Major political scandal: Cypriot banks write-off loans to politicians

Posted by in Economy

A major political earthquake shakes Cyprus after a list containing names and written-off loans by banks was handed out to the Parliament. Politicians from three major parties and government officials took loans from the Bank of Cyprus and Cyprus Popular Bank (Laiki) and had them written-off after having paid back only a small part of it -in best case.

Former and current politicians (except from EDEK and Ecology party), wives or relatives took loans of several thousands euro and achieved significant remission of the debts by the banks.

A parliamentary investigation will have to show how and why this special treatment occurred and thus by boars of the financial institutions that were appointed by the same politicians who took the loans.

The list was handed out by the directors of a major Cypriot website 24H to the general prosecutor on Wednesday afternoon.

Greek daily Ethnos published the list on Friday however omitting the full names of the politicians and the companies. “Politicians’ names on the list of the big looting”

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some had written THIEVES in front of the bank

Indicative examples for deleted loans by the Bank of Cyprus:

A hotel company “affiliated to AKEL-PEO” had the total loan of  €2,813,000 deleted in May 2012.

Pancypriotic Labor Federation (PEO) had deleted 193,000 euro from a 554,000 euro loan in May 2012.

Company «N.M.G.» “affiliated to AKEL official, had 110,000 euro being deleted from 1,830,000 euro loan in March 2007 and January 2008.

Former DHSY MP paid back only 67,000 euro to a loan of 168,000 euro. The rest was deleted.

A company belonging to brother of former DHKO minister paid back only 310,000 euro for a loan of 1,595,000 euro. The rest was deleted in May 2011.

The son of former AKEL-minister had 2,000 euro deleted in May 2012. The total loan was 5,000 euro.

Similarly the Cyprus Popular Bank (Laiki) and the Hellenic Bank had deleted loans to active ambassadors, former and current wives of foreign ministry officials, but preferably loans given to former lawmakers.

The most striking case seems to be this of a company of a famous politician in the Cypriot scene (owns 51% of company shares). He appears to have made a deal with COP to delete a loan 0f 5.8 million US-Dollars. The loan delete was planned for 2014.

The scandal explodes like a bomb in the country amid a severe economic crisis with the two banks on the verge of bankruptcy and depositors having to come up for their losses.