor also seeks an absurd prison sentence of 173 years for 82 year-old Francisco González, who was BBVA's chairman during the period under investigation - 2004-16 - although he could only serve a maximum of 15.

Alongside Spain's second-largest bank, several other companies are being probed for allegedly hiring the services of José Manuel Villarejo, a private investigator best known for his starring role in the 'sewers of the state' scandal. The case has yet to go to trial, but in 2024 the investigating judge, Manuel García-Castellón, claimed that the available evidence showed González "knew about and authorised the illegal activities" conducted by Villarejo.

These are alleged to be his speciality - secretly recording conversations with the wealthy and powerful in order to obtain incriminating information, which he then sold at a handsome price to their adversaries for use as blackmail. The targets in this case are said to be executives from construction company Sacyr, which in 2004 sought a 3.1 per cent stake in BBVA, and members of the Socialist government of José Luis Zapatero, which the bank's management believed to support Sacyr's bid. Villarejo allegedly taped as many as 15,000 conversations in connection with this assignment. If he did, it worked: Sacyr dropped its BBVA bid in early 2005.

If the accusations against González are true, he was far from alone in hiring Villajero to do his dirty work. The former police officer, now 74, went on trial in 2021, accused of decades-long involvement in a vast network of corrupt politicians and business leaders known as the 'sewers of the state'. He was convicted for revealing secrets and falsifying documents and sentenced to 19 years.

When Carlos Torres replaced González as BBVA chairman in early 2019, he sent a memo to the bank's employees about the Villarejo affair. Torres confirmed that BBVA's management had contracted Villarejo's intelligence firm Cenyt in 2004, and that an internal investigation had been launched into the allegations of illegal espionage, which the bank denies.

It stretches credulity to believe that BBVA's management were unaware of Villarejo's reputation in 2004 - and if they didn't, the efficacy of their due diligence can be questioned. They're damned if they do and damned if they don't, just like Mariano Rajoy when he appeared as a witness in the Gürtel trial in 2017. Rajoy claimed to have no idea of the massive kickback scheme operating under his nose, which, if true, revealed how little control he exercised over his own party. If knowledge shows complicity, ignorance can reveal incompetence.