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Paphos developer gets five months behind bars

A property developer in Paphos has been sentenced to five months imprisonment for unpaid tax debts.

FOLLOWING the news story that we published last Sunday ‘Home buyers may lose their properties’, we understand that the Paphos developer involved has been sentenced to five months in prison for unpaid tax debts.

The developer is reported to owe the bank €3 million which has applied to the court to appoint a receiver.

But a group of property buyers are opposing this appointment as they believe that a receiver will serve the interests of the bank and they feel that there is a better solution that would not result in them losing their homes.

Readers' comments

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  • dimitri says:

    Any chance of knowing the name of this developer, i would not be surprised if when he is released that he starts to re-sell, thanks

  • Matt says:

    As I’ve mentioned in previous comments –

    I bet the banks have loaned the developers company far more than the development land is worth.

    No developer would buy a piece of village land worth 3million euros. Large village building plots in Cyprus do not cost millions of euros.

    So even though the banks have the original title deed (which clearly states the value), how can they hold the house owners accountable if the developer goes bust?

    In years to come, this is going to be remembered as one of the biggest scams of the 21st Century.

    How a small med island managed to dupe billions of euros out of overseas investors. Government,Banks,Developers & Estate Agents all in it together.

    Yes, you may have a house but you never fully own it out right.

    You’ve all been sold a White Elephant – sorry

    Beware Greeks baring Gifts !

  • Peter says:

    Why are the residents worried about the banks? Actually there are three types of creditors.

    The first is the “Government”. It takes out from the remaining assets of the company (eg:your home) unpaid taxes, National insurance contributions and other debts owed to the Government.

    Then next comes “Secured Creditor”, those who have a charge or mortgage over the assets of the company. For example the bank, developer (yes he can be a secured creditor above you) and then last of all you. The mortgages are serviced in the order they were created, which means the bank comes first, then the developer and then last you. Fixed charges or mortgages take priority over floating mortgages, which only crystallize when the company goes into liquidation.

    Then if there is anything left the “Unsecured Creditor” That will probably be you if you bought your house for cash. You are at the bottom of this ‘dung heap’.

  • Peter says:

    No pro-active work here then by the Government? €3m has not just ‘snuck up’ on the developer. The Government should be taking taxes at the point of sale, not months or even years after all the money has been spent.

    Again if you buy in Cyprus be prepared to lose your home. My advice for these people is to seek a legal remedy called “The Doctrine of Part Performance’ It is an order imposed by the court awarding the buyer title deeds and forcing through the sale, but you need to be quick.

    In the meantime the Paphos Land Registry refused to allow a Paphos developer to transfer title deeds over to one of my friends, as the developer was unable to produce a certificate saying he had paid all his taxes. He was transferring an asset off the books of the Company. So what has that to do with the buyer I hear you ask?

    Well I have no idea why a buyer should be penalised for the sake of another person’s debts. But hey, this is Cyprus do they need a reason?

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