Former IMF Head Says Sorry as He Begins Prison Sentence in Spain

(Bloomberg) -- Former International Monetary Fund Managing Director Rodrigo Rato apologized for his crimes as he disappeared into Soto del Real prison near Madrid to begin a 4 1/2-year sentence.

The decision by Rato, the former chairman of Bankia SA, to surrender himself on a fraud conviction completed a dramatic fall from grace: his case has come to symbolize a crisis that forced Spain into a multibillion-dollar international bailout and years of austerity.

“I accept my obligations to society, I accept the errors I may have committed and I ask for forgiveness from society and from those people who may have felt deceived or affected,” local media reported Rato as telling journalists outside the prison.

Judges earlier this month confirmed a February 2017 ruling by the National Court in Madrid that sentenced Rato for misappropriating funds by misusing a corporate credit card when he was Bankia chairman and head of its founding savings bank, Caja Madrid.

The “Black Cards” case, which also involved 63 other officials at the two banks, probed how ex-officials racked up 12 million euros ($13.9 million) in expenses including clothes, hotels and cash withdrawals between 2003 and 2012, when the lender’s near-collapse forced Spain to take a 41 billion-euro bailout for its banking system.

Rato, who left his IMF role in 2007, became chairman of Caja Madrid in 2010 and led the creation of the Bankia group by merging Caja Madrid with six other savings banks. A Spanish court is also investigating his role in Bankia’s initial public offering in 2011, in which he and other former managers stand accused of falsifying the bank’s accounts and providing false data in its prospectus.

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