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Our View: CBC Governor cannot afford to be doubted by anybody

Chrystalla Yiorghadji was Auditor General from 1998 till 2014

THE HONEYMOON period is over for the Governor of the Central Bank Chrystalla Georghadji whose appointment, a few months ago, had been greeted with almost universal approval, thanks to her long and successful service as Auditor-general. Now the knives are out, Georghadji being the target of several attacks from different quarters. There have been charges of conflict of interest, violation of procedures and arbitrary decisions.

Unaccustomed to political onslaughts, the Governor has shown a reluctance to confront them head on, usually avoiding responding for several days in the vain hope that they die down. Her approach has been anything but effective because she eventually answers her detractors, but her delay in doing so could be interpreted as a sign of weakness or confirmation that she is in the wrong. This is not to say that she should be issuing a statement every time a politician or journalist criticises her decisions, but some matters are too serious to be left unanswered.

The report about a conflict of interest, which appeared in Kathimerini some 10 days ago, was ignored for a couple of days and even then the Governor relied on the Attorney-general to respond on her behalf. In this case, the problem was that there was no real defence. The paper revealed that the Governor’s daughter was working at the law office that represented former Laiki strongman Andreas Vgenopoulos. The office belonged to Georghadji’s husband from whom she has been separated for many years. As there was a law suit involving billions of euro against Vgenopoulos, brought by the ex-Laiki administrator, who was under the authority of the CBC Governor, the paper concluded there was a serious conflict of interest.

It was difficult to argue against this, even if the Attorney-general Costas Clerides issued a statement saying that he had been informed of the relationship by Georghadji and expressed the certainty that she would “act independently, objectively and fairly.” The Governor spoke a couple of days later, assuring that she was committed to the “principles of integrity and objectivity.” While nobody has any reason to doubt this, the claims of conflict of interest will not go away unless her daughter stops representing Vgenopoulos. Would it not reflect badly on Georghadji if ex-Laiki lost the case against Vgenopoulos?

Public perceptions are important and the CBC Governor cannot afford to be doubted by anybody. Her failure to deal decisively with the conflict of interest issue was seen as a sign of weakness encouraging her foes to attack her for hiring a former CBC employee that had taken early retirement as her PA. She would have been able to deal with this triviality much more effectively – telling her detractors that she had the right to choose her PA – if the conflict of interest ceased being an issue.

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