By George Psyllides
THE Nicosia district court has frozen assets worth around €5.3 billion belonging to former Laiki Bank strongman Andreas Vgenopoulos and two other people, it was announced on Friday.
The court basically upheld interim orders with a global reach, secured by the administrator overseeing the resolution of Laiki Bank, formerly the island’s second-biggest lender.
The orders were issued in May 2013.
The court froze assets belonging to Vgenopoulos and former Laiki CEO Efthimios Bouloutas worth €3.79 billion, and those belonging to former board member Kyriacos Magiras worth €1.5 billion.
It also banned Vgenopoulos’ Marfin Investment Group (MIG) Holdings SA from making any payments or transfers to the benefit of the three men.
It followed a lawsuit filed against the trio and MIG, demanding damages for several reasons.
The defendants were accused of granting unsecure or insufficiently secured loans or loans that entailed undue risk, violating prudent banking practices, and insufficient supervision and management in relation to the merger between Greece’s Marfin Egnatia and Laiki.
Vgenopoulos, Bouloutas and Magiras were accused of acting in a devious manner.
From the three and MIG, Laiki is demanding compensation for the loss incurred through the merger due to a conspiracy between the four.
The district court approved the freeze request after it was satisfied that the defendants have a case to answer, the applicant may be entitled to remedy, and full dispensation of justice at a later stage can only be achieved by issuing the injunctions.
The court said the freeze will remain in place until the end of the case..
Cyprus was forced to shut down Laiki impose massive losses on depositors in Bank of Cyprus keep it afloat and get €10 billion in aid from international lenders.
MIG has said it would seek compensation via an international arbitration tribunal after its 9.5 per cent stake in Laiki in 2006 whittled down to less than 1.5 per cent.
A Greek parliamentary enquiry had called attention to “serious conflicts of interest” in Laiki’s Greek operation.
It had loaned money to a community of Greek monks involved in land deals and to others who used the money to support a share sale by Marfin Investment Group, a company linked to Laiki through a shared chairman – Vgenopoulos — until November 2011.