Eduardo 'Teddy' Bautista, President of Spain's SGAE, Resigns After Financial Investigation
Eduardo 'Teddy' Bautista, President of Spain's SGAE, Resigns After Financial Investigation

In a stunning piece of news that's dominated the front pages of Spanish newspapers, the offices of the country's powerful Society of Authors and Editors (SGAE) have been raided by national police who are investigating the organization for misappropriation of funds.

A total of nine people-including Eduardo "Teddy" Bautista, the powerful and charismatic president of SGAE's board of directors--were detained between Friday July 1 and Saturday July 2 in what authorities are calling "Operation Saga," according to published reports. The raid led by Spanish Civil Guard Officers of SGAE's offices in Madrid and 16 other locations, including private homes, took place just hours after the Society elected its new board of directors.

According to Spanish daily El Pais, the investigation against SGAE was triggered by a complaint filed by several Internet, computer and restaurant business associations against the organization in 2007. At the core of the complaint are actions by Spain's Digital Society of Authors (SDAE)-which is fully controlled by SGAE--and its general director, José Luis Neri. SDAE was created in 2000 to protect authors' digital rights, but many of its actions-including a special tax on any devices that can store music-have been controversial in Spain. According to published reports, Neri is accused of diverting funds through a company called Microgénesis.

In a statement published in its website, SGAE said it was collaborating with authorities and fully trusted the innocence of its executives. It also said it was still awaiting the reasons behind the Civil Guard's investigation and search.

"Likewise," the statement added, "we are surprised that this action took place precisely one day after more authors than ever in recent history participated in the election of the Board of the directors."

According to published reports, Bautista, along with general director Enrique Loras, and finance director, Ricardo Azcoaga, will be interrogated by a judge on Sunday (July 3).

SGAE is Spain's leading collection society and widely considered the most influential and powerful cultural entities in the country. The organization has over 100,000 members and last year alone, it distributed some 365 million Euros to its members, according to published reports. Although most of its membership is linked to music, it also represents members from the areas of film, theater and audiovisual arts.

SGAE is also a major advocate of artists through a broad variety of initiatives. In 1996, for example, it launched Spain's Premios de la Musica (Spanish Music Awards) together with Spain's Society of Artists. The awards are currently presented by Spain's Academy of Arts & Sciences.