Banking tycoon 'unethical but not illegal'

27th July 2006, Comments 0 comments

27 July 2006,

27 July 2006

MADRID – The multimillion euro pensions paid to two former banking directors were “unethical” but not illegal, Spain’s Supreme Court has ruled.


The court upheld the acquittal in April of Emilio Botin, the head of Spain's largest bank, Banco Santander Central Hispano, on charges of making improper severance payments to former directors.


Botin had stood trial alongside two ex-directors, former co-chairman Jose Maria Amusategui and ex-chief executive Angel Corcostegui, who received EUR 43.8 million and EUR 108.1 respectively.


The trio was accused of illegally siphoning off funds. Botin was accused of arranging the early retirement package for Amusategui, who was chairman of Banco Central Hispano, with which Botin's Banco Santander merged in 1999, so that "he would not place obstacles in the way of the merger".


But this week the Supreme Court ruled that the payments were made legally with “massive” approval from shareholders and caused no damage to the company since the merger which gave rise to the payments benefited Santander.


It was not the role of a court to “take the place of the mechanisms of functioning of the financial market”, stated the ruling.


However, the court added that it was clear that the pension payouts clearly exceeded ethical limits.


[Copyright EFE with Expatica]


Subject: Spanish news

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