The Rise and Fall of King Juan Carlos I

When Juan Carlos succeeded Francisco Franco as Head of State on the Generalissimo’s death in November 1975 the King played a major role in moving Spain from a right-wing dictatorship to a modern democratic constitutional monarchy. However, over the years a number of controversies led to his abdication in 2014 and since then a long list of allegations of corruption have emerged. This led to him going into self-imposed exile in the UAR in 2020. Paul Whitelock plots the rise and fall of this once extremely popular monarch.

Juan Carlos Alfonso Víctor María de Borbón y Borbón was born on 5 January 1938. He is the grandson of Alfonso XIII, the last king of Spain before the abolition of the monarchy in 1931 and the subsequent declaration of the Second Spanish Republic. Juan Carlos was born in Rome during the royal family’s exile and grew up in Italy.

Francisco Franco took over the government of Spain after his victory in the Spanish Civil War in 1939, yet in 1947 Spain’s status as a monarchy was affirmed and a law was passed allowing Franco to choose his successor. He by-passed Juan Carlos’s father, Juan, the third son of King Alfonso, who had renounced his claims to the throne in January 1941, as Franco considered him to be too liberal, and in 1969 installed Juan Carlos as his successor as head of state.

On Franco’s death in 1975, Juan Carlos became king and reigned until his abdication in June 2014. In Spain, since his abdication, Juan Carlos has usually been referred to as the Rey Emérito, King Emeritus.

Juan Carlos spent his early years in Italy and came to Spain in 1947 to continue his studies. After completing his secondary education in 1955, he began his military training and entered the General Military Academy at Zaragoza. Later, he attended the Naval Military School and the General Academy of the Air, and finished his tertiary education at the University of Madrid.

In 1962, Juan Carlos married Princess Sophia of Greece and Denmark in Athens. The couple had two daughters and a son together: Elena, Cristina, and Felipe. Due to Franco’s declining health, Juan Carlos first began periodically acting as Spain’s head of state in the summer of 1974. Franco died in November the following year and Juan Carlos became King on 22 November 1975, two days after Franco’s death, the first reigning monarch since 1931; although his exiled father did not formally renounce his claims to the throne in favour of his son until 1977.

Expected to continue Franco’s legacy, Juan Carlos, however, soon after his accession introduced reforms to dismantle the Francoist regime and begin the Spanish transition to democracy. This led to the approval of the Spanish Constitution of 1978 in a referendum which re-established a constitutional monarchy. In 1981, Juan Carlos played a major role in preventing a coup that attempted to revert Spain to Francoist government in the King’s name. In 2008, he was considered the most popular leader in all Ibero-America. He was praised for his role in Spain’s transition to democracy.

According to a poll in the newspaper El Mundo in November 2005, 77.5% of Spaniards thought Juan Carlos was “good or very good”, 15.4% “not so good”, and only 7.1% “bad or very bad”.

However, the King and the monarchy’s reputation began to suffer after controversies surrounding his family arose, exacerbated by the public controversy centring on an elephant-hunting trip he undertook to Botswana in during a time of financial crisis in Spain. Up until the Botswana elephant trip, Juan Carlos had enjoyed a high level of shielding from media scrutiny, described as “rare among Western leaders”.

Spanish news media speculated about the King’s future in early 2014, following public criticism over the Botswana trip and an embezzlement scandal involving his daughter Cristina, and her husband Iñaki Urdangarin.

In June 2014, Juan Carlos, citing personal reasons, abdicated in favour of his son, who acceded to the throne as Felipe VI.

The Spanish constitution at the time of the abdication did not grant an abdicated monarch the legal immunity of a head of state, but the government changed the law to allow this. However, unlike his previous immunity, the new legislation left him accountable to the supreme court, in a similar type of protection afforded to many high-ranking civil servants and politicians in Spain. The legislation stipulates that all outstanding legal matters relating to the former king be suspended and passed “immediately” to the supreme court.

In June 2019, the former King announced his retirement from all official duties.

Recordings of the former King’s alleged mistress Corinna zu Sayn-Wittgenstein-Sayn speaking with a former police chief, were leaked to the press in mid-2018. Sayn-Wittgenstein claimed that Juan Carlos received kickbacks from commercial contracts in the Gulf States and that he maintained these proceeds in a bank account in Switzerland.

She alleged that he purchased properties in Monaco under her name to circumvent the tax treatment of lawful residents, stating “[not] because he [loved] me a lot, but because I reside in Monaco.” She further claimed the head of the Spanish intelligence service warned her that her life, and those of her children, would be at risk if she spoke of their association. The allegations drew demands for Juan Carlos to be investigated for corruption in early June 2019.

Swiss authorities began investigating Juan Carlos in March 2020. Sayn-Wittgenstein reportedly told the head Swiss prosecutor on 19 December 2018 that Juan Carlos had gifted her €65 million out of “gratitude and love”, to guarantee her future and her children’s, because “he still had hopes to win her back”. A letter written by Juan Carlos to his Swiss lawyers in 2018 stated the gift was irrevocable, despite having asked in 2014 for the return of the money.

On 14 March 2020, The Telegraph reported that his son Felipe, King of Spain since 2014, appeared as second beneficiary (after Juan Carlos) of the Lucum Foundation, the entity on the receiving end of a €65 million donation by Abdullah bin Abdulaziz, King of Saudi Arabia. On 15 March 2020, the Royal Household issued a statement declaring that Felipe VI would renounce any inheritance from his father. Additionally, the statement announced that the former king would lose his public stipend from the State’s General Budget.

In June 2020, the public prosecutor’s office of the Spanish Supreme Court accepted to pursue an investigation against Juan Carlos pertaining to his role as facilitator in Phase II of the high-speed rail connecting Mecca and Medina, intending to delimitate the criminal relevance of the facts that took place after his abdication in June 2014. As King of Spain, Juan Carlos was immune from prosecution from 1975 to 2014 via crown immunity.

A further investigation by Swiss authorities is being undertaken regarding €3.5 million paid from the Lucum Foundation to the Bahamas-based bank Pictet & Ciein for a society called Dolphin, which was controlled by the lawyer Dante Canónica, who also controlled Lucum.

Spanish prosecutors opened an investigation into the use by Juan Carlos and other members of the royal family of credit cards between 2016 and 2018 which were paid for by an overseas account to which neither Juan Carlos nor any member of the royal family were signatories. This led to accusations that the funds are undisclosed assets of Juan Carlos, and as the card drawings exceeded €120,000 in one year, comprised undisclosed income and was therefore a tax offence in Spain. Mexican millionaire and investment banker Allen Sanginés-Krause has been named as the owner of the cards, a friend of Juan Carlos to whom he donated sums of money using Air Force Colonel Nicolás Murga Mendoza as an intermediary.

In December 2020, Juan Carlos reportedly paid 678,393.72 euros to Spain’s tax agency for the concept of defrauded money in an affair of “opaque credit cards” used between 2016 and 2018 by himself, his wife and some grandchildren, intending to avoid further scrutiny from the Supreme Court’s prosecutor, the payment being, in fact, an admission of fraud.

A third investigation is being undertaken by the Spanish authorities over an attempt to withdraw nearly €10 million from Jersey, possibly from a trust set up by or for Juan Carlos in the 1990s. Juan Carlos claims he is “not responsible for any Jersey trust and never has been, either directly or indirectly.”

A further investigation is taking place regarding the fact that until August 2018 Juan Carlos maintained a bank account in Switzerland which contains almost €8 million.

Reports have been made that Juan Carlos made a private trip to Kazakhstan in October 2002 to hunt goats with President Nursultan Nazarbayev. On departure from Kazakhstan he was given 4 to 5 briefcases purportedly containing $5 million in cash.

The Zagatka Foundation, founded in Liechtenstein in 2003 and owned by Álvaro de Orleans-Borbón, a distant cousin of Juan Carlos who lives in Monaco, received a large sum of money from Switzerland. Juan Carlos is named as the third beneficiary. In 2009 Álvaro de Orleans-Borbón paid a cheque from Mexico for €4.3 million into the account which the Swiss adjudicated belonged to Juan Carlos. Juan Carlos appears to have drawn down funds from the Zagatka Foundation to spend €8 million between 2009 and 2018 on private flights, with Air Partner receiving around €6.1 million.

Zagatka used commissions due to Juan Carlos and paid to Zagatka to invest millions, mainly in Ibex35 companies between 2003 and 2018.

A Panamanian Lucum foundation had Juan Carlos as the first beneficiary and King Felipe VI as a named second beneficiary, although King Felipe VI has subsequently relinquished any inheritance from his father Juan Carlos. Lucum received $100 million from the Saudi royal house in 2008. Swiss prosecutors are concerned about who at the Swiss bank, Mirabaud & Cie, know who the account was for and what was discovered about the source of funds from the Ministry of Finance of Saudi Arabia. They are also concerned about a €3.5m transfer from Lucum to the Bahamas to an account held by Dante Canónica. Mirabaud bank, who had concealed from its employees the beneficial owner of the account, asked in 2012 for the account to be closed, due to possible adverse publicity, this was when the bulk of the funds were transferred to Corinna zu Sayn-Wittgenstein-Sayn.

On 3 August 2020, the Palace of Zarzuela announced Juan Carlos wished to relocate from Spain because of increased media press about his business dealings in Saudi Arabia. Since then, Juan Carlos has lived in self-exile from Spain over allegedly improper ties to business deals in Saudi Arabia. On 17 August, the Royal Household confirmed that, since 3 August, Juan Carlos has been living in the United Arab Emirates, where he arrived by taking a private plane from Vigo Airport.

As for his private life, this too is not without controversy. Juan Carlos and Sofía have had two daughters and one son, but they have apparently not shared a bed since 1975.

Juan Carlos is also the alleged father of Alberto Sola, born in Barcelona in 1956, also of a woman born in Catalonia in 1964, and of Ingrid Sartiau, a Belgian woman born in 1966 who has filed a paternity suit, but complete sovereign immunity prevented that suit prior to his abdication. Juan Carlos had several extramarital affairs adversely affecting his marriage, including on ongoing relationship with Diana, Princess of Wales, who, along with Prince Charles, spent every summer as guests of the King in Mallorca.

So, Juan Carlos has truly gone from hero to zero over the course of three decades and his legacy will be forever tainted. What a great shame!