Our View: PEP asset disclosure is in need of serious reform

The issue of the disclosure of the personal assets of politically exposed persons (PEP) has been going on for years. Not even the passing of two laws, stipulating the submission of a list of assets of each PEP – state officials and deputies – to the legislature has settled the matter.

This was because each person entered whatever they chose to in their submission, as there was no standardised, uniform way of doing this. Worse still, there were no checks on the veracity of the data provided. The tone was set by the former president himself, Nicos Anastasiades, who submitted a list of assets and income that gave the impression he was almost a pauper and was mocked and laughed by everyone.

This farce and the incomplete submissions went on for a few years until deputies decided, after criticism from the council of Europe, that the submissions should be checked by a committee made up of auditors. There have been endless discussions about the amendment of the laws since then and have yet to be concluded. A couple of days ago, the Tax Commissioner Sotiris Markides appeared before the House ethics committee with his own proposal. He said that each PEP should publish his/her net asset position rather than listing all assets and all liabilities.

It is a sensible suggestion, which also ensures that a PEP would not have to give information about bank deposits, specific shares, property holdings and loans. We assume that the net asset position would have to be verified by an auditor, who would be in possession of all the necessary documentation. Deputies indicated that transparency was not served by this method as all the relevant information would be kept secret. The other alternative discussed was the submission of a capital statement, again prepared by an auditor.

There would probably be greater transparency with this method, than with that proposed by the Tax Commissioner, but deputies were concerned about the cost of this statement. Nobody suggested that it should be paid for by the taxpayer. There was also discussion about which official would be covered by which law. Each party’s parliamentary group would discuss the proposals and then return with suggestions about the capital statement. It could take another year or so before the parties finally decide what is to be done.

It is a positive that all parties agree that the current system is something of a joke and is treated as a joke by many of those who are obliged to complete it. It is also positive that an auditor would have to certify the capital statement or net asset position submitted as this would make submissions uniform and formal. It is now up to the parties to ensure that there would be a system in place that could be taken seriously.