Greek pensioner, widow sue state over bond losses

Reuters News
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Posted: Apr 06, 2012 12:13 PM
Greek pensioner, widow sue state over bond losses

ATHENS (Reuters) - Two Greek bondholders, a wealthy widow and a male pensioner, sued the state on Friday over the money they have lost because of the country's multi-billion euro debt restructuring.

The 76-year-old widow says she has lost about 200,000 euros ($261,300), roughly half her investment in Greek government bonds, considered by many a safe asset before the debt crisis exploded, while the man has lost some 4,000 euros, a court official said.

The two plaintiffs demand the annulment of a cabinet decree which forced private debt holders to swap their bonds with new ones, worth substantially less, saying the decision was unconstitutional and illegal, the official said.

"It's an unprecedented case. It's legally very interesting but these bondholders' problem is also very urgent," their lawyer Alexandros Lykourezos told Reuters.

Lykourezos said more bondholders wanted to join the two plaintiffs since they appealed to the court.

"The more (plaintiffs), the better. We just happened to be the first, we opened the way," Lykourezos said.

Pensioners have been hard hit by Greece's worst economic crisis since World War Two, suffering cuts of about 25 percent on average in their old-age benefits over the past two years.

A 77-year-old retired pharmacist, Dimitris Christoulas, shot himself in the head in central Athens on Wednesday after saying that financial troubles had pushed him over the edge. A suicide note said he preferred to die rather than scavenge for food.

His suicide outside parliament has become a symbol of the hardships ordinary Greeks are suffering because of a series of wage and pension cuts and tax rises imposed to keep the country afloat and meet conditions to get aid from the EU and the IMF.

Greece swapped 177 billion euros worth of bonds for new ones last month, inflicting losses on bondholders averaging three quarters of their investment, as part of a plan to slash its gargantuan debt and stay in the euro zone.

The lawsuit filed by the two Greeks on Friday follows a case involving more than 100 holders of Greek bonds in Germany [ID:nL5E8EC7OV].

Lykourezos said he hoped the lawsuit would be dealt with quickly due to its severity, but the judicial process in Greece often moves slowly, with cases sometimes taking years for a final ruling, something that has been criticized by international lenders. ($1 = 0.7655 euros)

(Reporting by Renee Maltezou and Angeliki Koutantou; Writing by Ingrid Melander; Editing by Tim Pearce and Alison Williams)