A Mayor’s failure to take due actions regarding compliance with the loan agreement’s terms, resulting in financial damage to the Municipality

Details

Following an anonymous complaint, a team of NTA Inspectors carried out an audit relating to the period from 2004 to 2023 in a Municipality of the Thessaly Region to investigate the Municipality’s omissions, regarding compliance with the terms of a private agreement between the Municipality and a banking institution in the context of repayment and servicing of a loan agreement of a defunct development company, with an initial loan amount of 130.000,00 euros. Of this amount, the Municipality received EUR 68.645,00, which was transferred to final arrears, with a final debt of EUR 233.445,11.

The audit found the following:

  1. Non-execution by the Mayor of City Council’s decisions on refinancing the original loan with a new loan from the Consignment Deposits and Loans Fund (Parakatathikon kai Daneion) or another financial institution,
  2. The delegation by the Mayor to a private individual, without a decision by a single or collective body, of the representation of the Municipality in contact with the credit institution and the company managing the bank's claim with a view to settling the debt.

The banking institution sent an extrajudicial notice to the Municipality and the debts of the banking institution were set off against the accounts held by the Municipality with it. As a result of the above, the Municipality was financially burdened with the amount of EUR 214.345,47 due to partial repayment, while the net financial loss of the Municipality is estimated at approximately EUR 150.000,00.

The NTA sent the report to the Decentralised Administration for the initiation of disciplinary proceedings against the Mayor.

This website has been translated from Greek into English using the translation software «DeepL», a machine translation tool. All translated texts have been subsequently edited by the website administrators in order to improve their rendering.

The English version of the website consists of texts, manuals and other documents. Some of the content (e.g. images, videos, files, etc.) may not be accurately translated due to technical limitations of the translation software.

Any discrepancies or differences arising in the translation are not binding and have no legal effect for compliance or enforcement purposes..