The defendants’ lawyers in the Bank of Cyprus (BoC) trial raised on Monday additional pre-trial objections, with the court deciding to adjourn to May 22, giving the state prosecutors time to consider their response.
In the case before the Nicosia criminal court, five of the bank’s former top brass, as well as the lender itself, are accused of deliberately misinforming investors with regard to the bank’s capital position in 2012.
In addition to the bank, indicted are former CEO Andreas Eliades, his successor Yiannis Kypri, former board chairman Andreas Aristodemou, former vice chairman Andreas Artemi and former first deputy CEO Yiannis Pehlivanides.
They are facing charges of market manipulation and conspiracy to defraud investors in connection with “non-disclosure to the public that the bank’s capital needs had risen significantly relative to the amount of €200 million, which was announced on May 10, 2012.”
With the exception of Artemi, all had previously motioned for the suspension or dismissal of the case against them, citing pending Supreme Court appeals they had filed against a Cyprus Securities and Exchange Commission (CySEC) ruling, which imposed hefty administrative fines on them for the same offence.
But in an interim ruling earlier this month, the court rejected the motion, arguing that the Supreme Court appeals against CySEC cannot be considered criminal proceedings.
The judges had also denied a motion by Artemi’s lawyers to dismiss the case against him as CySEC had exempted him from administrative sanctions.
In court on Monday, defence lawyer Chris Triantafyllides challenged the correctness of the interim ruling on Artemi, motioning for it to be referred to the Supreme Court.
Attorney Demetris Araouzos said that CySEC failed to adequately substantiate its finding that “the bank’s capital needs had risen significantly.” This was a generic phrase that needed further documentation, he said.
Defendant Andreas Eliades’ attorneys argued that the charges facing their client are deficient in describing an offence that is recognized by criminal law.
The defence are seeking to demonstrate that the prior CySEC decision – on which the criminal charges largely rest – carry no legal implications.
To this end, lawyer Esftathios Efstathiou summoned a parliamentary officer, who submitted documents according to which parliament has yet to vote on CySEC directives relating to market manipulation.
Efstathiou argued moreover that CySEC has no authority to take administrative action. He cited the Constitution, which he said grants no state organ – other than the cabinet – the power to issue subordinate legislation.
Subordinate or secondary legislation is law made by an executive authority under powers delegated from a legislature by enactment of primary legislation. It is law made by a person or body other than the legislature but with the legislature’s authority.