Company “Duvan” from Cacak, estimated at almost 41 million, was sold in March 2003 by auction for 6,5 million dinars to the Consortium Milan Gojkovic- Dragan Topalovic. Until now, Agency for Privatization performed six contract observance inspections due to the numerous complaints of the small shareholders against “Dunav” privatization procedure.

The prime suspicion is linked to the contractual obligation of the new owners to invest 3,3 million dinars in the capital fund. The employees, who hold 30 % of the shares, believe that majority owners made no investments. This was backed up with the bank statements showing that Mr. Topalovic, owner of the company “Top gan insurance” as well, was returning, after only two days, investment money paid in tranches to the account of “Dunav”, into the account of “Top gan”. The authorized auditor “Privredni savetnik – Revizija” from Belgrade, nevertherless, believes that the investment was fulfiled pursuant to the contract. The employees have forwarded the copies of the bank statement confirming the fraud to the Agency, but the Agency found nothing controversial except that money was spent on salaries (close to 70 %) and other day-to-day business, contrary to the contract. Confirmation of the violation of the contract, however, does not imply any sanctions towards the new owners.

At the same time, the employees doubt that the new owners have conveyed the profitable section of the company “ Dunav” in Slatina. The Consortium of the owners claims that the section is not alienated, moreover, that the company “ Duvan” founded a company “ Alfa papir” together with Mr. Radenko Curcic (former Director who was preparing the company for the privatization, also councilman of the Municipal Assembly of Cacak), whereas Mr. Curcic invested cash and “ Duvan” the section in Slatina. Agency’s investigation could not determine if the section was sold, because the documentation submitted by the new owner was incomplete.

The fifth inspection of “Dunav” privatization, performed by the Agency at the time when Mr. Branko Pavlovic was acting Director, determined that the employees were right, and that Mr. Topalovic was actualy returning the money from the investments into the account of the company

“Top gan”. The owners were sent a warning prior to cancellation of the contract with a deadline for submitting the documentation explaining the contraversial investment and allienation of the section in Slatina. The deadline was up after the dissmisal of Mr. Branko Pavlovic, and the report regarding the mesures taken, after the deadline was excedeed, submitted to the Council by the new management of the Agency brought the whole story back where it started. Despite the fact that the investment fraud was acknowledged, the Agency found, again without any explanation, that the investment was performed pursuant to the contract, and on 13 August a new, sixth inspection was sent to the buyer.

Is there any sense, however, in sending a new inspection from the Agency, for even if it is determined that the new owners did not observe the contract, the only sanction would be a new inspection sent by the Agency?

Ms Verica Barac,
President of the Council