Cyprus Mail: News Articles in English, 98-10-09

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From: The Cyprus Mail at <http://www.cynews.com/>

Friday, October 09, 1998

CONTENTS

[01] Central Bank imposes restrictions on Russia's Inkombank

[02] Markides puts brakes on committee probe

[03] Limassol bishop will not step down

[04] 'Priest blackmailed into drug trade by transvestite photo'

[05] Senator says Turkey has crammed the north with US weapons

[06] Foreign experts postpone visit on missing

[07] World first for Cyprus triplets

[08] Police hunt for the fifth man

[09] Save us from the dolphins

[10] CyServ opens with pledge to promote service sector

[11] Galanos movement turns into a party

[01] Central Bank imposes restrictions on Russia's Inkombank

THE CENTRAL bank has imposed restrictions on the operations in Cyprus of Russia's Inkombank, instructing the Limassol-based offshore banking unit not to accept any new deposits.

The instructions were given to the bank in a letter dated September 14 following consultations with the Central Bank of the Russian Federation, according to Spyros Stavrinakis, head of the Banking and Financial Services Section at the Central Bank of Cyprus.

Speaking to the Cyprus Mail yesterday, Stavrinakis said the Central Bank's action was not a reflection of how it viewed the operations of Inkombank in Cyprus, but rather to conform with measures taken by the Russian central bank against Inkombank.

"We are supervising the operations within Cyprus of a branch of a Russian bank and we as the Central Bank of Cyprus are satisfied and have no adverse comments to make about the branch in Cyprus," he said. "The branch is following the fortunes of the whole bank and it has no solvency of its own."

There was no immediate comment from the bank in Limassol.

Inkombank is one of five Russian banks operating on the island as offshore banking units. It is the second largest among the five but, unlike the other four, has been heavily engaged in retail banking. It is believed to have attracted business from a wide range of mostly Russian investors and companies.

Depositors of the other four offshore Russian banks have also been unable to access their foreign currency funds, but the Central Bank has not been approached with any complaints.

News of the Central Bank's action against Inkombank in Limassol is a by- product of the two-month-old financial crisis in Russia which has taken the economy of the former communist country to the brink of meltdown as the national currency, the rouble, rapidly depreciated.

News of the move also does not bode well for the large Russian business community in Cyprus, which has assembled on the island following the break- up of the Soviet Union at the start of the decade.

Of the estimated 34,000 offshore companies registered in Cyprus, about 5, 000 are believed to be Russian, and an estimated $20 billion to $25 billion worth of investments are believed to have been reaching Russia through Cyprus every year.

The news also worsens the anxiety felt by Russia-related businesses in Cyprus over delays in renewing a key 1982 double taxation treaty between the island and Russia. The issue has been on the back burner since the crisis began in Russia with the new Russian government of Prime Minister Yevgeny Primakov busy charting a way out of the crisis.

Stavrinakis said yesterday Inkombank's exposure in Cyprus amounted to several million dollars, but he declined to give an exact figure.

Earlier this year, the bank heavily advertised high interests on US dollar deposits over relatively short periods, and it is believed that its current exposure is partly owed to clients of this product.

Industry sources said some of the bank's clients who are owed interest on their US dollar deposits or who wish to withdraw their funds are planning to take the bank to court in Cyprus in an attempt to get their money back. The sources, however, said such action was unlikely to bear fruit.

The Central Bank of Russia took regulatory measures against Inkombank back in August at the outset of the Russian crisis. The appointment of a temporary administrator to the bank was challenged by Inkombank and no such person was appointed. The Russian central bank later gave Inkombank's household depositors the option of transferring their funds to the state- owned Savings Bank.

"We could not in Cyprus take stricter measures than those taken by the Russian central bank against Inkombank," said Stavrinakis yesterday.

Friday, October 09, 1998

[02] Markides puts brakes on committee probe

ATTORNEY-GENERAL Alecos Markides yesterday raised doubts as to whether the House Watchdog Committee had the authority to probe corruption allegations against political figures.

Nevertheless, the House Watchdog Committee voted unanimously to go ahead with its investigation into whether Interior Minister Dinos Michaelides had a case of political responsibility to answer.

The committee convened yesterday behind closed doors to discuss whether it should proceed with a probe into unlawful enrichment claims levelled at Michaelides and, to a lesser extent, House president Spyros Kyprianou.

Markides - who was called upon to give his opinion to the committee - said afterwards he had grave reservations on whether the House had the power to probe one of its own or a member of the executive.

As a result, a decision on whether to take the Kyprianou issue further was put on the back burner.

"When a House as an organ of the State comes to probe other deputies, then I think there is a problem.

"At this stage, I have doubts about how far the House can act in this way."

Markides' was called upon to give his advice because it is the first time in the Republic's history that such allegations have implicated a member of the House.

Neither has a minister ever been investigated or charged with unlawful enrichment since the relevant law was introduced in 1965.

The Attorney-general made clear the House did have the authority to apportion political responsibility, but not to delve into any criminal aspect of the corruption allegations.

Committee chairman Christos Pourgourides - who has drawn up a 14-point list of corruption allegations against Michaelides - said he believed the House had the right to apportion political responsibility.

"All that the minister has admitted shows huge political responsibility."

Pourgourides said the allegations involving Kyprianou and his family were a more delicate issue because the committee only has possession of a single unsigned document indicating that Kyprianou's two sons had obtained land at below the market value.

However, Pourgourides said Kyprianou himself was eager for the committee to discuss the issue and clear the matter up once and for all.

"We can't allow shadows to form over people and we must show due sensitivity in clearing the matter up."

Meanwhile, the House Legal Affairs Committee said it was progressing on approval of a government-backed anti-corruption bill, which would oblige public figures to state their sources of income and wealth.

Legal affairs committee chairman Panayiotis Demetriou said there was a convergence of views on various aspects of the bill, which is expected to be ready for a plenum vote in December.

Deputies have agreed that the penalties under the bill should be five years imprisonment and/or a £10,000 fine.

Friday, October 09, 1998

[03] Limassol bishop will not step down

LIMASSOL Bishop Chrysanthos yesterday said he would not step down, despite calls on Wednesday for his resignation.

Speaking after a two-and-a-half-hour meeting with Archbishop Chrysostomos, he added that he was at the disposal of investigators and would obey the rules of the Church and State.

Chrysanthos is also understood to be upset at the decision to hand over of the findings of the Church's Special Investigative Committee on the allegations against him to Attorney-general Alecos Markides and to Justice Minister Nicos Koshis.

Chrysanthos' lawyer, Christos Kitromolides, was bitter: "We were reassured again and again by members of the Holy Synod's Committee that the report was purely the concern of the Holy Synod and was an internal Church issue."

Kitromolides said Chrysanthos was upset because a special relationship existed between members of the Church, and felt he may have "stated things he would not have stated to the Attorney-general or to police investigators." He added it would be unfair to Chrysanthos if the Holy Synod had now been swayed by outside influences.

Elias Pantelides, who headed the Church investigation, yesterday defended his committee, saying they had had no part in the decision to pass on copies of the 1,700-page report. The committee's responsibility, he said, had ended with the delivery of the report to the Holy Synod.

Friday, October 09, 1998

[04] 'Priest blackmailed into drug trade by transvestite photo'

POLICE are investigating allegations that an orthodox priest photographed naked with a transvestite was blackmailed into becoming a mule for underworld drug traffickers.

According to Sigma TV and Simerini newspaper, the senior cleric - who has not been named - transported drugs for local underworld gangs after they threatened to make public his sexual preferences.

Justice Minister Nicos Koshis confirmed yesterday that there was a police investigation into the case, although he said no specific charge had been made.

"Such information does exist, and the police are investigating it, but there is no specific accusation."

It was reported that the priest had been trafficking drugs for the underworld over the past two years, but police only began a surveillance operation two weeks ago following a tip-off, which included the compromising photograph.

The photograph is understood to show the naked cleric in an incriminating position with a transvestite.

Quoting police sources, Simerini said the priest had been under 24-hour police surveillance for the past two weeks.

Sources told the paper that the cleric had made frequent trips to Crete and Lebanon to pick up packages allegedly containing drugs.

Reports claim that Archbishop Chrysostomos and the Presidential Palace applied pressure to sweep the case under the carpet in a desperate effort to avoid another scandal.

Both Koshis and government spokesman Christos Stylianides yesterday denied that there had been any official intervention to close the investigation.

Archbishop Chrysostomos told Simerini that he had not given permission to the cleric to travel abroad or receive any packages.

The cleric has apparently explained the photograph to a meeting of the Holy Synod.

He has denied any involvement with drugs and the underworld, the paper said.

Friday, October 09, 1998

[05] Senator says Turkey has crammed the north with US weapons

American Senator Alfonse D'Amato says he has received "new and credible information" that US defence equipment and defence services sold or leased to Turkey have been re-deployed in the occupied areas.

His information includes details on the deployment in the north since 1994 of more than 200 main battle tanks, 400 armoured personnel carriers and dozens of TOW anti-tank missiles and self-propelled howitzers, all sold or leased by the US to Turkey.

D'Amato has written to US Secretary of State Madeleine Albright and Defence Secretary William Cohen asking for an immediate review of the situation.

"Such deployments severely complicate the efforts of the United States to achieve mensurable progress towards a just and lasting Cyprus settlement," D'Amato said.

"I requested the immediate review of this matter, including an inventory of US defence equipment and defence services in the occupied zone of northern Cyprus."

In his letter, D'Amato said the Foreign Assistance Act prohibited the supply of US military assistance to any country for purposes other than internal security, legitimate self-defence of United Nations approved actions.

"This... is extremely troubling," D'Amato said, adding that he has demanded a report explaining the situation within 30 days.

The north of Cyprus is one of the most heavily militarised places in the world, with 35,000 Turkish troops stationed there.

As part of the Greek Cypriot side's efforts to help reduce tensions on the island, President Clerides has proposed the idea of demilitarisation, but the Turkish side has until now refused to consider it.

Talks to negotiate a bi-zonal bi-communal federation have stalled since the Turkish Cypriot side insisted they be based on the idea of a confederation.

The UN is due to begin a new round of shuttle diplomacy to break the deadlock. The National Council will meet today to discuss the latest UN effort.

Friday, October 09, 1998

[06] Foreign experts postpone visit on missing

Christopoulos said the experts had also been to assist in exhuming the remains of unknown Greek Cypriot soldiers killed during the coup and invasion, and who are buried at Nicosia cemeteries.

"They were supposed to come at the end of August but said they had more pressing business elsewhere," Christopoulos said. "They did not say when they could come," he added.

Christopoulos said Foreign Minister Yiannakis Cassoulides had met the experts in New York during his recent visit there, and they had informed him of their position.

Although the Turkish Cypriot side has reneged on last year's deal designed to clear once and for all the issue of the missing, the Greek Cypriot side intends to go ahead with whatever it can do.

The government is fulfilling its side of the bargain after being faced with the threat of the UN washing its hands of the entire issue, despite having recently appointed its own member to the tripartite Committee for Missing Persons (CMP).

Faced with this possibility, the government offered to pay the entire cost of running the CMP.

In all, 1,619 Greek Cypriots are officially listed as missing, but the government has statements from witnesses which indicate that 126 were probably killed.

In August, two women tried to dig up the grave of an unknown soldier, believing their husbands might be buried in the cemetery.

Friday, October 09, 1998

[07] World first for Cyprus triplets

Born by Cesarian section to their 32-year-old mother, the triplets, though delivered after just 33 and a half weeks, are completely healthy.

The two girls weigh 1,760 grams and 1,458 grams respectively and their brother is 1,738 grams.

This method of diagnosing thalassaemia before a baby is conceived has been used in Cyprus for two years by the Gynaecological and Maternity Departments of the Makarios Hospital and the Thalassaemia Centre in co- operation with American experts at Chicago's Institute of Reproduction and Genetics.

The method is based on artificial insemination. Diagnosis comes before fertilisation and pregnancy, therefore avoiding a possible abortion as only healthy eggs are fertilised.

Previously, the earliest diagnosis could only come in the third month of pregnancy. A diagnosis of a thalassaemic foetus then led to the traumatic choice of abortion.

The new method has also been used overseas in the prevention of genetically transmitted diseases, leading to the birth of approximately 200 healthy children so far.

The first time this method was used successfully was in April 1998, with the birth of a boy. The first girl was born three months later. The Cyprus triplets are the first in the world.

Friday, October 09, 1998

[08] Police hunt for the fifth man

Police are looking for Andreas Sinesis, also known as Mexicano, aged 32.

Police have already remanded Theodoulos Sinesis, Pavlos Kouilis, Kyriakos Sinesis and Giorgos Xiourouppas, after an all-night police operation earlier this week apparently foiled a double gangland murder plot.

The operation began on Monday night when police gave chase to a car in the Limassol village of Kolossi.

It ended in the early hours of Tuesday outside a pub in Limassol, when the occupants of the car handed over three packages - later identified as automatic weapons - to the passengers of a black BMW.

Theodoulos Sinesis and Kouilis - the occupants of the first car - were arrested on the spot, but the BMW escaped. Two of its occupants, Kyriacos Sinesis and Xiourouppas, were arrested on Wednesday. Andreas Sinesis is thought to be third man in the car.

The three automatic weapons have not been found, though an earlier search revealed a sports bag holding 100 cartridges. The BMW was also found.

Friday, October 09, 1998

[09] Save us from the dolphins

The Pancyprian Association of Professional Fishermen, which enjoys the full backing of the four national farming organisations, presented a letter to the president outlining the problems facing their industry and drawing attention to a previous letter stating their demands.

That letter, dated March 11 1997, had called for immediate compensation for the damage caused to fishing nets by dolphins. No action has since been taken to satisfy those demands.

The fishermen yesterday also asked for measures to keep dolphins away from beaches, for a protection plan for their nets and for strict enforcement of the law providing for "true protection of professional fishermen".

The fishermen conceded that this was an extremely sensitive issue, as dolphins are a protected species in Cyprus.

Friday, October 09, 1998

[10] CyServ opens with pledge to promote service sector

Opening the four-day exhibition, President Glafcos Clerides said "the government is promoting and staunchly supporting the efforts to turn Cyprus into a regional services centre."

Clerides noted that the service sector contributed 73 per cent to the country's Gross National Product, and that Cyprus aimed to have even better results that would have a positive effect on all areas of economic activities.

Some 30 service companies from Greece, Israel and Egypt, Jordan, Lebanon and Malta, and more than 50 from Cyprus are participating in this year's exhibition.

Friday, October 09, 1998

[11] Galanos movement turns into a party

Movement founder, former House president and rebel Diko deputy Alexis Galanos, made the announcement yesterday saying: "The Eurodemocratic Renewal Party has a very important role to play".

Galanos said the decision had been reached on Wednesday by the Movement's central committee.

Underlining the need for "better governance and greater emphasis on economic issues," Galanos said the Eurodemocratic Renewal Party (ERP) aimed to raise the level of political behaviour, attitudes and ideology a change "essential in Cyprus' political life today".

He said the ERP was demanding an equal role to that enjoyed by other political parties and expected a seat on the National Council, the top advisory body to the President on the Cyprus issue.

Galanos broke ranks with the Democratic Party, Diko, where he had served as Vice-president, before last February's presidential elections.

The move came after Galanos disagreed with the party's decision to back independent candidate George Iacovou, putting forward his own candidacy in the first round and backing President Clerides in the second.

Galanos yesterday reiterated his support for the Clerides government but said his party would not hesitate to criticise it, especially on internal issues.

© Copyright Cyprus Mail 1998

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