Albanian Daily News
Government initiates Pyramid scheme liquidation

Albanian Economic Tribune - Jan 19, 2000

TIRANA - The government has ordered the initiation of the distribution of the money remaining from the 1997 pyramid schemes, reminding Albanians of the frenzy of fake richness that led the country astray.

The Savings Bank of Albania will start on Wednesday in its Tirana and Vlora branches the distribution of money from two minor pyramid schemes to their investors, the bank told daily Zeri i Popullit, the Socialist daily.

This will initiate the distribution of the fund of the pyramid schemes in the country, following the sale of their assets by international accounting companies Deloitte & Touche and Coopers & Lybrand.

An SBA Tirana branch will distribute the compensation money to 130 investors of the Arset/Aulona scheme, which mostly operated in the capital, Llazi Balliu, chief SBA accountant, said.

Vlora creditors of the M.Leka scheme will start to get their money on Friday. Tirana investors in that scheme will receive their money from the capital’s branch next week.

The government decided to liquidate the money from those schemes last month.

SBA said it will use a branch in Durres, the second largest Albanian city, for the delivery of money to the investors in the schemes. "The distribution of the money will make this year the epilogue of a dark chapter in the country’s history," the newspaper commented.

The pyramid schemes began to collapse at the end of 1996, and the difficulty of the largest schemes to pay back investors caused riots that plunged the country into anarchy the following year. The protests soon took a political turn, and the Democratic Party of Sali Berisha was ousted from power in the extraordinary elections of June 1997.

After M.Leka and Arset, money from the other schemes will be distributed shortly, including Global Foods, Silva, Cenaj & Co. It will end with the distribution of the money from the largest schemes, Vefa Holding and Gjallica.

Deloitte & Touche and Coopers, which dealt with the management of the schemes, said they had collected only $8m for the investors, leaving more than $300m outstanding. But some investors are luckier, those of Silva may get up to half of what they had invested.

The return of what remains of the schemes was pledged by the Socialist-led government coalition, which had earlier promised to end it last year. But the process was delayed by instability, bureaucratic delay and the Kosovo crisis.

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