Swiss open criminal investigation linked to Spain graft scandal

GENEVA Mon May 6, 2013 7:14pm BST

Former People's Party treasurer Luis Barcenas carries documents as he leaves Spain's High Court after testifying before a judge in Madrid, February 25, 2013. REUTERS/Juan Medina

Former People's Party treasurer Luis Barcenas carries documents as he leaves Spain's High Court after testifying before a judge in Madrid, February 25, 2013.

Credit: Reuters/Juan Medina

Related Topics

GENEVA (Reuters) - Swiss authorities have opened a money laundering investigation into a former treasurer of Spain's ruling party suspected of depositing millions of euros from bribes in Swiss bank accounts, the Geneva prosecutor handling the case said on Monday.

Luis Barcenas, accused by Spanish authorities of abusing his position to secure bribes, evading taxes and laundering money, is at the heart of a growing corruption scandal that has hurt the conservative People's Party and Prime Minister Mariano Rajoy.

Spanish court proceedings indicate that Barcenas, who stepped down as party treasurer in 2009, held up to 38 million euros (32.1 million pounds) in Swiss bank accounts.

"If the suspicions of money laundering are confirmed, if bribes were paid, we will confiscate the money and then we will discuss (with Spain) what happens to it," prosecutor Jean-Bernard Schmid said.

He added the investigation would focus on examining the bank accounts in more detail and checking the origins of the funds.

Barcenas, a mountaineer who once scaled Everest, is also part of a second Spanish corruption investigation involving a secret ledger of cash donations from construction magnates that was purportedly redistributed to party officials.

He has denied any wrongdoing, saying the ledger was forged and that the money in Switzerland was obtained from legitimate business activities.

The investigations have enraged Spaniards at a time when deep recession has pushed unemployment to 26 percent and the government has slashed public spending.

Schmid said Swiss authorities would check to ensure the banks concerned in the case had complied with Swiss laws that require them to take additional measures to determine the source of funds held by so-called Politically Exposed Persons, or PEPs.

"The bank is supposed to pay attention (with PEPs) so we will see if this was done properly and if flags should have been raised and more research done," he added.

Documents from the evidence file of the Spanish examining magistrate seen by Reuters have shown that Barcenas held deposits in Dresdner Bank, since acquired by Liechtenstein's top bank LGT.

"As far as LGT is concerned, we have always complied with the relevant laws and cooperated with the competent authorities," a spokesperson for the bank said on Monday.

Swiss broadcaster RTS reported on Friday that Barcenas also held an account with Geneva private bank Lombard Odier.

Asked for comment, a Lombard Odier spokesman said in an e-mailed statement: "Our establishment has respected its obligations and we are cooperating fully with the competent authorities."

(Additional reporting by Julien Toyer in Madrid; Editing by Alison Williams)

FILED UNDER: