Spanish court to investigate Iberdrola CEO in alleged spying case - Metro US

Spanish court to investigate Iberdrola CEO in alleged spying case

FILE PHOTO: Ignacio Sanchez Galan, chairman of Spanish power company Iberdrola, reacts during a speech during the annual general meeting of shareholders in Bilbao

MADRID (Reuters) -Spain’s High Court on Wednesday placed Iberdrola Chief Executive Ignacio Galan under investigation as part of a probe into an alleged spying case dating back more than 15 years, a court document showed.

The court will investigate Galan’s connections with the hiring of former police chief Jose Manuel Villarejo, who ran an intelligence services company and was released from jail in March after three years of pre-trial detention in a separate case dealing with alleged money laundering and bribing public officials.

Galan and three other Iberdrola executives will be investigated for alleged bribery, breach of privacy and fraud in commercial documents.

Iberdrola said on Wednesday that Galan and the three executives had done nothing wrong and that the company and its executives were open to cooperating with judicial authorities.

In Spain, being placed under investigation does not necessarily lead to indictment. No formal charges can be brought until the first phase of an investigation is completed.

The High Court will investigate if Iberdrola hired Villarejo to spy on Real Madrid soccer club president Florentino Perez when Perez’s construction company ACS was fighting to secure a seat on Iberdrola’s board in 2009.

It will also investigate whether Iberdrola hired Villarejo to repel local opposition to a power plant in southern Spain, and to obtain information about Manuel Pizarro, former chairman of utility Endesa.

ACS and Endesa were not immediately available for comment.

Iberdrola, Spain’s second-largest company and a world leader in wind power, has previously said it hired Villarejo’s security company Cenyt from 2004-2009 and 2012-2017, making payments detailed in 17 invoices.

In May, it said three internal investigations into the matter had found no evidence of breaches of its internal codes of conduct, but that the case had caused “significant reputational damage”.

Proxy adviser ISS advised shareholders ahead of an annual meeting last week that the investigation was a cause for concern regarding the company’s reputation, but recommended voting to approve its management.

But it warned that the outcome of legal investigations may warrant opposition to management in the future.

Other prominent Spanish companies, including lender BBVA and energy firm Repsol, have been drawn into the inquiry revolving around Villarejo.

Iberdrola shares were down 1.5% at 11:16 GMT versus a slightly negative Madrid blue-chip index.

(Reporting by Emma Pinedo, Isla Binnie; additional reporting by Jesús Aguado; editing by Inti Landauro, Jon Boyle and Jason Neely)

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