More than 300 crimes and 700 witnesses: BES case begins to be judged Tuesday, ten years after the collapse
The trial of the main BES case begins on Tuesday and no one risks predicting when it will end, as it involves 18 defendants, 733 witnesses, 135 assistants and more than 300 crimes. This mega-process, which now has 215 volumes after an indictment with more than four thousand pages, begins to be judged more than a decade after the collapse of the Espírito Santo Group (GES), in August 2014.
The fall of BES, according to calculations made by Lusa, has so far cost the public coffers around 8 billion euros, mainly the result of the initial capitalization of Novo Banco and the recapitalizations carried out by the Resolution Fund at Novo Banco.
According to the Public Prosecutor’s Office, in the case that is now beginning to be judged – considered the main one in a universe of six criminal cases – an amount greater than R$ 11.885 billion in benefits obtained from the commission of crimes is at stake.
The case’s main defendant is the former president of BES Ricardo Salgado, who was accused of 65 crimes, including criminal association, active corruption, document forgery, qualified fraud and money laundering.
Deemed as one of the largest legal proceedings in the history of Portuguese justice, this case, investigated by the Central Department of Investigation and Criminal Action (DCIAP) of the MP, brought together 242 investigations into the main case (which were joined together) and brought together complaints from more than 300 people, individuals and legal entities, residing in Portugal and abroad. Due to the vastness of crimes, defendants, assistants, witnesses, facts and documents that make up this case, BES’ computer process has eight terabytes of information, corresponding to many thousands of files.
The BES resolution, on August 3, 2014, caused losses to shareholders and debt holders, from small investors to large investment funds (such as Blackrock and Pimco). The collapse of BES/GES caused millionaire losses to shareholders, creditors and customers, with currently more than 2000 injured customers who have obtained victim status in court and are demanding compensation. With the force legitimized by this statute, they ask for compensation for having been victims of material and moral damage as part of a crime. The amount claimed is at least 300 million euros, including moral damages.
Of all these, the customers who had purchased debt from companies in the Espírito Santo Group (notably commercial paper) at the branches of Banco Espírito Santo (BES) became more vocal and which over the last 10 years took place in dozens of demonstrations. Protests followed in front of the Banco de Portugal, Novo Banco, Belém Palace and even in Paris.
Rafael Marchante
More crimes may prescribe
The slowness of the process has already led to some charges being dropped, and at the beginning of this month the Central Criminal Court of Lisbon declared the prescription of 11 crimes, three of which were attributed by the Public Ministry (MP) to the former president of GES Ricardo Salgado. The former banker, who was initially accused of a total of 65 crimes, will now be tried for 62 criminal offenses, after two crimes of document forgery and one of infidelity were prescribed.
The survey of crimes at risk of prescription recently carried out by the MP also indicates that Ricardo Salgado could see another forgery crime fall at the end of November and two other crimes at the end of December. In January 2025, three more crimes of document forgery will be prescribed, at the end of February one of infidelity will fall and by March 28th another three of infidelity will fall.
More than a decade after the collapse of BES/GES and the beginning of the investigation, there are more crimes at risk of statute of limitations by the end of the first quarter of 2025, namely those of defendants Francisco Machado da Cruz, Amílcar Morais Pires, Pedro Góis Pinto , Pedro Almeida e Costa, Cláudia Boal Faria, Etienne Cadosch, Michel Creton, João Alexandre Silva and Nuno Escudeiro.
ANTONIO COTRIM/LUSA
Media “megaoperation”
Meanwhile, the trial room for the BES case at the Central Criminal Court of Lisbon, at the Justice Campus, Lisbon, will have 67 seats for defense and assistant lawyers, in addition to housing 16 individual defendants and some members of the public.
The trial will be broadcast live to two press rooms in buildings A and B of the Justice Campus, with capacity for 32 media professionals, and other spaces are being evaluated to allow remote monitoring by more attendees and the general public .
For the trial, presided over by judge Helena Susano, an auxiliary clerk was assigned exclusively, who will be supported, when necessary, by an auxiliary clerk and other court officials performing duties in the case unit in question. .
Sound systems, evidence recording and remote communications have been tested, and IT and technology equipment has been made available, including computers and screens for viewing documents. The videoconferencing system is in the finalization phase.
ANTONIO COTRIM/LUSA
The collapse
Throughout 2013 and then in the first months of 2014, signs of problems at Banco Espírito Santo (BES) and Grupo Espírito Santo (GES) became evident.
The tightening of the siege of the Bank of Portugal (BdP) reveals financial holes in the group’s companies and the promiscuity between financial and non-financial areas. Group companies had hidden debts and overvalued assets (the case of ESI – Espírito Santo International) and BES used its clients to finance group companies through the placement of debt, such as commercial paper.
It was also around this time that more scandals linked to the president of BES, Ricardo Salgado, were revealed. It is known that he received millions of euros (later it was discovered that it was 14 million euros) from the construction company José Guilherme and the power struggle with his cousin José Maria Ricciardi became public.
Despite the instability and reputational damage, Salgado does everything he can to remain president of BES and publicly tries to give an image of trust, helped by the thesis that the bank is not affected by the non-financial part of the group. However, the degradation of the group and its image means that, in June, he is forced by the BdP to step down as president, just a few days before his 70th birthday.
At the beginning of July, the central bank still says that “BES’s solvency situation is solid”. However, the collapse continues, shares fall on the stock exchange, companies in the group undergo restructuring, the Swiss Banque Privée Espírito Santo delays refunds to customers who invested in ESI debt and the flight of deposits at BES begins. The scandal turns international, with the Financial Times and the Wall Street Journal reporting that international markets “fear over the Portuguese bank”. The new management of BES (led by Vítor Bento) will discover that the situation is even more serious and, on the night of July 30, 2014, the accounts for the first half reveal losses of 3.6 billion euros and expose financial irregularities and cool.
Even so, that night, the governor of the BdP, Carlos Costa, guarantees in writing that the bank will continue. The bank and the group would be there for days.
On July 31, the European Central Bank (ECB) announces to the Bank of Portugal that BES will be suspended from monetary policy operations, which in practice determines its end. In view of this, Carlos Costa informs Frankfurt of the resolution measure and coordinates the process with the Government.
Around 11pm on Sunday, August 3, 2014, the governor announced to the country an “urgent” solution for BES. BES and the group went bankrupt in the public square, the century-old story ended that day.
Marcos Borga
Marcos Borga
Salgado, from “prince of the bench” to the dock
Salgado began defending himself in the public square – “When a leopard dies, it leaves its skin. And a man, when he dies, leaves his reputation”, he stated in the parliamentary commission of inquiry. In 2015, he considered in his response to a BdP process that it acted “like a kind of COPCON of modern times” against “the rich and powerful – but in recent years he has presented himself as a lonely and weakened man.
In February this year, he appeared in court (EDP case) looking sick, walking slowly, hand in hand with his wife. In January, Maria João told the judge that her husband is dependent, gets lost at home and sometimes doesn’t remember the names of his grandchildren. “I had a fantastic husband and these days I have a big baby to look after,” she said.
Salgado turned 80 in June, having celebrated in Switzerland, at the home of his daughter and son-in-law (billionaire Philippe Amon, owner of the paint company with which the world’s main banknotes are printed), according to Correio da Manhã. It is also the daughter Catarina who, according to the newspaper, gives her mother 40 thousand euros per month for expenses.
Ten years after the fall of BES, the main criminal case against Salgado (the trial of the BES/GES case), in which he is accused of 65 crimes, begins next Tuesday (15 October).
Ricardo Salgado’s defense invoked his diagnosis of Alzheimer’s to ask that the man who was once called “the owner of it all” could be excused from the trial, but the court “did not buy” the argument and the judge who presides over the group that will judge the case, Helena Susano, determined that Salgado will have to appear and answer personally for 62 crimes, including corruption.
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