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Cyprus

Criminal court reopens Laiki case

Defunct Laiki bank

The Laiki trial took another twist on Tuesday after the Nicosia criminal court – which was expected to announce its verdict on the day – decided to re-open the case.

In a statement, presiding judge Elena Efraim said that, while reviewing the litigants’ closing arguments, a matter came to the attention of the court that needed to be resolved before a final decision could be delivered.

The matter concerns the defence’s request that the court apply the legal principle known as lex mitior – the principle by which a person is to benefit from the lighter penalty where there has been a change in the law.

The defendants are facing two charges: market manipulation, and submitting false or misleading information with regard to publishing an interim consolidated financial statement in November 2011, in which they omitted to include a goodwill writedown of €330m for Marfin Popular Bank’s – as Laiki was then known – operations in Greece.

The interim financial statement, published on November 29, 2011, related to the bank’s third-quarter results as of September 30 of that year.

In their summations, defence lawyers for two of the defendants argued that the obligation to publish interim results for the third quarter (as well as for the first quarter) of 2011 has since been rescinded. Therefore, the court should afford the defendants the benefit of the lighter penalty.

The court said the specific matter deserved closer scrutiny, and as such asked the state prosecution to respond by September 6.

It reserved issuing its final ruling for October 12.

On trial are four defendants: former Laiki bank managing director Efthimios Bouloutas, former deputy managing director Panayiotis Kounnis, former non-executive vice-president Neoclis Lysandrou and former executive board member Marcos Foros.

The case was referred to a criminal trial on November 28, 2016, following delays after Bouloutas and Foros refused to appear in person in a Cypriot court.

In March 2017 the court agreed that state prosecutors had managed to demonstrate a prima facie case against the defendants, of all whom pleaded not guilty.

The defendants subsequently chose to testify under oath and to be cross-examined.

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