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29th May 2022
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The troika’s title deeds demands

title-deed-issues THE Title Deeds Scandal has dogged the Cyprus property market for years and remains unresolved.

This column has been obliged to return to this suppurating issue many times over the past 9 years to air not only the failure of successive governments to deal decisively with it but also the incalculable damage to the country’s property sector and Cyprus’s reputation as a safe place for investment of any kind.

Moreover, thousands of innocent property buyers, especially foreigners, have been treated so atrociously that it is hard to imagine anyone buying a property in Cyprus ever again.

The 2012 request by Cyprus for an EU bailout brought a glimmer of hope that finally the Title Deeds Scandal of the backlog of 130,000 still to be issued and transferred would be eradicated.

The Memorandum of Understanding (MoU) from the Troika on the Cyprus bailout includes a requirement for the Cyprus government by quarter 4 of 2014 to ‘eliminate the title deeds issuance backlog to less than 2,000 cases’ that remained pending for more than 1 year. A noble objective indeed, but how realistic is this target and timetable and what stumbling blocks does it gloss over?

Are The Troika Being Naïve?

While theoretically the Land Registry and related offices may be able to become more efficient to achieve the Troika’s issuance target, it is quite another proposition to transfer those deeds issued to developers to their rightful owners – the buyers who have already paid for the property in full.

Many developers took out mortgages on the land and the latter need to be discharged before title deeds can be issued let alone transferred. However, many developers are in severe financial difficulties and are unable to discharge their mortgages.

Further legal complications arise where developers have taken out mortgages without full and proper disclosure to, or agreement by, the individual property buyers many of whom have paid in full.

For many years, Cyprus banks have been reluctant to enforce NPL procedures against such developers and, in some cases, it would appear that banks themselves have conspired with developers against individual property buyers. In some cases (see below), Cyprus banks are pursuing innocent home buyers for the mortgage default debts of the developer instead of pursuing the developer personally and his guarantors.

Multiple ‘class actions’ for mis-selling against Cyprus banks and developers by several groups of aggrieved property buyers numbering at least 450 are also underway in the UK High Court with further large batches preparing their cases.

An informed and influential source confided that recently a Troika official in Cyprus expressed surprise at being told of such matters as hidden developer mortgages, uncooperative near-bankrupt developers, bank recovery procedures against innocent property buyers and the impact of all this on the Troika’s instruction to clear the title deed backlog and, indeed, added that he was sure none of his Troika colleagues knew either! Was he being naïve or disingenuous?

Can we really believe that such Troika officials knew nothing of the developer mortgage quagmire and how it would probably scotch the Troika’s plan? The Troika’s officials are among the elite of their professions and I think we are entitled to assume that they must have known. Well, if they genuinely did not know, now with this public notification in Financial Mirror, Miss Delia Velculescu, IMF Head of the Troika’s Cyprus Mission (, and Mr Vincenzo Guzzo, Troika Resident Representative (, and their staff cannot plead any such ignorance.

Cases of Extortion by Cyprus Banks

The Troika are reported to have indicated that in seeking to drastically reduce the massive NPL mountain in Cyprus (reported by the CBC as being some €15.5 billion), they are not in favour of seizure of primary residences for debt recovery. That may well be their intellectual preference but, as is clear from a number of on-going cases, some banks appear to be thumbing their nose at the Troika on this matter.

In at least three high profile cases so far, Cyprus banks have not been shy in pursuing for recovery not the developer who took out the loans and mortgages and their guarantors but the home buyers individually, most of whom had already paid for their properties in full and had never had a loan of their own on the property or indeed been party to any of their developer’s mortgages. Their only ‘crime’ was to still be waiting for the developer to hand over the Title Deeds.

Case 1: The A&G Froiber Collapse

On 18 September 2009, A&G Property Wise Development Ltd operating under the Froiber brand collapsed and went into liquidation. A large number of home buyers who had already paid in full had still not received their title deeds.

It was then reported that such buyers received from various banks including USB threatening letters stating that they would not receive their title deeds unless and until they contributed a ‘symbolic’ amount of €8,000 per apartment towards the outstanding debt of the liquidated developer. In addition, the letters demanded a larger sum to help pay off the developer’s tax liabilities to the Inland Revenue.

Allegations also emerged that in some instances the banks, after the individual apartments had been paid for and unbeknown to the buyers, had issued further loans to the developer with charges against these properties as collateral.

The final outcome of this case is not yet known. However, quite apart from the outrageous pursuit of innocent property buyers instead of the developer, questions inevitably arise as to how the banks could have issued further loans to the developer against properties that had already been sold and without informing and obtaining prior agreement from the buyers.

Case 2: The Liasides Collapse

In December 2011, Alpha Bank sought legal permission to auction eight plots of land that it had repossessed from the bankrupt developer Mr Yiannis Liasides.

When he ceased trading in 2007, buyers had acquired from him some 230 properties across 14 sites but had not received their title deeds. It is understood that while some buyers had taken out home construction loans, a significant proportion of buyers had taken out no loans at all on their property.

Evidence has emerged that the developer took out mortgages on a number of the properties just before buyers signed their contracts and unbeknown to them. This may have occurred after the buyers’ lawyers had done standard searches at the Land Registry to identify encumbrances.

It is unclear whether or not the buyers’ lawyers were aware of these late mortgages prior to contract but, if they were, it is apparent that they failed to tell their clients or advise them against signing their contracts.

It now emerges that the developer’s main bank Alpha Bank is, as did the banks in the A&G Froiber case, demanding via its receivers that all the buyers contribute to paying all the developer’s debts and tax liabilities otherwise their homes will be sold.

Daniel Hannan MEP raised the specific case of Alpha Bank’s conduct in the Liasides liquidation in the European Parliament on 30 October 2013 (written question E-012350-13) and asked: ‘Could the Commission please confirm that this extortion by the banks is in direct conflict with the terms of the MoU?’ Delia and Vincenzo, please note.

Case 3: The SNK Collapse

The collapse of Larnaca-based SNK developers (SNK Venus Homes and SNK Exclusive Properties) is following the same path as Liasides and A&G Froiber. It is reported that liquidators acting for the Bank of Cyprus and possibly the liquidated Cyprus Popular bank are starting enforcement procedures against SNK home buyers to recover the developer’s debts. The debts plus liquidator fees will amount to at least €15,000 to €20,000 per household plus a contribution to SNK’s unpaid taxes totalling some €540,000.


In pursuing home buyers for recovery of the developer’s debts and tax liabilities (instead of the actual debtor and his guarantors), it looks like the banks regard them as a softer target with possible property assets overseas that could be liquidated at full value rather than trying to sell the Cyprus properties at knock-down prices in the highly depressed Cyprus market.

The dubious legality, not to say moral degeneracy, of the banks’ behaviour demands serious public scrutiny and accountability. Delia and Vincenzo should impose the Troika’s moral compass on the Cyprus banks and insist on an Irish style NAMA solution. Just tell them to accept a discounted debt buy-out and stop pursuing innocent buyers, or else Cyprus will forfeit its next bailout tranche. And why the deafening silence from the CBC Governor and the Finance Minister?

About the Author

Dr Alan Waring is an international risk management consultant with extensive experience in Europe, Asia and the Middle East with industrial, commercial and governmental clients. His latest book *Corporate Risk and Governance is at Contact

©2013 Alan Waring

First published in the Financial Mirror



  1. Actually – I find myself on this occasion – in violent agreement with @SoOJB. There is E.U policy @ work here that few (if any) of us could have known about.

    Therefore – it’s increasingly looking like we are ‘collateral damage’ as the US used to describe innocent civilisations, bombed, shot, maimed etc in various theatres of conflict and bloodshed.

    Do we want to be ‘collateral damage’?

    I don’t thanks – not to keep a handful of plutocrats somewhere on this planet in the luxury to which they’ve become perennially accustomed.

    Anyone else?

  2. Will as many people as possible please as one of the earlier post asked e-mail Delia at the address in the above article probably make no difference but at least make them aware at the amount of anger there is on the subject in this corrupt country.

  3. I was pleased to see that this article, in the Cyprus Sunday Mail, actually had over 80 comments, so the message is getting to all the English speaking population of the island. But are the local Cypriot papers actually publishing anything about this fiasco?

  4. Does this sound like the TROIKA? Moronic Schultz knows nothing, sees nothing!

    Sooner or later the worm turns.

    “Peoples do not judge in the same way as courts of law; they do not hand down sentences, they throw thunderbolts; they do not condemn kings, they drop them back into the void; and this justice is worth just as much as that of the courts.”

    Maximilien de Robespierre.

  5. @Cordarone. Your description of the depraved Cyprus milieu that is the subject of so much long-term disgust reminds me so much of the Hollywood satirical film ‘Idiocracy’. The story line briefly is that a Pentagon experiment to put a Mr Average into clinical hibernation for one year goes wrong and he wakes up hundreds of years later. In the meantime, the gene pool of the population had been in perpetual decline and the average IQ was now below the current decile. In the New World Order, everyone was a knuckle-dragging dummy; entertainment had been dumbed down to the level of sado-masochistic game shows; the hospital director was a pot-smoking hippy; the judge in our Mr Average’s trial was a hang-em-all TV game show MC; the defence council openly colluded with the prosecutor in court to denounce his client as guilty etc etc.

    Although exaggerated for effect, doesn’t such a perverse nightmare world remind you of the Cyprus Property Scandal?

  6. The law in Cyprus is problematic in many fields, including the complex field of property transactions and conveyancing. What I have observed was that Cypriot lawyers without any expertise or even knowledge in relation to property law matters became property lawyers in a night. Unfortunately, in Cyprus, the legal profession is “one fits all”. The roots of the problems are very deep. Who study law? How do they enter the UK universities and how do they take their grades and diplomas there? The truth is terrifying. I know lawyers who supposedly have studied law somewhere in UK, as students have been absolutely stupid, and now they cannot even think as lawyers when trying to interpret and use the laws. They have many-many clients. They learn the “legal profession” in practice in the same way they would learn to make pizzas; they do not love their subject, and they are unable to research, to provide ideas, and improve our legal system.

    The same mess exists in the Banks. Who work in the Bank? How did they get that job? What they know about banking? In what expertise they were giving advices to people? There are people in high positions in the Banks who the only think that they know to do is to give instructions; they cannot listen to others; they cannot communicate with the knowledge; they believe that they are in a position which permits them to authorize everything and impose whatever irrelevant they want. I will not provide my examples! There are many Codes drafted in the line with EU Directives and national regulations (Banking Code of Conduct, Housing Loans Code, Code of Conduct between Banks and Small or Medium size Enterprises, etc). The average employee in the Banks does not know even their existence. On Thursday 05/12/2013 there is a very interesting Banking Forum at Hilton Park Hotel in Nicosia; who will be there? Probably, not the employee who gives the “instruction” about you housing loan!

    The same mess exist as concerns the developers. At those “gold ages” there were many constructors, who had learned from their fathers or alone to put some bricks together, and suddenly they left their villages, they registered limited companies with impressive names, and they were pretending the “developers”. The absolute exhibitionism went in its peak. Who are you man? What do you know about developing and business management? They were getting loans from perfectly ignoramus bankers without any knowledge to control their business operation and with the “lights” of irrelevant lawyers. What a great company… The bankruptcies of those companies were logically expected!

    The corruption is everywhere as in the mentality of the people who cannot see the ethical crisis behind the things. Let us now impose the law against those people. It is funny, up to a point. Who is negligent from all those? Probably, all of them are negligent (lawyers, bankers, developers, government, you, me) in different ways and for different reasons. The problem is that they cannot understand why due to their inherent stupidity! They will not see the substantial or the ethical dimensions of the mess that their great company has created, apart from the economical and other damages. What they see is that there are some odd Britons who are shouting because they do not understand that the things work in this way in Cyprus. So, they will think to speak to their “koumparos” who is a minister or a member of the parliament to approach the judge, or they will try to resolve the problem under the table, and … this kind of jobbery, which runs in the veins of some Cypriots.

    No my love, the things do not work in this way in OUR Cyprus; you know, there are people who are studying for a life, with a passion for their subject. There are people who lost their health serving their profession, and they are Authentic (!) lawyers, bankers and developers. There are people whose works are perfect, but they were all thrown in the same black soup with the “others”. Therefore, the damage that this company of ignoramus has caused to the reputation and dignity of all the authentic people is ethically accountable.

    You! You are not the perfect victim; you have also a small part of this liability pie. I will not explain you why; you have to investigate alone and understand the reasons. Now, why do you sue only the lawyers? How about the developers who get your much monies? How about your advisors in UK who told you that Cyprus is the sun island and that has the same legal system with UK because it was a British colony? Why do you give the impression that your only purpose is to be dispensed from your loan and keep the properties? Where is the truth? Which is your own truth?

    Me! What did I do to change the things? I saw that mess, and I kept my mouth closed. They imposed me the thought for a moment “why all the other lawyers do property law except of me?” Hopefully, I do not like that subject or any extra-judicial work; I hate speaking English and I was not misguided to believe that I would be able to advice for such property matters. What do I do now? Nothing! I am just observing this mess like watching a cinema movie; I am researching the different “legal schools” that they are created for its legal anticipation (be careful again what you are prefer), and I am waiting to criticize the decisions of the courts and generally the others.

  7. kufrahdog & others.

    I wonder if you’re as sickeningly tired of having the same old refrain being churned out almost on cue whenever one mentions the sorry state of government inaction, crooked developers, banks and lawyers and indeed anything ‘crooked’ in Cyprus: “It’s the same in England.”

    If anything’s likely to get the juices flowing, for me, those words are IT. When it comes to the legal ‘profession’, I have it on the very highest authority that even when Cypriot lawyers have been suspended, it’s for only a few months and soon enough they’re back on the circuit.

    As for any comparisons with England, there aren’t any so it’s definitely not ‘the same’. By accessing the U.K. Law Society’s rogues’ gallery, there are pages and pages of lawyers with full details of their misdemeanours, sentences and fines. In Cyprus, no such list exists.

    The whole title deed fiasco is ultimately down to the sharp practices of the lawyers as they’re in cahoots with their developer chums. So if ever you encounter a Cypriot who’s part of the “my country, right or wrong” school of thought, you know exactly what to tell him.

  8. This problem has obviously gone on far too long and in all honesty nothing has been resolved and indeed the tragedy of victims is in all likelihood likely to get worse in the future.

    How therefore do we fight a sovereign EU member state that facilitates, and by it’s actions, condones and promotes, property fraud against it’s citizens, EU nationals, Chinese, Russians indeed anyone who buys a house here?

    Any lawyers out there?

  9. As S of OJB states, the EU / Troika have their own agendas and this does not seem to include the protection of EU Consumers.

    If they did, why did they not insist, in addition to the issuing of all outstanding Title Deeds by Q4 2014, that the current Property conveyancing and land registry systems in Cyprus were brought into the civilised world and that Individual Title Deeds for all sales & transfers of property from Q1 2014 should be issued to the individual purchasers at the point of transfer / sale of the property.

    Otherwise isn’t the Troika and EU endorsing the current, unfit for purpose, Ottoman based system that got us into this mess in the first place?

  10. @andyp, re your last post, thanks, I had not forgotten. I was merely attempting to take a high-level view of how certain infringements could be overcome for the benefit of many, particularly property buyers.

    The problem with these people is that they are always seeking a pecuniary advantage or protection for their own kind, rather than addressing infrastructure issues relating to business process and practice, banking, the law, property conveyancing, fairness and morality. I agree with the sentiments expressed in your post.

    The best advice I was ever given was, ‘don’t do business with a Cypriot’. Unfortunately, I had bought my property from a crook aided and abetted by a crooked lawyer before being given that pearl of wisdom. The fight back goes on! KD.

  11. On 30 November last year, Cyprus Property News carried an article on the leaked MoU on Cyprus. Three relevant aspects are as follows:

    “Introduce legislation on amending the procedure on the forced sale of mortgaged property to allow for private auctions as under the rules for immovable property recovery under bankruptcy regulations.”

    “Better target the rules of court to improve the pace of court case handling. The authorities shall assess the need for additional measures – including if necessary legislative reforms – to eliminate court backlogs by end of the programme.”

    “Property pledged as collateral can be seized within a maximum time-span of 1.5 years from the initiation of legal or administrative proceedings. In the case of primary residences, this time-span could be extended to 2 years.”

    These indicate to me that the Troika’s priorities concern the speedy reduction of bank debt first and foremost and that the Troika is actually now part of the problem for buyers fighting possession by the banks of mortgaged property. This seems to contradict some of the statements put forward by Dr Waring, particularly the ones concerning no seizure of primary residences for debt recovery and the view that the banks behaviour is of dubious legality. As I have been told with monotonous regularity every time it suits the authorities in Cyprus to say it; without title deeds I have no rights and no say.

    As for Daniel Hannan’s question to the European Commission, it simply tells me that Euro MPs are as much in the dark about what the Troika has said and exactly what is in the MoU as most of the rest of us appear to be.

  12. @Kufrahdog.

    In reality it is illegal under Cyprus law for us to be occupying our homes without completion certificates. It is also a criminal offence for a developer allowing us to do so without a completion certificate.

    Successive Cyprus governments, with the help of our lawyers who never told us about this either, are simply not enforcing the law and expecting the buyer to sort it out at their expense (planning amnesty/blighted deeds).

    Cyprus property regulation is a complete sham and ultimately it is all down to the Cyprus government.

  13. There is zero chance that all but 2000 title deeds will be forthcoming by Q4 2014. I believe that house buyers in Cyprus, who for whatever reason, have not acquired their title deeds, will be unlikely to ever receive them.

    I think they are mere pawns in a much bigger plan to prolong the life of the Euro and are being sacrificed as a means to an end. Look at how much money has been thrown at Cyprus to stop it from going under and leaving the Euro. A few thousand EU citizens without deeds are a drop in the ocean in comparison.

    By Q4 2014 either the deadline will be postponed indefinitely or Cyprus will be outside the Eurozone.

  14. Quite apart from the dubious lending practices of Alpha bank is the question of why they have chosen to ignore the guarantors of the various loans and instead have applied to sell the properties of innocent buyers?

    C’mon Alpha bank, any answers?

  15. @ Linda Leblanc – it seems to me that the most practical and cost effective way to remove infringements that are related to the houses that have been built in violation of building density / coefficients as laid down in planning and building laws / regulations would be for the appropriate authority (Interior Ministry?) to rezone the land.

    For example, where a house has been built at 40% on a plot of 1000 m2 when it should have been built at 15%, the plot should be rezoned at 40%. This would make the house legal and it would thus qualify for its Final Completion Certificate.

    This would seem to be a reasonable approach to solving this type of issue simply because the house already exists on the landscape and the community has accepted the status quo.

    Developers or property buyers, depending upon who has been proved culpable in a court of law for the violation, should then be required by law to pay for the submission of revised plans to the planning and building authorities. Once the revised plans have been approved the FCCs should then be issued, thus preparing the ground for the transfer of titles.

    I should also to add that the current system of land zoning is archaic and in need of root and branch revision, but that is a separate matter.

    Has anything like this been discussed at Pegia Council – are you able to say?

  16. It is true that on first reading, the MOU stipulation that the authorities will reduce the Title Deed backlog to less than 2,000 cases pending for more than one year, sounds very ambitious.

    However, as always, it is not altogether clear what is meant: ‘Backlog’ refers to ‘applications’ and units that are ‘eligible for .. “ex officio” issuance’.

    It would have been better for the Troika to state the number of the ‘backlog’ in their view at the outset. Then there would be something to monitor progress against.

    Further there must be many cases of properties where neither of the above criteria are met. Irrespective of planning infringements, applications may be held back for various reasons and encumbrances may inhibit the issue of TD.

    Apart from a rather vague exhortation to ‘accelerate the swift clearing of encumbrances’, the MOU has little to say on this problem.

    The Document specifies a quarterly report be published on progress, the first of which has been seen on the Cyprus Property News website.

    However the authorities idea of publishing is at some variance to normal practice. All the essential figures were stripped from the version available to the public and just a load of guff was included. Any meaningful content and statistics on progress were suppressed and confined to a further report not available to the likes of us.

    Perhaps I am just being suspicious, but I do not believe that the matter is being handled with good faith. One might expect claims of outstanding progress in the new year.

  17. Thank you Dr Alan Waring for an excellent article.

    Nigel, to get the message home, if you haven’t already done so, have you thought of doing a presentation to the Resident Representative of the Troika in Cyprus, Mr Vincenzo Guzzo? I for one would be happy to assist by presenting evidence of the corruption practised by my developer and lawyer and the developer’s lending bank. KD.

  18. @Nigel – Since the highly immoral practice of the ‘buyer’ having to pay for the sins of the ‘developer’ under the GREY and RED deeds syndrome and then sue the developer in the forlorn hope of getting any money back, can you advise under which statute or Act of Parliament this was incorporated into Cyprus law as I can only assume it is unique to this corner of the developing world?

  19. Thank you for a timely and informative article Alan.

    I recall that one of the terms of the MoU which seem to have been dropped is that the progress of the title deed issuance stats were to be published (I think) every quarter.

    I have not seen any such figures, aside from some government numbers stating that 90% of property owners had paid their IPT.

    A few weeks prior to that announcement, we were being told that the land registry did not know the precise ownership of 200,000 properties!

    I smell a carob rat!….

  20. @jjames – I have just received information on another case involving a bankrupt developer in Limassol.

    People are facing demands from the Bank of Cyprus to pay the receiver’s fees, and debts and taxes of the company.

    We may hear more about this.

  21. @Linda Leblanc – thanks for your comments. The issue of Final Completion Certificates on properties suffering by planning infringements has come from the ‘Town Planning Amnesty’.

    Basically there will be three categories of Title Deeds:

    1. A ‘white‘ deed where everything is OK

    2. A ‘grey‘ deed on which minor infringements are noted.

    3. A ‘red‘ deed for properties suffering more extensive planning infringements. These cannot be sold until the infringement has been rectified (but it can be passed to legitimate heirs).

    To my way of thinking, properties with ‘grey‘ deeds will have a lower market value and therefore the Property Transfer Fees should be lower.

    And of course those with a ‘red‘ deed cannot be sold and will therefore have a zero market value – so no Property Transfer Fees should be payable.

    Personally I believe it’s a good move to enforce those whose property has a ‘white‘ deed to pay Property Transfer Fees. After all it is a government tax.

    But for ‘grey‘ and ‘red‘ deeds the victim (i.e. the buyer) has to pay for the misdemeanours of the culprit (i.e. the developer) – and then sue the culprit in the hope of recovering their money!

    Although in the eyes of the law this procedure is perfectly correct, it’s highly immoral!!!

  22. What about this end of year deadline for lodging property complaints at the courts. Are the banks waiting for this to expire to then pounce on property and assets elsewhere in the EU?

  23. Good article. I have a tuppence ha’pennyworth to add (on one of my increasingly infrequent visits to this side of the dark divide)…

    People are now wise-ing up to what the Cyprus banks are doing (and what the plan seems to have been all along with regards to loaning money to developer mates with no intention of ever getting it back from them but instead by extorting it from those who call Albion Terra Mater i.e. us ATMs).

    However, many people, expecting the Troika to arrive from on high with an “S” on its chest and with underpants on the outside, are now wondering at the Troika’s inactivity to tackle the Title Deeds Scam (and their ineffectiveness to actually DO anything except set a quite frankly ludicrous time-scale to reduce the deed-less pile to 2,000 next year). Then we’ve got various Troika bods popping up saying, “I never knew (what was going on in the camps…)”. Others, including Nigel, would beg to differ.

    So, we’ve got to ask ourselves: WHY aren’t they doing anything? Why are they lending money to Cyprus that they know they’ll never get back without INSISTING on reform? Are they stupid, ineffectual, gullible or a combination of all three?

    Or, do they simply not care, as their intended purpose is NOT to get the economy back on its feet by forcing through changes that virtually EVERYONE on this forum thinks are necessary?

    Have a read of this (again, a bit shouty, but the main point I think hits it BANG on the head: Vanishing Cyprus – Poisoned loans for Cyprus).

    Yep, that’s it. They serve a higher purpose: putting in policies to save the economies of the enslaved nations is not what it’s all about. Not by a long chalk. The author of the piece gets it wrong when he equates the Eurogroup’s strategy of “co-ordinat(ing) and coloniz(ing) nations through loans!” and that “what happened to Cyprus was a clever collusion in crime by the Commission’s Eurogroup. Germany… should have known better!”

    The Eurogroup’s aim is to keep the single currency together and really doesn’t mind lending countries only just enough money – with very weak, unenforceable strings attached – to keep them from defaulting and plunging European banks and then their governments into a major crisis. Germany’s aim is to protect its own economy and as it is benefitting hugely from this mess (Germany got great benefit from eurozone crisis), really is quite happy for the present situation to continue.

    In the light of the above, the Troika’s actions are completely understandable. Should Germany have known better, if it wanted to resurrect the economies of the enslaved? It does.

  24. From what I’m hearing at Pegeia Council, there’s even worse coming.

    Here’s what’s happening: To meet Troika demands to clear the backlog, Local Authorities are discussing issuing Final Completion Certificates (FCCs) on “problem” cases, without the illegalities being resolved. Many of the title deed delays have been caused because of these anomalies. This means the buyers end up with deeds that have formal, written notices on them listing the illegalities. The Municipality receives money for the FCC fees & the developers don’t have to amend illegalities for which, for the most part, they are responsible.

    But it’s pats on the back all round because they’ve cleared the backlog on pending title deeds & Troika demands met. It is just business as usual.

    They seem to think that the poor buyers will pay the sometimes inflated Land Registry valuations for transfer fees for a title deed with the illegalities written on it. To ensure this, I hear rumours that there are even discussions ongoing about legislation with time limits to force buyers to register their properties. Some of the illegalities actually result, according to current legislation, in restrictions on sales, until they are resolved (& some anomalies cannot be fixed).

    Unfortunately, legislation again favours the developers. I’ve never seen anything that covers penalties for their failures or delays to meet planning permit conditions, which are very much related to how this mess happened in the first place. The current “solution” being offered just shifts this burden to the hapless buyer.

    I believe this is a bureaucratic con which helps the developers and damages buyers.

  25. @Nigel Howarth re Alpha Bank. Although the holding company is registered in Greece, it was made clear to me by Alpha officials in Greece a few years ago that Alpha Bank in Cyprus is an autonomous Cypriot-registered company not controlled from Greece. The same goes for Alpha Insurance which is owned by Alpha Bank in Greece. Alpha Insurance in Cyprus is (they say) also an autonomous Cypriot-registered company not controlled from Greece.

    What effect, if any, would this distinction have on recovery actions against the developer? Presumably it would be the Cypriot Alpha Bank seeking recovery.

  26. Although I simply cannot believe the Troika are not aware of the complex and extremely serious ‘overlapping mortgages’ and of numerous other ‘practices’, ranging from ‘dubious’. To ‘Outrageous’ within RoC, the rest of Dr. Waring’s comprehensive article is to be very much welcomed. What I sense is a collective ‘heads in the sand’ behaviour by those, particularly the ‘new’ government, who would be most able to ‘do something about it’, thus the Troika MUST insist that the terms and detail of the MoU are fully delivered before ANY more EU/ECB monies are released.

    If this horrendous set of entangled problems is not sorted, and sorted Quickly, I see NO chance of the Cyprus property markets recovering from their downward slide, and therefore watch the RoC economy spiral further and faster downwards.

    This is the time for bold Action by those who KNOW what has been ‘going on’, (I include the Troika and IMF in this) and what the short medium term impacts will likely be and, however difficult and incriminating, bring it all to a head NOW, start planning how to resolve these mind-boggling ‘situations’ before the entire Cyprus economy goes over the metaphorical Cliff, and potentially many of us with it!!

  27. I’m personally very unhappy & disappointed that all of the machinations so far between the Troika and the Government of the Republic/banks etc as it all appears to be being carried out behind closed doors in the age-old opaque & slippery manner.

    Without transparency and giving ordinary people access to Troika personnel and the processes being worked – this situation will simply NEVER be properly sorted.

    Even on this forum – we are told the Troika are ‘well aware’ of ‘this and that’.

    Who is aware – and of what?
    What’s being done by whom and when?
    What’s the ‘roadmap’ of fixing these issues underpinned by persistently corrupt practices and those people behind them?
    And last – but by no means least – how is it going (IS IT going) to bring justice to those who have been robbed and deceived?

    Any answers in non-legalese, plain English would be much appreciated..

  28. I hope so Nigel. The bit in this article stating that the troika official was surprised to hear about the dodgy situation is of concern. If that individual really does know then are they choosing to bury their head in the sand as well or are there manoeuvres going on behind the scenes that cannot be made public at this time. I find it difficult to remain positive due to the lack of official communication and lack of detail in the occasional vague comments made by officials.

  29. I see in today’s internet issue of the Cyprus Mail that there has been a meeting with the President about ways of helping developers build yet more unsaleable projects, but there was no time to talk about NPL’s. I think that says exactly how important this useless government sees the problem that is worrying so many thousands of the people that pay their wages.

  30. This situation is so bizarre you couldn’t make it up!

    If every buyer refuses to pay the banks’ outrageous and utterly immoral demands, are banks going to repossess the entire housing stock on the island that is subject to developers’ non-performing loans?

    I cannot believe that these banks are capable of forcing the liquidation of other overseas property at full value to repay debts that the owners have clearly never incurred.

    Surely there must be some legal protection for assets that buyers’ own in their native country even if the corrupt bankers in Cyprus manage to inflict their moral degeneracy on buyers there.

  31. Crunch time is here! The Cyprus govt. property, banking and legal communities are now facing the Armageddon we could see coming years ago. They will prevaricate and ask for more time but in the end it will either be pay-up and issue the TD’s if they can, or leave the eurozone and probably the EU.

  32. Alan Waring.

    This is a truly excellent article. Thank you.

    To all and sundry.

    Many of us have sent emails to the troika referring to this article and I would respectfully suggest that those who haven’t do so in order to reinforce the issue. (The email addresses are in the last paragraph of the section headed ‘Are The Troika Being Naive?’).

  33. This is an excellent article with specific examples of the practices that have gone on and the unfortunate consequences for buyers of real estate in Cyprus.

    In case 2; the Liasides collapse, the buyers’ lawyers could always defend themselves from allegations of negligence in not conducting pre contract searches, by simply citing the Land Registry policy of refusing access to property records unless one has a registered ‘Specific Performance’ contract or Title Deeds for the subject property.

    That is the ‘Catch 22’ for buyers of Cyprus Real Estate, now well-known to everyone except, it seems, the Troika.

  34. @Pippa – I can assure you that the Troika has been aware of the ‘hidden’ mortgage issue for quite a while.

  35. @jjames – the Alpha Bank is a Greek bank and received €1.9 billion from the EU last year as part of the EU bailout deal with Greece.

    If your developer goes bust owing money on land he has mortgaged, the bank that may pursue you is the one that loaned him the money.

  36. Having said that no more needs saying I will mention that when I logged into my Alpha Bank account today I was faced with a modernised format; new password required; secret Q&A to confirm identity and ELIMINATE FRAUD. Improvements for our existing and prospective customers, it says. Customers are invited to give feedback!

    If my developer goes bust (I have no Deeds) will Alpha Bank be turning to me for money? – No doubt it will help towards their costs for this super new website! Time to do some feeding back I think……

  37. Excellent article!

    With the constant drip, drip, drip, and continual facts upon facts being reporting about the unsafe property sector in Cyprus surely something has to give?

    The EU and the Troika must by now be fully aware of this particular can of worms and the many artful ways practiced in the worm canning factory?

    Perhaps 2014 will be the year when the ATM’s fight back and the worm turns?

  38. As always Dr Waring has very comprehensively summed up the mess that was/is Cyprus Property buying. If, as he says, the Troika were unaware of the fall out of their demands on ordinary property buyers, not only foreigners but local Cypriots then what hope is there that this fiasco will ever be sorted? When the banks and the government still refuse to acknowledge that it is the developers who took out the loans and therefore should be the ones to pay PERSONNEL for loans?

  39. When I went to the Land Registry to “chase up” my title deeds over a period of three years I was surprised how much information was kept in manual ledgers.

    Whilst the staff were always helpful and polite this surely is an area that could have been so easily computerized? I had to go from department to department and building to building. Why isn’t this centralised into one office?

    Then came the day of paying for my deeds, an experience never to be forgotten. Despite three visits to my property by surveyors (why you ask three because I have no idea why three) it was clear the lady asking for the highly, over inflated price for the deeds had no idea of what the premises looked like and was asking me questions about the villa.

    She told me the price to pay for the title deeds, several hundred more than the contract price, but she would do a deal when I objected and knock three hundred off if I paid there and then. Is this what passes for a professional Government Department in Cyprus?

    But of course manual records keeps people employed and manual records give scope for creating accountancy. They were even still using carbon paper. Why?

  40. ‘the letters demanded a larger sum to help pay off the developer’s tax liabilities to the Inland Revenue’.

    So it would appear that as the Inland Revenue are too lazy or inefficient to collect Taxes due they can pass on the debt to the purchaser of a property! This will of course prevent the transfer of title deeds so a delay is again being caused directly by the government.

    So if you buy a property from a fellow expat who then has a capital gains tax liability but leaves the country before paying it, this becomes your debt as it is registered against your property!

    Surely that cannot be possible, even in Cyprus?

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