By Stelios Orphanides
Chris Iacovides, the special administrator of the Cyprus branch of Tanzania’s FBME Bank Ltd, said he considers himself entitled to participate in proceedings at German courts as he was the only cell “vigorously resisting” lawsuits brought to European courts by depositors.
Iacovides was responding to an April 7 report by Kathimerini newspaper that a German court in Frankfurt had banned him from obtaining documents of the ruling, which Bank of Tanzania won when unnamed depositors claimed unspecified deposits held at an also unnamed correspondent bank in Germany.
Kathimerini said the German court, to which an FBME depositor resorted to have his funds ringfenced, ruled that they did not belong to a particular customer and belonged instead to the bank. When the special administrator of FBME’s Cyprus branch sought through his lawyers to get all relevant information about the case, the court denied the request.
Kathimerini which did not cite a source for its report, said that the Frankfurt court did not recognise the legal entity of FBME’s Cyprus branch and therefore it could not consider requests from Iacovides on its behalf.
“The decisions to which the article refers relate to technical arguments concerning the standing of the special administrator to make applications in the German proceedings,” Iacovides said in an emailed statement on Friday. “My case is that I should be entitled to take part in the German proceedings in order to protect assets of FBME’s Cyprus branch, over which I am appointed under the resolution law. I am considering the recent decisions of the German courts with my German counsel, and it is likely that further applications to court will be made”.
As the proceedings at the Frankfurt court continue, “it would therefore be inappropriate for me to comment further on matters which are sub judice,” Iacovides said.
Iacovides said the English High Court already recognised his standing and authority as special administrator and added that he already had German and English court orders for the seizure of assets overturned.
The Kathimerini report was published on the same day the Cyprus Business Mail reported that Iacovides was able to successfully initiate legal action to set aside a garnishment and transfer order issued by an English court in October 2015, after he had been notified by Germany’s Commerzbank. The order was issued after a group of FBME depositors, including Cinque Ports Trading Limited, Modena Corporate Services Limited, Saunders & Fyffe Corp., and Clifton Conroy Associates Limited, filed proceedings in England seeking the immediate repayment of $201.2m in deposits at FBME.
Lawrence Mafuru, the statutory manager of FBME in Tanzania, failed to take legal action in time to prevent the issue of the order and saw himself forced to do so after Iacovides challenged it.
“The proceedings had been served only on the bank in Tanzania, but the Statutory Manager in Tanzania had failed to respond to them,” said Iacovides who repeatedly complained about Mafuru’s lack of cooperation and accused him of being driven by ulterior motives. Iacovides was not in position to confirm whether the case reported by Kathimerini was the same reported by the Cyprus Business Mail.
“I am now seeking recovery of my legal costs from the depositors in question,” Iacovides said.
In 2014, the Central Bank of Cyprus placed the Cyprus branch of FBME under administration and subsequently under resolution, after US authorities described the bank as a financial insitution of primary money laundering concern. In 2015, the central bank revoked the licence of FBME’s Cypriot branch and a year ago it triggered the deposit guarantee scheme for its customers.