Cyprus Mail
Guest Columnist Opinion

Legal fracas over BoC lances the boil of the old guard

By Demetris Theodorou

Cousins, god-siblings and koumbaroi in the legal world are having a spectacular falling out, divided among themselves into what has become one of the most serious institutional crises of recent history prompted by the Bank of Cyprus (BoC) court cases.

The interwoven connections between the main players are staggering.

Attorney-general Costas Clerides, whose son was a BoC employee, has been railing about the role of his god-brother, Polys Polyviou, whose law firm works for BoC. Currently, Clerides’ son – now eased out of the BoC – works for the cousin of a supreme court judge. The attorney-general’s former friend and repeat Boxing Day travel companion, the supreme court president, Myron Nikolatos, is no longer talking to him, but his other cousin twice removed, Christos Clerides, is supporting him. Polys, in the meantime, is cousin twice (or three) times removed from lawyer Chris Triantafyllides, while Nikolatos’ daughter was a minor with a protected account who lost it at the bank which is a customer of Polys, who is cousin of Chris and father-in-law of Michalis Kramvis, son of a retired supreme court judge.

In the meantime, this entire football match was ignited by the fact that former Bank of Cyprus CEO, Andreas Eliades, was acquitted by the supreme court. At the BoC, the notion that they conspired to help Eliades is greeted with bemusement. Nothing would have been more convenient, and perhaps more pleasant, for the BoC than to leave the issues of 2013 behind them with an Eliades conviction and what would have been a mild fine for the bank itself. If the BoC can be legitimately expected to control the establishment – as it was expected to do since its inception 12 decades ago – a ruling in favour of Eliades would be the last thing they would be expected to desire or support.

In any case, the confusion continues to deepen as the attorney-general’s office approved the deal between the bank and Nikolatos’ daughter before accusing the co-conspirators of conspiring. Perhaps he had a change of heart after a certain development regarding his son’s employment status. The most amusing part of this, has been how some of the respective wives have been calling ‘friends’ to make their colourful feelings known about the others.

The permutations of cousinship, employment, friendship are shockingly complex.

But perhaps there is an element of hope in all of this.

The very fact that this crisis has been driven squarely by personal vendettas, the breaking up of relationships and friendships and the falling out of old partners, is in itself important. In 2013 the old establishment lost its access to the centres of control of economic activity. Former major businessmen of the deep state are being put to resolution. Former banking directors are out. Former big shots and puppet masters are down and out.

To be sure, some political dynasties persist, but even they have been significantly renewed. Polyviou will remain one of the most important lawyers of the capital, but that is also driven by the technical-legalese know-how of his firm, even after a reduction in its control of the establishment. The big names of Cyprus are out of the game, and a new guard has come in.

This is nowhere more visible than at the Bank of Cyprus. With the solitary exception of Polyviou, the entire edifice of the old guard is out. And, irrespectively of ambient conditions, Polyviou does have a solid practice worthy of a bank. Overall, however, the new senior management is made up of people extraneous to the establishment. Even if a couple of them come from some of the ‘old families’, they could draw no benefit from that relationship and they have had to make it on their own merit.

The bank’s relationship with the establishment has, in fact, been rather strained lately, partly because of the fact that the Special Relationship that was expected of the bank, is no longer afforded to them. Some of the senior cadres comment that the rumours methodically circulating lately that the bank is in some kind of trouble, spur largely from the newly-found mistrust and the annoyance over the treatment that the ‘old guard’ is receiving from the bank.

And yet, as is the case with the whole country, they too have been loaded with the remnants of the pre-2013 collusion, including this now-infamous Eliades business. Coco bonds and loans connected to them, indebted households, lost jobs, delayed recovery and lower wages are all part of the persistent fallout from the ‘cleansing event’ of 2013.

What is at stake today is for the country to see that process through. The last throes of the ‘old regime’ are manifesting themselves through this recent vitriol. The country should remain focused and calm, but remember that new, fresh, young lawyers can supply a new breed of judges the way the Bank of Cyprus has delivered a new senior management (led by an Irishman) who are believers in changing the ethical values of their profession.

In politics, we are seeing the first vestiges of this – despite it all, despite the aggravating pettiness and lack of ability, we have seen some change. Fifty per cent of the parliament was changed in the last elections, with a younger average age and (a little) more gender equality. Even President Anastasiades, whose cabinet was a Disy all-star team in 2013, now sits at the head of a cabinet of young nonpoliticians.

Maturity is still lacking and the new breed has a long way to go before they become ‘made’ as a new anti-establishment. But the first buds of a changing society are there. And, in the midst of anger, scandal and personal enmity, it will be important for us all to support it to maturity.

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