Greece's Varoufakis defends covert plan to hack tax codes
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The start of new bailout talks between the Greek government and its international creditors has been overshadowed by revelations that Greece's maverick ex-finance minister Yanis Varoufakis was secretly planning for a parallel system of liquidity.
The European Commission confirmed on Monday that technical talks on Greece's third bailout had started in Athens, where the embattled leftist government has been forced to implement a further slew of austerity measures in return for much-needed bailout cash.
But the return of the reviled “troika” of creditors – EU, European Central Bank and International Monetary Fund – was eclipsed by news Varoufakis had "hacked" into his own ministry weeks earlier to create duplicate files for millions of Greek taxpayers.
In a telephone conversation with a group of London-based investors after he resigned his post on July 6, Varoufakis claimed that Prime Minister Alexis Tsipras had "given the green light" for a Plan B before coming to power in January, according to a recording released Monday.
The goal, he said, was to create a "functioning parallel system" of liquidity in case the European Central Bank cut off support to Greece's banks – as indeed it did after talks with the Greek government on new austerity reforms broke down in June.
Varoufakis said a five-man team under his orders had hacked into the finance ministry and obtained access to the tax file numbers of Greek taxpayers in order to create duplicate accounts.
He said the subterfuge was necessary to avoid alerting Greece's EU-IMF creditors who "fully" control the Greek state's revenue mechanism.
The operation was designed to enable the ministry and also taxpayers to make digital transfers without having to use the banks, which as it turned out had to be shut down for three weeks this month to avert a run on deposits.
"Of course this would be euro denominated but at the drop of a hat it could be converted to a new drachma," Varoufakis said, adding that the work was “more or less complete”.
The Kathimerini daily first broke the story over the weekend, and the recording of Varoufakis's remarks was released Monday by the Official Monetary and Financial Institutions Forum which organised the conference call.
‘Hideous restriction of national sovereignty’
The news touched off a political storm in Athens, with opposition parties demanding an official explanation from the government and threatening to put Varoufakis on trial, and officials around Europe expressing anger.
On Monday, one of them – Slovakia's hawkish Finance Minister Peter Kazimir – noted that the plan merely confirmed how "unpredictable" Varoufakis was.
"We need to make sure that such two-faced 'games' will be avoided when debating and drafting the third bailout package for Greece," Kazimir said in a tweet.
The Greek government has not yet officially commented on Varoufakis's claims, but junior finance minister Dimitris Mardas on Monday insisted the plan "was never part of economic policy".
Speaking to Britain’s Daily Telegraph, Varoufakis said the quotes were accurate but that some reports in the Greek press were twisted to make it look like he had plotted a return to the drachma from the start.
"I have always been completely against dismantling the euro because we never know what dark forces that might unleash in Europe," he said.
The former finance minister later penned an article in the Financial Times’ comment section, in which he defended the plan as an attempt to ease the country’s chronic liquidity shortage.
“While I understand the press’s excitement emanating from elements of that exchange, such as having to consider unorthodox means of gaining access to my own ministry’s systems, there is only one matter of significance from a public interest perspective,” Varoufakis wrote.
“There is a hideous restriction of national sovereignty imposed by the troika of lenders upon Greek ministers who are denied access to departments of their ministries pivotal in implementing innovative policies.”
(FRANCE 24 with AFP)