The judge approved a police request to detain 48-year-old Gary John Robb for 8 days to assist investigators in the first such case brought before a Greek Cypriot court.
Police said Robb, from South Shields, was extradited to Greek Cyprus on a European arrest warrant after serving a 2 1/2 year sentence in a British prison for a 1995 drug trafficking conviction.
Rob is being investigated on nine charges that he was a partner in a company called Aga Development Ltd. that sold more than 200 luxury villas it built on Greek Cypriot land near the northern village of Klepini. Police said the villas were each being sold for euros 50-170,000 ($71-242,000) and British nationals were among the buyers.
The charges include illegal possession and use of property registered to another person, obtaining money under false pretenses and fraud.
Most of the land in the north belongs to Greek Cypriots who fled in 1974 when Turkey sent troops after a coup by supporters of union with Greece. Turkish Cypriots declared their own state in 1983, but it's only recognized by Turkey which maintains 35,000 troops there. The island joined the European Union in 2004, but only the internationally recognized south enjoys membership benefits.
Thousands of foreign nationals have purchased homes in the north, including British couple Linda and David Orams. A British court last year ruled that the couple couldn't keep the holiday villa they bought in 2002.
The court upheld an earlier European Court of Justice decision which affirmed that the property belonged to a Greek Cypriot whose family fled in 1974.