Letter from Athens: Greece Has Stay Out of Jail Card for Rich, Powerful

June 20, 2021

One of the best benefits about being rich and connected and just about untouchable in Greece is you don't have to worry about even being charged with a crime and, if you are, you can count on it being shelved until everyone forgets about it.

Take the case of the Koutsolioutsos family, which investigators said have operated an open fraud scheme for almost two decades with their Folli Follie jewelry and accessory maker company that apparently used Fool's Gold too.

An interim audit conducted by the firm PwC of the bankrupt company reportedly showed “substantially erroneous" results that misled investors and signs of massive embezzlement, said the business newspaper Naftemporiki in December 2020.

That was a review of several years of figures that reportedly also showed that the numbers were fake and shareholders and the company's managers profiting off high share prices and trading.

Between 2001 and 2015, for instance, dividends and returned capital doled out to shareholders, based on what the newspaper called "cooked books" totaled 116 million euros, equivalent to $139.22 million.

Founder and primary shareholder Dimitris Koutsolioutsos received 44 million euros ($52.81 million) on top of 130 million euros ($156.02 million) from selling off shares, the report said.

His son and successor leading the failed company,  former CEO Georgios Koutsolioutsos, collected 3.8 million euros ($4.56 million) and another 2.2 million euros ($2.64 million) during the same period.

Both  were been relieved of positions within the company, which is now overseen by a court-appointed management, but there have been no prosecutions for what multiple media reports suggested is criminal activity.

The report also called for further investigation into Athens Stock Exchange transactions of the group’s shares via accounts of third parties but ongoing probes for the past couple of years have gone essentially nowhere.

The audit claimed that between 2007-17 the figures in the company's consolidated financial statements were  false and deceptive, with phony sales ascribed to subsidiaries of the group in Asia, beginning in 2001, the paper said.

It found the company's share price over time recorded an upward course, allowing the father and son to rake off huge profits from share sell-offs through seven private placements between 2004 and 2017.

How did this happen in a market that's regulated? Let's ask Charalambos Gotsis, former Chairman of the Hellenic Capital Market Commission, who has been charged with breach of duty for looking the other way while the scandal unfolded.

A prosecutor accused him in connection with the 2018 embezzlement case against the company after he allowed its shares to be traded for 21 days before deciding on their suspension to protect shareholders.

That was despite the revelation of wrongdoing that was cited earlier by the American fund Quintessential Capital Management (QCM), which revealed the financial problems the company was facing and money mismanagement.

Prosecutor Spyros Pappas, who is handling the case, also referred to trial ex-chief executive Tzortzis Koutsolioutsos, son of company founder Dimitris Koutsolioutsos, and security director Nikolaos Sakos for moral instigation, said Kathimerini.

The family was accused of siphoning off money for some 17 years and in an email included in an audit report between the Folli Follie executives, Gotsis was said to have tried to cover up his alleged mismanagement, giving instructions to make it seem like he was doing his job, the report also said.

But this is amateur compared to the switch chicanery of the principals. 

If Lavrentis Lavrentiadis didn’t exist, you’d have to invent him as a composite characterless creation of the embodiment of all the worst traits of the minority of modern Greeks who are the antithesis of those decent people who work and struggle and scrape to get by.

Arrogant, rich, greedy, above the law, he can slide off sandpaper at the same time he’s greasing palms to buy influence, including corrupting successive governments and avoiding trial on so many charges you’d need a scorecard to keep count.

In June it will be five years – years – since he was released from pretrial detention as prosecutors said he had embezzled 511 million euros ($572.86 million) from Proton Bank, which the government had to rescue.

Why was he let out? The same reason celebrity criminals in Greece use that courts almost always seem to buy like it was the first they’d heard it: he said he didn’t feel well, although probably better than all the people he hurt when the bank in which he was a major shareholder, Proton, lost its license and was liquidated.

Lavrentiadis was banned from leaving the country but is being allowed to keep operating another company, Hellenic Fertilizers (ELFE), and accused of complicity in a decision to transfer its activities to two other companies to get out of having to pay back its loans.

He and four close associates were accused by an Athens prosecutor in April of cheating Alpha Bank out of millions of euros in loans and this guy’s still scheming and wheeling and dealing while prisoners with terminal cancer are penned up to die.

If this sounds familiar to you, it's because these are the exact words used in previous Letters from Athens about how people above the law manage to steal and swindle and get away with it.

The late singer Leonard Cohen, who spent a lot of time on Hydra, put it best: “That's how it goes. Everybody knows.”


Information we receive can be categorized into that which we already knew without being told, and that which we otherwise wouldn’t have known and now have to use our critical thinking skills to determine its accuracy.

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