That's a gross mischaracterization of what actually happened. The EU didn't seized anything but gave a bailout of 10 billions euros at the demand of the cypriot governement and asked that in return the second largest bank be closed and uninsured deposit over 100k€ (and 48% of them in the largest bank) used as a one time levy. Most of this money belonged to foreigner using cyprus as a tax haven. Those who lost 3 millions in the process were given a 7 millions discount on buying the cypriot citizenship.

see here: https://en.wikipedia.org/wiki/2012%E2%80%9313_Cypriot_financ...

But now let's provide some context here, the EU had to bailout Cyprus as a consequence of the US subprime mortgage crisis. So the EU had to clean up the mess made by the US.

Though I do agree there are some rotten things on the financial side of the EU, mainly the IMF and the ECB but also that countries have to pay for the private debt of banks. But this is not so different from the rest of the world and other central banks. Though quite scaled down it's not so far from the 700 billion bailout of banks in the US and the ECB and other central banks and federal reserve buying 2.5 trillion of government debt and bank asset the largest such move ever while EU and US government were injecting 1.5 trillion in their major banks.

> That's a gross mischaracterization of what actually happened. The EU didn't seized anything but gave a bailout of 10 billions euros at the demand of the cypriot governement and asked that in return the second largest bank be closed and uninsured deposit over 100k€ (and 48% of them in the largest bank) used as a one time levy.

Whether you call it a "one-time levy" or the assets being seized is splitting hairs. The result is the same. Given that the money had already been taken, it would be hard to apply the levy more than once.

> Most of this money belonged to foreigner using cyprus as a tax haven.

This is just a smear against depositors. They had their money in a Cypriot bank account and had a reasonable expectation that it would stay there. Their intent for moving the money into Cyprus is irrelevant and certainly doesn't give anyone the right to arbitrarily seize assets.

> Those who lost 3 Millions in the process were given a 7 millions discount on buying the Cypriot citizenship.

How generous. This is like buying a faulty good and being given store credit for the same store as compensation.

That sucks - it also happens to be the protected amount that the EU guarantees and is committed to reimburse the account holders with when a bank fails and go bankrupt.

So in one way the customers outcome did not really change from a real bankruptcy, while reducing the risk of crashing the entire bank system in Cyprus, possibly EU and in that case the world.

The sum is not extraordinarily high though so I suspect that quite a few rather ordinary people saw their retirement savings evaporate.

I also suspect that the bank have been paying dividends to it's shareholders for many years, so it would have been nice to let them bail the bank in one way or another instead of ordinary people - but I doubt that it's possible to do that legally after the fact. The best you can do is to step in and buy the bank for nothing - but that won't remove the debts.

I suppose that it would be possible to write laws that make the banks shareholders be responsible for any debts somehow, just like some other types of incorporations - and why not? Owning a bank seems to be pretty risk-free if you can just use your customers money to bail yourself out...

> I also suspect that the bank have been paying dividends to it's shareholders for many years

maybe not as the bank ceo later admitted that the bank had probably been insolvent as early as 2008, even before cyprus entered the eurozone.

It is outright theft. Commies also did something like this but worse, it was called nationalization.