Politico

An Ex-King, Missing Millions and a Monarchy in Crisis


Anyone who was in Spain on Feb. 23, 1981, remembers where they were around 6 p.m. I was in a small Spanish village on the remote Mediterranean island of Formentera, where I was trying to write a novel while living in a two-room stone house. I was having an early-evening beer at Catalina’s, the only bar open in town, before going home.

The usual early evening crowd was there: men playing cards at a couple of tables, women chatting over cups of chamomile tea, a few foreign hippies with their beers as the day drew to a close. The bar’s radio was tuned to a station broadcasting from Valencia, and the usual programming of awful Spanish pop was suddenly interrupted by a firm, male voice. The voice announced that a military takeover to save the nation was underway, a curfew was being imposed, and people should go to their homes and await further orders. A heavy silence fell over the bar.

That afternoon, Spain’s Congress in Madrid had been meeting to elect a new prime minister when 200 Civil Guards armed with machine guns stormed in, firing into the ceiling and ordering legislators to get down on the floor. A camera for Spain’s state-owned, sole television network was in the balcony to cover the proceedings, and the footage it shot of the uniformed insurrectionists firing and the legislators diving for cover would be rebroadcast constantly over the next few days, becoming as familiar to Spaniards as footage of JFK’s assassination, or the Twin Towers falling, is to Americans.

The coup attempt came less than six years after Francisco Franco’s death ended a 36-year dictatorship, so it was easy for Spaniards to believe Franco’s military followers were coming back to power. In that tiny village bar, far from armed authority, people obeyed orders and headed home. On that evening in 1981, young and naive, I felt for the first time a bit of what it was like to have a dictator’s yoke on my neck, a glimmer of the four decades of Franco and the Church setting the narrow boundaries of how to live. The fear that it was beginning again was written on the faces around me as we all filed out the door at Catalina’s and headed to our homes.

A few hours later, at 1:15 a.m., I was listening to my small transistor radio when I heard the king of Spain, Juan Carlos I, broadcast a message on television and radio. He condemned the coup attempt and vowed to punish those responsible. It was clear the coup was effectively over. I breathed a sigh of relief, and went to bed, as did millions of others. The king’s adamant defense of Spain’s nascent democracy put an end to the putsch, and its instigators surrendered shortly thereafter, eventually serving prison time. That night, we all felt a tremendous sense of gratitude toward the king.

It turned out to be the high point of Juan Carlos’s 39-year reign — and it has been a long fall since.

These days Juan Carlos is the main character in a long-running scandal that has all the ingredients of a made-for-television drama, a full-bore telenovela. The 83-year-old Juan Carlos is no longer king and has fled Spain in disgrace, gone to live a life of exiled luxury in Abu Dhabi, leaving his family behind. Meanwhile, his former lover has publicly accused him of hiding many millions of euros in ill-gotten gains for which he did not pay any taxes.

The gravity of his fiscal crimes is sowing doubt in the minds of many Spaniards as to whether a good reason exists to continue maintaining a monarchy in the 21st century.

Juan Carlos’s serious troubles began in 2012 when he went on a hunting trip to Botswana. A photo of the king proudly standing with his rifle in front of a dead trophy elephant was widely published, and harshly criticized at home; at the time he was the honorary president of the Spanish branch of the World Wildlife Federation.

While the king was in Botswana killing an elephant on a private big-game hunt, Spain was still recovering from the global recession, with a 23 percent unemployment rate, rising to 50 percent among people under 30. The monarchy began to be widely questioned, and the first concerted calls arose for an investigation into the king’s finances. The clamor grew, and in 2014 he abdicated and his son Felipe VI became king.

In mid-2018, Corinna Larsen, an aristocratic German-born, Danish citizen came under pressure from Swiss authorities to explain the huge sums of money in bank accounts under her name. She was said to have been romantically linked to the king since shortly after being introduced to him by the Duke of Westminster in 2004. Under questioning, she revealed her role in helping Juan Carlos hide part of a “gift” of nearly $100 million, given to him by the king of Saudi Arabia. It was a token of the Saudis’ appreciation for the Spanish king’s help in contracting a company to build a high-speed railway to Mecca, part of an $8 billion Saudi project. Larsen, who was no longer involved with the ex-king, said the money was a kickback. Whatever it was, Juan Carlos had not reported it to Spanish fiscal authorities.

An investigation of the Saudi “gift” was opened, and eventually expanded to include foundations connected to the ex-king, at least two of which appeared to be shell entities with little purpose other than to funnel money his way. In addition, between 2016 and 2018, Juan Carlos had provided some members of his extended family (although not Felipe VI’s immediate family) with “opaque” credit cards owned by a wealthy Mexican businessman, which were used to spend hundreds of thousands of euros.


Revelation followed revelation. The investigations are ongoing, and to date no charges have been filed, but in August 2020, the Royal Palace announced that Juan Carlos was leaving Spain to live elsewhere. He soon turned up in a friend’s luxurious mansion in Abu Dhabi where he is currently in residence.

He enjoys constitutional immunity from prosecution for anything he did while king, but any crimes committed since his 2014 abdication are actionable. Since leaving Spain for Abu Dhabi, the ex-king has made no public statements or appearances. Last month, he paid the Spanish treasury more than 4 million euros ($4.8 million) in back taxes, presumably in hopes of precluding criminal charges.

Felipe VI, his wife Queen Letizia, and Sofia, his mother the ex-queen, are about the only three people in the entire country who have had absolutely nothing to say about Juan Carlos’s latest misfortunes. Felipe projects an aura of uprightness in his reign, and in the spring of 2020 it was announced that he had voluntarily given up all rights as listed beneficiary on his father’s suspicious accounts. Other than that, the current king has had no public reaction to his father’s misdeeds. Both he and his mother maintain a dignified silence.

The ex-queen Sofia, 82, is a Greek princess who married Juan Carlos in 1962. They have three children: Felipe and two daughters, Cristina and Elena. In the face of her husband’s fall from grace, Sofia has carried on as always, exemplifying moral rectitude, staying active on behalf of a variety of charitable and cultural causes in Spain, and around the world.

In many ways, Juan Carlos was an accidental king, one who had Francisco Franco to thank for his reign. In April 1931, King Alfonso XIII was deposed by the Second Republic, the first democratically elected government in Spain’s history. The Republic declared the nation monarch-free and quickly became one of the most progressive European governments of the 20th century. But just five years later, in 1936, Franco led a military revolt against the Republic, and after three years and a million people dead, he succeeded in overthrowing the government with military help from Mussolini’s Italy and Hitler’s Germany.

Franco was not inclined to share power, and ruled Spain without a king for 36 years until his death in 1975. But, he was also an ultra-conservative Spanish Catholic, and believed in a vision of the nation which harked back centuries to Spain’s days of monarchy and global power. In 1969, he named Juan Carlos, Alfonso XIII’s grandson, as his eventual successor.

Juan Carlos has an impeccable pedigree — he is a Borbón, a direct descendant of an aristocratic European family, which has intermittently ruled Spain since 1700. But Juan Carlos was never a staid monarch. A bon vivant, he has always been a yachtsman, and was a ferocious competitor in Spain’s most important sailing regattas. He also was given to more plebian pleasures. Urban legend in Madrid had it that the ex-king liked to take anonymous, unescorted rides through the streets on his motorcycle, sneaking out of the royal palace late at night. Tales were told of Madrileños waiting at a traffic light who saw the king wearing a helmet and black leather jacket astride his motorcycle in the next lane.

His motorcycle days are behind him. Juan Carlos has struggled with health problems for the past decade. He had successful, open-heart surgery in 2019, and multiple hip replacement surgeries stemming from an injury sustained when he fell during that ill-fated 2012 trip to Botswana. He walks with great difficulty, always with a cane and often needing an arm to lean on. He is still able to enjoy time aboard a yacht, but is no longer able to participate in regattas.

The Spanish constitution makes it clear that kings are not to have a voice in the political arena, but actions by members of the Spanish royal family frequently have political ramifications. The separatist, anti-monarchist parties in Catalonia, the Basque country, and Galicia reacted fiercely to the ex-king’s adios, as he headed to Abu Dhabi.

“The best service you can do for the people of Spain is to not run away from justice and to show your face with dignity,” tweeted Carolina Telechea, spokesperson for the Esquerra Republicana de Catalunya (Catalan Republican Left), the strongest of the parties advocating Catalonian independence from Spain, and resolutely anti-monarchist.

The Socialist government’s coalition partner, the left-wing Podemos (We Can) party, joined the separatists in condemning the ex-king’s departure. “Juan Carlos de Borbón’s flight to a foreign country is an undignified attitude for a chief of state, and leaves the monarchy in a very compromised position,” tweeted Pablo Iglesias, leader of Podemos. “Out of respect for the citizens and Spanish democracy, Juan Carlos I should answer for his acts in Spain before the people.”

The governing Socialist party has been much more discreet, defending the institution of the monarchy and its role in Spanish society, while assuring the public that wrongdoing by any Spaniard, including an ex-king, will be prosecuted under the law. In the Congress, the Socialists joined the far-right Vox party, and the conservative Popular Party in blocking the creation of a commission to investigate Juan Carlos’s finances, declaring that to be the job of the legal system, not the legislature.

Do Spaniards consider the institution of the monarchy a living example of Spain’s ancient noble heritage, or little more than a relic from a time when aristocrats and the Roman Catholic Church ruled the nation for centuries, keeping its populace illiterate and oppressed? It depends on whom you ask. The right wing reveres the monarchy, while the left wing calls for an end to it, and the elimination of the royal household’s 8 million euro ($9.5 million) share of the Spanish annual budget. That is only a tenth of what is annually spent by Britain’s royal family, but an increasing number of Spaniards see it as too much.

For much of his reign, Juan Carlos I was well-regarded by most Spaniards. His excesses were generally tolerated prior to 2012 by subjects who still remembered with gratitude how he reacted to the attempted military coup in 1981. Recently, even that has come under question, with some observers advancing a theory that the king, specific politicians, and the military staged the whole affair in order to frighten Spaniards into accepting a carefully engineered, moderate, parliamentary monarchy. Because Spain has no effective public access laws, the government documents relating to the 1981 coup attempt are still unavailable to journalists or historians.

In any event, this time the ex-king is unlikely to be widely forgiven. It is one thing to have an attractive Danish lover, or sneak out of the palace to have a little late-night fun, but in a modern European country, it’s quite another to evade paying millions of euros in taxes to the nation he once ruled.

Juan Carlos apparently understands the gravity of his situation. He did not come home to spend the Christmas holidays with his family, and has not announced any plans to return to Spain.

The Spanish royal family’s bad press continues. The same week in late February when it was revealed Juan Carlos had paid 4 million euros in back taxes, it was reported that his two daughters had visited him in Abu Dhabi in January, both getting Covid-19 vaccinations while they were there.

This did not sit well at home. By the end of March, about 74,000 Spaniards had died from Covid-19, but the eagerly awaited vaccines have not been available here, even while people in the U.S. and UK receive theirs. Vaccination is a privilege currently unavailable to the millions of us in Spain anxiously awaiting our needlesticks, because vaccine is still scarce.

So as the normally gregarious Spaniards cower inside their homes, hoping to avoid infection before they can get vaccinated, the royal family is providing a real-life telenovela to take their minds off the plague. In some ways, however inadvertently, Juan Carlos is again saving Spain during a time of national crisis — this time, by keeping us entertained.

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