FORMER head honcho at Laiki Bank (then known as Marfin Laiki) Andreas Vgenopoulos has blasted the chairperson of the Cyprus Securities and Exchange Commission (CySEC) Demetra Kalogirou, accusing her of dereliction of duty for not investigating possible stock market manipulation.
In a letter sent addressed to Kalogirou on Thursday, and which he immediately made public, the Greek financier suggested that Kalogirou was deliberately stalling and trying to cover her lack of action with legalistic shenanigans.
In prior correspondence with Kalogirou, Vgenopoulos – who himself is blamed here for many of the woes befalling Laiki – had asked her to investigate public remarks attributed to Michalis Sarris, non-executive chairman of Laiki from January to August 2012.
In a letter dated October 20 of this year, Kalogirou in turn had asked Vgenopoulos to provide specific information on the alleged violations.
Vgenopoulos writes back: “In any case you were obligated to monitor the market and ensure its smooth operation, while the events I have reported to you repeatedly, verbally during the second half of 2012, and in writing on October 3, 2013 occurred under your watch, it is therefore inconceivable that today, some two years later, you are asking me to furnish specific information.”
Vgenopoulos is alleging that in early 2012 Sarris was talking up the prospect of foreign investors – including the Russian VTB Group – pouring money into under-capitalised Laiki.
However later that same year, and having left the lender, Sarris allegedly admitted to media outlets that realistically there had been no hope of finding investors and that the bank was “doomed.”
According to Vgenopoulos, Sarris’ initial remarks therefore constituted misleading of the bank’s investors and depositors, and as such CySEC should have initiated a probe, which it never did.
Back in April of this year, Vgenopoulos asked the Attorney-general to look into possible criminal offences that Kalogirou, as head of CySEC, may have committed.
In May 2012 the state underwrote the issue of €1.8bn in new shares for Laiki to help it recapitalise, after the lender took heavy losses on Greek government bonds. Less than a year later the lender was wound down as part of the terms of a bailout of the Cyprus government.