By George Psyllides
BRITISH financial regulators have not asked for the closure of over 100 accounts in the Bank of Cyprus UK (BoC) over money laundering concerns, despite allegations by the island’s central banker and a leading opposition MP.
A source in Cyprus told the Cyprus Mail yesterday that the Financial Conduct Authority (FCA) had not asked for 130 accounts to be closed but that it had told the BoC to carry out more thorough reviews.
This came after an FCA routine audit but also due to concerns stemming from recent developments in the island’s banking sector.
On Tuesday, CBC Governor Panicos Demetriades told lawmakers that the accounts, mostly belonging to unnamed Cypriots, had been shut down as part of anti-money laundering checks on politically exposed persons (PEPs) who were considered high risk customers.
He was responding to a question put by main opposition AKEL MP Irene Charalambidou.
The MP insisted yesterday, demanding that BoC hand over the details of the accounts.
DISY spokesman Prodromos Prodromou called on the CBC to provide all the details and say whether it had co-operated with the British authorities in closing the accounts.
“The question that needs to be asked is whether the CBC has co-operated with the British authorities to close accounts in a Cypriot bank abroad,” Prodromou said.
If that was the case, then the CBC should say what criteria were used.
The issue came up in the wake of a damning internal report concerning Demetriades.
The investigation, conducted by the CBC’s audit committee, consisting of three members of the board, found that the governor had misled the board, ignored its decisions, concealed information from it, violated procedural rules, including the awarding of contracts without tenders, and tampered with agreements.
Demetriades responded to the damning findings focusing on the technicalities rather than the substance.
He said the committee had exceeded its powers because it did not have the approval of the board for the investigation and had not informed the governor.
He described the investigation as “illegal” and complained that he had not been asked for his views, something that led to “arbitrary and mistaken observations.”