EU urges BiH to boost high-level corruption action

An investigation into allegations of misuse of funds and money laundering at the Sarajevo Tobacco Factory is one of the most high-profile corruption cases in Bosnia and Herzegovina (BiH).

The Federation of BiH (FBiH) financial police department submitted three reports to the BiH prosecutor’s office alleging that the company’s executives took part in financial abuse and damages to shareholder and state capital. The damages are estimated to be about 40 million euros, according to the prosecutor.

In a July interview with Oslobodjenjenewspaper, FBiH Prime Minister Nermin Niksic said factory director Edin Mulahasanovic allowed more than 30 million euros in discounts over the approved limit to various buyers. He said that Mulahasanovic said he was trying to “save the factory,” which is owned by shareholders with 60 percent and the FBiH with 40 percent.

If the investigation, which was launched late last month, uncovers corruption, the prosecutor will file indictments against Sarajevo Tobacco Factory management, including Mulahasanovic.

The prosecutor’s office said the amount of documents it must review in order to file charges will take months.

Alem Hamzic, a spokesman for the prosecutor’s office, told the media that it is a complex case. “The prosecutor will analyse this documentation and he will give his opinion in this case,” Hamzic said.

EU special representative office spokesman Andy McGuffie said that there is an urgent need to move beyond rhetoric and tackle corruption and organised crime in earnest.

“There is an insufficient track record of investigation and prosecution in high-profile cases. BiH launched the 2009-2014 anti-corruption strategy and decided to implement an action plan against corruption. So far, we could see only limited steps towards the implementation of the strategy and the action plan,” McGuffie told SETimes.

Adis Arapovic, an analyst at the Centre of Civil Initiatives in BiH, called the tobacco company investigation “symbolic” considering widespread reports of corruption and nepotism in the country.

“It is just symbolic step. Corruption and unemployment are the biggest problems of citizens in BiH, but for political elite circles this disorganised system is good and they are not working anything to solve these problems,” Arapovic told SETimes.

He said that political leadership in many enterprises makes the problem even bigger.

McGuffie said greater efforts and political will are needed to improve the anti-corruption strategy.

When political actors ensure conditions that allow law enforcement agencies and other institutions to implement the law without obstruction, corruption would decrease and the integration process would speed up, McGuffie said.

Milorad Novkovic, president of High Judicial and Prosecutorial Council of BiH, said members of judicial institutions, who are working on cases of corruption and money laundering, are well trained for the job.

Prosecutors and other members in these institutions are educated for all kinds of investigations including those at high political and economic levels, Novkovic said.

The recent Progress Report from the European Commission said corruption remains widespread throughout the public and private sector in BiH, and that it continues to negatively impact all spheres of life, economic development, and the rule of law.

“It is clear that if we do not take specific actions in prosecuting the worst forms of corruption, there is great danger that it could come to a complete collapse of the legal system and institutional framework,” Transparency International BiH said.

sources: SETtimes