Iberdrola Chairman Galan Named as Suspect in Criminal Probe

(Bloomberg) -- Iberdrola SA Chairman Ignacio Galan is being investigated by Spanish authorities for his alleged role in a corporate spying case.

Spain’s national court formally named Galan and three others -- all current or former Iberdrola executives -- as suspects on Wednesday. In an emailed statement, it cited their alleged involvement in bribery, falsification of documents and violation of privacy.

The probe is part of a broad scandal involving other blue-chip Spanish companies. According to investigators, these businesses may have hired a firm owned by a former police officer to spy on rivals and their executives.

Iberdrola said Wednesday it had already formally requested that the judge allow its executives “to testify in the investigation to clarify this situation.” The Madrid-based company “has been involved in this for 20 months and it has affected its reputation,” a press officer said.

The events under investigation date back as far as 2004, when the utility -- led by Galan as chief executive officer -- was seeking permission to build a plant in southern Spain. According to the court documents, Iberdrola’s security head at the time hired the firm led by the former police officer to gather intelligence and help “overcome obstacles” to gain the necessary permits.

Iberdrola also allegedly asked the firm to investigate the chairman of Spanish competitor Endesa SA, and to gather information on construction tycoon Florentino Perez and his family amid a takeover battle, according to the filing.

Documentation on billing for these services was hidden and tampered with by Iberdrola once the criminal probe began, according to the court statement. Galan was aware of the payments, the court said.

(Updates with Iberdrola comment in fourth paragraph.)

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