CITING what appeared to be a technicality, former Laiki strongman Andreas Vgenopoulos failed to show up in a Paphos court yesterday to answer charges that he had misled investors into buying high-risk securities.
Vgenopoulos and former Laiki CEO Efthimios Bouloutas, both Greek nationals, argued through their lawyers that the charge sheet had not been delivered to them in the correct manner.
Their lawyers raised a pre-trial objection suggesting that the papers had been delivered under the provisions of the Schengen Agreement, which Cyprus had not ratified.
Joining Schengen entails eliminating internal border controls with the other Schengen members, while simultaneously strengthening external border controls with non-Schengen states.
The island’s division is the reason why Cyprus has not yet joined Schengen.
Claiming he was defrauded of €108,000, a Paphos-based man has filed a private criminal case against the Laiki as a legal entity, the bank’s former brass, and former Central Bank (CBC) governor, Athanasios Orphanides.
The plaintiff’s lawyer countered that the summons had not been delivered under the provisions of the Schengen Agreement but in accordance with a relevant bilateral agreement between Greece and Cyprus.
The Paphos district court is expected to issue its decision on the matter on Monday.
Three other Laiki officials named in the suit were scheduled to appear in court on May 16.
Former CBC governor Orphanides has not yet received a summons.
The plaintiff, Stavros Mavrosavvas, is one of hundreds of depositors who claim they were misled by the banks into putting their savings in high-yield securities.
Mavrosavvas claims the defendants had falsely stated that the securities would fetch high-yields knowing that this was untrue.
Thousands of people were affected when the island’s two biggest lenders, the Bank of Cyprus and Popular Bank, stopped paying interest and blocked access to the investors’ capital following losses on a Greek sovereign debt write-down in late 2011. The total amount put in securities is said to be around €1.4 billion.