Flats from the air: are “schemes of the developer Wojciechowski” possible in Ukraine now?
20 March 14:08
Anatoly Voitsekhovsky, who defrauded investors of 42 new buildings in Kyiv and fled abroad, was extradited to Ukraine the day before. The days of selling “air” are over. This was emphasized by Olena Shulyak, chairwoman of the parliamentary committee on the organization of state power, local government, regional development and urban planning, "Komersant Ukrainian" reports.
According to the deputy, the end of the scams perpetrated by such developers came when the Verkhovna Rada supported the Law of Ukraine “On Guaranteeing Real Property Rights to Real Estate Objects to be Constructed in the Future,” which cuts off the oxygen to scammers. Now no apartment can be sold until the property is registered in the State Register of Rights.
How this law makes “Wojciechowski schemes” impossible
Olena Shulyak draws attention to the main problems and preventive measures:
The main problem is the sale of air. The law introduces mandatory registration of a special property right to future apartments, which makes it impossible to double-sell, which was actively used by Wojciechowski.
Investor protection. Now apartments can be sold only after registration of rights in the State Register of Property Rights, which provides guarantees for buyers and protects them from the risk of buying an apartment from a fraudster. And registration is possible only if the construction is legal and all permits have been issued.
Control over developers. The law provides for clear requirements for disclosure of information, including information about the developer, rights to perform work, contractors, and construction progress. This makes it impossible to manipulate documents that were previously actively used by fraudsters.
Restrictions on fundraising schemes. The law prohibits preliminary purchase and sale agreements and other “gray” mechanisms of construction financing that created chaos and danger for investors.
Financial transparency. The law introduces clear rules for raising funds, making it impossible to use cooperatives, fictitious funds and other schemes used by Wojciechowski.
Strengthening investor protection requires increased liability for developers
In this regard, Olena Shulyak mentions the draft law No. 5877 “On Amendments to the Code of Ukraine on Administrative Offenses and the Criminal Code of Ukraine on Strengthening Responsibility in the Field of Urban Development” proposed by her and other MPs, which strengthens responsibility for violations of urban development legislation and is pending consideration in the second reading as early as 2021.
This draft law proposes
– introduction of temporary seizure of illegal construction sites,
– increased criminal liability for unauthorized construction, especially in the areas of cultural heritage sites.
– introduction of real responsibility for scammers, not just fines.
According to the MP, if this law had been in effect earlier, Voitsekhivskyi and all his “pyramid schemers” would have been in jail before they had time to deceive thousands of people.
At the same time, as Olena Shulyak emphasizes, Wojciechowski’s “legacy” is still alive in the minds of many unscrupulous developers and construction supervisors who would like to return to the old days. So, control over developers should not be forgotten.
As a reminder, the day before, Anatoliy Voitsekhivskyi, a developer who had carried out many construction scams and was involved in dozens of criminal proceedings, was extradited to Ukraine. The police detained him twice, but in both cases he was released on bail with the alternative of being released on his own recognizance. He paid the bail and fled abroad.
The police put him on the international wanted list, made every effort to find him in Spain. He has now been extradited to Ukraine so that he can finally stand trial and receive the appropriate punishment for his crimes.
It is reported that the companies associated with the defendant illegally built facilities on illegally occupied plots without a full package of permits at prices 30-40% below market prices. A significant number of buildings were never completed, and only a few were put into operation.
The defrauded investors still cannot register their ownership of these apartments and connect to the utility networks on a permanent basis.
Police investigators served the scandalous developer with suspicions of creating an organized criminal group for unauthorized occupation of land, misappropriation of investors’ funds, organizing forgery of official documents, and intentional tax evasion. His property worth UAH 200 million was seized, and 12 indictments were sent to court.
Currently, the defendant is in a pre-trial detention center, he was chosen a measure of restraint in the form of detention with an alternative bail of UAH 20 million. For the crimes committed, he faces up to twelve years in prison with confiscation of property.
