Cyprus’ Toxic Debt

In the Republic of Cyprus they call the problem where builders/developers have taken out mortgages on properties legally bought by someone else, the “toxic” debt. In the North, they seem not to have recognised the severity of the problem here until recently. Now Prime Minister Küçük is telling us that because it is so prevalent the Government cannot afford to help. With all due respect to Mr Küçük, and the Government, you have been warned of this situation ever since you came to power and your predecessors had also been made aware. Your inaction has made it so prevalent!

Marion Stokes of the Home Buyers Pressure Group had been telling the previous government and this government of the time bomb the property market has become since 2005. The Property Complaints Office was the price of calling off a planned demonstration outside the new Parliament Building on the day of its official opening. As a result of the government’s constant ignoring of the problem, it has festered into an ugly sore and unless some drastic action is taken, and taken now, the patient (the Property Industry) is going to die. So I guess the word toxic, as in poisonous, is equally applicable here in the TRNC.

Mr Küçük says there are 2-3,000 victims of Property Scams. So if we take into account it is a Politician speaking, I think you can quite easily double that figure. On the one side you have the Banks who have been said to be underpinning the government with loans that allegedly are not being repaid at the moment. On the other side you have the innocent homeowners who unbeknown to them, and entirely without their consent, have found themselves with a mortgage on their homes and being asked to repay a debt they did not incur. Now call me naive if you like, but isn’t this fraud, and isn’t fraud a criminal offence, even here? Could it be that the Banks are getting away with a lot more than they would if the Government weren’t so deeply in ‘hock’ to them?

The Banks say, don’t blame us, we have done nothing wrong. Well if this is your idea of nothing wrong Mr Bank Manager/Owner, then I would be fascinated to know your idea of what is right. The Banks, had they acted with due diligence and made even the most perfunctory checks, would have found they were at best being hoodwinked and at worst a willing party to a fraud, in my opinion.

A problem ignored does not go away, it just gets bigger and bigger. So, before it explodes, I suggest the Government gets off is backside and faces its responsibilities. Correct me if I am wrong, but isn’t that what decent hardworking Turkish Cypriots elected them to do?


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