Filenews 18 March 2023 - by Fanis Makrides
A case of international proportions is at the centre of an investigation by the Cyprus Police. It concerns a registered company on our island with the object of exporting grain from Ukraine, but also possible criminal offences attributed to its officials and associated persons. Among them are two Greek Cypriots, as well as two other people who obtained a Cypriot passport by utilizing the investment program.
Based on the content of the complaint before them and investigated by the Cyprus law enforcement authorities, the aforementioned persons allegedly acted in such a way as to alienate the property of the company in question with the ultimate goal of avoiding the payment of a debt of $116.3 million to a consortium of creditors.
Already international media have promoted these complaints, as in the frame is the grain trade, which is in increased demand due to the Russian invasion of Ukraine.
The investigation of the case was confirmed by the sergeant of the communication branch of the Police Headquarters, Eleni Konstantinou, with her statements to "F". In response to our question, he merely stated that a written complaint had indeed been received at the end of February and that a number of statements had already been received as part of the ongoing police examinations. He added that the investigation has been undertaken by the Financial Crimes Prosecution Subdirectorate. This unit is part of the Anti-Crime Department of the Police Headquarters.
According to information provided by "F", as well as publications abroad (yahoo.com), the complaint to the Cyprus Police has been submitted in writing by Christos Jacovides on 21/2/2023. The latter is acting on behalf of the consortium of lenders Madison Pacific Trust Limited, which appointed him as Receiver Manager of G.N. Terminal Enterprises Limited (subject to floating charge provisions).
Always based on his claims, when on 20/12/2022 he was appointed as receiver manager of G.N. Terminal Enterprises, the latter had payable debts of 98,367,270.42 USD to Madison Pacific Trust Limited, while based on a newer additional claim on 10/1/2023 this amount amounted to $ 116,298,775.09.
In his written complaint to the Police, he records in detail the way he allegedly acted in the context of his duties, but also the investigation he made to identify the network of companies associated with G.N. Terminal Enterprises, as well as the exact qualities of owners and officers of these business entities. G.N. Terminal Enterprises, according to its research, is the parent company of a Group of companies incorporated in Cyprus, the United Arab Emirates, Ukraine and Switzerland. Its subsidiaries on our island are five.
Among other things, it records the collateral that Madison Pacific Trust Limited had for the amount owed to it, but also the - according to its positions - illegal actions carried out by G.N. Terminal.
It describes how that business entity avoided fulfilling its obligations to the Madison Pacific Trust and transferring shares to a specific company of the latter's interests, as agreed.
Attaching documents with his complaint to the Police, Mr. Jacovides, refers to documented alienation of assets of the alleged company, while focusing on two of its shareholders. The latter, according to reports cited, are allegedly involved in cases of corporate abuses, misappropriation of funds and fraudulent liquidation of assets.
Finally, Christos Jacovides, summing up what he complains about in his lengthy complaint, indicates the seven individuals on whom he focuses his complaints, including two Greek Cypriots who, due to their professional capacity, collaborated with G.N. Terminal Enterprises. Two other persons, out of these seven, have obtained a Cypriot passport.
It charges them with potential offenses, such as theft, obtaining credit by false representations, obtaining registration by false representations, false reports of company officials, conspiracy to commit crimes and money laundering.
The dispute between the Madison Pacific Trust and G.N. Terminal Enterprises has already been taken to court. The first allegedly secured from the Supreme Court of England and Wales, a global order freezing all assets of two of the shareholders behind the operations of G.N. Terminal Enterprises up to the amount of $118 million.
Moreover, on the part of the complainants (G.N. Terminal Enterprises) a temporary prohibition order has been secured by the District Court of Nicosia at the beginning of February. Their goal is to protect a grain station of their interests, located in the port of Odessa. They want to rule out the possibility, that is, that Madison Pacific Trust will use this asset for the amount owed to it.
However, the complaints of the Madison Pacific Trust are categorically rejected by the GNT Group. It is characteristic of the report in the Interfax-Ukraine news agency that we identified and is dated January 17. G.N. Terminal Enterprises had issued a written statement in response to the order freezing its assets secured by its consortium of lenders. She claimed that she is being attacked with accusations and that the actions against her are aimed at gaining control over the grain trade.
Reply from GNT and letter to Zelensky
The publication of Interfax Ukraine presents the positions of the Group of companies and its officers, whose activities are the subject of investigation in Cyprus. In short, they acknowledge the existence of debt to the Madison Pacific Trust, however, they consider that the measures taken against them were unnecessary. According to the positions of the GNT group, control of the grain trade seems to be behind the whole effort.
They note, among other things: "The GNT group denies all the accusations against it and is ready to settle the obligations to creditors in any civilized way. This dispute has been artificially caused by Argentem Creek Partners and Innovatus Capital Partners (members of the Madison Pacific Trust consortium) to secure a drastic takeover of the business in Ukraine due to its activity in the grain trade. The steps they took to resolve the debt repayment issue were unnecessary."
After the GNT group cites some facts to support the positions it expresses, it says that the Ukrainian President Volodymyr Zelensky is also aware of the relevant developments: "The group of employees of the group has already sent a letter to Volodymyr Zelensky, President of Ukraine, to inform him about the threats in the grain sector, the possible loss of jobs and the risks to Ukraine's reputation."
FINDINGS
Battlefield of foreign interests
The dispute between the consortium of lenders and the company registered in Cyprus has already been transferred to the courts, while it is being investigated by the Cyprus Police. The positions expressed by the two camps are of interest. Especially since in the middle is an exorbitant amount, but also (mainly this) the grain trade from Ukraine. We are not, of course, competent to draw a conclusion. The prosecuting authorities and the judiciary will decide. Our observation in this regard, which we record, is that Cyprus has become a battleground between foreign economic interests. Many companies choose Cyprus as their registered office, while the Cyprus Investment Programme has also attracted various entrepreneurs. Inevitably, cases of international concern include frequent references to the name of Cyprus. And of course the question is whether this "advertising" of our island will be a deterrent for potential serious investors.
