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European Union


What the ECB knew but will not tell

ECB council turning their backs to the public

The European Central Bank has refused to show what it knew about Greece's mounting debts since 2001. As the Court of Justice will hear the arguments for and against disclosure, others can support Bloomberg news agency or the ECB.

Monday May 6 is deadline for organisations in favour of throwing light on the background of the present crisis.
The central questions are as described by Bloomberg news agency:
”When did the European Central Bank (ECB) learn that Greece was concealing the catastrophic extent of its debts? And what did it know about the quality of the collateral the Greek government used to secure loans from the bank?”
Gabi Thesing, a reporter at Bloomberg, believes there are documents showing what the ECB knew about the misery.
But the bank refused her access to two identified files by claiming disclosure ”would undermine public confidence as regards the effective conduct of economic policy in the EU and in Greece.
The General Court (previously known as the Court of First Instance) ruled in favour of the bank in November 2012.
The EU-judges concluded it is not in the public's own interest to know how well or badly informed the ECB was. This knowledge would only make things worse as figures from 2010 would mislead the public and the market if they were to be published.

If they knew and if they didn't
Seen from the ECB there can only be a bad outcome of a disclosure, as last years ruling has been appealed to the Court of Justice (the supreme chamber of the EU-court in Luxembourg).

  • * If the bank knew about the cover up – done by providing false securities by trades in agreements on future payments (”interest rates-swaps”) – the ECB might be almost as much to blame for the crisis as the Greek government.
  • * If, on the other hand, the bank did not know the bank can be accused of not fulfilling its tasks and obligations as a guardian of the rules of the European Economic and Monetary Union.

Seen from Bloomberg, other news desks, pro-transparency bodies, and not the least the public in Greece this is much more than getting a clear understanding of some ECB-manoeuvres a couple of years back.
Matt Winkler, editor in chief at Bloomberg stated when the agency brought the case to court:
”It's very straight forward. We are seeking full disclosure of documents that show how Greece was able to finance itself into a predicament that became the European debt crisis as we know it. It's entirely to the benefit of all the members of the EU, all of the citizens, all the taxpayers and for sure the financial markets. Transparency is something that has a way of enlightening perspective.”

Two weeks to go
In the upcoming court case, both parties can ask for support from others by so called interventions. These are written statements from actors interested in promoting a final decision by the Court in either way.
The right to intervene is often used by EU member states, which take side according to national or principal interest in a specific case. But you need not be representing a state in order to intervene. A shown interest in the outcome is enough, if this interest is explained and motivated.
How to file an intervention in shown in a ready to use template provided for by Finers Stephens Innocent, the law firm acting on behalf of reporter Gabi Thesing and Bloomberg – se under Documents.
There is at the time of writing two weeks to go for organisations who would like to intervene in favour of transparency – and of course also for those in favour of keeping the handling of the Greek debt crisis out of the limelight.


Staffan Dahllöf


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