Military Brass Linked To Defense Scandal

ATHENS – The growing scandal into corruption in the Greek Defense Ministry has now involved charges that top military leaders – including a former Chief of Staff – received bribes to give their okay to contracts being approved, suggesting the graft was even more out of control than believed.

A former representative of a German defense systems firm testified that at least 10 members of the Armed Forces had their hands out asking for money and received payoffs, media reports said.

The suspect, 83-year-old Panayiotis Efstathiou, was taken into custody after 12 hours of testimony before investigating magistrates Gavriil Mallis and Yiannis Stavropoulos.

Efstathiou, who used to represent the German firm Atlas, said the officers took the bribes from the company and that they included top brass and a former head of a Greek defense systems manufacturer, unnamed sources told the newspaper Kathimerini.

Other reports said Efstathiou allegedly named deceased former Chief of the Hellenic Navy General Staff, Giorgos Theodoroulakis, and former Chief of the Hellenic Army General Staff, Kostas Panayiotakis, as the bribe-takers. There was no reported response to the allegations which were said to have shocked the Armed Forces.

Efstathiou has so far refused to reveal whether any politicians were involved in the scheme to steal from defense contracts. He also reportedly named three German nationals with ties to Atlas who allegedly provided him with cash to bribe Greek officials.

Efstathiou also allegedly admitted setting up three offshore companies, one to launder bribe money and the other two for his own purposes. The first firm was used to channel a total of 1.5 million euros in bribes to armed forces officials, according to Efstathiou’s testimony.

A similar-sized sum is said to have been given to Antonis Kantas, a former procurements manager at the Defense Ministry who has implicated several alleged mediators, including Efstathiou in a broadening probe.

According to Efstathiou’s testimony, Kantas demanded the cash to secure the contract for Atlas which related to the installation of sonar on German U-214 submarines and the purchase of the anti-aircraft system Asrad.

On Jan. 3 magistrates are to question another suspect in the probe, Dimitris Papachristos, who formerly represented another German firm, Krauss-Maffei Wegmann. In his testimony, Kantas claimed to have been given 750,000 euros by Papachristos to secure the sale of 24 self-propelled howitzers.

Lawyers representing Papachristos, 78, have said their client is willing to cooperate with judicial authorities but that he suffers from amnesia.