Costa Blanca
Court hears Caja de Alcoy fraudulent bankruptcy case this week
By m.p.
Jan 20, 2008 - 7:45 PM

The case of the Caja Alcoy gets underway in the Alicante provincial court on Tuesday, where five managers of the Caja de Crédito de Alcoy building society are charged with fraudulent bankruptcy. They are the director, the deputy, the branch manager and two members of the board, and each face a possible six years in prison and a fine of 360,000 €.

EFE said the Alicante chief prosecutor, José Antonio Romero, is also asking for 2.6 million € compensation as part payment of the 3.7 million which was owed to creditors: the remainder has already been recovered during the bankruptcy.
More than 35 of the 1,500 clients affected are expected to be called to declare as witnesses in the hearing.

The alleged fraud relates to unpaid loans – some of them granted to family members – said to have been backed by insufficient or non-existent guarantees, prior to the Caja de Alcoy’s application for a suspension of payments, and later declaration of bankruptcy. A ruling classified the bankruptcy as fraudulent in 1996.

EFE notes that the director, Jesús Llopis, was banned from office in 1989 in proceedings by the Bank of Spain, but remained in the position with the appeals presented against the decision.