Afxentiou Hits Back Over Share Dealing Controversy

by Philip Morton, Investors Offshore.com

31 January 2002

The Governor of the Cyprus Central Bank has hit back at allegations made by the joint House Finance and Watchdog Committee Chairman, Christos Pourgourides, that he and his family were involved in dodgy dealings on the country's stock exchange.

Mr Pourgourides has claimed that Afxentis Afxentiou's son, Christos, was given private placement shares by a number of companies, and in one instance made a £1.2 million profit. 'Your son has taken several million pounds from the Cypriot people,' he accused last week, going on to question the Central Bank Chief's own integrity by asking: 'Your children managed to make millions from private placements and you insist that you had no ethical connection to this huge problem, so why were your children given all these shares?'

The committee is attempting to understand what went wrong during the boom-bust cycle of 1999-2000, in which artifically inflated share prices caused investors to lose millions. According to reports, Mr Pourgourides received information concerning the business dealings of Christos Afxentiou from a journalist on a Cypriot newspaper, who had in turn received an anonymous letter.

Mr Afxentiou, meanwhile, has condemned the actions and accusations of the House Finance and Watchdog Committe in general, and Mr Pourgourides in particular, complaining that: 'the way they operate only damages the Stock Exchange as an institution.' The Central Bank chief also warned that he would be complaining to the House Speaker over Pourgourides' use of an 'inaccurate, untrue, libellous, and anonymous letter' during last week's hearing.

Despite strenuously denying any wrongdoing and dismissing any attempts to link him to his children's activities, Mr Afxentiou, who is due to retire in three months, revealed that he had spoken to President Clerides following the eruption of the scandal, offering his resignation. However, the President asked the Governor to stay on until the end of his term.

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