The judge of José Luis Calama National Court opened oral trial against the former president of Banco Popular Angel Rontwelve managers and the auditor PriceWaterhouseCoopers (PwC) for crimes of defrauding investors and accounting falsity during the 2016 capital increase. Likewise, it set a bail of 2,277,658,321.17 euros for Bank of Santander (Purchaser of Popular in its resolution), PwC and the insurers who cover these risks for both companies.
In an order, the president of the Central Investigating Court number 4 brings together the qualification documents of the 14 accusations, among which is the Anti-corruption prosecutionand that requires 6 years, 7 months and a day in prison for Ron, for the former CEO Francisco Gomezthe former vice-president of the entity Roberto Higuera and whoever was a member of the board of directors Jorge Oroviogoicoechea.
In addition, several former directors of Banco Popular and auditors from PwC will sit on the trial bench. José María Sanz and Pedro Barrioas well as the listener herself. These last three are considered necessary cooperators for the execution of crimes.
The judge imposes a total bail of 2,277,658,321.17 euros, an amount that the accusations and the instructor explains that it is provisional since some of them have not finalized their request. He explains that the purpose of setting a bond is to ensure the execution of the civil and patrimonial provisions of the sentence pronounced.
In this sense, the magistrate rejects the real precautionary measures raised by the accusations, taking into account the economic and financial solvency of Banco Santander, PwC and the insurers.
Concerning Santander, the judge rejects the opening of an oral trial concerning lucrative participant and indicates that his position as subsidiary civil liability being the universal successor of Banco Popular and, therefore, subsidiary civil liability must be the area in which the accusing parties formulate their legitimate demands.
Rejects PwC’s arguments
In the case of PwC, which the prosecution did not ultimately indict, but for the rest of the accusations – with the exception of the consumer and user organization – the judge indicates that, without prejudice to its direct responsibility in as long as accusedmust respond in a subsidiary manner in relation to the facts alleged against the two auditors.
In his resolution, the magistrate rejects the questions of prior decision that the auditor raised after having read the content of the writings of the different accusations. PwC, in particular, has highlighted the lack of standing of some of the injured parties appearing in the case.
Calama explains that the planned procedure has no place in the current procedure and that the accused, PwC, “under the cover of article 4 of the Code of Criminal Procedure cannot introduce at will into the criminal procedure procedures truly established for civil procedure. , since the terms of the abbreviated procedure are perfectly defined in articles 780 and following of the LeCRim.
Let us also remember that the injured parties mentioned by PwC appeared individually throughout the long period. instruction -more than six years-, without the auditor having formulated any appeal or raised any question about its lack of legitimacy, which is why he considers that the request is “extravagant and untimely”.
The judge adds that PwC’s silence during the investigation into this issue is “the simple responsibility of its lawyers”.
The order to open the oral trial, without appeal, agrees to give the defenses a period of 20 days to present their respective briefs.
The 2016 expansion
In accordance with the order, the investors went to the capital increase of 2016 “misled”, since the financial statements of this year and 2015 “did not reflect the true image of the balance sheet or the assets”.
It was last March that the judge prosecuted the accused, finding that it was proven that on May 25, 2016, the Board of Directors of Banco Popular, chaired by Ángel Ron, had decided to carry out and execute the The capital increase agreed at the General Meeting. General Meeting of April 11. Prior to this meeting, he explained, a meeting of the Audit Committee of the Board of Directors took place on the same day, the second item of which on the agenda was “the approval of a report favorable to the capital increase”.
The resolution stated that the Audit Commission had published a report in favor of enlargement, without having a detailed written study that could be debated. The external auditors PwC were present at this meeting and did not warn the members of the said committee of any problem in Popular’s accounts (annual-2015- and quarterly-2016-) with a view to the capital increase.
Concerning the capital increase brochure, explained the judge, “it offers deliberately altered financial information – which hid huge provision deficits from investors – taken from the 2015 annual accounts audited by PwC and the financial statements as of 31.03. .2016 with limited report from the said auditor.
Calama assured that if this had been reflected in the balance sheets of Banco Popular – as of December 31, 2015 and March 31, 2016 – the provisions were not reflected in it “the accounting result of the profit and loss account would have shown at least 2,500 million lossesinstead of the profits declared” by the entity, in addition to substantially modifying many account ratios, which are used by investors for their financial analysis.
The judge specified in his resolution that PwC had not made any reservations in its audit report on the 2015 annual accounts, nor in the interim accounts as of March 31, 2016.
