Shots fired at home of tycoon linked to Flyglobespan collapse

Published on Saturday 30 January 2010 19:09

SHOTS were fired at the home of the tycoon widely blamed for the collapse of Flyglobespan in a dispute over debts, Scotland on Sunday can reveal.

Police in Cyprus confirmed that shots had been fired at a flat belonging to the parents of Elias Elia, the chief executive of E-Clear.

Some of Elia's closest associates believe that the attack was what Cypriots called a "notification", a gangland-style reminder that a debt is overdue.

Elia's business empire folded earlier this month with debts of more than 100 million, including 35m that E-Clear had withheld from an ailing Flyglobespan for much of 2009.

The debt helped to force the Scottish airline out of business in December, costing more than 500 people their jobs and leaving thousands of holidaymakers stranded.

E-Clear administrators, accountancy firm BDO, said Elia's company had "no immediate source of funds" and launched what they called an "international" hunt for assets.

Scotland on Sunday, however, can reveal that Elia's problems began long before the failure of Globespan and his own business empire's collapse.

Police said the modest Elia family home, above a post office in a suburb of Nicosia, the Cypriot capital, had been attacked in February 2009. The crime has never been solved.

Elia was said to be stung by the attack on his parents' house in Halkokondili Street.

"Elias was very good at hiding his feelings," said a former associate, who declined to be named.

"But clearly he was frightened for his parents and he was frightened for himself."

Elia routinely stayed in the flat when he was in Cyprus to look after his business interests on the island, which included a property development firm called Elian.

At the beginning of 2009, his company, on paper, was highly successful. Its last annual accounts showed that it had turned over nearly 1 billion worth of payments and other business a year and was making a profit of more than 5m.

E-Clear was handling the online ticket sales of the new breed of budget airlines, but in 2008 the airline market began to struggle.

Several of E-Clear's biggest customers were to fall victim to the downturn, including Canadian airline Zoom, UK holiday giant XL and Slovakian low-cost carrier SkyEurope.

Friends said success had gone to the head of the once penniless Elia, who had taken to boasting of himself as the "richest man in Cyprus".

The 39-year-old Catholic Mennonite was eager to keep up his front as a wealthy man. Elia, who is single, spent much of his time in a rented Knightsbridge flat and his luxury offices in Berkeley Square, driving between the two in his Rolls-Royce Phantom. He also had a Ferrari, a Range Rover and a Mercedes.

Before the February shooting, Elia's firm, Elian, had become shirt sponsors for a football club in Cyprus's first division, Enosis Neon Paralimni.

But Scotland on Sunday has learned Elia had bigger footballing ambitions and wanted to buy Greek side AEK Athens, one of Europe's biggest clubs and a regular competitor in the Uefa Champions League.

"Elia will always project an image of absolute confidence," said his former associate. "He was talking big but there was little substance behind it, even though it got into the Greek press. I don't know why he engaged in that because his company had major problems at the time."

Another former business associate of Elia, fellow Cypriot George Palaondas, laughed at the idea of his one-time friend buying AEK.

"A lot of people when they really make money want to buy a team just to show off," he said. "Elias was calling himself the richest man in Cyprus."

Palaondas has claimed to have lost 1m in E-Clear. The London-educated engineer, who now lives in his native Cyprus, said he took Elia on as an associate of the company after he bought into it from its English founder in 2000. The pair parted on poor terms two years later.

Former business associates and employees of E-Clear are now helping BDO to trace the millions.

One well-placed employee, speaking on condition of anonymity, told Scotland on Sunday that he believed an investigation should now be carried out into the way the company operated.

"It would be irresponsible not to probe," the employee said. "It will show that E-Clear suffered huge losses as the result of two airlines that went down in 2008."

The Serious Fraud Squad has taken an interest in the case, although it has yet to begin a formal investigation.

Scotland on Sunday reached Elia by telephone yesterday. Asked about the shooting, he said such a story was "absurd nonsense" and warned that he was considering legal action against newspapers who printed "rubbish" about him. When told the police had confirmed the incident, he said: "I am not making any comments on anything, whatever it is."

The steel shutters at the Elia home in Nicosia were rolled down last week and nobody answered the door.