ND plays it cool over leaked bond report extracts

Gov’t insists there is no political link

The government yesterday played down leaked extracts from a probe suggesting Finance Ministry officials were aware that a Greek state bond would be sold on before reaching four pension funds and that some money from the transactions ended up with a political party.

The extracts appeared to be from the report into the sale of a 280-million-euro structured bond compiled by Giorgos Zorbas, the head of the committee formed to fight money laundering.

New Democracy refuted the potentially damaging allegations, saying it had nothing to hide, particularly since it was the government itself that had prompted prosecutors to investigate whether the pension funds, which purchased the bond at an inflated price, were the victims of any wrongdoing.

«New Democracy was the one that revealed the matter and referred it to justice,» said party spokesman Constantinos Arvanitopoulos. «Zorbas's report is just one of the factors that the judiciary will consider in their investigation into the bond affair.»

He categorically denied that money from unlawful practices had ended up in ND's coffers.

PASOK, however, saw the leaks as an opportunity to back up its claims that the government was trying to cover up its alleged involvement in the affair.

«After the latest developments, no person in this country can have the slightest doubt that Karamanlis was forced to call elections,» said PASOK spokesman Yiannis Ragoussis. «He is systematically trying to cover up the huge structured bond scandal.»

However, the government will be hoping that it has taken another step toward distancing itself from the bond scandal after revealing last night that a deal had been reached for the pension funds to get their money back.

Labor Minister Vassilis Magginas said that US investment bank JP Morgan and London-based hedge fund North Asset Management had reached an agreement with the four pension funds to buy back the bond.

The Greek funds are also expected to receive some 2.7 million euros to cover the interest that has accrued.

The impact these developments may have on the election race will probably become more apparent in days to come when a series of opinion polls are released.

According to two polls made public yesterday, New Democracy has a lead of up to 1.6 percent over the main opposition PASOK party.

A GPO survey on behalf of Mega TV put ND at 36.2 percent and PASOK at 34.6 percent. According to the survey, 7.5 percent of voters are undecided.

A poll by Metron Analysis for Antenna TV gave ND 31 percent and PASOK 29.5 percent.