By Andria Kades
Limassol district court on Monday issued arrest warrants for 19 people in yet another Ayia Fyla cooperative bank loan scam.
The case concerns the approval of 11 loans worth €11.9 million between 2007 to 2009.
Warrants were issued on Monday against two business persons, two of their staff who would find people to sign as guarantors while they were principal debtors , five former co-op members, and three former members of the branch committee, four property valuators and three relatives of those implicated.
All but five suspects were arrested later on Monday, with police continuing the search for the rest.
They will be investigated for 11 alleged offences, namely conspiring to commit a crime, conspiracy to defraud, obtaining goods with false pretences, fraud in sale or mortgaging property, theft from directors or company officers, theft from secretaries and services, keeping false accounts, forgery, circulating forge documents, challenging documents under false pretences and offences relating to money laundering.
Six of the suspects had been arrested in September as they were embroiled in a previous coop loan scam where between 2006 and 2009, €9.6m of loans were dished out by the bank to a 54-year-old businessman’s firm, and personal accounts without the required collateral. The irregularities were reported to police in March last year after the findings of an internal audit at the co-op were forwarded to the Legal Service.
Both loan scams operated in the same way.
A key suspect in the first dodgy loans case concerning the now-defunct Ayia Fyla cooperative bank, Iordanis Kostekoglou, 45, was arrested in September at a beach hotel in Limassol after a three-day police stake out.
He is reportedly the manager of the land development company of the 54-year-old businessman who is also in custody.
In addition to the two men, three co-op employees are in prison, a 43-year-old loan manager and his 40-year-old assistant and a 55-year-old former employee. 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 using fake collateral.
The contractor’s 52-year-old driver and a 69-year-old man, also an employee of the contractor, were arrested but initially released without charge due to their limited involvement in the case. They will reportedly be used as prosecution witnesses.
The two men were allegedly approaching people with money problems and paid them 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 the same case, the businessman’s 49-year-old accountant is wanted. She is believed to have fled abroad.
The suspected irregularities were reported to police in March 2015, after the findings of an internal audit at the co-op were forwarded to the Legal Service.