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Our View: Business and political leaders stuck to cowardly code of silence

IT WAS fascinating to hear the answers given by the former senior executive of the Bank of Cyprus Yiannis Kypris to the investigative committee for the economy last Thursday. He explained that the bank’s former CEO, the autocratic Andreas Eliades, decided to invest €2bn in Greek government bonds six months after the Greek sovereign had been relegated to junk status without securing the approval of the board of directors. After the purchase, the board of directors endorsed Eliades’ position that “there was no danger of a Greece bankruptcy,” said Kypri.

He said nothing that we did not already know, but the more interesting thing is that he said nothing when he learnt that €2bn worth of bonds – sold by the bank in December 2009 – were re-bought later the same month and in January 2010. Kypri claimed he had a big discussion about the matter with the CEO when he found out but in end, presumably, he went along with the decision. Meanwhile, the board which is supposed to exercise control over the CEO accepted his decision without a word of protest, not daring to censure him for blatantly ignoring procedures and abusing his power. He did not have the authority to invest such a big amount without board approval.

Nobody spoke out publicly about Eliades’ scandalously reckless decision and nobody on the board demanded his dismissal. They were all happy to play along and hold on to their positions rather than fall foul of the autocratic and vindictive CEO by openly criticising his decisions at board meetings or company AGMs and alerting shareholders to what was happening. It was shameful that not one bank executive or board member had the guts to stand up to this man and speak out about the huge risks he was taking.

Even worse things were taking place at Laiki. Its executive chairman Andreas Vgenopoulos was plundering the bank, sanctioning multi-million loans without security to friends and associates to invest in share support schemes and nobody said anything. One Laiki executive resigned but the rest of the senior management team were happy to turn a blind eye to the plundering so as not to put their jobs at risk. The same cowardly behaviour was displayed by the board of directors who watched Vgenopoulos drive the bank into ground without uttering a single word. Perhaps keeping silent while crimes were being perpetrated was part of the ethos of the bank, since the Milosevic money-laundering in the ’90s.

Turning a blind eye to wrongdoing rather than speaking out is endemic. Nobody seems to have the courage to stand up in public and report the corruption, dishonesty, negligence and incompetence that plague most aspects of Cyprus life. Doctors will never testify against a colleague even if his or her negligence may have cost a life. Lawyers get away with incredibly unethical behaviour because none of their colleagues would ever speak out against them. As for state employees, they know that adopting the code of silence ensures career advancement.

Government obeys the same rules. In the last two years of his term Demetris Christofias took every wrong decision he could have taken and not a single member of his cabinet or inner circle had the moral courage to resign and warn that he was unfit to govern and leading the country to catastrophe. Instead they defended his misguided decisions, bad judgment, erratic choices and incompetence that led us to economic meltdown. Loyalty to the unfit president and AKEL was placed above the interests of the country.

Three finance ministers who served under Christofias were fully aware of the damage his bizarre decisions were causing the country but not one of them chose to speak out. Neither did any senior finance ministry officials, who only talked about the president’s criminally irresponsible behaviour at the investigative committee when it was too late.

What use is talking publicly now that Laiki has been closed down, the BoC is on life-support and the state is technically bankrupt? None of these leading personalities of the business and political worlds spoke out when their words could have made a difference, preferring to safeguard their well-paid jobs by adhering to the cowardly code of silence. They can say what they like now, but the truth is that they contributed to the catastrophe of the country because they did not possess the public spirit and moral courage to speak out when it mattered.

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