CySEC set to investigate CYTA Pension Fund investment

The Cyprus Securities and Exchange Commission may order an investigation to ascertain whether the committee handling the Cyprus Telecommunications Authority (CyTA) Pension Fund had received investment advice from a specific stockbroker and whether any such advice had been acted upon
improperly.

This follows reports that the CyTA pension fund registered losses after investing in high-risk companies.

CySEC chairman George Charalambous told CNA that Provident Funds appoint committees which receive advice from stockbroker firms on how to invest funds, pointing out that the Ministry of Labour and Social Insurance is responsible for monitoring provident funds.

Charalambous said that the law seeks to secure the credibility of stockbroker firms, adding that these firms have an obligation to deter their clients from making high-risk investments.

He said action will be taken against any stockbroker firm which has lured its clients to invest in high risk investment products.

Meanwhile, CyTA chairman Stavros Kremmos, in a statement, said that figures indicate that CyTA lost 600,000 euro in investments of its pension fund in foreign products with the guarantee of Lehman Brothers.

The money lost, he added, will be offset by investments in banks with higher interest rate.

“We are acting in a formal manner and with consistency”, Kremnos said. “I can say that we are overly conservative and this is our choice”, adding that the Board of Directors always tries to minimise the risks from any kind of investment.