Cyprus Mail

House Ethics to release list of money movers

President of the House Ethics Committee Demetris Syllouris

By George Psyllides

As part of a probe into the collapse of the island’s economy, the House Ethics Committee decided yesterday to publish all the names of individuals and companies that either took money out of Cyprus in the run up to a deposit seizure last March or received favourable treatment when borrowing from banks.

Main opposition party AKEL suggested having a separate entry about politically exposed persons (PEPs) and other cases — like that of a businessman who was considered bankrupt but transferred €20m abroad on March 1, 2013 – and other people and companies who took large amounts of cash out of Cyprus in February 2013.

In an eight-hour session yesterday, parties agreed to the changes that will be included in the final text of the report that will exceed 500 pages.

It will be divided into a section containing the joint conclusions, including 11,000 names of individuals and companies that transferred money abroad from July 2012 to March 2013.

The report will also include bank bonuses and the names of people who received loans with favourable terms or had their loans written off.

There will be a separate appendix with the parties’ differing views.

The committee will meet again on April 29 to review the final report after some amendments.

The report will be discussed by the plenum on the morning of May 6.

Committee chairman Demetris Syllouris said the report recorded “political culpability, supervisory culpability, structural gaps in the operation of the supervisory authorities, corporate governance problems in banks, problems in the presentation of bank financial results, problems in the implementation of laws and regulations, and need for additional laws and regulations for the banking system to work better.”

“There were suspicious money routes, and favourable treatment,” he said.

Among other things, the report focuses on the fire-sale of the Greek operations of Cypriot banks in the wake of the Eurogroup’s bailout/bail-in decision; the sudden spike in Emergency Liquidity Assistance in the order of billions of euros within 40 days after the state underwrote €1.8bn to float Laiki Bank in May 2012; banks’ bookkeeping and the possible inflating of assets; and, potential conflicts of interest concerning law firms which banked with the same financial institution as clients who owed the bank money.

Piraeus Bank, the Greek lender that took over the Cypriot banks’ operations, reportedly wrote to the committee arguing that the transaction was legitimate and a condition set by international lenders.

Reports said the bank rejected claims that big shareholders had taken out loans from Laiki Bank to support Marfin Investment Group and Marfin Egnatia Bank stock. All three entities were controlled by Greek businessman Andreas Vgenopoulos.

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