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Cyprus

Court rules for asset seizures in land scandal

By Constantinos Psillides
THE Larnaca Criminal court ruled on Wednesday that the state could seize the assets of defendants found guilty on the Dromolaxia scandal.
The seizure ruling was part of the mitigation hearing that took place until late afternoon after which session was adjourned pending sentencing on January 5.
On December 22 the court found five people and one legal entity guilty. The case concerns the purchase by Cyprus Telecommunications Authority (CyTA) pension fund of a land plot in Dromolaxia at an inflated price.
The court had then delivered a guilty verdict for ex-CyTA boss Stathis Kittis; former Electricity Authority boss Charalambos Tsouris, who was a member of the board of directors of CyTA during the material time; AKEL member Venizelos Zanettos; trade union rep Orestis Vasiliou; land registry official Gregoris Souroullas; and the company Polleson Holdings Ltd as a legal entity.
Larnaca Press said the state was demanding €200,000 from Vasiliou and €250,000 from each of the other defendants, with the exception of Zanettos and Tsouris. The expected amount is estimated at a €1.2m.
Tsouris was only found guilty of conspiring to commit fraud – he was facing the same charges as Kittis, Souroullas and Vasileiou but the prosecution failed to establish his guilt beyond reasonable doubt – while Zanettos was found guilty of blackmail, as he threatened to block the Dromolaxia investment unless Nicos Lillis – the businessman behind the project that turned prosecution witness- repaid old debts of Alki football club worth €650,000. Lillis was chairman of Alki at the time.
Kittis was pronounced guilty on 16 out of 19 counts, including corruption of a public official, accepting bribes and legalising ill-gotten gains. The court said Kittis conspired to inflate the real cost of the Dromolaxia project, for which he took kickbacks totalling €300,000.
He also forged documents in a bid to give the veneer of legitimacy to a commercial agreement between Wadnic Trading and another company by the name of Leagros Investment Ltd, which would justify him receiving a €100,000 cheque from businessman Nicos Lillis, a key player in the whole deal.
Tsouris is liable for going along with the addition of 400 square metres to the Dromolaxia project, known as the Aero Centre. The added surface area unnecessarily raised the project’s cost. He was also liable for drafting a report – which he submitted to the pension fund’s management committee – containing false data to that effect. He was found guilty of fraud, abuse of a public official’s fiduciary duties and obtaining moneys under false pretences.
Vasiliou took €450,000 in bribes as a sweetener to refrain from inciting opposition to the investment from CyTA unions.
Souroullas received €250,000 from Polleson Holdings Ltd and from Vasiliou despite knowing that these were ill-gotten gains. Polleson Holdings, of which Souroullas was a member, was found guilty on the charge of money laundering.
Legislation on seizing assets believed to be the product of criminal activity allows authorities to look into financial records going back six years. CyBC radio also reported that one of the defendants had his assets moved shortly before the trial commenced.
The court acquitted the two other defendants in the case, jewellery shop owner Antonis Ioakim and former CyTA marketing manager Yiannis Souroullas.
As part of the mitigation arguments process, the Criminal court heard a report by Welfare Services on each of the defendants.
The trial began in March 2014. It revolved around the purchase by CyTA’s pension fund of office space in Dromolaxia, near Larnaca airport, at a price several times the going market value. The land was initially sold to a company by the name of Wadnic Trading, which upgraded the coefficients, built on it and sold it on to the CyTA pension fund for some €20 million.

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