Dismisses two appeals seeking annulment of the National High Court ruling on the ground that effective judicial protection had been breached
The Supreme Court has upheld the acquittal issued by the national court of Rodrigo Rato, former president of Bankia, and 33 other defendants in the entity’s IPO trial, charged with the crimes of fraud against investors and accounting lies. The High Court has dismissed the two appeals filed against the National High Court’s decision in September 2020.
The appeals against the acquittal have been filed by the Spanish Association of Minority Shareholders of Listed Companies (Aemec) and by Bochner Spain. No one asked the Supreme Court for a conviction, but the quashing of the Court’s ruling on the grounds that the right to effective judicial protection was violated. In particular, they pointed to the fact that the Court did not sufficiently justify its ruling and that there was a “deficiency of reasoning” in not deciding in accordance with the expert report of the experts of the Bank of Spain, Mr Antonio Busquets Oto and Mr Víctor Jesús Sánchez Nogueras, where they concluded that the prospectus for the IPO of Bankia did not reflect the actual financial situation of the entity.
Faced with these allegations by the appellants, the Supreme Court declares that “there is no basis” for stating that the considerations taken into account by the National High Court are “arbitrary, absurd or without any identifiable basis”. Furthermore, the Supreme Court notes that the Court did not disregard the expert evidence of the inspectors of the Bank of Spain, but weighed its content, although it diverged from its conclusions based on other evidence provided at the trial (experts, testimonies and documents ) “that deserved more credit”. “Obviously, these reasons may or may not be shared,” he says, but makes sure there is no extreme that denounces “display of irrationality” or that the decision was made “arbitrary or baseless”. Certainly when other experts – commissioned by the defense and of the same ‘rank’ – also judged on the same points in a different sense than the experts proposed by the Public Prosecution Service.
Aemec argued that the grounds of the National High Court’s ruling “in relation to the expert evidence conducted are manifestly insufficient and incomplete”. In addition, she criticizes that the contested resolution did not clearly determine, whether this was done incorrectly, “who was responsible for ensuring that the financial statements and the IPO brochure itself faithfully reflect the economic reality of the entity.” It considers that the Court’s ruling is wrongly understood that the Bank of Spain and the CNMV “have approved the annual accounts”, which, according to Aemec, is not supported by the applicable regulations or by the testimonies of the Governor and the President of the CNMV. In this regard, the Supreme Court points out that “accounting standards are still open to various interpretations, without the option for any of them, specially approved by the Bank of Spain, here to be considered criminal in itself.” «Certain doubts raised by the management of the companies about the correct way to apply certain accounting standards were raised with the regulator, which was resolved in a favorable way by him. And in this scenario, as far as it can be understood that an expert (that of the allegations) does not share that decision, or it seems insufficient to better convey the true picture of the company, and even in the internal sphere of the services of the Bank of Spain could have had some controversy in this regard, admitted the application of accounting standards by the said body (and are also endorsed by the competing criteria of other experts), it would be difficult to basic lies,” he explains.
As is known, in the IPO of Bankia, the entity obtained 3,092 million euros from retail and institutional investors on the basis of a prospectus reflecting a profit from the financial statements in 2011 of 309 million euros, although after the resignation of Rodrigo Rato as President of Bankia on Op. May 7, 2012 the accounts were restated with losses of 2,979 million euros.
The Supreme Court emphasizes that “it is not the intention of this appeal to proceed with a comparison of the evidential assessments made in the judgment under appeal in order to determine which in our opinion is more convincing or more accurate”, but rather that what to determine whether the right to effective judicial protection of the charges has been violated “to the extent that the decision is based on reasoning, as is so often debatable, but based on meaningful, reasonable considerations, in accordance with the so-called rules of sound criticism. And it concludes that “no glaring error is noted, nor apodictic or absurd arguments that could determine the sought nullity declaration.”
Source: La Verdad
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