It Takes A Financier To Catch A Financier

For shareholder activist Enrique Casany Cortada it's payback time. He's taking on Spanish bankers and corporate executives who pursued "quick money" at the

expense of small investors. As president of the Association for the Defense of Shareholders, Casany, 56, is helping shareholders sue board members and accounting firms to recover some of the millions they lost when Spain's 1980s economic boom gave way to a 1990s bust.

A number of the corporate failures, Casany alleges, had been caused by

unscrupulous executives who bilked investors while regulators looked

the other way. "It's institutionalized fraud," he fumes. Today, Casany is pursuing 20 cases for the association's 1,500 members, who pay $120 a year and split the proceeds of settlements. One target is Banco Espaol de Credito, which collapsed last year and is now majority-owned by Banco Santander. Casany seeks $5 million in compensation for losses suffered by 70 shareholders.

NEW LAWS. What separates Casany from other shareholder activists in Europe is his inside knowledge. A lawyer and economist, Casany also has worked as a financial analyst, banker, and stockbroker. He helped create Spain's first investment funds in the 1970s and steered investors into newly privatized companies in the 1980s. He often saw executives report misleading information, he says, which Spain's fledgling securities watchdog failed to catch.

That's beginning to change. The government is updating the criminal code so that more white-collar crimes can be prosecuted. And it's launching an anticorruption campaign. Spain is trying to clean up its image, Casany says. That'll help him in his quest.

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