Lloyds, Bank of Cyprus Cases Highlight Correspondent Banking Issues

By Brian Monroe and Brian Orsak

When reports surfaced in the spring of 2001 that publicly traded software company AremisSoft had inflated its earnings to boost its stock price, the case looked like a straightforward, open-and-shut securities fraud involving the company and some of its principles. The next year, the U.S. Securities Exchange Commission brought charges against the company that resulted in a $500 million settlement. By then, the Nasdaq had delisted AremisSoft and a federal grand jury had indicted the co-chief executive officers, Roys Poyiadjis and Lycourgos Kyprianou, for securities fraud. But the widening case resurfaced Monday when U.S. prosecutors in the Southern District of...