Illegal body’s ruling cannot form basis of charge BoC trial hears

The Cyprus Securities and Exchange Commission (Cysec) was an invalid body, and thus its rulings cannot form the basis for criminal proceedings against the defendants, defence lawyers argued on Tuesday in the trial of the Bank of Cyprus and six of its former top officials over investments gone bad.

In addition to the lender itself, former CEOs Andreas Eliades and Yiannis Kypri, former board chairman Andreas Artemis, and former board members Georgios Georgiades, Costas Severis and Costas Hadjipapas are on trial.

All defendants face four charges relating to market manipulation in purchasing Greek bonds, with Eliades facing an additional two charges of perjury before the Investigating Committee for the Economy.

At Tuesday’s hearing, defence lawyer Polis Poliviou argued that a directive issued by Cysec, which rendered the lender’s transactions questionable, was drafted by an illegal body, therefore nullifying the legal basis for the offence of market manipulation.

The appointment of one member on the securities watchdog’s board had been found to have been illegal, thus making any decision invalid.

Poliviou submitted that there can be no criminal offence without a law in force, citing the legal principle of ‘nullum crimen, nulla poena sine lege’ – Latin for no punishment for something not prohibited by law.

State prosecutor Polina Efthivoulou said the charges are fully justified, rejecting the defence’s arguments.

She also cited a recent Supreme Court ruling to a similar objection, which she said “clarifies that it is not the Criminal Court’s job to ascertain the legality and validity of the Cysec’s 2011 directive”.

Having heard all arguments, the court said it will issue an interim ruling on December 20.

Eliades, Kypri, Artemis and the Bank of Cyprus, are also defendants in another criminal trial over their failure to disclose the substantial increase in the lender’s capital needs between June 14 and 26, 2012.

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