Bursting the Bubble

Greek Defence Corruption

19 May 2014 | by

In 1996, Greece was involved in a skirmish with Turkey over a set of islets. With their Defence Ministry awoken to the ‘potential need’ for better resources when faced with a foe, Greece commenced a wide-ranging purchasing spree for its defence and security efforts. Manufacturers and service providers from the sector across the world all wanted a slice of the potential sales, often made to the Greek officials who were rapidly grabbing at purchases, without fully rationalizing them. What began as a natural human reaction to what was a more recent security threat quickly spun out of control, as different industry actors quietly courted Greek officials with millions of Euros, and foreign accounts were set up in an attempt to hide the bribes. In the past two years a variety of Greek Defence Ministry employees have been brought up on corruption, or bribery charges; ranging from low ranking officers such as Antonis Kantas, who is currently on trial, to the 2013 conviction of the former Defense Minister Akis Tsochatzopoulos. These are only two of the many Greek officials who, in a current Greek surge of anti-corruption measures, stand accused, indicted or in jail over the widespread Greek Defence corruption occurring between 1996 and 2008.

While recently the facade covering these escapades has fallen, it still appears that many are quite complacent about these activities, only pursuing it due to a small group of anti-corruption personalities. While Akis Tsochatzopoulos was sentenced to 20 years in the 2013 trial which also brought conviction to 16 out of the 18 co-defendants, it was a speedy trial that was largely kept under an auspicious air of keeping this Greek affair quiet. Infamous for his blatant acknowledgement of a disposition that even low-level officials could amass around 18 million Euros over five years, Antonis Kantas is currently being held in jail awaiting his trial. For this trial, the team of four prosecutors have been given one mere storage unit to complete their investigation and acquire evidence. The prosecution unit’s chief Eleni Raikou reported being forced to invest her own resources to outfit their ‘joint office’ with electricity and internet. This disregard to well equipping the prosecution comes despite the fact that this case alone concerns millions in bribing officials, and millions more in inappropriately influenced purchases which wasted the tax money of Greek citizens. For such an important matter, the condition under which the prosecution team operates adds self-inflicted mockery to the Greek stance of punishing corruption.

In the case of Mr. Kantas, he is being charged with taking bribes on 12 purchasing accounts; 6 with German companies, 2 with French companies, 2 with Russian companies, and 2 with Swedish companies. These companies, mostly arms manufacturers, paid a cash ‘toll’ of sorts to Mr. Kantas, asking him to merely look the other way whilst other officials approved purchases, or to make skewed purchase selections himself. Mr. Kantas, as a moderate level official, is open in affidavits about the ability of every level of the Defence Ministry to make a fortune in the form of gifts left by foreign manufacturing companies or dealers, implying that we most likely are just skimming the surface of the vast corruption.

After 1996, many corruption affidavits indicate a huge influx of bribes for irrelevant purchases coming from foreign based companies, dealers or institutions. And while the Greeks are currently prosecuting many of their citizens for facilitating or participating in corruption, the foreign actor is, more often than not, never prosecuted. Some have received fines so inconsequential that it is a bit of a laugh when one considers the millions still made from selling Greece inappropriate, inadequate or simply useless equipment. Many manufacturers that could stand to be accused of wrongdoing have stayed silent on the issue, though individuals have come out to say that the corruption was intrinsic in the Greek Defence acquisition structure, where it was widely known that a sale could not be made without bribing an official.

For instance, in the money traced to bribes accepted by Mr. Kantas, he was given 600,000 Euros to overlook the purchase of 170 German tanks which were considered by military experts to be inconsequential for any Greek war scenarios. To top this purchase off, for those 170 tanks there was essentially no ammunition purchased for these vehicles; the amount of ammunition that was purchased was inadequate to even test each tank.

Highlights of other well-known acquisitions from the Defence Ministry of Greece which reek of bizarre dealings are the purchase of fighter planes, which still remain without the electronic guidance systems that are essential to modern flight exercises. There was also, around four billion spent on incomplete submarines that as of yet have not moved from a shipyard on the perimeter of Athens.

Slowly, despite the inadequate conditions claimed by Greek prosecutors, these bizarre acquisitions are being investigated and arrests are being made. Two of the recent Greek arrests of Sotiris E. and Yannis B. involve the sale of German-made 214 Class submarines. Those accused, currently undergoing separate trials, are estimated to have earned around 23.5 million Euros on this deal that was worth approximately 1.14 billion Euros to the German manufacturers.

The foreign actors in these situations are being accused of taking advantage of the situation to sell Greek officials items that were far too overpriced, and of a subpar quality. While European citizens were criticising Greek economic circumstances, some of their own companies were taking advantage of the situation to obtain increased profit yields from the purchases made by a Defence department that sellers knew had no use for some of these overpriced acquisitions.

Corruption is something that must be addressed from all sides of the problem. Such widespread corruption of governments, as well as corporations should be seen as a serious crime against the people, both in the minds of those contemplating it, and in the courtroom prosecuting it. Recent Greek efforts to address these past instances of corruption must be applauded but I still wonder if, given the extent of the evident Defence Ministry corruption, the mentality and acceptance of corruption will truly change, particularly considering accusations of inadequate resources given to prosecutors.

One Comment

  1. Involved in a Federal Case in the United States District Court for District of Maryland. Issues of a US freight Forwarder not being paid for shipping Foreign Military goods are central to the case. The Freight Forwarded as testified under Oath and has some e-mails to document that he was solicited to pay brides in order to be paid for his outstanding invoices. Wondering if your research uncovered Greek Officials seeking money from shippers of goods before they would approve the payments of the money owed by Greece to these shippers??

What do you think?