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Arrest warrant issued after Orphanides a no-show in court (Updated)

Former Central Bank chief Athanasios Orphanides

By Stefanos Evripidou 

THE LIMASSOL district court yesterday issued an arrest warrant for former Central Bank governor Athanasios Orphanides after his no-show at a private criminal prosecution regarding the alleged fraudulent selling of bank securities.

A Limassol resident has initiated the case against members of the former Laiki (Popular) bank brass and Orphanides as CB governor at the time, claiming he was duped into buying €400,000 worth of high risk, high-yield bonds.

According to his lawyer, Costas Melas, Laiki Bank in cooperation with Orphanides sold his client the bonds “in a fraudulent manner”.

Since neither Orphanides nor his lawyer turned up to court, the presiding judge decided to issue an arrest warrant against the former governor, who is currently teaching in the United States.

Melas said the fact Orphanides was abroad “means nothing…there are bilateral agreements to locate his whereabouts”.

“From what I know, he is in the US and an international arrest warrant will be issued through the relevant ministries so he may be arrested and brought before the court,” said the lawyer.

Also facing charges are Laiki bank as a legal entity; former Laiki chairman Andreas Vgenopoulos, former Laiki CEO Efthymios Bouloutas, and former Laiki brass, Neoclis Lyssandrou, Christos Stylianides, Panayiotis Kounnis; Andreas Kalisperides and Spyros Georgiou.

The lawyers of Vgenopoulos and Bouloutas- who were present at the pre-trial hearing- asked for an adjournment to have time to examine the charge sheet served to their clients and decide whether to accept or challenge it, said Melas.

He added that his client and other bondholders were “vindicated” by the recent findings of the central bank that, “regardless of anything else, the promotion of bonds was carried out in an illegal manner”.

The court decided to reconvene on November 14 to examine the execution of the arrest warrant and the charge sheets served to the defendants.

During the hearing, a number of junior bondholders held a protest outside the Limassol court.

Earlier this month, former Attorney-general Petros Clerides suspended the prosecution of Orphanides in a similar fraud case filed in the Paphos district court by another bond investor.

In one of his last acts before stepping down from his post, Clerides decided to make use of the authority afforded him to suspend any criminal prosecution on the island and informed the Paphos court in writing of his decision.

Clerides’ decision was announced during a hearing at the Paphos district court on September 10 of a case filed by a resident of Polis Chrysochous who claims he was duped by Laiki bank into buying high risk, high-yield bonds. The Laiki top brass, including Vgenopoulos and Bouloutas- both Greek nationals-, are defendants in the case.

The Paphos court will next convene on October 30 where the lawyers of Vgenopoulos and Bouloutas are expected to question the legality of the way their clients were served the charge sheet.

Cyprus was forced to shut down Laiki as part of an international bailout agreement.

Hundreds of bondholders in the island’s major banks claim they were misled by the banks into putting their savings in high-yield securities without being informed of the risks.

The total amount put in securities is said to be around €1.4 billion.



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