Bosnia's Serb Republic police has filed with the special prosecutor's office criminal charges against six Lithuanian citizens as part of the ongoing investigation into alleged embezzlement at alumina plant Birac which led to its bankruptcy in April, news service Capital.ba reported.
The head of the police, Gojko Vasic, told a news conference in Banja Luka that one charge was pressed against four Lithuanians for the embezzlement of BAM 19.4mn, which were approved by the Republic's Investment-Development Bank to help boost employment.
Local firm Energolinija Zvornik, which was supposed to be the recipient of the funds, suffered damages of BAM 11.3mn because of the inappropriate use of the money, Vasic said, adding some of the funds went to pay heating bills instead of creating more jobs.
A second criminal charge was pressed against two Lithuanians who allegedly made damages worth BAM 2.6mn because of the sale of secondary raw materials, in particular iron. Vasic said the iron was sold to buyers in the eastern town of Zvornik (where Birac's headquarters is) but the problem was that the money was paid in cash and not via an account.
The names of the accused cannot be revealed at present, Vasid said. He reminded that the ongoing international investigation into Birac is quite widespread and could last for months.
The police and tax inspectors raided Birac's premises on April 2 over suspicions into illegal transactions between connected legal entities. The company entered liquidation six days later upon a request of the Republic's tax administration office, which sought to protect its claims of some BAM 17mn. The liquidation procedure aims to determine the company’s true state since a large number of connected entities made it difficult to track where all the assets of the plant are.
Prior to the bankruptcy Lithuanian investment group Ukio Banko, which itself went bankrupt in Feb 2013, owned 56.8% in the alumina producer following a 2001 privatisation deal.
Earlier in September, the Republic's interior minister Radislav Jovicic said former Birac managers, including former CEO Virginius Vajega and CFO Mindaugas Kazakevicius, have been accused of abuse of office and causing Birac BAM 92mn worth of damage. Kazakevicius in particular has allegedly caused damage of BAM 62mn, daily Nezavisne Novine quoted Jovicic as saying.
The Republic's finance minister Zoran Tegeltija, who oversees the investigation at Birac, has said the Lithuanian managers left the Republic before Easter (March 31) and despite pledging to quickly come back have never returned. He added they can now enter the Republic only escorted by the police.
Birac's liquidation manager, Lazo Djurdjevic, told a court hearing in June he has received some 90 claims from creditors worth an overall BAM 265mn (EUR 135.5mn). He said back then he would assess and answer to all claims at the next hearing scheduled for Sep 25.
The creditors present at the first hearing included Banja Luka-based Hypo Alpe-Adria-Bank, Serbian state-controlled firms Telekom Srbija and gas monopoly Srbijagas, and Montenegrin mining firm Rudnici Boksita Niksic.
Furthermore, Bosnian natural gas importer BH Gas seeks BAM 26.9mn for unpaid gas deliveries, local electricity distributor Elektro-Bijeljina seeks BAM 5.7mn and the Serb Republic’s pension fund PIO requires BAM 6mn in unpaid contributions for Birac’s workers, according to June data.
On the other hand, company employees (some 300) seek the payment of nine wages arrears worth a total of BAM 264,000.
Lithuanian state-controlled lender Ukio Bankas seeks more than BAM 155mn from Birac and earlier this year finance minister Tegeltija has confirmed the government of Lithuania has requested negotiations with the Serb Republic government on Birac’s debt towards the bank. Tegeltija, however, has said it would be very difficult to answer the claims from Lithuania since there are too many connected entities.
The alumina plant employs 1,100 but the whole region of Birac, eastern Bosnia, is economically dependent on it. Over the past years the company has been trying to deal with its financial problems and its gas supplies were frequently discontinued over unpaid bills.
Since it entered bankruptcy, the government has taken over the plant and managed to maintain production and keep its workforce but it has not been able to service the debts.
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