The story of a Golden Visa real estate scam

They wanted to live in Greece. They believed that they would have a pleasant life and travel easily to other European countries. So, they sold their apartment in China to raise the money for an apartment in Greece.

In Beijing, they came into contact with a company acting as an agent for a Greek real estate firm. They met with them and expressed their interest in buying an apartment in Athens. The Chinese representatives showed them photos of apartments offered by the Greek firm. A modern kitchen. A comfortable bedroom. A bathroom with gleaming marble surfaces. Soon they would have an apartment just like this!

In August 2018, the couple signed papers and purchased a three-bedroom apartment in Kallithea district for over €330,000. Included in the purchase of the 90-square meter apartment, was a private parking space in the building’s garage, a storage room, and the company’s commitment to providing furniture worth €13,000: TV, refrigerator, oven, bedroom furniture, mattresses, chairs for the balcony, even an ironing board, hangers and a hair dryer.

Then it came time to pay.

Consecutive receipts, printed within minutes of each other, seen by Solomon, show that the amount was paid in “installments” through payments of a few thousand or even hundreds of euros via POS terminal.

The POS was not Chinese – evidence shows the money was paid into an account at the National Bank of Greece. To reach Beijing, the Greek POS terminal had traveled more than 7,000 kilometers, from the headquarters of the Greek real estate company in Psychiko, Athens.

Unusual transactions

During the purchasing process, the Chinese representatives had stressed that the owner of the Greek company was “a very important person” with “strong connections to the Greek government”. They also said that the company was approved by the municipality of Athens to manage the Golden Visa program and displayed relevant documents as proof.

The mayor of Athens at the time, Giorgos Kaminis, had filed a lawsuit against a real estate company that allegedly “advertised cooperation with the municipality of Athens for the Golden Visa program, on a document with forged signatures of the mayor and the director of the municipality”.

That company was DESTINY (full title: Destiny Ependitiki MIKE, a Private Equity company) − the same company the unsuspecting couple bought the apartment from.

At the time, they couldn’t have known about the company’s questionable practices. But, as an investigation by Solomon and Reporters United has revealed, during that time, both the Chinese and Greek authorities were already taking a closer look at DESTINY.

Specifically, at the center of the controversy was Evangelos Papaevangelos, former vice president of Jumbo (large retail toy store chain) and, at the time, the sole partner of the DESTINY and BW real estate firms (with Petros Kapsas, as acting director of the company). Documents which the Chinese authorities shared with Greece stated that Papaevangelos’ companies used Greek POS terminals to sell apartments to Chinese Golden Visa investors — as in the case examined by Solomon.

This particular money trail was illegal in both China and Greece: on the one hand, it violated the capital controls regulations that were in force in China; on the other hand, it was not allowed, according to the Greek Golden Visa legislation.

At the same time, the conclusion of the Greek Financial Intelligence Unit 

referred to “consecutive real estate leases” by companies owned by Papaevangelos, which “may be fictitious, with an aim to hide taxable income”. Also included in a report of the inspectors of the Bank of Greece was potentially incriminating data for transactions of over €15 million at Papaevangelos’ companies.  

In the fall of 2019, however, the case was shelved. With an amendment, the Minister of Development at the time, Adonis Georgiadis, made the use of POS terminals to transfer money through the Golden Visa program not just legal, but retroactively legal from 2017.

The Georgiadis amendment provoked the reaction of the president of the opposition at the time, Alexis Tsipras, who asked Georgiadis in parliament: “At what price have you settled the Chinese POS scandal? By legislating retroactively, to include the past two years, precisely to cover it up?”

Locked out of their apartments

In the ten years that the Golden Visa program has been in effect, Chinese citizens are the first nationality among third-country nationals to buy real estate in Greece through the program.

From Solomon’s report, it appears that investors often buy their apartments just by contacting representatives of Greek companies in China, without visiting Greece to see the property in person.

This especially applies to cases where the buyer’s reason for purchase is not to live in the property themselves, but to obtain the possibility of free movement in the EU. In these cases, the new owners sublet their properties to companies (often the ones they bought them from), which in turn make the property available for short-term rental.

The good faith the buyers display sometimes make them victims of fraud.

In previous lawsuits against DESTINY, Chinese investors argued that upon arriving in Athens they found that the actual size of their apartments was not what they agreed to (e.g. instead of 80 square meters, the apartment was 60 square meters) or that the apartment was not “under the Acropolis” as DESTINY had promised them, but in Patisia − nowhere near the Acropolis.

Others claimed that DESTINY had simultaneously sold the apartment they bought to another buyer. This couple’s experience was different.

When the man traveled to Greece in 2019 to open a bank account, DESTINY told him the apartment was not ready. He returned to China. With the outbreak of the pandemic and then strict lockdowns in China, the couple was unable to travel to Greece before the end of October 2021, when they arrived in Athens intending to stay in their new home.

Again, they were told by DESTINY that the apartment was not ready.

After staying in another apartment provided by Destiny for a few days, they decided to visit the property they had purchased. They got into a taxi and went to Kallithea.

But they couldn’t get into their apartment. In fact, they weren’t even allowed to enter the building. At the entrance, they were met by a security guard. On their balcony, which they could see from the street, they could see other people’s belongings.

The security guard told them that asylum seekers lived in their apartment. The same was true for all of the apartments in the building, which had all been sold to Chinese Golden Visa investors.

DESTINY and Hopeland/Hopeten

The purchase contract for the apartment, seen by Solomon, states that the new owners have the option of subletting their apartment to DESTINY. But the decision is up to the buyers, not the company. And the Chinese couple says they made it clear to DESTINY from the start that they weren’t interested in that prospect: they were buying the apartment in order to use it themselves.

According to documents and emails seen by Solomon, in their absence and unbeknownst to the buyers, DESTINY had sublet their apartment to an NGO subsidized by EU funds to house asylum seekers.

The accommodation of asylum seekers in apartments was carried out by the ESTIA program. In practice, the EU provided the Ministry of Migration with funds, which were directed to NGOs, that in turn, rented the apartments to asylum seekers – usually families or vulnerable people.

The couple could not have known that DESTINY and the NGO that rented their apartment (named Hopeland, later renamed Hopeten) had a very interesting history. Nor could they have known how the two are connected. 

They were unaware, for example, that Hopeten was founded (originally named “Hopeland”) in 2020 through the acquisition of an inactive NGO that had nothing to do with refugees, by two partners who did not have any experience dealing with refugee issues: Georgios Pouladakis, an employee of the Sanitation Department in the Athenian suburb of Maroussi and a woman from Thessaloniki who worked the field of cosmetics. 

They could not have known that, even though the newly-established Hopeten did not meet the formal criteria set by the Ministry of Migration (for registering NGOs), the Ministry not only registered Hopeten anyway, but the NGO’s application was fast-tracked and was the second NGO to be registered in Greece.

They were also unaware that the NGO, which was so far an inactive organization, had secured a subsidy of over €7 million of EU funding to house asylum seekers.

The unsuspecting buyers could not have known that, by securing EU funding, Hopeten leased at least 100 apartments from DESTINY to house asylum seekers.

Nor, of course, could they have known the relationship between DESTINY and Hopeten.
Petros Kapsas, director of DESTINY, (whose signature appeared next to theirs on the documents they signed) is the nephew of Georgios Pouladakis (Hopeten’s founder).

In addition, Kapsas, director of DESTINY, is the son-in-law of Papaevangelos, sole partner of DESTINY.

And of course, the buyers were also unaware of something else: that two months before Hopeten was established, Petros Kapsas (and his wife, Katerina Papaevangelou) were seen together socializing with the Minister of Migration (at the time) Notis Mitarachi on the island of Mykonos.

In fact, the findings of our joint report with Reporters United, caused opposition parties SYRIZA and PASOK to react strongly.

Questions go unanswered

The Chinese couple knew one thing for sure: that they had traveled to Athens, traveling the opposite route of the Greek POS which was used to pay for their property − an apartment that they still could not access.

Meanwhile, Solomon reviewed the buyer’s email communication that testifies to their own frantic efforts to communicate their requests to DESTINY.

“The behavior of your company has violated our interests and property rights,” states one of their emails to DESTINY, with the Chinese couple highlighting that they had made it clear that they wanted the apartment for themselves and that a representative of DESTINY had “assured them that this is a new apartment.”

The messages cover a period of several weeks. DESTINY’s side reportedly attributed the subletting of the couple’s apartment to a “mistake” but showed no willingness to provide a solution, even when the buyers visited the company’s offices in person. The couple also tried to contact Hopeland, but say they were met with an indifferent and even hostile attitude.

The last time they visited DESTINY’s office, they say they were asked to sign a lease, but they refused. They had no choice but to hire a lawyer, with whose help they were able to get their apartment back and receive an amount to sublet it to DESTINY.

“There are also good people in Greece”

At the end of 2021, the ESTIA program was completed. With the completion of the program, and the end of the EU funding that came with it, Hopeland vacated the apartment building.

The NGO stopped offering services altogether. On its website, to this day, Hopeland states that it aims to make “every day better for children, families, refugees and anyone in need of protection”. But as of early 2022, the NGO appears to be completely inactive.

Upon entering their apartment, the couple encountered more problems. The apartment building is newly built, but photos seen by Solomon show walls damaged by moisture and mold, pipes that have burst and areas with water damage.

They claim that even today DESTINY continues to ignore their requests. Although the apartment included a parking space and a storage space, six years later the building construction has not been completed and they do not have access to a parking space or a storage area.

At the same time, the press is reporting that there have been internal rifts within the real estate company. Journalist Petros Kousoulos’ column indicates, without mentioning any names, a son-in-law who “took off” [Petros Kapsas] and a father-in-law [Papaevangelou] who talks openly about his former son-in-law, “having a bigger appetite [for more money] and moving on” – suggesting possible controversial financial practices.

The couple believes that probably dozens, maybe even hundreds of fellow Chinese buyers have fallen victim to fraud by real estate companies when purchasing property under the Golden Visa program. When they found out about DESTINY’s history, they wondered why they were allowed to operate without scrutiny.

They try, however, not to let the negative experience deter them from wanting to stay in Greece. They want to travel and get to know the country better.

“Greece has made many mistakes with the Golden Visa,” they say, “and the people in this company are not good people. But the vast majority of people we met in Greece have treated us very well.”

*Full details of the Chinese couple as well as relevant documents, evidence and emails have been made available to Solomon.