(Reuters) -
Greece's new anti-corruption minister is not a politician, but he is in tune
with the new crusading mood.
International
attention on Greece since the Syriza party took over has
focused on the leftist government's fight against an austerity package imposed
from abroad. But
Panagiotis Nikoloudis, 65, a supreme court prosecutor and specialist on
economic crime, is spearheading another battle declared by Syriza: this one on
the home front, against some of the wealthy businessmen who dominate Greek
political and economic life.
Speaking
to parliament last week, Nikoloudis denounced an elite that included a
"handful of families who think that the state and public service exists to
service their own interests." Such
businessmen influence politicians and state officials or abuse their control of
the media to unfairly win state contracts, change regulations to their
advantage or escape prosecution for illegal conduct, critics say.
Prime
Minister Alex Tsipras has announced radical measures aimed at what he calls the
"oligarchs", including re-licensing private TV channels, ending
"crony" bank loans for the well-connected, exercising the state's
voting rights in the case of majority shareholdings of private banks, unwinding
some key privatizations and aggressive tax audits of those with offshore bank
accounts. "We have made the
decision to clash with a regime of political and economic power that plunged
our country into the crisis and is responsible of Greece’s depreciation on an
international level," Tsipras told parliament last week.
Finance Minister Yanis
Varoufakis has been equally blunt, declaring that his government will
"destroy the oligarchy" in order to increase tax revenues, open
markets and spur economic growth.
So far, no-one has been
named in the crackdown, and few of Greece's top entrepreneurs have commented
publicly. But deals under scrutiny
include the privatization of the national lottery and planned sell-off of state
shares in major ports.
Energy Minister and
Syriza party member Panagiotis Lafazanis told parliament last week the
government would seek the cancellation of the "scandalous purchase"
of the old Athens airport, Hellenikon, by Lamda Development, a company
controlled by the family of Greece’s richest businessman, Spiros Latsis.
Latsis has not been
personally criticized by Syriza. Lamda responded with a
statement last week lamenting "the discouraging message to the long-term
private international investors that our country desperately needs." Asked by Reuters to
comment further, Latsis did not respond.
Businessman Yannis
Vardinoyannis, whose family has interests in oil refining, shipping and the
media, said in a statement to Reuters that Tsipras had a "valid
point" in attacking "a certain regime that has played a
significant role in influencing in a negative and corrupt way Greece’s business
environment", and that tackling corrupt practices would be good for economic
growth and business confidence. He also noted that
"owning and operating a globally successful organization does not classify
you as an 'oligarch'". "We have faith in
our new Government and I personally welcome this type of approach where fair
play, the law and regulations will prevail," he said.
NOT JUST TARGETING THE RICH
Syriza under Tsipras has long been critical
of how a handful of Greek families play a dominant role and enjoy political
patronage in key sectors of the economy.
But some critics say the Syriza government
should make a clearer separation in its public rhetoric between its drive
against illegal activity like corruption and tax evasion and its wider
political agenda to curb the power of the rich, which could scare away investors
and spur capital flight.
Nikoloudis told Reuters in an interview he
was not accusing the wealthy in general. "I would be crazy to think like
that," he said. He is still waiting to be given a new
office, staff or a budget. But, speaking at his old office, he said previous
investigations into oil smuggling, banking fraud and tax evasion had identified
perpetrators who were wealthy businessmen with political patrons. "So I don't attack the rich, but the
people I've found committing crime just happen to be rich," he said.
As a non-political outsider with a clean
record, Nikoloudis is a popular appointment among Greeks who believe corruption
is deeply embedded in society. He has a reputation for action, and says the
financial intelligence unit, which he led until now, developed a system of
audits that identified over 20,000 people whose assets do not match their tax
declarations.
George Sourlas, a senior official at the
justice ministry and a former conservative MP and deputy speaker of the
parliament, said he "had to admit" the anti-corruption measures put
forward by Tsipras were "very impressive so far." Sourlas praised Tsipras's promise to curb
oil smuggling, a racket in which un-taxed fuel for export or commercial
shipping is diverted and sold instead for domestic consumption, evading sales
tax due. Previous governments have been aware of the racket for years but did
nothing, Sourlas said. "The smugglers have the support of
political power and a relationship with all political parties," he said,
declining to elaborate.
TAX REVENUES
University professor Dimitris Mardas has
been appointed deputy finance minister to spearhead measures to tackle both
un-taxed revenues and corrupt procurement.
In an interview, he outlined the program he
has in mind to defeat the smugglers, from installing GPS systems on fuel barges
in ports to new incentives for customs officers to forcing refineries to hand
over more data. Mardas said he hoped to recover a billion
euros of missing annual revenue just from tackling fuel smuggling.
But skeptics question if Syriza's hopes for
a windfall of tax revenues from the crackdown are realistic. Harry Theocharis, a former chief tax
collector and now a newly-elected MP for a centrist party, said Mardas was
exaggerating the revenue lost by smuggling. The bigger problem, he said, was that tax
evasion and corruption in general extends well beyond the rich. But going after
evasion by professionals or other restrictive practices such as unfair barriers
to professions maintained by trade unions could threaten Syriza's political
support.
Nikoloudis has acknowledged that targeting
the richest and most powerful would not eliminate tax evasion. In fact, he found the biggest companies in Greece were the most scrupulous in paying
their taxes, unlike many self-employed people. "Specifically everyone who
has a hotel or a taverna on an Aegean island systematically commits tax
evasion."
An attack on corrupt behavior by powerful
interests was perhaps more about justice than revenue-raising, he said. "Even if we accept that some people
will take their money and go abroad, I would prefer to take that risk instead
of seeing the economy of my country based on dirty money and
corrupt enterprise." Not every oligarch would be challenged, and
not all crimes of the past could be prosecuted. "I am not going to fight everyone. I
don't want to break my nose. I want to change the system. That's my ambition."
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