Spain's ex-spy chief loses case linked to royal family

Spain's former spy chief has lost his case against a retired police chief suspected of large-scale corruption whose revelations have shaken Spain's royal family, a court said Monday.

The ruling acquitted Jose Manuel Villarejo of slander and making false allegations about General Felix Sanz Roldan, who headed the CNI intelligence services until 2019.

The case centred on remarks by the ex-police chief in a 2017 interview claiming Sanz Roldan had "threatened to kill" a woman who had a decade-long affair with former king, Juan Carlos I.

German-born business consultant Corinna Larsen testified as a witness for the defence saying Sanz Roldan had threatened her life on orders from the now-exiled monarch himself.

She said the explicit threat had been made in person during a meeting at a London hotel in 2012, which she then revealed to Villarejo during a meeting in 2015 that he secretly recorded.

Two years later, he leaked details of the conversation to the press, prompting Sanz Roldan to sue for slander.

By video link from London, Larsen told the court Sanz Roldan had demanded she hand over sensitive documents about the royals' financial and business dealings, making clear that until she did, neither she nor her children would be safe.

She said he had laid out various recommendations and "unless I followed them, he could not guarantee my physical safety or the physical safety of my children," admitting his words "terrified" her.

That same day, she flew to Switzerland and at her apartment found someone had left a book about Lady Diana's 1997 death in a car crash under a Paris tunnel, with an anonymous caller later warning her in Spanish: "There are many tunnels between Monaco and Nice."

At the time, Larsen had a home in Monaco.

Her allegations were roundly denied by Sanz Roldan, who told the court it was "a lie" and that he had "never, ever threatened a woman or a child".

The court said it was not its role "to establish the truth of Villarejo's accusations" but noted it could not prove they were false.

Sanz Roldan now has 10 days to appeal the ruling.

Villarejo has been in pre-trial detention since 2017 on multiple charges of corruption linked to his trademark practice of recording conversations with the rich and powerful that have rocked Spain's elite.