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Ex-IMF chief could be expelled from PP over credit card scandal

Rodrigo Rato is due to explain his role in the Caja Madrid case to High Court on Thursday

Rodrigo Rato in Congress in July 2012.
Rodrigo Rato in Congress in July 2012. REUTERS

The Caja Madrid credit card scandal has turned a former International Monetary Fund (IMF) chief into the target of an investigation that could get him expelled from his party.

The ruling Popular Party (PP) said on Monday that it would investigate the case of the opaque credit cards “to its last consequences.” Party sources said they were not ruling out expelling all PP members found to have abused their privileges, which could potentially include ex-IMF head Rodrigo Rato, a party heavyweight who served as economy minister and deputy prime minister of Spain in the early 2000s.

Most of the 86 executives or board members of the regional savings bank and its follow-up lender, Bankia, caught up in the scandal belong to the center-right party, although there are also Socialist, United Left and labor union representatives on the list.

Revelations about alleged abuse of representation expenses has already triggered a cascade of resignations and dismissals. But if Rato were to be expelled from the PP, it would be by far the most politically significant move given his national and international relevance.

A minister and deputy prime minister under José María Aznar, Rato had ambitions to run for prime minister but lost out to Mariano Rajoy in internal party decisions. He ran the IMF between June 2004 and November 2007. Rato was also chairman of Caja Madrid and Bankia.

Only Rajoy could make the decision to expel Rato, but everything suggests that social pressure is so great and the political distance between both men so large that the decision has practically been made already.

Rato has been called in to testify at the High Court over his role in the scandal on Thursday, and it is likely that by then he will already have ceased to be a member of Spain’s ruling party – the one that got him appointed to Caja Madrid in the first place.

The PP is feeling pressure from the opposition Socialists and the unions, both of which have announced that they will expel members ensnared in the scandal, which involves €15.5 million in allegedly misused funds.

“We understand [citizens’] indignation and feel the same way. We are the first to feel incensed,” said PP official Carlos Floriano.