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Former Cyprus Central Gov wanted in court

28 September 2013

Former Cyprus Central Bank Governor, Athanasios Orphanides, who failed to attend a hearing in connection with a lawsuit filed against him by a Limassol resident, has had an arrest warrant issued against him by Limassol District Court.

The Limassol resident has filed a law suit against the former bank governor for allegedly being defrauded in a bonds purchase worth 400,000 euro by the Cyprus Central Bank in collusion with Orphanides.

The client’s lawyer said that neither Orphanides nor his lawyer were present at today’s hearing and thus the Court had decided to issue an arrest warrant.

Orphanides is currently in the US and is working as a professor at the Massachusetts Institute of Technology (MIT).

The lawyer, Costas Melas said the Court will convene on November 14 to ascertain whether the arrest warrant was executed.

South Cyprus’ two largest banks, Bank of Cyprus and Cyprus Popular Bank, issued in 2011 and 2012 bonds worth of 1.4 billion euro which have been converted to worthless shares as the banks’ capital depleted due to huge losses from the Greek debt haircut and soaring non-performing loans as a result of the financial crisis. Orphanides served as CBC Governor from May 2007 to May 2012.

A report issued by Central Bank of Cyprus, made public by a House Committee on Tuesday, found that in selling the bonds, the banks engaged in miss-selling practices. The report said that the CBC fined the Bank of Cyprus with 4,000 euro. No fine was imposed on Cyprus Popular Bank.

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