ALL five suspects in the Aristo Developers case of forging documents and conspiring to defraud the state were questioned by police yesterday, including the company’s founder and CEO Theodoros Aristodemou who had been hospitalised for the last five days with chest-pains and high blood pressure.
Aristodemou’s questioning began on Thursday afternoon and was concluded yesterday.
Also questioned was 36-year old Elisavet Kouspou, a Paphos municipal engineer who was also hospitalised. Kouspou fainted during her remand hearing last Saturday, followed by signs of depression, which prompted her admission to Limassol general’s psychiatric ward.
According to police sources, Aristodemou told investigators that he was willing to fully cooperate with the authorities, denying all charges against him.
Aristo is under investigation in a suspected attempt to increase the demarcation area under development by forging the documents submitted to, and approved by, the Land Registry.
The forged document, which relates to Aristo’s planned development at the Skali area in Paphos, had green areas and the road network on the approved plans reduced by some 2,700 square metres, allegedly in order to allow Aristo a larger area for development. This allegedly resulted in an estimated additional gain for the company of €1.1 million.
Already questioned were Aristodemou’s wife Roula, 63-year old former municipal engineer Savvas Savva and 38-year old designer Christos Solomonides, who appears to be the one who forged the documents.
Specifically, Solomonides was claimed by lead investigators to have created fake blueprints bearing the official seal of the Land Registry and the signature of a Registry official, both of which he had scanned from the original plans and pasted onto the tampered ones.
According to police sources, Solomonides admitted to being the one forging the document but claimed that he did so under instructions by his superiors and that this was standard practice.
According to the same sources, Kouspou also claimed that she was operating under instructions, laying the blame with the 63-year old former municipal engineer.
The eight-day remand for all five suspects expires tomorrow and the prosecutors may seek a renewal.
On September 23 Dolphin Capital Investors Limited issued its Trading Update and Preliminary Half Year Results for the period ended 30 June 2014, which included the following statements concerning Aristo:
- 52 homes and plots were sold by Aristo in the eight month period ending 31 August 2014, representing sales of €16 million. Both figures are in line with the performance over the corresponding period in 2013. 51% of the clientele originated from Russia and 40% from China.
- As indicated by the level of sales over the period, Aristo’s sales performance remains poor, putting a strain on the company’s cashflows. As a result, Aristo has prioritized its payments so as to ensure that its development programme continues on course, while it is making good progress in restructuring its bank obligations in a long term and sustainable way which will benefit both the company’s shareholders and its lenders – since such obligations are fully secured against land mortgages exceeding the respective loan values. To that regard, Aristo has already agreed the restructuring of its loan obligations with all of its lenders, except one – its major lender – with whom the company is in advanced discussions to agree a significant deleveraging of the Aristo group through a project level debt-to-preferred-equity conversion together with the re-profiling of the Aristo Group’s loan maturities and reductions in the interest rates incurred.
- In parallel, the company is taking actions both at the wholesale level (for example, by selling Venus Rock Golf Resort) as well as at the retail level by launching new projects to enhance the diversification of product offering and support its sales potential.
- In addition to the ongoing challenging market conditions, recent sales performance has been adversely affected by negative publicity relating to an investigation carried out by the authorities with regard to the subdivision of 177 land plots in a 160,000 m2 site owned by Aristo in the Paphos area. Mr. Aristodemou and his wife were detained for questioning in the context of this investigation. The size of the disputed green area is 2,730 m2 which, although not material, has drawn disproportional attention by the local investigators and media, due to the previous appointment of Mr. Aristodemou as the Chairman of Board of the Bank of Cyprus.
- The Aristo management is fully cooperating with the local authorities on all aspects of the investigation, and remains confident that its result will demonstrate that there has been no inappropriate action or intended omission by Aristo.