ECB taken to court over decision to freeze funding to Greek banks

Posted by Christian J. Hadjipateras 19/12/2017 0 Comment(s) Economia Blog,

The European Central Bank (ECB) is, according to Reuters, being sued over its decision to freeze funding to Greek banks during the peak of the financial crisis in 2015 when the Greek banking system was on the brink of collapsing. Among those suing the ECB is former Marxist finance minister Yanis Varoufakis, who contributed in bringing the country to its knees.


One of the main objectives of the action is to gain access to a document elaborating on the ECB’s decision to freeze vital funding to the banks, which left prime minister Alexis Tsipras with no alternative but to impose capital controls. Varoufakis resigned and Tsipras made a deal that gave Greece cash in return for austerity measures and reforms.


A German leftist MP, Fabio De Masi, is also part of the action. “By restricting liquidity to the Greek banking sector to force cuts in pensions, tax increases and fire-sale privatizations, the ECB overstepped its mandate,” De Masi said.


An ECB statment said the legal opinion preceded the decision to withhold funding by at least two months.

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