Charges of an ‘ETBA scandal plot’

It appears that the scandal that has broken out regarding ETBA Finance, a subsidiary of ETBA Bank, has broader dimensions than was initially thought. Although it is a fraud case involving the misappropriation of money from the State, something that has happened before, the fact that high-ranking figures in the government were mobilized points to the pressure on the State following the failed merger between the National Bank of Greece and Alpha Bank. Such tension could be considered justified as the scandal was revealed on the eve of a meeting between German shipyard HDW and government officials to decide the fate of local Hellenic Shipyards, also called Skaramanga. The encounter was crucial, as it would have meant giving the green light to the transfer of ETBA Bank to Piraeus Bank. Members of the ruling party have suggested that the timing of the two events is hardly coincidental, and have even gone as far as to say that it could be part of a broader plot to destabilize the government, with the first victim being the Economy Ministry. They also said the failure of privatization of Hellenic Shipyards and ETBA Bank could result in a governmental impasse and would harm its structural reform program, which constitutes one of the principal yardsticks for evaluating government policy. The scandal involving ETBA Bank was made public last Friday evening at a press conference by Economy Minister Nikos Christodoulakis himself. Not only are ETBA Finance executives involved but private individuals are implicated as well, all of whom took advantage of the lack of transparency, complexity and red tape governing the liquidation process. In the last eight years, the racket misappropriated a massive sum of money which, according to preliminary estimates, exceeded 10 billion drachmas. The long period over which this occurred, and the minister’s hurried announcement, led to suspicions that the offense could have much broader dimensions and could even involve senior officials and executives. The misappropriated funds came from the liquidation of assets belonging to problematic companies, among them textile firm Peiraiki Patraiki and the Business Restructuring Organization, and which had been in ETBA Finance’s charge. An individual named Dimitriadis is involved in the case. During the liquidation of these assets, ETBA Finance was supposed to collect the funds and deposit them in Eurobank. The people involved in the ring – and according to the ETBA management, personnel in the accounting office must have had a hand in the transactions – deposited the funds in another account via Dimitriadis, who has a company transmitting sell and buy orders to brokers. After each liquidation, ETBA Finance received a cheque from the buyer corresponding to the funds raised from the transaction. An executive then signed the check and passed it to Dimitriadis, who presented himself as being from Eurobank. Dimitriadis deposited the cheque into another account, using the funds to invest in repos and time deposits and according to sources even in equities via Avax Securities. Dimitriadis gave forged deposit receipts to ETBA Finance, thereby facilitating the case. It should be noted that the case was uncovered by a due diligence conducted on ETBA subsidiaries prior to their transfer to Piraeus Bank. Sources said the chartered accountant also asked for a repo agreement worth 200 million drachmas and discovered that there was no such paper nor money. Banking sources said it is odd that there has never been any cross-checking nor verification done during all these years. Odder still is that the state has never asked for the liquidation funds, leading to suspicions that high-ranking executives and lawyers are involved. Economy Minister Nikos Christodoulakis appeared to understand the seriousness of the situation, as was evident during the extraordinary press conference last Friday and his telephone calls to the supervisory authorities. The minister also assured Piraeus Bank governor Michalis Sallas that the scandal would not affect the selloff of ETBA Bank and that the losses would be deducted from the price it would pay. Following the news of the scandal, ETBA Bank governor Giorgos Kasmas suspended ETBA Finance Managing Director Spyros Stephanatos, General Manager G. Karayiannidis, Chief Accountant Dimitrios Frangodimitropoulos and Financial Officer Georgia Sbarouni.

Subscribe to our Newsletters

Enter your information below to receive our weekly newsletters with the latest insights, opinion pieces and current events straight to your inbox.

By signing up you are agreeing to our Terms of Service and Privacy Policy.