EU Economics

IMF SCANDAL: Greek bailouts, Euro-love and missing documents EXPOSED by watchdog

THE INTERNATIONAL Monetary Fund (IMF) has been sharply criticised for the Greek bailout, unwavering support for the Euro, misleading its own board and misplacing important documents by a furious independent watchdog.

GETTY    The IMF has been sharply criticised in a watchdog report

A damning report released by the Independent Evaluation Office (IEO) blasted the financial authority’s “culture of complacency” and also revealed jarring divisions within the financial organisation.

The report revealed the IMF’s board of directors had not been informed an exception was being made to bail out Greece – using a rare clause which has since been quietly shelved.

In an attempt to prevent the collapse of Greece and a domino effect across Europe, a huge bailout was granted without approval of the board – and the people of Greece were eventually blamed by the IMF before being made to pay the price for the resulting failures.

As well as this, the bailouts for Greece, Portugal and Ireland saw the nations allowed to borrow over 2,000 per cent of their allocated quota – a huge sum which has been criticised as reckless by the watchdog.


GETTY    Greece has been subjected to a controversial IMF bailout

Worryingly, the IEO’s investigators were also unable to find vital documents and records during their inspections, raising concerns about the legitimacy and operational security of the IMF.

The report said: “Many documents were prepared outside the regular established channels; written documentations on some sensitive matters could not be located.

“The IEO in some instances has not been able to determine who made certain decisions or what information was available, nor has it been able to assess the relative roles of management and staff.”


GETTY    The IMF’s cheerleading over the Euro has been blasted in the report

The IMF’s support of the Eurozone and the common currency has also been condemned by the report, which described the group’s Euro policy as “groupthink”.

The report said: “Before the launch of the Euro, the IMF’s public statements tended to emphasise the advantages of the common currency.

“After a heated internal debate, the view supportive of what was perceived to be Europe’s political project ultimately prevailed.”


GETTY     There has been calls for Poul Thomsen to step down in the wake of the report

This unfounded optimism in the single market and shared banking system, the report said, meant the IMF was taken completely by surprise by the 2007 financial crash.

It said: “The IMF remained upbeat about the soundness of the European banking system and the quality of banking supervision in Euro area countries until after the start of the global financial crisis in mid-2007.

“This lapse was largely due to the IMF’s readiness to take the reassurances of national and Euro area authorities at face value.”

The revelation has lead for calls for Poul Thomsen, the director of the IMF’s European department, to be sacked.

Economist Yanis Varoufakis said: “Time to demand the immediate firing of Poul Thomsen. No ifs. No buts. Exit stage left.”

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