Three arrested, 25 charged in 500 mln euro Postbank loans case

Former Hellenic Postbank (TT) vice-chairman Marios Varotsis was the third suspect arrested on Thursday over millions in 'bad' corporate loans paid out by the former state-owned bank. He was given until Monday to prepare his testimony by Examining Magistrate for Corruption Giorgos Andreadis.

Another two of the bank's employees, including a 25-year-old, arrested on Thursday in connection with the case are due to appear before the magistrate later in the day.

Corruption prosecutors have pressed charges on 25 people and have already ordered the arrest of seven people related with a case of corporate loans which cost TT more than 400 million euros in losses.

A total of 25 people have been charged over the bad loans at Hellenic Postbank, court officials said, including Greek businessman Lavrentis Lavrentiadis, who is already in custody pending trial over another banking case in which he denies wrongdoing.

Greek businessman Dimitris Kontominas, 75, who owns a Greek TV channel, was arrested on Wednesday while in hospital, the court and police officials said on condition of anonymity.

Kontominas has entered a private clinic, from where a coroner on Thursday ordered his transfer to a public hospital, following the directive of the chief prosecutor on the TT case. The prosecutor, Giorgos Andreadis, visited the clinic in person.

The businessman, president of DEMCO Insurance, is facing charges of fraud, direct complicity in malpractice, and money laundering.

Corruption attorneys have pressed charges on 25 people and have already ordered the arrest of seven people related with a case of corporate loans which cost TT more than 400 million euros in losses.

Greece's debt crisis has triggered public anger against a political and business elite widely viewed as privileged and corrupt, prompting prosecutors to step up corruption investigations.

The investigation began in July 2010 focusing on the bank's activities in the period 2007-2012. According to sources the bank approved excessive loans to certain businessmen without guarantees for which the bank has not gotten back "even one euro."

The investigation also revealed that in several cases these loans were not distributed to support business activity but for "the creation of wealth" through their transfer to offshore companies or through the purchase of real estate property abroad.

Among the 25 people accused are businessmen and present or former Hellenic Postbank executives.

The lawyer of businessman and former chairman of Hellenic Postbank (TT) Angelos Fillipidis, Athanassios Varlamis, appeared before Andreadis on Thursday and informed him that his client, against whom an arrest warrant is pending, is currently in the USA and will return to Greece within the next ten days.

According to Varlamis, Fillipidis will testify as soon as he returns to Greece.

Greece's debt crisis has triggered public anger against a political and business elite widely viewed as privileged and corrupt, prompting prosecutors to step up corruption investigations

Police have yet to formally comment other than to say three people have been arrested.

Kontominas has denied any wrongdoing and was expected to appear before a judge on Tuesday to respond to the charges.

"There is not even a trace of illegality in my business activity," Kontominas said, according to state agency ANA.

Two former TT executives were also arrested on Wednesday and were expected to appear before a prosecutor on Thursday. Prosecutors have also issued arrest warrants for four others, including TT's former chairman Angelos Filippidis.

Filippidis told Greek Skai radio that he was on a business trip that he would cut short to appear before the prosecutor in Athens. He has denied the accusations.

"I'll explain each and every loan," he said. "All of the loans ... were issued correctly and if I could turn back time, I would issue them again."

Authorities wound down TT in January 2013, after efforts to sell it failed. Greece's bank rescue fund HFSF pumped about 4.5 billion euros into the bank, stripped it of it bad loans and sold the entity to Eurobank in July as part of a wave of consolidation in the country's battered banking sector.