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Fraudulent property scheme of biblical proportions

British home buyers have filed a class action against the ‘Turkish Republic of Northern Cyprus’ and the HSBC claiming they are victims of a fraudulent property scheme of biblical proportions.

A CLASS of British homeowners claims in court that the ‘Turkish Republic of Northern Cyprus’ and HSBC Holdings created “a fraudulent property scheme of biblical proportions” that cost people their life’s savings by selling them stolen vacation and retirement properties in Northern Cyprus.

Four dozen plaintiffs filed a federal Racketeer Influenced and Corrupt Organizations (RICO) class action against the ‘Turkish Republic of Northern Cyprus’ (TRNC), HSBC Holdings and HSBC Bank USA.

The plaintiffs say that though the ‘TRNC’ purports itself to be a government, it operates illegally in the Republic of Cyprus through the “brute force” of 40,000 Turkish troops.

“The pattern of racketeering activity engaged in by defendants involves a scheme to fraudulently create a pretence of a legitimate recognized government with sovereign powers such as the ability to own and issue title, create corporations, exercise eminent domain, to commit fraud upon the public and foreign investors while, at every turn, seeking to further the illegal enterprise to avoid justice,” the class claims.

They say the ‘TRNC’ “brutally displaced civilians” from their homes in 1974, a fact that the organization conceals, and sold the displaced people’s properties to the plaintiffs.

According to the complaint, HSBC helped the rogue Turkish force in its racket, which included website operators, Realtors, real estate agents and attorneys.

“HSBC chose to operate in the TRNC illegal enterprise with the TRNC knowing that it was or likely violating the rights of others and/or that the underlying property transaction involving the plaintiffs and members of the class were based on fraudulent or defective title,” the plaintiffs claim.

They say that the ‘TRNC’ “could not exist without the infusion of capital from an international banking and money laundering system like HSBC.”

The class claims the defective title scheme has defrauded foreign investors of billions of dollars.

Recently, a federal judge threw out claims against the ‘TRNC’ filed by pop singer Julio Iglesias, who’d claimed he was duped into agreeing to perform an illegal concert in Cyprus by a military organization.

The plaintiffs want the ‘TRNC’ and HSBC to pay them compensatory and punitive damages for multiple counts of fraud and racketeering. They also want an injunction preventing the ‘TRNC’ from doing business as North Cyprus or the ‘Turkish Republic of North Cyprus’, and from falsely marketing and advertising properties.

First published in the Court House News Service

Further reading

United States District Court for the District of Columbia – Class Action Complaint for Fraud

Readers' comments

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  • @Fighting For Justice – I have to disagree with you about the lack of warnings concerning purchasing property in the south.

    I joined ‘MSN Cyprus Property Owners & Buyers‘ in 1997/8 and have been active on the Internet ever since. (The group is now dead, but the link above will take you to an archive copy).

    I set up ‘Cyprus Property Buyers‘ in 2004 – and for a few short weeks in the same year my book ‘Buying a Home in Cyprus: a practical guide to successful real estate purchase‘ was the Amazon UK number 1 best seller in their e-Books category.

  • Fighting For Justice says:

    Mike you have totally misunderstood what I said. I am fully in agreement with you in saying that there were warnings. However, as andyp quite rightly agrees with me, there were no warning about buying in the south. I am in exactly the same situation as those who lost their homes in the north but in the south. My home was stolen from me and someone else lives in it.

    My question was, why don’t GCs take similar class actions to regain their properties? Are they doing and it is in that long winded process? Mr Apostolides did it and it was simply a question of why don’t others? There may be a very good reason and that is what I am asking?

    I have not undertaken action in the south to get compensation for my lost house because I don’t have €20,000 to throw at legal fees and the ‘judicial authorities’ refused my EU right to cross border legal aid, instead suggesting that I commit fraud to fund legal fees.

  • Gavin Jones says:

    I have absolutely no sympathy whatsoever for those who have bought property in the north and are now crying into their soup. They knew full well that in all probability the land or property they were ‘buying’ belonged to Greek Cypriot refugees.

    Their action is no different from buying that ‘bargain’ off the back off that proverbial lorry.

  • Mike says:

    Fighting for Justice, I think the article refers to the class action being filed by BRITISH homebuyers. Why would Greek Cypriots want to or need to take such an action, they have not bought stolen homes in the so called TRNC or have I missed something in your comment?

    One of those houses in the North is in fact mine, according to title, but the title is about as much use to me as a chocolate teapot, the reality is I do not have use of or access to my home and that is the reality while carpetbaggers see or saw the perceived means of making a killing. Forgive me but I do not accept they were unaware of the situation. If I offered your home to you for £100k when identical units across the road were selling for £600k would you not ask yourself why. I certainly would even at the risk of showing my utter ignorance of the recent history of the Country I was intending to buy a home in. Sorry, as much as I do not like to see anyone being ripped off this one was with eyes wide open and blinking like a cash register. What goes round comes around.

  • andyp says:

    This is a difficult one and I sympathise with everyone caught up in The North.

    As said there were warnings from BHC when I was looking back in 2004. Unfortunately for me and many others at that time there were no warnings about the practices in the South.

  • Graham Cockroft says:

    Now this could be fun with Cyprus taking on the mantle of EU King of in July, Cyprus just might try to flex its new found EU muscle and turf out the Turks………..and that’s the end of Cyprus !!

  • Matthew Ring says:

    For their not to collapse, they will presumably have to overcome a sizeable obstacle in the form of the doctrine of caveat emptor.

  • Fighting For Justice says:

    Whilst on the one hand I applaud this action, on the other hand I have to say that the Foreign Office always warned against buying in the north whilst those of us with property problems and stolen property in the south did not have such warning although it is there now.

    I fail to understand why more original Greek Cypriots haven’t taken this action but before anyone shoots me down in flames I am saying I don’t know why they haven’t tried, not that it is possible.

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