VZCZCXYZ0006
OO RUEHWEB

DE RUEHTH #0935/01 1831406
ZNR UUUUU ZZH
O 011406Z JUL 08
FM AMEMBASSY ATHENS
TO RUEHC/SECSTATE WASHDC IMMEDIATE 2085
INFO RUCNMEM/EU MEMBER STATES COLLECTIVE
RUEHXD/MOSCOW POLITICAL COLLECTIVE
RUEHZG/NATO EU COLLECTIVE
RUCNDT/US MISSION USUN NEW YORK

UNCLAS ATHENS 000935 
 
2ND CORRECTED COPY - TEXT 
SIPDIS 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: PREL PGOV GR
SUBJECT: PASOK STEWS ALONE IN SIEMENS SCANDAL AS PM DELAYS 
INQUIRY INTO CURRENT OFFICIALS 
 
REF: ATHENS 899 
 
¶1. (SBU) SUMMARY: A major scandal involving alleged pay-offs 
by the German firm Siemens to officials of the former PASOK 
government may also ensnare current New Democracy officials, 
but PM Karamanlis has put off any parliamentary inquiry until 
after judicial officials have completed their investigations 
-- perhaps by the end of the summer.  Sitting members of 
Parliament are immune from judicial investigation and 
prosecution, so a parliamentary inquiry would be the only way 
to look into potential wrong-doing by current officials. 
Meanwhile, ever-widening accusations against former PASOK 
officials continue to hammer the party, which has been 
suffering from declining poll ratings and internecine 
leadership battles (reftel).  END SUMMARY. 
 
THE ALLEGATIONS 
--------------- 
 
¶2. (SBU) Main opposition PASOK has been badly rattled by the 
allegations made June 15 by Theodoros Tsoukatos, an 
ex-confidant of former Prime Minister Costas Simitis, who 
publicly admitted receiving one million Deutsche marks 
(EUR420,000) from the German telecom giant Siemens on behalf 
of the party.  Tsoukatos, who, without holding a formal party 
job, acted as Simitis's effective chief of staff and "fixer" 
with extensive control over the PASOK party machine, revealed 
that in 1999 he had "facilitated" the transfer of money to 
the PASOK treasury via foreign bank accounts and local 
couriers.  Tsoukatos, in a brief submitted to prosecutors, 
said he knew the money originated with Siemens and was being 
offered as a "contribution" to PASOK's election campaign.  He 
described the route the amoun, but the 
former Simitif cash "campaign gifts" 
to political parties in 
Greece was long-established and had always operated without 
objection from politicians and party officials. 
 
RULING NEW DEMOCRACY ALSO TAKING HEAT 
------------------------------------- 
 
¶4. (SBU) The pro-PASOK press has insisted that "Siemens 
money" has found its way into the ruling New Democracy's (ND) 
treasury as well.  ND spokesmen evade these allegations, with 
party secretary Lefteris Zagoritis telling reporters that "So 
far, there is evidence concerning members of other parties 
and not those of ND."  But most commentators believe that 
sooner or later the "Siemens thread" will lead to ND. 
 
¶5. (SBU) With prosecutors summoning an ever-widening circle 
of witnesses, PM Karamanlis announced that his administration 
was ready to launch a parliamentary inquiry into the affair 
-- but only after judicial officials had completed their own 
probes, probably by the end of summer.  In recent weeks, 
Karamanlis has been attacked almost daily by opposition 
parties for his presumed reluctance to initiate a 
parliamentary investigation of the Siemens allegations which, 
so far, appear to affect primarily PASOK.  The allegations 
have, however, already triggered reactionfrom incumbent ND 
cabinet ministers.  Transpotation Minister Michalis Liapis 
(who is a cousin of the prime minister) has filed three 
separate lawsuits against newspaper and television reporters, 
claiming he was being publicly slandered by reports alluding 
Siemens money had found its way into the ministry on his 
watch.  Minister for Merchant Marine and Island Policy 
Giorgos Voulgarakis has similarly filed papers with the court 
to protect himself against "malicious hearsay and 
unsubstantiated allegations" seeking to link him with Siemens 
bribes. 
 
PAPANDREOU'S REARGUARD ACTION 
----------------------------- 
 
¶6. (SBU) PASOK chairman Papandreou announced a zero-tolerance 
approach to all members of PASOK who would be named by 
prosecutors as having received Siemens bribes.  The PASOK 
leader has been calling for months for a parliamentary 
inquiry, which is the only investigation that may delve into 
the affairs of sitting parliamentarians, who are protected by 
law from judicial inquiries and prosecution.  In a press 
conference on June 27, Papandreou decried those "who use 
party business to promote (their own) business ... and thus 
lay a stain on the whole political system."  Without 
mentioning Siemens specifically, Papandre/u warned that the 
continuing discrediting of politicians might soon result in 
popular discontent that the political system would not be 
able to contain. 
 
COMMENT 
------- 
 
¶7. (SBU) The Siemens affair may be the most SeriouS scandal 
Greece has confronted in a long time.  There have been many 
past allegations of bribe-taking and other corrupt practices. 
 But the Siemens affair is different because the primary 
investigation was done by the Germans in a much more thorough 
and detailed manner than the Greeks are accustomed to.  Some 
commentators believe the scandal has the potential of causing 
major political upheaval and even of inducing Karamanlis to 
call early elections -- though we note that suggestions of 
early elections are a hardy Greek perennial.  Others, 
however, underscore the "long tradition" in Greek politics of 
covering up scandals quickly and efficiently and express 
doubt whether the investigation -- even one as thorough as 
the German case -- could reach those at the heart of the 
Siemens affair.  By delaying the opening of a parliamentary 
investigation, Karamanlis has delayed attention being focused 
on current ND officials and left PASOK to stew in allegations 
over the summer. 
SPECKHARD