Vast corruption scandal rocks Spanish opposition (News Feature)

Madrid - One of the regional leaders of Spain's main opposition conservative People's Party (PP) was given a watch worth 25,000 euros (37,000 dollars), a man tells another in a conversation taped by police. 'You know him, he just loves these things,' the voice says. '... He is like a child with new shoes.' The voices belong to two of the suspected masterminds behind a corruption network known as Guertel, which has been uncovered in what is being described as one of the biggest such scandals in Spanish political history. The man who was given the watch, allegedly as a bribe, is Ricardo Costa, PP secretary-general in the eastern region of Valencia. Costa, who has denied corruption allegations, was finally forced to resign this week. Phone conversations like the one on Costa's watch have played a key role in exposing the scandal which has caused a deep crisis within the PP. The scandal extends much further than Valencia, involving high- level party members, bribes worth millions of euros, and shady businessmen who made fortunes from contracts obtained with kickbacks in at least four regions. The head of the network, Francisco Correa, is suspected of accumulating a clandestine fortune worth 50 million euros. The corruption network has been named Guertel, the German word for 'correa' which means 'belt.' 'Call me Vito. Don Vito,' Correa said in one taped phone conversation, in a reference to Vito Corleone, the mafia boss played by Marlon Brando in the movie The Godfather. Correa's smooth-talking right-hand man Alvaro Perez, who allegedly specialized in linking up with powerful people, was known as El Bigotes (The Moustache). Starting in 1996, Correa and his associates are believed to have bribed PP officials and PP members governing regions or municipalities to give them lucrative contracts or building permits in Valencia, Madrid and the northern regions of Galicia and Castile- and-Leon. Alleged bribes included luxury cars, suits, television sets, handbags, trips to the Caribbean and parties with prostitutes. Dozens of people, including more than 60 official suspects, are being investigated by three courts. A PP treasurer, a European legislator, a Madrid senior official and four mayors have resigned over the case. Reports say the network may have reached as high up as 1996-2004 conservative prime minister Jose Maria Aznar's infrastructure minister and son-in-law, though both men have denied such allegations and neither of them has been named a suspect. Not only did suspects allegedly pocket huge bribes, but they are also suspected of funnelling part of the money into PP funds. The scandal has prevented the PP from taking full advantage of the problems of Socialist Prime Minister Jose Luis Rodriguez Zapatero, whose government has come under criticism over its handling of Spain's economic crisis. The PP would not allow 'shameful' behaviour from its representatives, party leader Mariano Rajoy said Thursday, announcing an ethical code of conduct for the party. It had taken Rajoy days to impose his authority on Valencian regional premier Francisco Camps, who tried to resist pressure to sack Costa. Camps himself was earlier cleared of charges of accepting tailor-made suits as bribes. The PP has accused the government of staging a judicial witch-hunt against it, but the argument has failed to convince many Spaniards as Rajoy has come under increasing criticism over his allegedly weak leadership. Yet while the Correa affair is exceptionally large in scale, it is far from being the only corruption case in Spain. More than 120 officials belonging to the PP and the Socialist Party - mainly mayors and local councillors - have been named suspects in corruption cases over the past five years, according to figures quoted by the daily El Pais. Corruption also extends to smaller parties. Around 100 municipalities are currently facing corruption suspicions in the southern region of Andalusia alone, the daily La Vanguardia reported. Most recently, Aznar's former environment minister Jaume Matas was named an official suspect in a Balearic Islands corruption case on Wednesday. One of the reasons for the extensive corruption is thought to be Spain's large housing sector, with construction companies paying backhanders for building licences. The meltdown of the overheated housing sector has been one of the main causes of the current economic downturn. There was no longer just a 'crack,' but an 'open fracture' between the political class and citizens, who had lost confidence in those governing them, La Vanguardia complained in an editorial.