Industry – Hotel & Tourism
Territory – Greece
Client – European bank
Case – A loan in the amount of approx. $21,000,000 was provided by the client to Greek entrepreneurs in order to develop a tourist resort in Greece. The resort was pledged to the client as collateral. Once the entrepreneurs stopped the re-payments of the loan, the client tried to enforce its rights and sell the property, but discovered the following:
- A Liberian entity leased the resort for 20 years for sub-standard leasing payments.
- Leasing payments could not cover the outstanding loan.
The client failed to obtain court injunction that would order cancellation of lease agreement and the sale of the property, free from any hold. Our services were retained in order to recover the client’s outstanding loan and interest.
Actions – We based our examination on intensive field-work and competitive intelligence methods that succeeded to discover legal evidence:
- The Liberian entity was in fact owned by the entrepreneurs through a trustee that held the entity’s bearer shares. The Trustee’s fees were covered by the entrepreneurs by bank transfers made from companies under their control.
- Day-to-day management of the resort was conducted by representatives of the entrepreneurs.
- Revenues were transferred from the resort to companies under the control of the entrepreneurs.
- Negotiations with local authorities related to licenses were conducted by the entrepreneurs, their legal advisors and representatives.
- The entrepreneurs conducted negotiations with travel agencies, throughout the world and decided upon commercial terms.
Outcome – Based on evidence and testimonies of our experts in Greek courts, the lease agreement was cancelled and the client succeeded to enforce the collateral, sell the resort and recover its loan and interest.