Spanish Prime Minister Mariano Rajoy acknowledged on Thursday he made a mistake in his handling of a major corruption scandal in the ruling centre-right People's Party, but vigorously denied he or other party leaders had received illegal payments.
It was the first time Rajoy has admitted any error since it came out in January that former PP treasurer Luis Barcenas - in jail pending trial on charges of bribery, tax evasion and other crimes - hid up to 48 million euros in Swiss bank accounts.
Barcenas, who left his post in 2009 but continued receiving financial support from the party, told a judge he collected millions in cash donations from construction magnates and distributed them to senior PP figures including Rajoy.
The prime minister, opening a debate in parliament about the funding scandal, said his error had been to trust Barcenas but made no other admission of wrongdoing.
"I can sum it up in two words. I was wrong. I'm sorry but that is how it was. I was wrong in trusting someone we now know didn't deserve it," he said.
Rajoy has been criticised for maintaining contact with Barcenas via text messages as recently as January.
The prime minister said he had always declared all his income to tax authorities and said a judicial investigation would prove that there was no illegal financing in the party.
He said all payments the party made to its employees - including expense accounts and seniority bonuses - were registered in official accounts.
Rajoy acknowledged the scandal has damaged his, and his party's, credibility as well as Spain's image abroad at a time when the country was already battling painfully high unemployment, a shrinking economy and a massive budget gap.
Rajoy tried to deflect criticism over his refusal to address the scandal in parliament earlier saying "we are facing a surprising and imaginative collection of lies, as time and justice will show."