YIANNOS Andronikou was on Sunday remanded in custody for eight days on suspicion of conspiracy to commit felony, theft, falsifying accounts and concealment offences.
In a court procedure that lasted around four hours, the judge ruled there were no grounds to detain his wife, Rea, who was also arrested for her involvement as the director of companies involved in the case.
The couple were arrested early on Sunday morning while their home and company offices were searched by police, who seized a large number of computers and documents.
Attempts to keep the arrests away from public light failed, and television viewers saw the former stock market big shot in his tracksuit running away from camera crews on Makarios Avenue in the centre of Nicosia.
The court heard that the deal for managing the Electricity Authority’s (EAC) portfolio had been signed by Andronikou and his wife, on behalf of Suphire Asset Management, and by the chairman of the pension fund management committee and two members.
The deal provided that the company would offer investment advice, while Suphire Stockbrokers would carry out the stock market transactions based on the managing committee’s instructions.
Based on the provisions, Suphire Stockbrokers should have kept a special investment account on the pension fund’s name, where all transactions would be recorded.
A bank account was also kept, and the fund provided a power of attorney so that the company could manage the account along with the fund committee.
The account was closed on May 20, 2003, with a deficit, and without the committee knowing.
Police said that the account did not show any movement from the day it was opened until the day it closed.
The court heard that Suphire Asset Management was bound by the deal to return the portfolio with the same number of shares it contained when the deal was struck.
On top of that, the company was meant to return the portfolio along with any free shares or benefits as well as interest on its initial value.
At a later stage, Andronikou asked the managing committee for a power of attorney to enable him to carry out transactions without its signatures.
The power of attorney was submitted with stock market authorities on November 25, 2002.
Andronikou appeared before the management committee six times and in all six he presented positive results.
But on January 5, 2005, the committee received the official transaction reports from the stock market and after crosschecking with the reports delivered by Andronikou, they discovered several discrepancies.
It also emerged that Andronikou had allegedly sold bank shares that were non-negotiable and that the company had not been cleared to trade.
The fund was never informed about the transactions, the court heard.
When he was asked to explain, Andronikou said the shares were transferred by mistake to another company and asked for a week to sort out the matter.
Nothing had been done until the day of his arrest, the court heard.
The fund management committee discovered a £9,221,544 deficit, as well as violations of a second deal in which Suphire allegedly used money from the fund to buy shares in public companies linked to them.
