The Public Procurement department has reversed its decision to extend scandal-hit Helector’s waste management contract at Kosi landfill in Larnaca for three years, it said in a statement.

The department is now investigating how it can get back millions of Euros in over-inflated charges for waste management.

Meanwhile, all payments to the company are being suspended, it said.

Helector director Ioannis Kokotsis has turned himself into the authorities after an arrest warrant was issued for him in connection with corruption allegations in Paphos. Helector has managed the Paphos landfill since 2005 and is accused of bribing public officials, and overcharging for waste management services.

Kokotsis has denied knowing anything about the alleged crimes.

Interior Minister Hasikos has distanced himself from Kokotsis, saying that:

“If I were walking down the street, I wouldn’t recognise him because I only met him once at the Unit of Solid Waste Management at Kosi.”

“I never negotiated (with him).”

According to his announcement in 2015, Hasikos was responsible for reducing the 75 Euro per tonne fee for waste disposal to 39 Euros per tonne. He branded the previous contract as scandalous and bad for the taxpayer and the state, but advocated that it be renegotiated and renewed.

Bribery arrests

Five people were remanded earlier this week for eight days on allegations they bribed public officials or accepted bribes, while overcharging for public services. The suspects in custody are Paphos municipality financial officer Dimitris Patsalides; Helector employee Michalis Michael; two Helector female employees and corrupt former mayor-turned-convict Savvas Vergas.

It’s estimated that the contractor overcharged by half-a-million Euros, passing on the costs to the public.

Public confrontation

For several months, there has been a public confrontation between Auditor-General Odysseas Michaelides and Interior Minister Socrates Hasikos over Helector’s contract. Michaelides said that the ministry has breached open competition rules by extending an existing waste-management contract until 2027 – without opening it to tender.

The company with the contract for Kosi unit may have offered a lower price, but will still make 17 million Euros in profit, and could earn the state a fine in the several millions from the European Union, said the auditor-general.

Hasikos rejected the arguments, claiming that Michaelides is over-zealous, and proceeded with renegotiating the contract anyway.

Now, the minister said he put someone else in charge of the renegotiation, Stratis Mattheou, who runs the Central Committee for Changes and Claims.

Hasikos defended himself, saying that two years ago, he was the one who ordered an initial investigation into the contract, which was made under the previous government’s administration.

Helector is a subsidiary of Ellaktor S.A., a listed Greek company owned by George Bobolas.

Another joint venture subsidiary – Helector-Ellaktor-Cybarco – has a 43 million-Euro contract with the government for the Larnaca-Famagusta waste treatment and disposal plants, according to its financial statements. The company’s directors are obviously heavily connected within the political and business circles in Cyprus and Greece. But if the corruption allegations are proved to be true, they could find more political figures turning their backs like Hasikos just did.

Since the new allegations surfaced, the state has suspended payments to Helector. Meanwhile, the current mayor of Paphos Phedonas Phedonos said he had refused to pay Helector months ago on the basis it was overcharging.

Vergas promises to tell all

Vergas, who was convicted of accepting bribes in connection with first major corruption scandal connected with Paphos Sewerage Board (SBP) projects, told the media he knew of many more people responsible for corruption.

Most recently, he testified in the ongoing corruption trial linked with the SBP scandal, saying that he took 500,000 Euros in bribes and intended to buy an apartment in Thessaloniki, where his children are studying.

Vergas and the former CEO of SBP Eftychios Mallikides are serving six years in prison for their part in a multi-million Euro deal involving bribery, forgery, and witness intimidation.

Another five people are on trial in the case – George Michailides, Phidias Sarikas, Efstathios Efstathiou, Vassos Vassiliou, and George Sialis. They face allegations of bribing public officials, conflicts of interest and money laundering.

Damage to the environment

In the past, Helector has been criticised by environmentalists for pollution of the groundwater and for burning rubbish, sending toxic fumes around Marathounda, where the landfill is located.

The municipality refused to answer complaints by residents, reported Phileleftheros at the beginning of February.