The Cosa Nostra of Dubrovnik

AIM Zagreb, October 29, 2000

The Dubrovnik File has spent all the time that elapsed since the elections stashed away in someone's drawer. This southernmost Croatian town, once a wealthy and internationally renowned tourist resort, has been turned into a center of organized crime of frightening proportions during the past decade.

Corruption, illegal car and narcotics trade, police surveillance and intimidation of citizens, murders - with a political, other or combined background - bribery, and deliberate destruction of the economy, all this is a part of the one and the same story, which in addition to the war, helped to turn one of the wealthiest points on the economic map of the country and Croatia's Athens into a problem-town and most of its inhabitants into people struggling for mere survival.

For most of the past decade this topic has been talked about in whispers. Two years ago, however, the Zagreb Nacional weekly revealed the Dubrovacka Bank scandal, which, though not the only such story, was still the one that seriously shook the until then undisputed rule of the Croatian Democratic Union. The paper informed the public that five "partners" - Neven Barac, Miroslav Kutle, Vinko Brnadic, Petar Luburic and another person whose identity was never officially established, but who was widely suspected as being Ivica Pasalic, Tudjman's assistant for internal policy and the second strongest man in the country - decided to take over the bank without spending a single penny of their own.

Given that in the meanwhile Dubrovnik's tourist industry was completely destroyed by the war and other adverse circumstances, the background of the scandal became quite obvious. Namely, the newly-emerging oligarchy needed a strong bank to take control of the profit-making tourist facilities once the town and the region began to flourish again. The logic of the plan was quite simple: if these facilities were first fully destroyed, their price would plunge, and if they controlled the strongest bank in the region, the plan was bound to work. The plan, unfortunately, has been exposed and this coincided with the political fall of the Croatian Democratic Union, which ultimately saved the town from any further onslaught by this party's conquistadors.

Today, however, it has become clear that this was probably the biggest, but not the only, such criminal plot that turned the Venice of the southern Adriatic into a Croatian Palermo, and that part of the coast and the entire Neretva River Valley into a Croatian Sicily. A member of the Croatian Parliament, Srecko Kljunak (from the Croatian Peasant Party), at the beginning of September filed a criminal report with the Croatian chief prosecutor listing in detail all alleged misdeeds committed over the past years by the political leadership of the municipality and the town, in which parts of the state leadership offered their generous assistance. The report has 55 thickly-typed pages, and the entire file, which includes evidence and other documents, numbers almost 500 pages. It clearly reveals the nature of the criminal interests that were at work in Croatia's south and why throughout the years they remained beyond the reach of investigative and judicial bodies. "In the file I prepared with the assistance of Niko Jerkovic, a police official of the Dubrovnik-Neretva district, and a team including some other people, we listed only such acts that could be entirely proven at any time," says Srecko Kljunak, one of the two signatories of the report. "This is the first time that an MP is filing a criminal report against high state officials," says Kljunak, explaining that he decided to do so when he became aware that the situation had reached the very bottom and that no one was ready to take any steps to change it. "Immediately after the elections we presented all our relevant documents to the new minister of the interior, Simo Lucin, and other state bodies in charge of such matters. But they have done nothing. The only response on their part was silence, or vague confirmations that organized crime indeed existed and operated in Dubrovnik. No investigation into the activities of the main protagonists of the story, however, has been launched. This is why we took upon ourselves the initiation of such proceedings, because the people in Dubrovnik are very bitter about it. From the new government they expected economic prosperity and prosecution of crimes. So far, however, there has been none of that."

The report contains an impressive list of criminal offences, which - in case the state prosecutor decides to act and a court accepts the evidence provided – could deprive several people of their prestige, careers, and even freedom. Maybe the greatest offence listed in the report involves joint activities of the police leadership of Dubrovnik and the state with the widely known Neretva tycoon Stipo "Jamba" Gabric. According to the documents, he was allowed by the state leadership to take over the company Razvitak, of Metkovic, crucial for the economy of the entire Neretva region and Dubrovnik as well. Gabric destroyed this once successful socially-owned company and led it to accumulate a DM55 million debt after he took possession of most of its assets. The story of Gabric's deals is not unknown to the Croatian public. The report, however, reveals that the Croatian Interior Ministry knew all along of what he was doing. But at one meetings of the police of the Dubrovnik-Neretva district it was decided that Jamba should be left alone, so as not to provoke a conflict of political interests in the Neretva region. The police were duly informed of all illegal activities in Razvitak - of the destruction of the company's departments, financial schemes, inflated invoices sent to state bodies as well as all other irregularities, but because of politics no one wanted to rock the boat. Meanwhile, in line with the Croatian privatization recipe, Razvitak was brought to the brink of collapse, together with several hundred of its workers. This is not the only thing the police in Dubrovnik should be held responsible for, however. According to the report, they never shunned making damaging contracts either. One such deal was made with the company Avia , which serviced their vehicles. For two years of its services the company charged the Dubrovnik police 2.6 million kuna (DM750,000), a staggering sum that could have enabled them to purchase 43 new Golf automobiles. For repairs to a single trailer, for instance, the bill was 18,000 kuna. This sum is sufficient to buy an entirely new trailer of the same make. In two years time the Dubrovnik police spent on car rentals almost half a million German marks, and one-half of this amount was paid to a single car rental company, AS. Several officers were employed by the Dubrovnik police although it was widely known that their diplomas were forged. The head of the Dubrovnik police, Eduard Cengija, is charged in the report of having been "lent" an Audi A4 by Avia, whereas the police, in turn, "lent" a similar vehicle to the Avia company manager.

Avia is owned by Pavo Zubak, one of the former government's trusted businessmen. According to Kljunak it is possible that Tudman's elder son, Miroslav, also has a share in the company. The same police administration enabled the former interior minister of Bosnia-Herzegovina, Valentin Coric, to import to Croatia free of duty and other fees ordinary citizens always have to pay, a Mercedes (what else?), and a Ford Maverick, the latter for an entirely unknown person. According to the report, the Dubrovnik police head enabled the return of illegally acquired property to suspicious persons. It appears that the police were party to the illegal trade in birth certificates, issued firearms licenses to people who would have never been allowed to possess them had Croatian laws been observed, and ensured that a host of crimes would remain unsolved.

The report names as many as eight people in connection with this. In addition to Eduard Cengija, Dubrovnik police chief, directly implicated are also his chief political ally, Petar Luburic, once himself the chief of the Dubrovnik police in the former Yugoslavia and one of the "partners" in the Dubrovacka Bank deal, Valentin Coric, former interior minister of Bosnia-Herzegovina, the former and incumbent deputy interior minister, Zdravko Zidovec, the head of the Interior Ministry internal affairs division, Renato Ivanusec, and other people, less known to the wider public.

Several murders were never resolved in Dubrovnik, among them that of an elderly woman who had made an inheritance contract with a local Croatian Democratic Union official, giving him her house after her death. Immediately after signing the contract, the woman died in a fire, and it is widely believed that she was murdered. Dubrovnik lawyer Drasko Soc, a Montenegrin, lost two houses in the town - they were taken over by Croatian Democratic Union officials - he was deprived of his license and expelled from the country. Soc pressed charges with the court in Strasbourg, and it appears that the court will soon hand down a ruling in his favor. An elderly woman lost her leg in a mob showdown when an explosive device was set off, and no one has been arrested in connection with the incident, which occurred in broad daylight. A family was robbed of its collection of antique coins... These and other crimes of which Dubrovnik inhabitants feared talking about openly, knowing or guessing the names of their perpetrators because Dubrovnik is a small town, have remained unsolved for the entire decade, because politics designated them as off limits to investigators. The new government, however, also did nothing. Maybe because the Interior Ministry of Simo Lucin is overwhelmed by reports, evidence, indications or intimations of crimes - "manifestations," as late Franjo Tudjman used to put it – the preceding period abounded in. Srecko Kljunak, however, suspects that the reason probably lies in close ties between the new elite and part of the old mob. "Lucin has confirmed some of my allegations; why does he keep quiet about the rest of them?" asks Kljunak. "If they do nothing, one may well conclude that part of the state leadership is also involved in organized crime."

The criminal report he filed contains numerous elements wherefrom even people who know little of legal matters can clearly see what is at stake. If even a portion of these allegations were proven, some of the people named in the paper would have to leave the Interior Ministry, and some would even be arrested. If the current government fails to do something, those who believe that there is a pact between "the old mafia" and the new authorities might be proven right. As far as the State Prosecutor is concerned, his office remains mum regarding organized crime in Dubrovnik.

Boris Raseta

(AIM)