Just when preferential shareholders from former savings bank Caja Madrid had lost all hope that anyone would be held responsible for their financial losses, the situation reverses. Some judges have issued firm decisions in an effort to find out what really happened and who is to blame.
The judges' tenacity is making life hard for Miguel Blesa, Caja Madrid's former CEO. His powerful ties are not going to free him from being responsible for how he managed the defunct savings bank. Nor will his friendship with José María Aznar, who put Blesa into the CEO position at Caja Madrid with votes from the Peoples Party, Convergence and Union and the Workers' Commissions. The Minister of Justice's zealous attempts to protect Blesa, who used to be his banker when Alberto Ruiz Gallardón was President of the Madrid regional government.
In January Blesa had to justify purchasing City National of Florida, and now Judge Andreu, who sits in the Audiencia Nacional, is asking Blesa to explain how and why he used preferential shares to "hide" the situation from the bank and "cover up its insolvency." The investors that bought these preferential shares assumed heavy losses and feel deceived by Caja Madrid, the Bank of Spain and the CNMV, because none of the entities warned them about the product's inherent risk or makeup. The tale continues to unwind and at each new step the courts are finding clues about why Caja Madrid collapsed.
Spanish citizens and Caja Madrid preferential shareholders already know, and elEconomista reported previously, that Blesa and his board of directors managed the bank poorly and took advantage of its investors.
