Cyprus investors ‘swindled’

NICOSIA (AP) – A parliamentary report yesterday blasted the government, stockbrokers, lawyers and accountants as being responsible for the Cyprus Stock Exchange collapse two years ago, which had disastrous consequences for thousands of investors. Parliament’s watchdog and finance committees concluded in the report that «investors were swindled» following public admissions of «most of those summoned to testify» before the committees during the past few weeks. The report said Finance Minister Takis Klerides and the government were responsible for the collapse and for failing to control the situation. Klerides said he had repeatedly warned investors to be careful. Attorney General Alecos Markides, who was mentioned in the report for not prosecuting wrongdoers, said his department will investigate the 300-page document and respond accordingly. Thousands of Cypriots rushed to invest in the Cyprus Stock Exchange in 1999, after several companies listed themselves. Ignoring warnings, Cypriots bought wildly, pushing the share index up 688 percent to a record 881 points. As investor interest grew, scores of new companies applied for membership, setting off a frenzy of new issues snapped up at up to 10 times their initial public offer price. In late 1999, the exchange marked a record daily turnover of 88 million Cyprus pounds (132 million dollars). Today, the index hovers at just under 100 points with a daily turnover of 1 million Cyprus pounds to 2 million Cyprus pounds. The report also blamed brokers and investment groups for being «the leading actors in the swindling of the public.» It said these groups grew enormously rich by attracting investors through promoting new issues based on misleading and false prospectus statements.