The Nicosia criminal court on Friday dropped all charges against former central bank governor Christodoulos Christodoulou and three others, including his daughter, in a corruption trial that has gone on for several years.
Charges were also dropped against two other key defendants – Michalis Zolotas and Michalis Fole who were being tried in absentia. The court also ruled that there was no prima facie case against the former central banker’s daughter or her company.
Prosecutors had claimed that Focus Maritime Corp, owned by Zolotas, was the conduit for transferring €1m to a consultancy firm in Cyprus owned by Christodoulou’s daughter Athina.
The prosecution’s case rested on the premise that the money was a sweetener to Christodoulou so he would green-light the 2006 takeover of Laiki Bank by Greek financier Andreas Vgenopoulos, now deceased. The bank was shuttered in 2013.
Zolotas is the owner of Focus Maritime Corporation, which paid the €1m to a company by the name of AC Christodoulou Consultants Ltd, connected to the former central bank governor. Fole is the person who managed Focus’ account at a Laiki branch in Marousi, a suburb of Athens. In Fole’s case the court cited lack of jurisdiction for the Cypriot courts to try the case. There had also been irregularities in the process for arrest warrants for both men, the court ruled.
The payment is thought to have been used as a slush fund to bribe state officials and political parties.
The prosecution maintains that Zolotas’ Focus acted as a front for Vgenopoulos, who bribed Christodoulou to look the other way while he irregularly acquired a controlling stake in Laiki in 2006.
The defendants were facing charges including corruption, bribery, abuse of authority, abuse of trust, and money laundering.
However, the Nicosia court on Friday dropped all charges, except those pertaining to the legal entities Marfin Investment Group – MIG (formerly Marfin Financial Group – MFG) and Focus Maritime Corp where a prima facie case exists in relation to the two companies.
The three-bench court cited judicial abuses for dropping the charges, referring to the fact that Christodoulou and his company had already been sentenced for the contested €1m.
For that case, the former Central Bank governor had been sentenced to five months in prison and the company fined up to €13,500. Also a revised income tax form had been submitted that resulted in a payment of €127,000 in taxes plus interest and other charges.
“The question therefore arises: Was it legitimate for the prosecution to split the case in two? Create two separate filings? To bring the accused to the court for the first case, to admit it and comply in some way, for the accused to be imprisoned, to serve his sentence, to be released and then – after years – to be dragged back to court, this time along with other persons and for other much more serious offences? The answer we give is clearly no,” the three judges stated in their decision.
The court’s decision said that although this was not meant to justify any actions of the defendants, it was catalytic for the case and made the examination of any other issue legally unnecessary.
“The prosecution had to show prudence and restraint. To behave fairly, reasonably and responsibly as befits this top state service,” the ruling added.
In a written statement afterwards, Christodoulou said Friday’s court decision proves “that for the past years, my daughter and I have been subjected to a brutal persecution which goes beyond the limits of the proper serving of justice.”
“The criminal court of Nicosia with its decision today rejected as abusive and in bad faith the accusations against me by the prosecutor’s office and underlined the innocence of me, my daughter and my company.”