Cyprus Mail
Cyprus

Remand for latest arrest in co-op scandal

Iordanis Kostekoglou, suspected of being implicated in the Ayia Fyla co-op dodgy loans scandal was remanded on Wednesday for eight days.

His lawyer raised no objections although Kostekoglou, 42, denies parts of the allegations against him.  He was the manager for a land development company owned by a 54-year-old businessman also in custody along with three former co-op staff.

The arrested bank employees were reportedly acting on behalf of the 54-year-old contractor, for a fee, securing loans for him and his company with faked collateral data.

The case concerns the approval of 22 loans worth €9.5m that were given by the co-op bank to the 54-year-old’s business and personal accounts between 2006 and 2009 without the required collateral. The irregularities were reported to police in March this year after the findings of an internal audit at the co-op were forwarded to the Legal Service.

Kostekoglou allegedly told investigators about a team that used to obtain loans through third parties while offering bribes to co-op employees who would help fake the collateral data.

According to the allegations, people with money problems were approached and paid to sign as guarantors for the businessman’s loans. The documents were later changed, making the paid signatories primary debtors of the loan without their knowledge.

For every loan Kostekoglou secured, he used to receive a ‘respectable’ amount of money as a reward, the court heard.

Kostekoglou reportedly told police he did not hand himself in when his arrest warrant was issued on September 10 as he feared for his safety and that of his family since he believed his implication in the case endangered him.

Police are still searching for a 49-year-old woman, an accountant for the contractor. She is believed to have fled abroad.

 

 

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