Cyprus Mail
Cyprus

Former central bank chief given five months jail, hospitalised

By Constantinos Psillides and Angelos Anastasiou

FORMER Central Bank governor Christodoulos Christodoulou was on Monday sentenced to five months imprisonment and fined €13,500 after admitting to six counts of tax evasion.

He had been charged with tax offences relating to an undeclared €1 million cash transfer from a Greek shipowner in 2007.

While the sentence was to be carried out immediately and the former governor and cabinet minister taken to the Nicosia central prisons, Christodoulou complained of chest pains and was rushed to the Nicosia General Hospital. He joins an ever-expanding list of convicted former officials who never made it to the prison but also ended up in the hospital.

According to the Cyprus News Agency, Nicosia District court judge Fani Kapetanou said in her verdict that the crimes Christodoulou committed were severe in nature, “made worse by the fact that the defendant isn’t just any other citizen but one with extensive knowledge both legal and financial, who has also served various government posts, including finance and interior minister as well as governor of the central bank.”

The judge said that given these circumstances Christodoulou should be fully aware of the importance of filing proper tax forms and paying his taxes on time. “It is expected that a person who is honoured by having served in public posts of such importance to set a proper example for all citizens of the state.”

The district court judge states in her decision that Christodoulou’s intentions in defrauding the state were evident. She added his actions up to the point the case was brought to light suggested he willingly and knowingly attempted to defraud the state by not filing a proper tax form, in order to benefit from the planned tax evasion.

Regarding mitigation, the judge listed the defendant’s admission of the crime, his clean criminal record, as well as his age. Christodoulou is 75, born in the village of Avgorou in 1939.

The court rejected Christodoulou’s lawyer’s argument that he was the victim of entrapment, since inland revenue officials asked the company for updated tax forms while not disclosing the fact that Christodoulou was under investigation.

When asking for leniency, Christodoulou cited the fact that he was a member of EOKA. This angered the EOKA fighters association, who issued a statement saying that he should face the consequences of his actions and not use the name of the organisation in mitigation.

Christodoulou was also set to speak at a 28th of October event in Avgorou, which prompted a reaction by the teachers’ union POED, which said Christodoulou should not be allowed to give the speech given current developments.

Last month, Christodoulou pleaded guilty to six charges relating to tax offences in connection with the transfer from Greek ship-owner Michalis Zolotas to a company managed by his daughter just a few months after his term as governor expired.

Christodoulou’s daughter Athina and her former husband, Andreas Kizourides, were also accused initially but were acquitted after the former CBC governor’s guilty plea.

The prosecution later suspended seven lesser charges.

Earlier, Christodoulou had claimed that the money was a downpayment for consultancy services that would have been provided over ten years to Focus, a company belonging to Michalis Zolotas.

Zolotas is said to be an associate of former Laiki strongman Andreas Vgenopoulos whom many hold responsible for the collapse of the island’s banking system, though Vgenopoulos has repeatedly rejected the connection.

Christodoulou also presented the court with a copy of an agreement between his daughter’s company and Focus.

The transfer in question was allegedly made to the company’s Athens-based bank account in July 2007.

Around two years later, the €1 million plus interest was transferred to an account in Laiki Bank.

Christodoulou had served as governor of the Central Bank of Cyprus from 2002 to 2007.

After the case was brought to light, Christodoulou’s company filed proper tax forms for 2008, 2009 and 2010. The company has already paid taxes on the one million received.

Speaking to the media after admitting to the tax evasion charges in September, Christodoulou said he had been vindicated by the fact that charges had been dropped.

“I neither stole, nor was I bribed,” he said. “My conscience is clear; I did my duty. I was honest and I have given this country more than I have taken.”

He said the whole affair was a smear campaign and half the island should have been

charged with the same offences.


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