By Angelos Anastasiou
It is up to Central Bank Governor Chrystalla Georghadji to justify her actions and to resolve the very public row over her reworked employment contract, President Nicos Anastasiades said on Tuesday.
Anastasiades said on Tuesday that t is up to Central Bank Governor Chrystalla Georghadji to justify her actions and to resolve the very public row over her reworked employment contract.
“It falls to Mrs Georghadji to take the necessary actions in order to dispel the perceptions that have been created,” Anastasiades told reporters on the sidelines of Tuesday’s Economist Conference in Nicosia.
Georghadji, who had remained stoically silent since the furore erupted finally went on the record on Tuesday. Also attending the same conference, she declined to comment on Anastasiades’ charges and said she would announce decisions once she has made them.
But she left no room for doubt when asked whether she was considering resignation. “I continue my work and the mission I was assigned,” she said.
Georghadji found herself cornered last Friday, after Anastasiades accused her of lying while questioned by the House Ethics committee over her daughter’s ongoing legal representation of entrepreneur Andreas Vgenopoulos – former boss of now-defunct Laiki Bank, the liquidation of which is being overseen by the Bank Resolution Authority, headed by the Central Bank governor. Legacy Laiki has sued Vgenopoulos, seeking damages for his role in the lender’s collapse.
The governor had claimed that she had discussed the matter with Anastasiades after initial press reports two months ago, which the President denied in his statement.
In fact, he said, Georghadji had failed to inform him of the potential conflict posed by her daughter’s job when accepting the post of Central Banker.
Matters were made worse for the governor when it was revealed that she had at least two provisions altered on the five-year contract template she was given to sign – one barring first-degree relatives of the governor from any job that may induce a conflict with the governorship’s duties, and another bringing her compensation on par with “pay rises afforded to the Central Bank’s permanent staff from 2007 to 2013” adding another €10,000 a year to her salary for her five-year term.
The revelations and Anastasiades’ statement on Friday prompted most political parties to call for her resignation on the same day.
Defending herself, Georghadji told deputies during the committee session that she had been offered two contract templates and simply chose one, which she aligned with legislation governing the Central Bank and its head on advice of her legal advisors. The law governing the Central Bank, she said, does not disallow the governor’s first-degree relatives to be employed by any business.
She also said that, acknowledging the potential conflict, she excused herself from Resolution Authority sessions – which she was meant to chair – that discussed the Vgenopoulos case.
But legal cover is of little use in political warfare, and Georghadji has been taking flak for her omission to disclose the conflict of interest and the contract changes timely.
On Monday, government spokesman Nicos Christodoulides tried to reduce the issue to a disagreement on ethics and civic duty which Georghadji needs to set right, while Finance Minister Harris Georgiades came out in her defence as a valued policy partner. Even occasionally vocal critic Averof Neophytou, ruling DISY’s leader, appeared to have dialled down Friday’s resignation imperative, calling instead for a “reorganisation” of the Central Bank’s structures and decision-making processes.
The saga continued on Tuesday, when Anastasiades adopted Georgiades’ “valued policy partner” spin but insisted that the issues he raised in his statement – the conflict of interest and the contract alterations – remained on the table.
“It was stated [on Monday] that there are no policy disagreements,” he said. “My statement related, and continues to relate, solely to the conflict of interest and ethical concerns, on which there has been significant dissonance with regard to the contract’s terms.”
Attorney-general Costas Clerides has played a rather murky role in the story. When the story was first run by daily Kathimerini, his position was that in a country as small as Cyprus this kind of relationship “could be expected to occur” but, that being said, state officials carried the burden of ensuring they carried out their duties honestly and with integrity.
But when invited by the Ethics committee to advise on Georghadji’s alleged conflict of interest two weeks ago, Clerides declined to appear because, he told deputies, the matter did not concern the legal services.
That was not his position during Friday’s session, however. When asked, he told deputies that while there is no legal issue, the governor could conceivably be in conflict under these circumstances, drawing Georghadji’s wrath.
And on Tuesday, the Attorney-general issued a statement saying he was “monitoring closely the developments around the issue of the Central Bank governor’s potential conflict of interest and the circumstances under which her contract of appointment was drafted and signed.”
“Although no complaint has been filed by any of the parties involved, the Attorney General is nevertheless monitoring developments around the conflict between top state officials and will intervene where he identifies grounds for intervention,” the statement said.
Meanwhile, the Ethics committee decided to resume discussion after last Friday’s session was cut short due to Georghadji’s departure.
In light of developments since Friday, deputies have decided to convene again on Tuesday, in order to investigate the issue of the altered contract.
To this end, they have decided to invite Auditor-general Odysseas Michaelides, Accountant-general Rea Georgiou and head of the President’s office Panayiotis Antoniou in order to obtain the facts around the drafting and signing of Georghadji’s contract.
By Angelos Anastasiou