Spanish duke to be questioned by judge in embarrassing first for Madrid’s royal family

The King has endeavoured to distance himself from the scandal. Last week it
emerged that in 2006 he sent an adviser to try to persuade the Duke to drop
his business interests in Spain.

Shortly afterwards, the Duke resigned as a director of the Noos Institute and
moved, with the Infanta Cristina and their four children, to Washington DC
to take up a consultancy post with the Spanish telecoms firm, Telefonica.

His exile, voluntary or otherwise, was the start of a spectacular fall from
grace that culminated last December with a Palace announcement that the duke
had been suspended from carrying out official engagements.

He earned an unprecedented rebuke from the highest palace official and
confidente of the King, Rafael Spottorno, who told Spanish media that the
Duke’s behaviour seemed “less than exemplary”.

The King himself made a thinly veiled reference to the case when he said in
his annual Christmas speech that “any reprehensible act should be tried
and punished in accordance with law”.

The once favourite son-in-law and his immediate family were absent from the
usual Christmas celebrations at the table of King Juan Carlos and Queen
Sofia at their Zarzuela palace, in what appeared to be a snub to their own
daughter and grandchildren.

The Duke even suffered the indignity of having his waxwork image removed from
its setting among other royal figures at Madrid’s waxwork museum, and
relegated instead to a spot in the sports hall, ostensibly to celebrate the
fact that he had won bronze medals in the Atlanta and Sydney Olympics.

Last week the court heard allegations of false accounting and tax evasion by
the Noos Institute and a swathe of smaller companies under its umbrella as
business associates of the Duke, themselves under suspicion, were called to
testify.

Prosecutors believe up to €5.8 million could have been misappropriated, and
have uncovered evidence of funds being squirreled away to offshore accounts
in Belize, Luxembourg and the United Kingdom.

The exact details of the allegations against the duke have not yet been made
public but when he appears in court on Saturday morning he will be
questioned about the extent of his knowledge and involvement in the fraud.

Amid fevered speculation that the duke will receive special treatment because
of his royal connections, the investigating magistrate last week accepted a
petition that his statement be heard behind closed doors and without the
usual procedure of video recording the session.

He may also be allowed to be driven into the court building to avoid walking
past the scores of press expected to gather for the hearing.

Last week anti-corruption investigators began the labourious process of
interviewing more than 100 employees of the companies run by the Duke and
his associates.

The statements, leaked to the press, painted a picture of unsavourary business
practices. Employees hired to work in the private home of the Duke and
Infanta, a €6m mansion in Barcelona’s upmarket Pedralbes district, claimed
to have been given contracts worth more than their actual wages through
companies under investigation.

Other testimonies suggested there were dozens of “ghost employees”
appearing on the books to justify lucrative consultancy contracts.

Even the Infanta Cristina, who was co-owner of Aizoon, one of the companies
under investigation, has not escaped scrutiny. Jose Castro, the magistrate
investigating the case, has so far stopped short of summoning her to give
evidence but calls are growing for her to be indicted alongside her husband.

“It seems that most of the responsibility was with her husband, but he
pulled her into the businesses, and she is not a stupid person,”
commented Jose Ramon Soriano, a Supreme Court judge not involved in the
case, when asked if the Infanta Cristina should be indicted. “If she
formed part of the companies involved, then of course she would know
something.”

The duke has said little beyond bland statements released through his lawyer
that he has “acted entirely properly” and “expects to be
fully exonerated.”

And he expressed “profound regret the serious damage to the image of my
family and that of the King’s household, which has nothing to do with my
private activities.”

But the damage that the case is has wrought on the institution of the monarchy
is profound.

“The Urdangarin case has been a time-bomb that has blown apart
relationships at the heart of the Royal family,” believes Pilar Urbano
Zamora, a royal correspondent who has written several biographies on the
royals.

She said gossip in royal circles suggested a deepening rift between the King,
his wife and his daughters as he sought to strengthen ties between his heir,
Crown Prince Felipe and Princess Letizia.

Princess Letizia, who is known to have had a frosty relationship with her two
sisters-in-law at the best of times, enjoys huge popularity at home and
abroad, and is feted for her style and poise.

“It’s true that the Prince Felipe and Letizia do not want to be
contaminated by the situation and haven’t spoken to Infanta Cristina in
months,” Ms Zamora said.

The future king and queen have stepped up their public duties over the last
year fueling speculation that King Juan Carlos, who aged 74 has suffered
several health scares in recent years, was preparing to step aside.

“But I believe rumours that the King is preparing to abdicate are
unfounded,” said Mrs Urbano.

“Above all what the monarchy needs now in order to survive is continuity
and the King to steer them through this most difficult of times.”

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