Если звезды зажигают, значит, §то кому-то нужно... http://www.nytimes.com/library/world/europe/081799bosnia-corruption.html August 17, 1999 Leaders in Bosnia Are Said to Steal Up to $1 Billion Related Articles Sarajevo Is at Peace, but Its Old Zest Is Lost (Aug. 10, 1999) Nations Agree Bosnia Needs Continued International Support (Dec. 16, 1998) Bosnia Economy Still at Mercy of Political Leaders (Nov. 22, 1998) Map Bosnia and Herzegovina from Microsoft Encarta Concise Encyclopedia By CHRIS HEDGES ARAJEVO, Bosnia-Herzegovina -- As much as a billion dollars has disappeared from public funds or been stolen from international aid projects through fraud carried out by the Muslim, Croatian and Serbian nationalist leaders who keep Bosnia rigidly partitioned into three ethnic enclaves, according to an exhaustive investigation by an American-led antifraud unit. The antifraud unit, set up by the Office of the High Representative, the international agency responsible for carrying out the civilian aspects of the Dayton peace agreement, has exposed so much corruption that relief agencies and embassies are reluctant to publicize the thefts for fear of frightening away international donors. The report names several officials linked to the governing nationalist parties that it says profited from the fraud. Even though the Office of the High Representative has dismissed 15 officials or prevented them from holding office, most retain authority. In one incident cited in the report, 10 foreign embassies and international aid agencies lost more than $20 million deposited in a Bosnian bank, but only the Swiss Embassy has publicly acknowledged its losses. The antifraud unit, which requires special security measures and does not make public who is working for the organization in Bosnia, is now investigating 220 cases of fraud and corruption. It documents the current cases in a 4,000-page report that has not been released to the public. Its contents were made available to The New York Times. Organizations as diverse at the Office of the High Representative, the United Nations and the United States Agency for International Development, all dedicated to rebuilding the country, have lost tens of millions of dollars, the report says. The widespread corruption is viewed by many here as a severe blow in the long, frustrating struggle to build a democratic Bosnia, a country that has received $5.1 billion in international aid since the end of the war in 1995. The corruption has also played a pivotal role in driving away foreign investment, seen as the only way to free Bosnia from dependence on foreign assistance. The missing funds were supposed to have been used to rebuild Bosnia's roads, buildings and schools, as well as to provide municipal services in towns throughout Bosnia. Alija Izetbegovic, the Bosnian President, along with other senior nationalist leaders, has dismissed the allegations of official corruption made by the international investigators. While conceding that corruption takes place, the President disputes the scale of the charges, denying that as much as a billion dollars has been misappropriated as stated in the long and detailed report. Izetbegovic has repeatedly denied the charges, most recently in a local press interview. "It would be nonsense to claim that there is no corruption, or that it is irrelevant, in a country that has just come out of the war," he said, adding that Bosnia is a country "which does not have established borders, where joint institutions are still not functioning, and which has at least two armies and two police forces." The Dayton agreement, which was signed by Muslim, Croatian and Serbian warring factions in 1995, called for the creation of a single state and the return of two million refugees and displaced people to their homes. But Bosnia remains partitioned into three antagonistic ethnic enclaves. Serb-held Bosnia continues to operate as a separate entity. The internationally created Muslim-Croat Federation has no authority and has been unable to raise revenues. The two million refugees and displaced people have not gone back to their homes. And the Office of the High Representative, the chief civilian international agency in Bosnia, has been reduced to promising money and aid projects to towns and cities that say they will allow some refugees to return, promises that are usually never kept. "Dayton stopped the violence, but it did not end the war," said Jacques P. Klein, the chief United Nations representative here, "and the war is still being fought bureaucratically through obfuscation, delay and avoidance by a group of leaders who do not want to lose power. Bosnia and Herzegovina is a patient on life support assistance -- political, military and economic." International donors say the endemic fraud is making it harder to justify continued aid levels. Without the huge infusions of money, it is unlikely that the Muslim, Croatian and Serbian enclaves will be able to continue to pay pensions and salaries and reconstruct the country. The Sarajevo Government, for instance, has asked the World Bank for loans to make pension payments. "Time is running out," said James Lyon, director of the Crisis Group, an independent research organization. "The international community has no enforcement mechanism. The international administrators beg, plead, cajole and in some case engage in what looks like bribery, promising cities infrastructure projects if they allow some refugees to return. This tactic might work if we continue the present aid levels, about a billion dollars a year, over the next 20 years. But as aid declines, what will make these people even promise to comply?" Tuzla, a Muslim city, is one case study of widespread corruption that infects many local governments, the report says. The investigators' report charges that $200 million was missing from this year's budget, in addition to $300 million missing over the last two years. Tuzla's schools were painted four times last year alone by the city government, although they were rebuilt and painted by international aid organizations as well. Tuzla officials paid two or three times the normal price for such work and sold many of the cans of paint on the local market, the auditors found. Many of the schools, meanwhile, still lack heat. In the town of Sanski Most, heavily damaged during the war, municipal funds are being used to build a horse racing track, much to the consternation of aid agencies, the report said. The report charges the town's Mayor, Mehmed Alagic, with 358 counts of corruption. The charges include the theft of $450,000 in relief aid from Saudi Arabia. That money was supposed to be used to provide feed and farm equipment, but the report alleges that the Mayor gave the money instead to his brother to start a bank. The Mayor has denied the charges and accused the Office of the High Representative of mounting a campaign against him. The most sensitive case under investigation by the antifraud unit concerns the Bosnia and Herzegovina Bank, or BiH, in Sarajevo. The bank took in tens of millions of dollars from international agencies and 10 foreign embassies. The money, the investigators say, was lent to fictional businesses or given as personal loans to friends by the two owners. The bank has now collapsed. The collapse underscores a near-total failure to establish a viable banking industry. Of the some 50 banks in Bosnia, Western diplomats say, only 6 are solvent. The Agency for International Development, which has not made its losses public, had at least $4 million in the BiH bank, according to Western diplomats. At least half of the $20 million lost by international organizations deposited in the bank was to have been used for reconstruction projects, the investigators said. "Our fear is that once the extent of the theft is known, international donors will get disgusted and walk away," said an official at the Office of the High Representative, who asked not to be identified. AID has also filed suit in Bosnian courts against 19 Bosnian companies, which have failed to repay loans worth more than $10 million. The loans, ranging from $100,000 to $1 million, are part of a $278 million revolving credit established in 1996 by AID to help kick-start the economy. The agency, unable to collect $1 million in loans from Hidrogradnja, one of Bosnia's largest companies, is trying to seize its assets. The rampant corruption has discouraged foreign investment. Most foreign companies, including McDonald's, have refused to set up operations after demands by officials to pay bribes and do business exclusively with local party officials. Other companies -- like the Italian construction company Aluveneto and Gluck Norm, Germany's largest maker of door and window frames -- have pulled out with heavy losses, complaining of interference from the state, an inability to collect debts and demands by officials for kickbacks and bribes to stay in business. Volkswagen is also considering pulling out of Bosnia, according to European diplomats. Volkswagen officials would not comment. The German Government pushed hard to get the company to reopen its heavily damaged plant in the Sarajevo suburb of Vogosca. Volkswagen did so on condition that the Bosnian Government buy official cars from the plant. Not only has the Government reneged on its promise, forcing Volkswagen to go to court, but the state company in partnership has also refused to pay the $1 million it promised to invest. The money-losing Volkswagen plant does only final assembly on car bodies shipped from the Skoda auto works in the Czech Republic. Sixty workers assemble about six cars a day from the kits. Few sell, in part because of the thousands of stolen cars brought into the country from Europe by local gangsters. The used car market in Stolac, which convenes every Sunday in the Croat-controlled part of Bosnia, has one of the largest collections of stolen vehicles in Europe, according to the international police. On one recent Sunday, some 400 cars, most with forged registration papers and German, Swiss and Italian license plates, were being sold for large wads of German marks. The gangs that bring the cars into Bosnia oversee the sales. The Office of the High Representative has outlawed the market. It pressed in January to have the market's organizer, Jozo Peric, arrested. But the local Croatian court released him a few days later and dismissed the charges. Now Peric is in hiding. When federal tax officials showed up last year to try carry out an audit, they were beaten so badly that they were hospitalized. Officials of the Office of the High Representative and Western diplomats say one of the wealthiest and most powerful men in Bosnia is Bakir Izetbegovic, the son of President Izetbegovic. He controls The City Development Institute, in charge of determining the occupancy rights of 80,000 publicly owned apartments in Sarajevo. The apartments, many of which belonged to Serbs or Croats before the war, have been given to members of the governing Muslim-led Social Democratic Party. Others who want occupancy rights must pay Izetbegovic $2,000, said several Bosnians who have paid the fee. Izetbegovic owns 15 percent of Bosnia Air, the state airline, and takes a cut of the extortion money paid out by local shopkeepers to Sarajevo gangsters, the diplomats said. Izetbegovic has consistently denied any involvement in such activities. When foreign aid agencies or even the Office of the High Representative try to turn to Bosnian courts for redress, they run up against an overwhelmed and corrupt system. The Agency for International Development is moving against several large state-owned companies. But creditors are rarely able to collect. The Tuzla courts, for instance, have a backlog of more than 30,000 cases of organized and violent crime. There were 1,050 convictions last year, and in most of the cases, those convicted were released on parole. Even when laws are passed to try to contain the fraud, politicians have blocked or ignored them. For instance, last year the Bosnian Assembly passed a law to allow the Government to tax the oil and gas trucked in from Croatia. The revenue was expected to be in the hundreds of millions of dollars. But when the law appeared in the official gazette, the articles stipulating the taxation were inexplicably missing. The Croatian mafia that brings in the oil and gas continues to pay no taxes. Although the case is in a Sarajevo court, diplomats say the judges, fearing retribution, are afraid to try it.