Cyprus Mail

Anastasiades gives green light for Georghadji’s dismissal

By Angelos Anastasiou

President Nicos Anastasiades has issued written instructions to Attorney General Costas Clerides to proceed with requesting the dismissal of Central Bank governor Chrystalla Georghadji on grounds of conflict of interest.

The case against Georghadji is reportedly almost ready and will be filed by Clerides to the Judicial Council – comprising the full roster of Supreme Court judges – in the coming days.
State radio reported that police investigators have not been engaged in this case as the Legal Service plans to handle the case itself.

Meanwhile, deputies on the House Ethics committee, which had been looking into the Central Bank governor’s alleged conflict of interest, reached near-unanimous conclusions on Tuesday, and its final report will be issued next Tuesday.

The committee’s probe relates to the fact that Georghadji’s daughter, Marianna, had been employed at Andreas Yiorkadjis & Co, founded and run by the governor’s estranged husband. The law firm represents former Laiki Bank strongman Andreas Vgenopoulos, currently battling the Central Bank of Cyprus in court.

Because Georghadji had this information at the time, she should never have accepted the appointment at the Central Bank’s helm, the Ethics committee argued.

In the aftermath of the political row over Georghadji’s conflict, Andreas Yiorkadjis announced his firm had dropped Vgenopoulos as a client, and that Marianna Georghadji no longer worked for her father.

Further criticism against Georghadji will take the form of censure for altering certain clauses of her contract of appointment, removing one banning her first-degree relatives – including her daughter – from working in any field connected with the Central Bank of Cyprus, and inserting another raising her salary and benefits.

But consensus among committee members faltered when it came to the Presidential Palace’s role in signing the altered contract. Internal process failures resulted in an embarrassing witch-hunt, which hanged then-presidential aide Makarios Droushiotis – who had received the signed documents from Georghadji and forwarded them for the President’s signature – out to dry.

Predictably, opposition AKEL wanted to include the Palace’s failures into the report’s conclusions, but stumbled upon ruling DISY’s resistance.

A third “pillar” of the conclusions will relate to any negative impact the events under scrutiny may have had on the investigations and legal proceedings relating to the banking scandal – meaning the economic meltdown of March 2013 – according to committee chairman Nicos Nicolaides.

He was referring to Georghadji’s conflict of interest, which deprived Vgenopoulos of his legal representation and may be used by the Greek financier in his defence.

In such a case, committee member Demetris Syllouris said, “people will be held accountable”.

Meanwhile, police confirmed on Tuesday that Attorney general Costas Clerides had given orders for them to stop current investigations into the Central Bank in connection with a complaint by parliamentarian Zacharias Koulias concerning a leaked list of MPs with non-performing loans.

This development comes days after Anastasiades received a letter from European Central Bank President Mario Draghi, who warned the government to cease infringing on the local Central Bank’s independence.

Draghi was referring to a police raid at the Cyprus Central Bank following a complaint by parliamentarian Zacharias Koulias in connection with a leaked list of MPs with non-performing loans. During the raid, police seized computer hard drives and documents from the Central Bank.

The drives and documents must be returned immediately, Draghi asked, otherwise the ECB would be taking up the matter with the European Court of Justice.

National central banks of Euro-area countries are independent of local authorities and subject to scrutiny only by the ECB.

Anastasiades had responded to the letter saying that the executive branch of government – meaning himself – has no say in criminal investigations against the Central Bank, and referred Draghi to Clerides.

But it is expected that the ECB will react to any legal efforts to remove Georghadji from her post.

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