(I’m going to reproduce the entire article in case you’ve already used up your six free articles and have hit the paywall; h/t juliania for the graphic.)
“A secret cell at the Greek finance ministry hacked into government computers and drew up elaborate plans for a system of parallel payments that could be switched from euros to the drachma at the “flick of a button”.
The revelations have caused a political storm in Greece and confirm just how close the country came to drastic measures before premier Alexis Tsipras gave in to demands from Europe’s creditor powers, acknowledging that his own cabinet would not support such a dangerous confrontation.
Yanis Varoufakis, the former finance minister, told a group of investors in London that a five-man team under his control had been working for months on a contingency plan to create euro liquidity if the European Central Bank cut off emergency funding to the Greek financial system, as it in fact did after talks broke down and Syriza called a referendum.
The transcripts were leaked to the Greek newspaper Kathimerini. The telephone call took place a week after he stepped down as finance minister. (read more here)
Via Naked Capitalism: ‘Comparison of Greek and English Version of Kathimerini Scoop on Varoufakis Parallel Currency Plan’, Lambert Strether
It includes this translation of a bit of the recording by NC contributor Andrew Dittmer by email:
“Starting last December, the former Finance Minister Yanis Varoufakis, with the authorization of Alexis Tsipras, had undertaken to work out a detailed Plan B; Varoufakis aimed to create a parallel banking system “that would be, yes, denominated in Euros, but that could be converted into a new drachma in a
single night.” An extremely interesting conversation [of Varoufakis] with investors and managers of international hedge funds took place on July 16, coordinated by Baron Norman Lamont, a well-known British Conservative politician and former Finance Minister under Prime Minister John Major, within the framework of an international forum on analyses [i.e. on global economic prospects?]. At the beginning of the discussion, Mr. Varoufakis was clearly informed that “this conversation is being recorded.” Despite this fact, the former Finance Minister describes in great detail his alternative plan [i.e. his plan B], which entailed having tax registration numbers (AFMs) be intercepted [i.e. hacked] by a childhood friend of his, whom [Varoufakis] had appointed into the ministry in order to get around Mr. Sabbaïdou, as well as an electronic attack (hacking) directed at the web page of the General Secretariat of Public Revenues. When after a plea [on his part for discretion] the participants assure him that nothing he has shared in the discussion will leak out, he responds, laughing, “And if something did, I would say it wasn’t true,
I would deny it.”
‘Trusting a bunch of hedge fund guys to keep his deep dark secrets, on which the fate of Greece may depend…, he’d added. Indeed.
Yikes, fallout: ‘Greece rocked by reports of secret plan to raid banks for drachma return; Opposition demands answers after covert proposals attributed to Yanis Varoufakis and fellow ex-minister highlight deep split in Syriza party’, the Guardian
From greekreporter.com: ‘Varoufakis Admits Plan B Involving Hacking’ Five short paragraphs, and zero comments?
Also from greekreporter.com: ‘Moody’s: Uninsured Depositors Compromised by Greece’s New Legislation’
“Ratings agency Moody’s said on Monday that uninsured depositors in Greek banks are in danger of losing some of their money in case of a bank’s insolvency.
Moody’s noted that the changes in the EU Bank Recovery and Resolution Directive, which was legislated in Greek Parliament last week, established new guidelines for the cases of bank insolvency. One of these is a haircut option for uninsured deposits exceeding 100,000 euros.
The ratings agency warned that uninsured depositors and bondholders are compromised by the new law as it limits the use of state funds to save banks as well as by distributing the cost of insolvency to all types of uninsured deposits, including bondholders.
Under the new legislation, the government has a number of options when it comes to lending institutions that become insolvent. It could decide that the bank must be sold, a bridge institution could be created and assets could be disjointed based on whether they are good or bad.
After January 1, 2016, the Greek government can also choose to bail-in deposits of more than 100,000 euros.
Moody’s also noted that non-performing loans will account for 40% of total loans in 2015-2016. Non-performing loans accounted for 35% by the end of 2014. This increase will further compromise the capital sufficiency of Greek banks, which scored a 12.8% ratio of common equity in Tier 1 capital ratio.”
Not.good.news. for savers, if it’s so. There have been conflicting opinions as to whether or not even the insured deposits have the capital to back-stop them at this point.
From TRNN: ‘If Syriza Ruptures, Will Greece’s Left Unite to Oppose Austerity? Dr. Panagiotis Sotiris, Member of Antarsya, talks to Dimitri Lascaris about Syriza’s failure to implement its anti-austerity program and the political options that are now available to the left in Greece’ – July 27, 2015
added: (the transcript is up now.)