The overlooked past of the “next PM of Greece”

Flickr/Nea Dimokratia
Kyriakos Mitsotakis

The current leader of the Greek opposition, New Democracy party leader Kyriakos Mitsotakis, is odds-on favourite to become the next Greek prime minister. Both German and US media have dubbed him a “star of the people” offering Greece “a glimmer of hope”. A sworn reformist, he slams nepotism and corruption. And yet that international praise ignores hard facts – such as the inclusion of his spouse in the Paradise Papers or his personal involvement in the biggest corruption scandal of the last 30 years in Greece.

Since Kyriakos Mitsotakis, 49, was
elected to the helm of the conservative New Democracy in 2016, he has
been consistently lauded by the overwhelming majority of the
international press, especially in the US and Germany: the Wall Street
Journal saw in him “a glimmer of hope”for Greece. For Die Welt, he is the “new star of the people”.

In the polls, his centre-right party is
ahead of Syriza, the leftwing ruling party led by prime minister Alexis
Tsipras, by five to twelve points. That in itself is little surprise:
Tsipras was elected on an anti-austerity ticket and yet, despite the occasional sweetener,
has been implementing an extreme austerity programme. The old Tsipras
became highly popular by scolding Greece’s international creditors; the
new Tsipras has become the creditors’ darling only to see his popularity plunge.)

Mareva in paradise

Meanwhile, the Paradise Papers,
an investigation by the International Consortium of Investigative
Journalists (ICIJ) into the offshore world, have tarnished the
reputation of politicians, sports idols and royals all around the globe.

But Greece, omnipresent in the news cycle
when it is about corruption, has strangely avoided even the slightest
media attention. Undeservingly so. Because in the latest round of leaks,
one name stood out: Mareva Grabowski-Mitsotakis, the wife of
Mitsotakis.

According to the report by Harry Karanikas and Thanassis Troboukis,
published in daily Ethnos (ICIJ’s media partner in Greece),
Grabowski-Mitsotakis is one of 130 Greeks whose name shows up in the
Paradise Papers.

Grabowski-Mitsotakis owned 50 percent of
Eternia Capital Management, an offshore company based in the Cayman
Islands which managed a fund in the British Virgin Islands.

In a long statement, Grabowski-Mitsotakis dismissed allegations of suspicious transactions, stressing, according to daily Kathimerini,
that she “had little to do with the administrative aspect of the fund
and was not aware of the specific legislation that applies in the Cayman
Islands”, noting that a legal firm handled those issues.

The existence of the Cayman-based company
and its potential ties to Grabowski were  first revealed several months
before the Paradise Papers by investigative journalist Kostas Vaxevanis
(story in Greek) without however evidence of Grabowski’s direct ownership. Grabowski back then had threatened to suit for libel.

The party New Democracy dismissed the
story as irrelevant. It argued that Mitsotakis and his wife were
separated at the time (before reuniting a few years later), therefore
Mitsotakis had no legal obligation to declare his spouse’s financial
interests.

It is also the case that Grabowski has a
professional life of her own: Formerly, she was an executive at Deutsche
Bank and she now runs her own business.

However, an important question remains unanswered: what was the motive of the setup of this double offshore structure?

There’s no evidence that Grabowski-Mitsotakis has broken any law or that Mitsotakis himself was involved in any of this.

There is, however, a coincidence linking Grabowski-Mitsotakis’s offshore structure back to the party of her husband.

Stavros Papastavrou,
Grabowski-Mitsotakis’ lawyer, is a former top executive of New
Democracy. Back in 2012, while dealing with Eternia on behalf of
Grabowski-Mitsotakis, Papastavrou held a top position, first inside the
New Democracy party (where he was Director of International Relations)
and then inside the government as Greece’s top negotiator on tax haven
issues. In fact, he was Greece’s envoy in talks with the Swiss
authorities regarding Greek bank accounts. 

For his involvement in a separate case, the Swissleaks/HSBC affair (dubbed the ‘the Lagarde list‘ in Greece), Papastavrou paid a fine of €3.5 million to settle tax evasion and money-laundering charges.

Heir to a political dynasty

No news outlet outside Greece has picked
up this particular Paradise Papers story. The only mention in the
English-speaking press came from Greek daily Kathimerini. And even that
piece, as its headline indicates (Mareva Grabowski-Mitsotaki responds after name appears in Paradise Papers) focused on Grabowski’s reply and not on the news itself.

In subsequent interviews with the EUobserver and Politico, Mitsotakis gave his usual speech, slamming clientelism and nepotism.

Awkwardly enough, while Mitsotakis
campaigns for a smaller state, several members of his family are being
remunerated by this “fat” Greek state.

He is, after all, the heir of one of Greece’s biggest political dynasties with political roots dating back to the 19th century.

Kyriakos’ father, late Constantine
Mitsotakis (died in 2017 at the age of 97), was a Prime Minister in the
nineties. The ‘Constantine K. Mitsotakis Foundation’ with three family
members on its board has been generously funded by the state to the tune of millions.

When in 2016 Kyriakos Mitsotakis ran as a
candidate to lead New Democracy, despite being a complete outsider, he
managed to outperform all predictions and win the race by trying to
distance himself from the family’s legacy. (“Judge me for my CV, not for
my name” he said.)

Three members of the core Mitsotakis
family are active on the main political scene. Besides Kyriakos, there
is his sister, Dora Bakoyannis, 63, formerly Foreign Minister and
currently an MP; and Kostas Bakoyannis, 39, the son of Dora and nephew
of Kyriakos, is a Regional Governor with high political ambitions.

To his credit, in December Mitsotakis vowed he would appoint no relatives to his cabinet in the event that his party comes to power.

“Defending meritocracy in theory but abolishing it in practice”

Mitsotakis insists that “the practices of
the past can no longer be tolerated”. During his tenure as a minister
for administrative reform and e-governance (2011-2015) his public
administration reforms were praised by many. “He took delight in
stirring hornets’ nests”, according to Politico), especially outside Greece, as a step towards meritocracy.

And yet there are strong indications that
Mr. Mitsotakis’ policies perpetuated the same old politicians’ grasp on
power”. Under his reform of public administration, all new civil
service executive directors were appointed with the signature of one
person: the minister of administrative reform.

In a 2014 statement the
alumni of the National School of Public Administration had accused
minister Mitsotakis of “defending meritocracy in theory but abolishing
it in practice” and blasted his reform as “an attempt to consolidate the
direct dependency of the administrative hierarchy on the political
leadership.” Mitsotakis, allegedly, hired in his ministerial office 25 advisors.

Before the Paradise Papers, there was Siemens

Sadly, this clientelistic practice was
continued at the same pace by Syriza, the party that succeeded New
Democracy in power. Mitsotakis is right to point out that the current
government turns a blind eye to corruption and shows disrespect to the
rule of law. And yet, based on his personal record in politics,
Mitsotakis is no stranger to either of those ills. Because before the Paradise Papers, there was Siemens.

According to evidence presented in
judicial procedures in Germany, the USA and Greece, German multinational
Siemens was routinely bribing politicians in the two main parties of
the time (PASOK and New Democracy) to the tune of hundreds of millions
in order to secure lucrative state contracts. Prosecutors know who bribed and with how much money, but not who was the recipient of the money.

Mitsotakis has been connected in multiple
ways with this ‘Siemens scandal’, though there’s no evidence linking
him to any of these bribes.

In 2008 he was caught accepting for free Siemens telecoms equipment of
a value of €137,000. Mitsotakis paid for this later, after witnesses
testified about the presents to the prosecutors. Similar “presents” were
given to the whole Mitsotakis family, including his wife Mareva,
according to invoices provided during the Siemens court case and on the
testimony of a key witness.

Court evidence shows Mitsotakis
maintained a more-than-close relationship with Michael Christoforakos,
the former head of Siemens Greece, who has evaded his bribery trial in
Greece by running away to Germany. (German courts have refused to
extradite him as he also has a German passport.)

Christoforakos had contact (either in
person or by phone) with the Mitsotakis family 356 times. This amounts
to 60 percent of the total number of such contact he had with all
political figures.

The media’s selective amnesia

As for Mareva Grabowski herself, the spouse of Kyriakos Mitsotakis, was involved in a real estate deal (link in Greek)
in 2002 that, although not illegal, confirmed the family ties to
Christoforakos with a triple coincidence: Grabowski and Christoforakos
both purchased properties on the island of Tinos with a coupe of weeks
difference (end of May – beginning of June 2002); from the same seller;
their respective contracts were handled by the same Athens notary. Some
of the plots of land are adjacent.

Facts linking Mitsotakis to the Siemens
saga have been out in the public for almost a decade. Since Mitsotakis’
election to the helm of the main opposition party, he was profiled or
interviewed by a number of international media. Out of four profiles or
interviews published by some of Germany’s biggest papers (FAZSZtazDie Welt…), not one of them even mentions his Siemens travails.

After all, selective amnesia is a
widespread symptom for the press. In the eight years that Wolfgang
Schäuble served as Germany’s finance minister, what European news outlet
has ever mentioned, even summarily, in any of the hundreds of profiles
about him, that the German politician admitted (after having lied about it) in the 90s taking a bag containing a pile of cash for the ruling Christian-democratic party CDU in a suitcase by a notorious arms dealer?