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Cyprus

Former BoC execs want CySEC official’s testimony scrubbed, citing bias

By Angelos Anastasiou

The trial of five former Bank of Cyprus top executives, and the lender itself, for alleged market manipulation and misinforming investors in 2012, resumed on Wednesday, with defence lawyers arguing that Securities and Exchange Commission (CySEC) officer Alkis Pierides’ expert testimony should be disregarded by the court.

Former board chairmen Theodoros Aristodemou and Andreas Artemis, former CEOs Andreas Eliades and Yiannis Kypris, and former deputy CEO Yiannis Pehlivanides are facing charges of conspiring to manipulate the stock market and defraud investors in connection with “failing to inform the public that the [Bank of Cyprus’] capital needs had increased significantly from the €200 million reported on May 10, 2012”.

Representing the Bank of Cyprus, lawyer Polis Poliviou said Pierides had a “unique and especially close relationship with the prosecution”.

“His role was such that he may not offer independent and unbiased testimony,” Poliviou said.
The objection related to allegations that Pierides was the architect of a CySEC probe on the very offences that sparked the subsequent trial, which triggered fines of hundreds of thousands of euros for the bank and its officials.

“It is obvious even from today’s proceedings that Mr Pierides is the driving force behind this whole case,” Poliviou argued.

“He is the person who ran the CySEC case, which, with slight modifications, was brought before court.”

Poliviou presented a British law, according to which where an expert witness has an “interest or connection” in the outcome of the case, the court must consider the “nature and extent of said interest or connection”.

But, the defence lawyer clarified, he did not attribute bad faith to Pierides.

“I suggest that you should not consider Mr Pierides an expert witness,” Poliviou argued.

“He may be likeable and competent, but he did not give the impression of an objective witness. He considers himself the standard bearer in this case.”

Defence lawyer Chris Triantafillides concurred with Poliviou’s arguments, and presented a separate case in which the court called for an expert witness’ “objective judgement”.

In that case, the court identified one of the prerequisites of an independent and unbiased expert is that he be distinct from one who has previously been involved in the case.

“Mr Pierides can testify, but what you need to decide now – and not at the end – is whether you will accept his testimony as expert or not, so that the defence can address it accordingly,” he said.

At the start of the proceedings, Pierides answered questions by prosecutor Polina Efthivoulou, revolving around his credentials.

These include a degree on Economic and Social Stats from Manchester University, his stockbroker’s licence, his ACCA and ICPAC memberships, and attending three training seminars in the United States relating to his post at CySEC.

But as soon as Pierides said he had drafted the CySEC directive saying that non-disclosure of information could compose market manipulation, Poliviou objected, arguing that under the guise of his credentials and experience, the witness was making a statement touching on the core of the case.

The objection was sustained by the court.

The case will resume on Friday at 9 am with the prosecution’s arguments



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