Juan Carlos blackmail plot inquiry

Spanish inquisition: Financiers accused of trying to force king's abdication to evade KIO fraud trial
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The Independent Online


Spain's attorney-general, Carlos Granados, yesterday ordered an urgent investigation into allegations that the disgraced Catalan financier, Javier de la Rosa, president of the collapsed Spanish branch of the Kuwait Investment Office, and the former Banesto supremo, Mario Conde, had tried to blackmail King Juan Carlos in an effort to escape possible long prison terms for criminal fraud.

An eight-page report in yesterday's Diario 16 newspaper alleges that Mr de la Rosa and Mr Conde, who were released from prison on bail earlier this year, plotted to use their fortunes to press the king to urge Spain's legal authorities to drop criminal proceedings against them.

"If the monarch did not bend to their wishes," the report says, "de la Rosa and Conde ... threatened to use part of their immense fortunes to force the king to abdicate under pressure of numerous alleged scandals."

On 18 March, the report said, the king was on the point of alerting the attorney-general to threats by Mr de la Rosa and Mr Conde to reveal damaging information about the crown. It quotes Mr de la Rosa as saying: "The king must abdicate. He's put me in jail and it's going to cost him the crown. With the money I've given to the crown all these years ... ", and later quotes Mr de la Rosa as warning the royal household in a telephone call: "I'm going to reveal the name of Don Juan Carlos as one of the principal beneficiaries of KIO money during the Gulf war." The king was reportedly dissuaded from taking action by his close friend, the businessman Manuel de Prado y Colon de Carvajal.

Mr de la Rosa told Spanish radio on Thursday night that he had transferred $100m (pounds 63m) to Swiss bank accounts controlled by Mr Prado from the accounts of the Torras group, KIO's Spanish subsidiary. The payment was made at the request of the Kuwaitis in appreciation for Mr Prado's help in mobilising Spanish support for Kuwait during the Gulf war.

Mr de la Rosa said his lawyers had given evidence to this effect to a commercial court in London that is pursuing him in connection with Torras's missing millions. The aim, Mr de la Rosa said, was to make clear that he had not kept the money for himself. Mr Prado, long a business associate of Mr de la Rosa and formerly a vice-president of the now-defunct Gran Tibidabo company, denies receiving money from KIO-Torras, but says that he was pressured to get lawsuits in London and Madrid withdrawn.

Mr Conde said yesterday the allegations were false and that in conversations with Mr de la Rosa he had always stressed his loyalty to the Spanish crown.

Before the Gulf war, and the emergence of massive losses on its Spanish portfolio, the KIO was one of the largest investors in the UK stock market.At one time it held stakes in a number of large companies, including Midland Bank and a22 per cent holding in British Petroleum bought in 1988.