Following the government’s decision to privatise Proton Bank, by activating a bank rescue fund, the Greek and foreign press is outwardly saying the word SCANDAL comparing it with that of the Bank of Crete Scandal in 1989. Proton Bank was the first bank to be nationalised under the Financial Stability Fund, a safety net set up by Greece and its international lenders for banks that need to recapitalise but do not have the means to raise funds in the market. The central bank of Greece’s move to nationalise Proton Bank (which is under investigation for possible violation of Greece’s money-laundering law) has sparked controversy because analysts claim that Proton’s problems are its own.
Adding to this, is a law that was surfaced last night by one of the best reporters on the state channel Kostas Vaxevanis (host of To Kouti Tis Pandora’s) that talks about Law #3904 which literally gives amnesty to anyone at the head of the Finance Ministry, or that has had authority over the disbursement of public sector funds, to not be held accountable for their decisions, if these funds were used illegally.
The reason Vaxevanis mentioned this law, is because Venizelos went and drafted a similar law a few days ago giving even further personal amnesty to all the Ministers of Finance that have governmed Greece since 1997, sparking even more reason for controversy.
Vaxevanis asked Venizelos why the government decided to give 120 million to Proton Bank even though it was told not to do so by the national treasury.
Watch the video below and see for yourselves. When Vaxevanis surfaces the issue, and more or less corners Venizelos on the issue, the Greek Minister does two things. First begins belittling the reporter taking his criticism to a personal level and then he indirectly leaves it to be understood that Vaxevanis’ interests should be on the state (or on defending only the PASOK party) and not on the actual truth! The Greek Finance Minister gives his own reasons why Proton Bank was privatised and totally avoids answering the reporter’s questions.
(To get a better understanding of the whole issue, first watch video and then continue reading article further down).
According to the article, main opposition New Democracy MP Nikos Nikolopoulos said that the primary members of the Executive Board of Omega Bank, bought out from Proton Bank in 2005, were none other than the father in law of Evangelos Venizelos, Mr. Bakatselos, Proton Bank Owner Lavrentis Lavrentiadis and surprise surprise… the brother of current prime minister George Papandreou, Nikos Papandreou, leaving it to be understood that the bank was being used for “unexplained and/or shady” dealings of the PASOK party.
In a separate article published on Wiki Greeks hellasfrappe found the following analysis written by Dimitri Bertson on September 20, 2011 on the Proton Bank issue. Hellsafrappe is certain that once you read it, you too will wonder the same thing we did.
How big a black hole is Proton Bank?
September 20, 2011Ask Greek Physicist Dr. Lavrentis Lavrentiadis, Who Has Found One in Liechtenstein. There is an old joke that physicists tell: The proton that walks into a bar and says, “I left my wallet here.” The bartender says, “Are you sure?” and the proton says, “I’m positive.”Greeks can be equally positive that there is a black hole at the center of the books of Athens’ Proton Bank, but the question remains, just how large is it, and what else will it suck into its negative event horizon?The Proton Embezzlement ScandalLast month, a Greek public prosecutor charged seven members of Proton’s board with embezzlement amid a sudden increase in its loan-loss provisions and the appointment of a new board of directors that included representatives of the Bank of Greece and the Greek government. It was also reported that Proton’s largest shareholder, Greek boy-wonder Lavrentis Lavrentiadis, was among those under investigation for embezzlement and money laundering. Notably, many of the loans that are said to be non-performing allegedly relate to other businesses in which he has an interest.
As of mid-August, four Greek banks agreed to participate in a €50 million bailout of the bank through the issue of a convertible bond to recapitalize Proton. The €50 million infusion by the National Bank of Greece, EFG Eurobank, Piraeus Bank and Alpha Bank, followed a €100 million deposit by the Greek government in mid-July to help it pass EU-required stress tests. The purpose of the announcement of the August recapitalization was similarly tactical – to counter market fears about whether Proton would survive the summer. While Proton Bank continues to survive, its reported losses of €29.6 million for the first half of the year likely understate its actual problems in light of the embezzlement allegations.
The propping up of Proton Bank is symbolic of Greece’s overall situation. Institutions that are fundamentally insolvent as a result of corruption, embezzlement and other abuses are being propped up not because they have reformed and are now capable of survival, but because their collapse imperils the rickety structures surrounding them. Proton isn’t even just a Greek embarrassment. Former U.S. Ambassador to Greece Daniel Speckhard has been its non-executive chairman, and is now “cooperating” with authorities on their investigations.Lavrentiadis: At the Center of the Black HoleWord is, Lavrentiadis (the Greek boy-wonder mentioned above) has had his accounts at Proton Bank frozen, and his cross-border financial transactions are now being tracked to assess whether he embezzled funds and laundered proceeds outside the country. Close attention is being paid to Proton Bank’s lending to companies in which the hyper-successful 39-year-old Lavrentiadis has been involved, including ten companies described in prosecutors’ reports as a pyramid built on loans from Proton Bank.
Was Proton Bank a Ponzi scheme as well? Greek prosecutors suggest that it was, as the bank provided depositors interest on deposits of 9 percent at the same time it was giving loans paying interest of 3.5percent – assuming that they were performing in the first place.
Meanwhile, Alapis Holding Industrial, of which Lavrentiadis owned 21 percent until the end of 2010, provides a beautiful illustration of what is likely taking place at Proton Bank. At its height in 2008, it sold for more than €80 per share. Three years later, its price has declined to some 14 cents per share, with a total market capitalization of €6.4 million, down from some €3.6 billion. At the very time Lavrentiadis sold two-thirds of his interest in Alapis, by selling his holdings in Lamda Partners GP Limited, Lamda Partners Ltd and Zirbuka Enterprises Ltd, he created a new vehicle in that haven for transparency and integrity – Liechtenstein.
Yes, at the very moment Lavrentiadis liquidated important Greek interests and long before the discovery of the apparent embezzlement at Proton Bank, he created the Lamda Private Bank Ltd. with headquarters in Vaduz, Liechtenstein, as the 16th financial institution licensed to operate in Liechtenstein, with authorized capital of 25 million Swiss francs. Please check out the website for Lamda Private Bank Ltd., and look for evidence that it has anything to do with Lavrentiadis and his assets. You will find mentions of his name nowhere on it.
But Liechtenstein sources write that Lamda Bank became operational in November 2010, offering services in “private banking” to “meet the needs of wealthy families and private clients like Dr. Lavrentios Lavrentiadis, who is a client of his bank since the beginning as well as majority owner and Chairman of the Bank,” to quote the Liechtenstein register of December 2010.
At the same time, Lavrentiadis announced he and his family were leaving their home in Greece to move to a safer place – London.Closing the Loop – Proton Bank and LavrentiadisAny guess as to whether any of the funds said to be embezzled from Proton Bank have travelled through Lavrentiadis’ private bank in Vaduz? Or whether they were part of Lavrnetiadis’ ability to fund his own endowed chair at Georgetown University’s Center for Strategic International Studies (CSIS) in Washington? Just what were the sources of funds for the CSIS Lavrentiadis’ chair in Southeast European studies?
Greek depositors in Proton Bank, Greek taxpayers whose funds have now been placed in Proton Bank by Finance Minister Venizelos, and German and other European countries who are being asked to bail Greece out should all be interested in finding out just what Lavrentiadis has been doing to obtain all those assets the young entrepreneur appears now to have successfully transferred out of Greece. The bar that Proton Bank walked into and where Lavrentiadis left his wallet appears not to have been located in Athens. Instead, it appears to have been located somewhere around Vaduz.
But as any good physicist knows, once a black hole has been created, no light ever emerges. Which doesn’t mean that its trail cannot be traced by a prosecutor or bank regulator from the data points left behind.