Bad loans revive MP financial disclosure debate

A ruthless debate is picking up steam among members of parliament following public discussion and media coverage that raises the issue of conflict of interest ahead of a crucial vote on bad loans.

On Friday, Kathimerini Cyprus raised the issue of conflict of interest concerning members of parliament, who sit on House committees debating pieces of legislation without disclosing known or potential personal interests.

The issue came up in connection with the government running against the clock to pass five bills through the House, one of which would make it possible for a co-op deal to go forward.

Hellenic Bank is said to take over the healthy part of the Cyprus Cooperative Bank, essentially its bank operations and assets except bad loans, but not without state guarantees in absorbing potentially high-risk loans in the co-op takeover.

MPs have gained footing in the debate, asking for earmarks and provisions on foreclosure and bankruptcy laws in exchange for voting in support of the legislative package.

Kathimerini wrote about a conflict of interest on its website concerning an MP, who remained unnamed in the story and was linked to over €3 million worth of bad loans.

On Saturday, Daily Politis followed up on the story, naming Independent Anna Theologou as the MP in question.

Theologou reportedly has Non-Performing Loans (NPL) and owns 25% of shares in a consulting company, which was facing legal issues and court battles since 2013.

The MP, formerly with Citizens Alliance before going rogue, issued a response on Facebook, saying she did not have an NPL to her name and that all assets owned by her were reported on the personal asset declaration form with the House.

“Regarding the publication in Politis, I wish to say that everything I have reported on my asset declaration form is true and that the shares in my family-owned company were given to me as a gift by my father when I was 17 years old and I don’t have or didn’t have any involvement in taking out those loans,” Theologou said.

The MP also said she was not a co-signer to any of the loans, which she described as business-related, nor did she sign any loan applications on behalf of her company.

On Friday, Theologou took the floor during a House session to call on the media to investigate politicians who might have personal interests in the co-op deal, saying they ought to be absent during the crucial vote.

According to House regulations, “when a member of a committee has personal interest in regards to an issue being examined by the committee, he or she ought to state this conflict of interest to the chair and members of the committee at the start of the hearing or as soon as it becomes clear in the ongoing discussion that a member has a personal interest.”

Questions remain unresolved as to whether MPs should be required to declare private interests beyond their own, such as to include assets of their spouses and other relatives.

Kathimerini said only one MP so far was known for submitting a spouse financial disclosure form, while it is not currently required by House rules.