The start of the trial for the Ayia Fyla co-operative loans scam was postponed yet again on Wednesday, as prosecutors pondered whether to join it with another case brought subsequently to court, involving similar incidents at the same co-op.
In the case due to start on Wednesday, six individuals are accused of having conspired to take out loans from the Ayia Fyla co-op. The mastermind appears to have been a 54-year-old land developer, who, along with his firm’s 42-year-old director, had convinced four co-op officials to approve bogus loan requests he filed.
A 65-year-old former co-op senior official, the 55-year-old secretary of the co-op, a 43-year-old loans department head, and his 40-year-old assistant, all seem to have been part of the scheme, approving loans backed by inadequate collateral and guaranteed by obviously unfit people, including recipients of social-welfare benefits and psychological issues. The guarantors were then unwittingly turned into primary debtors
Though all involved were paid off to play their part, unbeknownst to them, the guarantor straw-men were then turned into primary debtors.
In other cases, investigators found, individuals were lured into taking out loans from the co-op to buy properties from the land developer, which they were assured would generate them significant profits down the line. The victims were shown inflated valuations which did not reflect the true value of the properties.
The defendants are facing a total 180 charges over 22 individual loans from 2006 to 2009, worth €9.5 million.
Five of the defendants are facing similar charges over 11 loans taken out from the same co-op, from 2007 to 2009, worth close to €12 million.
As argued by the defence in court on Wednesday, since the two cases are similar in nature, and it would thus be more convenient if both cases were folded into one.
Therefore, the court ruled, Wednesday’s case was postponed to March 17, so that all defendants of both cases appear in court on the same day.
Meanwhile, Finance Minister Harris Georgiades told parliament on Tuesday that eight more cases from other co-ops across Cyprus are under investigation and will soon be filed in court.
These relate to old incidents, which the new management has investigated, raised, and reported to the authorities, CEO of the Central Co-operative Bank Nicolas Hadjiyiannis said on Wednesday.