The list of properties linked to Antonio Arroyo Arroyo, a 72-year-old lender, is extensive. Hundreds of them, many in Madrid, but also in Murcia, Cuenca, Lugo, Almería, Seville, Alicante, Segovia, Soria, and Toledo. More than 80 pages of lists of homes, as numerous as his alleged victims. After more than a decade successfully navigating lawsuits, complaints, arrests, and accusations that seemed to fall on deaf ears, the man described as “Spain’s biggest mortgage scammer,” “the scammer of the poor,” now appears to feel the pressure mounting.
Arroyo enters and exits the Provincial Court of Madrid with a brisk pace, as he has always moved through the courts, a folder in his right hand and his mobile phone in his left, but with a growing expression of concern. He quickly passes by his alleged victims, who remain seated, anchored to the chairs in front of the courtroom door, their faces etched with a perpetual sadness, waiting to be called to testify. Few recognize him, most having only seen him once, during the years of the crisis (between 2008 and 2015), the day they signed the loan that ruined their lives.
Wearing a tweed jacket, Arroyo quickly enters the courtroom and sits in the front row, alongside the eight lawyers representing him and his seven co-defendants. Facing them are the lawyers for the four private accusers, representing around thirty affected parties, and the prosecutor. Arroyo is the main defendant and will be the last to testify next week. The prosecution is seeking eight years in prison for a continuous fraud offense, while the accusers are adding another eleven years for “criminal organization” and “falsification of public and private documents.”
Around thirty affected individuals have joined together in a large-scale trial against him, the latest in a series after successfully avoiding consequences for many years. People like Gloria Esquivias, a 61-year-old nursing assistant, who in 2011 found her credit card debts accumulating and sought to consolidate them into a single loan with manageable payments. She saw an advertisement from Arroyo’s companies and took the bait: “Fast money, credit in one day, we cancel embargoes,” “Need money? We provide it immediately and without formalities.” She requested 5,000 euros and ended up paying 63,000 euros under the threat of losing her home and almost her marriage. Or Isabel Ballesteros, who applied for 22,000 euros and ended up having to sell her apartment quickly to avoid foreclosure, incurring a new debt of 60,000 euros to Arroyo. Or Begoña Martínez, a hairdresser, who agreed to a loan of 6,000 euros with the lender’s intermediaries and ended up having to sell her salon to prevent losing her home, paying another debt of 28,000 euros. And the tragic case of Ramona Navarrete, mother of a disabled child, who received a message from her husband (“Take good care of the boy, forgive all the pressure I’ve put you through, I can’t take it anymore, don’t call anyone”), just before he took his own life because he couldn’t cope with the spiral of debt they had been plunged into. They had requested a loan of 19,000 euros to finish paying for a backhoe, purchased by her husband and stalled by the real estate crisis. “We didn’t even have money for diesel,” the woman recalled this Wednesday during the trial.
One by one, the affected individuals have been testifying this week in the courtroom, recounting the modus operandi already described by the police in their reports: “Humble families with financial difficulties, promised loan repayment in comfortable installments, possession of real estate as a prerequisite, summoned to a notary, urged to sign papers with confusing and false explanations under the threat of losing the opportunity to obtain the money they need, given money in cash or checks that is always half or a third of what they sign in a deed without realizing it, with impossible payment terms (letters payable on consecutive days) and, in case of default, their properties are claimed through legal action.”
Notaries as “Money Launderers”
A near-perfect trap in which key secondary actors appear, such as notaries (who are almost always the same), habitual intermediaries (including Antonio Arroyo’s wife, daughter, and nephew), and even false bank directors.
Arroyo’s operation, developed over years, led alleged victims from anywhere in Spain to Calle Rosario Pino, 8 in Madrid, where the registered office of one of his companies is located, described by the victims as “a house.” Subsequently, and always creating a sense of urgency for borrowers, they were taken to a notary’s office, almost always on Calle del Buen Suceso, 6, or Calle Orense, 68, in the capital, where two of the most frequent notaries in these operations are located: Julia Sanz López and Ricardo Ferrer Giménez. Specifically, at the notary office of Julia Sanz, between 2006 and 2012, 319 mortgage loans from Antonio Arroyo were signed, 10% of all signed in those six years at that Madrid notary office, according to one of the reports submitted in the case.
The police, in the reports contained in the extensive case file, describe the role of the notaries as “money launderers” for the scam, in that they give a veneer of legality to the operations and signatures as public officials. And this is what the victims say in their statements: “Because there was a notary, I trusted him,” they summarize.
However, during the investigation, the notaries involved were exonerated: “There are not enough elements to conclude that the notaries knowingly participated in the allegedly fraudulent activity of Antonio Arroyo and his collaborators, nor that they cooperated with their intervention, nor that they benefited economically,” says the order of November 2019 from Court No. 4 of Plaza Castilla, by which the judge decrees the provisional suspension of the case with respect to the notaries Julia Sanz López, Ricardo Ferrer Giménez, José Usera Cano, and Ángel Almoguera Gómez.
The notaries, although some have tried to avoid even their citation to appear in court as a witness, will also testify next week. They are the main asset of Arroyo’s defense lawyer, who has forced all the alleged victims to recognize their signatures on the papers signed by the notaries and the accused. That is, to assume that they signed to obtain money before a notary who – even if it was in a hurry and in a confused manner – read the documents to them, which they now claim they did not know what they were or what they said.
However, despite the doubts, there is a very clarifying case in this judicial process because the police were directly involved in it and Antonio Arroyo and several of his collaborators were arrested at the time the alleged scam occurred. This is the case of José Enrique Masía Pérez and Andrea García, who, suspicious and surprised by the evasive characters who were going to give them a loan and by the staging of their deception, carried out some checks and discovered that the person claiming to be a director of Caja Duero (the bank supposedly managing their credit) was an impostor, and went to the police station. On September 5, 2012, when Arroyo’s collaborators gave them an appointment at 12:00 noon again at the notary’s office on Calle del Buen Suceso, 6, they called the agents of Group IX of the Madrid Judicial Police Brigade. The police accompanied them there and verified that they were given 7,500 euros in cash and not the 16,000 euros stated in the deed they signed. They then arrested the alleged scammers.
In their report, they reveal the apparently fraudulent operation to which the victims were subjected and confirm their modus operandi, and also insist that “the fundamental legal instrument used by the organization and as a guarantee of impunity for the perpetrators is the deed certified by a notary.” And they add: “This public faith character, whitens and gives a legal appearance to the different operations.”
The investigators of the police, witnesses to the fraud, also allude to article 24 of the Notary Law which establishes that the means of payment used and what must be put in cash payments in the deeds must be identified: “Confessed if it has been satisfied before the formalization of the document, in cash if This proves done at the time of the signature and deferred if it is done at a later time.”
For all these reasons, they conclude: “The delivery of cash amounts does not coincide with those reflected in the deed, said money is not counted in the presence of the notary, the origin of said money is not accredited, a copy of the deed is not delivered to the victims, it is not shown that it has been at their disposal beforehand either, the victims are not informed about the default interest (29%) or about the letters and their maturities, the reading of the clauses by the notary is not carried out.”
The trial against Antonio Arroyo Arroyo and his accomplices continues on Monday. A case that portrays an era, that of those who took advantage of desperation in the last major economic crisis.
