Spain’s performing rights organisation SGAE raided by anticorruption police
The Civil Guard today raided the headquarters of the General Society of Authors and Publishers (SGAE) in Madrid as part of an investigation into embezzlement and misappropriation in an operation ordered by the anti-corruption prosecutor, who has announced that it has spent the last two years investigating a series of alleged crimes at the powerful artists recording rights organisation.
Police say that “so far” there have been no arrests, although the Police had orders to detain the president of the SGAE, Teddy Bautista, and two others senior executives. It is also possible that the operation will be extended to other offices of the Company throughout Spain.
However, a SGAE spokesman speaking to reporters this morning denied any police search and told reporters that there has been no arrests. “[President] Teddy Bautista is meeting with the head of communications analyzing the election results. It is a mornings work like every morning in our offices,” reporters were told.
The Headquarters of the SGAE is, however, closed and barred to the public, and guarded by Guardia Civil officers. Three Civil Guard vehicles are located at the confluence of streets Fernando VI y Pelayo and numerous journalists have gathered outside the historic building, the Palacio de Longoria.
Early in the morning, officers sealed the building to the public. At 12 o’clock, they permitted some workers to leave the building to go home.
For now, the Civil Guard has seized all computers and company owed mobile phones in the building, and issued instructions to workers to hand over their company laptops.
According to sources, the investigation is looking into how the SGAE was raising money by way of copyright among those artists residing outside of Spain. These artists did not receive their fair share of the money, and it is alleged that those involved were diverting the money to personal accounts in Switzerland.
Alleged diversion of funds, fraud and embezzlement
The Anti-Corruption Prosecutor has filed in the High Court a complaint directed against the SGAE for alleged misappropriation of funds in their activities, according to Europa Press legal sources.
The brief of the Public Ministry, which was presented a few weeks ago to Dean of the High Court, requested the opening of a preliminary investigation by the department following a complaint filed in November 2007 by the Association of Internet Users, the Spanish Association of Small Business Computing and New Technologies (APEMIT) and the Spanish Association of Innkeepers Victims of the Canon (VACHE).
The complaint, which was seen by Europa Press, was based on the appearance in various media of several “alleged illegalities committed in the economic management of the resources of the SGAE.”
The citizens complained that the directors of the body had formed a web of subsidiaries around the Digital Society of Authors and Publishers (SDAE) in which the amounts collected in respect of copyright management were invested in income-generating activities for them instead of going to the correct sources.
Under these partnerships, the entity reported breach in this way, “the legal mandate that requires that the distribution of the fees collected be made equally among the owners of the works or productions, allegedly allocated such revenue in the running of their own private enterprises, or those of their partners, which also involved the generating of a profit [which they then kept], something expressly prohibited by law. ”
In their view, these activities may constitute the crime of misappropriation, embezzlement and fraud, crimes that would be attributable to the heads of the companies that have carried out the “misuse” of their economic resources and, additionally, to Ministry of Culture, as “chief auditor of such associations.”