A former judge, an economist and a banker will make up the executive committee that will investigate any suspicious dealings that took place in the troubled Cypriot co-op.
Attorney General Costas Clerides has announced the names of the three-member committee and is further expected to provide the parameters which they will need to follow, said to be wide-ranging and without time deadlines.
“The state attorney general, exercising his full authority provided by law, has decided to appoint an Investigative Committee tasked with investigating and determining all the facts in connection with the situation of the cooperative financial credit system in Cyprus,” an official statement said Wednesday.
The committee will be headed by George Arestis, who is currently sitting on the bench at Qatar International Court. He also served on the Cyprus Supreme Court and the European Court of Justice in Luxemburg.
The committee is expected to have broad powers as they have the legal authority to invite any person with knowledge or expertise on any given subject within their purview
The two other members will be economist Georgios Charalambous and banker George Georgiou.
Charalambous is a former deputy head at the Bank of Cyprus’ Economic Research Department, who also served as chairman of the Cyprus Securities and Exchange Commission.
Georgiou served as Chairman of the Board of Directors of the Cyprus Bankers Employers Association and managing director of Alpha Bank Cyprus.
The committee is expected to have broad powers as they have the legal authority to invite any person with knowledge or expertise on any given subject within their purview.
The exact terms and appointment provisions will be made public within the next few days, according to reports, and the committee is expected to begin work immediately after that.
The probe is aimed to looking into possible wrongdoing within the Cooperative Bank, where a number of managers and staff are widely suspected of giving high-risk loans without collateral among other offences, including corruption.
In a recent case, seven senior co-op executives pleaded not guilty to fraud charges in connection with a banking scandal where loans worth millions were given out without due process.
The historic banking institution began when small Credit Unions stated coming together, providing financial solutions to small town farming and housing needs.
But over the years, the institution accumulated an unmanageable burden of non-performing exposures (NPEs) amounting over €6 billion, roughly 60% of its total loans, with the state owning 99% of the CCB.
Widely-circulated rumours, that emerged during public discussions recently, suggested it was common knowledge that certain people would not be expected to pay back the ir loans.
The co-op’s healthy part of the bankj is currently in the process of a takeover by Cypriot commercial bank Hellenic, but legislation debates over bad loans are holding up the process.