FINANCE Minister Takis Klerides yesterday pre-empted attacks from deputies over the stock exchange (CSE) fiasco with a well-prepared three-hour speech made before the House Finance and Watchdog Committees.
Addressing a joint meeting of the parliamentary committees, which are conducting an investigation into alleged stock market frauds, Klerides yesterday admitted that he held a share of responsibility for the CSE gloom, but cited relevant laws and facts to argue that he was powerless to reverse certain decisions made by the stock market authorities.
The marathon speech started at 3pm and went on until 6, leaving no time for questions from deputies. The minister said he needed two more hours to finish his presentation, and the meeting will therefore resume next Wednesday.
“I have the view that political responsibility has a general character. Every competent body is burdened with responsibility according to its duties,” said the minister. “How can the Foreign Minister or the Parliament wipe off their responsibilities if the economy is doing poorly or if a bad law has been implemented?” he asked.
Klerides added: “the people are the sole judge to assign responsibility.”
The minister said the general impression that he had superpowers when it came to decisions concerning the stock market was wrong.
“It would be unacceptable for me to intervene in these matters, and laws that were recently implemented strip me of the right to impose my opinion on the CSE Council and the Securities and Exchange Commissions,” he pointed out.
However, the minister conceded that he would accept full responsibility if a member of one of those bodies was found to have acted out of line with regulations.
He made it clear, however, that the law did not allow him to fire a member of either of those bodies before they had completed their term of office.
The minister made detailed reference to the law on the stock market to argue that he could not have stopped the market from plunging.
“The minister can have a say in stock market issues only when the Government Commissioner who heads the Securities and Exchange Commission has a disagreement with the CSE Council and asks him to rule on the subject.”
Klerides added the Government Commissioner had never sought his opinion on a matter he had the authority to decide on, such as the possible suspension of trading in a company’s stock. He said, however, that in the past two years he had been asked to say whether six companies were eligible for listing on the stock market.
The minister cited five cases in which he had ruled against a company’s listing.
One of those companies, the minister said, was LK Globalsoft.Com Limited, whose share price crashed before it was temporarily suspended from trading last year because of alleged irregularities.
Klerides said that, although he had ruled against the company’s entry, in the end Globalsoft had made it onto the stock market because the Securities and Exchange Commission and the CSE Council had agreed to admit it despite insufficient information on its activities.
Meanwhile, the Committees submitted the minutes of their past few sessions to the minister after some deputies charged that members of the Committees had exceeded their duties when they asked Central Bank Governor Afxentis Afxentiou to step down.
The two Committees believe the minutes will prove that they had acted in line with Parliament’s code of practice.
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