How PASOK conned stockmarket players

Some five years have passed since France’s Credit Agricole bought a 6.5 percent stake in Emporiki Bank. Socialist PASOK, which was in power at the time, had advertised the deal as another sign of Greece’s allegedly powerful economy, as a leading European institution was expressing its confidence in the Greek economy. Governmental triumphalism inevitably influenced domestic investors. However, according to data published in Kathimerini today, investors were bamboozled while stock market legislation was violated in the Emporiki deal. The acquisition of the Emporiki shares actually had no strategic importance since, contrary to the big words, the French actually bought the shares after the Greek bank promised to buy them back at the price it sold them. More precisely, Emporiki would cover the damage caused by the sale of shares to a third party, as late as seven years after the agreement. Small investors who bought Emporiki shares while trusting in the judgment of a big foreign institution were not aware that the strategic investors were guaranteed that they could sell their shares at the same price, seven years later. The deal was kept a state secret in order to con the public. The Emporiki Bank chairman who signed the deal, the national economy minister who approved it, the head of the Capital Market Commission who disguised it and the prime minister who made ample political capital from it all bear huge responsibilities that cannot be dismissed. Such an agreement could never have been agreed on or kept secret without the hand of those who were entrusted with the task of safeguarding the investing public. The stock market debacle was not some unavoidable natural disaster, as former prime minister Costas Simitis claims. It was the outgrowth of actions and omissions by people who failed to live up to their responsibilities.

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