Turkish Cyprus on alert over southern cash flows

ISTANBUL - Anatolia News Agency

Turkish Cypriot banks will investigate all bank transfers from Greek Cyprus, says a North Cypriot bank executive. REUTERS photo

Turkish Cyprus’ banks will not accept unidentified bank transfers coming from Greek Cyprus, Northern Cyprus Banks Association (KKBB) Chairman Yunus Rahmioğlu said yesterday.

“We expect a [monetary] flux from Greek Cyprus’s depositors through our banks. We will check the origin of the money to prevent money laundering, even if it is a bank transfer,” Rahmioğlu said.

He stated that the KKBB has warned all Northern Cyprus banks to strictly investigate bank transfers from the other side of the island.

However, the banks will not accept any cash of local or foreign depositors from Greek Cyprus, they would only accept bank transfer after a detailed check, he said. “When deposits come via bank transfer, it is not ‘OK’ for us... Our duty is to ask its origin and how it was earned,” he added.

Rahmioğlu noted that they needed to investigate the origin of the deposits coming from Greek Cyprus, claiming that Russians had a considerable amount of deposits in the Greek Cypriot banking system.
Northern Cyprus should not open up to Russian deposits from Greek Cyprus without investigation, said Rahmioğlu. He noted that their banking system was in a vulnerable position, whereas Turkish Cyprus was not a recognized country in the world.

Money-laundering risk

The European Union has not been tolerant of Greek Cyprus, Rahmioğlu, also General Manager of Türk Bankası in Northern Cyprus, said.

He said the EU aims to tax illicit money by loading a part of the burden on it. “We do not want this illicit money to come to the North. Because they are suspicious,” he said.

Rahmioğlu underlined that if the depositors transfer their money to the North with the aim of money-laundering, Northern Cyprus would become “a country that helps money-laundering.” He said Northern Cyprus, whose economy has always been transparent abroad, always fights illicit money.

Nonetheless, he repeated that if bank transfers from Southern Cyprus proved not to be illicit, they could accept it.

In the 10-billion-euro bailout accord agreed to on March 16 with the EU, the International Monetary Fund and the European Central Bank, Greek Cyprus accepted a levy of 6.75 percent on accounts up to 100,000 euros and 9.9 percent thereafter.