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Probe into Turkish Cypriot property fraud

Interior Minister Constantinos Petrides

Interior Minister Constantinos Petrides said on Wednesday an intensive effort was underway to locate and stamp out mismanagement relating to Turkish Cypriot properties, as Paphos Mayor Phedonas Phedonos said politicians and others had been illegally exploiting them.

The outspoken mayor, whose past revelations led to a rubbish management scandal and the arrest of state and elected officials, charged that ineligible individuals, including a former minister and former municipal councilor were getting rich through the unlawful possession of Turkish Cypriot properties.

Petrides responded immediately, saying on Wednesday that the cases Phedonos was referring to were known to him and the Turkish Cypriot management service.

“The Paphos mayor’s reports concern seven cases, already known to the minister, for which the necessary procedures are underway to recover them or put other corrective measures in place, like readjusting the rent,” Petrides said in a written statement.

He said these constituted a small number of the cases identified by the ministry.

“The ministry, especially the Turkish Cypriot property management service, has launched an intensive effort to identify and stamp out mismanagement that has accumulated all these years,” he said.

Following the 1974 Turkish invasion, properties abandoned by Turkish Cypriots in the south were, by law, put under the protection of the interior ministry, or the guardian of Turkish Cypriot properties.

Because of the need to house Greek Cypriots who were displaced from the north, it was decided to allocate such properties to them – usually for a small fee – on condition that the owners would not lose their rights.

Speaking on privately owned television station Sigma on Tuesday evening, the Paphos mayor said there were non-refugees who held property worth millions either because they had been renting it before the invasion or managed to secure them through various means.

He spoke of a former minister who had property in his possession without being eligible, and a former councilor who stayed in the occupied areas for a few months before the invasion but managed to secure refugee status and now has buildings in his possession that he sublets for €2,000 to €3,000 per month without declaring the earnings to the tax department.

Phedonos also mentioned a party official who mediated the construction of a commercial building on Turkish Cypriot property by a company that it later emerged he held shares in. Neither he nor his wife were refugees.

There are also thousands of hectares of farm land that the state has paid subsidies on without asking for leasing agreements from the applicants, he said.

The blatant mismanagement of Turkish Cypriot properties is an issue that comes up from time to time but never seems to be resolved, apparently because of the vested interests involved.

In March this year, MPs called on the interior ministry to stop threatening Greek Cypriot users of more than 1,300 Turkish Cypriot properties with eviction, and to submit a report explaining the criteria they used for rent hikes imposed last year.

According to Akel MP Skevi Koukouma, head of the House refugee committee that discussed the rent increase issue earlier in the week, the government’s decision was unilateral and there was no consultation with those affected.

The rent increase on those properties was introduced last year as part of a plan by the interior ministry to amend outdated procedures and introduce a fairer distribution of Turkish Cypriot property to beneficiaries.

The move was deemed necessary after it emerged that many who hold such properties – especially businesses in places like Larnaca – sublet them, often at inflated rates.

It also affects houses in Turkish Cypriot villages that are often used as holiday homes. According to the new rates, those who used to pay €10 as monthly rent will now pay €25.

Those paying between €11 and €20 will see an increase to €35, for €21 and €30 to €45, and for more than €31 there will be a rise to €50.

This concerns 1,342 establishments used by 759 refugees and 583 non-refugees.

The decision was met with discontent by many tenants who found the rent increase unfair because they had spent a lot of money over the years repairing properties – many of which were dilapidated – and had brought life back to deserted communities.

Interior minister at the time, Socratis Hasikos, said those expenses had been recouped over the years the property had been used at low rent.

He said that the redistribution of Turkish Cypriot land was already under way and that procedures had been set in motion to take Turkish Cypriot property from those who refuse to pay the higher rates.

Also in March, the Paphos district officer said that around 50 Turkish Cypriot properties had been recovered over the past nine to 10 months from users who were not paying rent or where irregularities were detected. The same policy, she said, had also been applied in the other districts.

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