Costa whistleblower 'made a scapegoat': Manager at Greek bank became suspicious of Cypriot after call from BCCI, reports Tim Kelsey

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The Independent Online
IT WAS Robinson Zymboulakis, a senior manager in the National Bank of Greece, who first suspected fraud by Charilaos Costa. Mr Zymboulakis was not impressed by Costa's much vaunted links with leading members of the Labour Party and did not allow himself to be fooled by the Cypriot businessman's plausible manner.

Mr Zymboulakis, 53, who says he has been threatened with violence by Costa if he reveals details of the fraud, was alerted in February 1991 by a telephone call from one of Costa's British banks, BCCI. The bank was refusing to honour two letters of credit owed to the National Bank of Greece because it found the exports covered by the letters of credit did not exist.

Mr Zymboulakis then refused two debts owed by his bank to Barclays in Britain when he discovered allegedly fraudulent airways bills covering non-existent exports. Union Discount, the financing house, in turn investigated its transactions with Costa and discovered that pounds 6m worth of financing may have been fraudulently obtained. Union Discount called in the Fraud Squad. Costa's British companies went into receivership with debts of pounds 2m.

Before the authorities closed in, Costa had established himself in north London's Cypriot community as a man who rubbed shoulders with national figures. Neil Kinnock visited his Enfield factory while Labour leader, and once, according to a business associate of Costa's, came to the office Christmas party. Mr Kinnock does not deny his acquaintance with Costa, and said he had met him socially. When it emerged that Costa was being investigated in May 1991, Mr Kinnock issued a statement that Costa had never donated money to himself or his wife, Glenys, personally.

Mr Zymboulakis was blamed by Costa for causing the collapse of his business empire. During a National Bank internal investigation, he was praised for stopping the fraud. But the bank finally honoured its debts to Barclays, and wrote off at least pounds 1.3m. Mr Zymboulakis believes that he was made a scapegoat. He was dismissed on a technicality because he overstepped his powers in allowing Costa, as a trusted customer of 10 years standing, to exceed his business overdraft.

The National Bank, for whom he had worked for 33 years, withheld his pension (around Cyprus pounds 90,000), and called for the immediate repayment of loans he had taken to buy a house for his daughter.

Mr Zymboulakis was deprived of his passport during the police investigation into Costa's affairs. It has not yet been returned, and no explanation has been offered by the local authorities. He is now optimistic that he may get it back. He has not been able to find other work and has been forced to scrape a living mending roofs, and working as a restaurant cashier.