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Vote Buying and Fraudulent Business First, Now Refugee Relief Fund Manager

28. Nov 2016.
Iustracija: Đorđe Matić
Branislav Švonja, a politician convicted of buying votes, was appointed a director of Vojvodina’s refugee relief fund. A private company, owned by him until recently, whose representatives pose as state institutions’ officials, makes millions by peddling for a fee information which is otherwise free of charge

Many invited guests, including Novi Sad mayor Miloš Vučević, gathered for electoral convention of the Serb Democratic Party (SDS) in this city in February 2016. On that occasion, Branislav Švonja, the SDS president, announced joining forces with the Serbian Progressive Party (SNS) for the forthcoming elections.

In April, SNS scored the best election result in Vojvodina, whereas SDS did not even contend for power at the polls. Shortly afterwards, on the 27th of July, Švonja was appointed an acting director of the northern province’s Refugee and Internally Displaced Person Relief Fund.

The Center for Investigative Journalism of Serbia (CINS) reveals so far unknown details from the political and business career of Branislav Švonja.

Mr Švonja was convicted of vote buying in 2013 local elections, but he did not stop there. A company owned by Mr Švonja until recently, Nacionalni privredni operater (National Business Operator), has been peddling data for a fee, otherwise available online free of charge, to state institutions, local governments, state-run public enterprises and private companies throughout Serbia. From its inception in July 2014 until the end of 2015, the company generated almost 11 million dinars in revenues, according to financial statements available on the Business Registers Agency (APR) web site.

 

Location of Nacionalni privredni operater, SB Company and SDS

 

Photo: Lazar Čovs

Mr Švonja has been involved in this business for years. As far back as 2011, CINS wrote about the companies set up by his associate Dušan Oluić and himself in Serbia and other countries in the region, which were making money in the same manner as Nacionalni privredni operater does.

According to APR data, Slobodan Švonja, whose other company – Privredni propisi (Business Regulations) – was in the same line of business, replaced Branislav Švonja on the 26th of October 2016 as the company owner. A month earlier Slobodan had also replaced Branislav as a director of Nacionalni privredni operater.

Employees and managers of companies and institutions said that Nacionalni privredni operater representatives were offering data free of charge and requesting only a receipt to be signed. Sales managers would pose as representatives of state institutions, and several months later they would send invoices. Believing that they were deceived, many subsequently brought criminal charges or complaints against them.

In 2015, Belgrade Public Health Institute filed criminal charges against Nacionalni privredni operater.

A man who introduced himself to me as a representative of the Ministry of Economy gave me two USB sticks, said Dušanka Matijević, Public Health Institute director, then asked me to sign a receiving slip and left.

‘‘I wouldn’t have even exposed him, but they failed to make that application on the USB stick well,” explained Matijević. As the Public Health Institute’s staff could not open the content on the USB sticks, the institute called the Ministry of Economy only to find that the person in question was not the ministry’s employee.

However, in December 2014, Nacionalni privredni operater collected 196,000 dinars from the Public Health Institute. Director Matijević was away at the time, and her assistant was tricked, as she put it, into making the payment against a forged contract with her signature on it.

Nacionalni privredni operater contracts stipulate their validity for the current and following three years, as well as an option to cancel them but solely in the first week of January for that year only. Relying on these provisions, Nacionalni privredni operater attempted to collect money from the institute in 2015 and 2016. They managed to do so in 2016.

‘‘They contacted directly the head of department for financial and economic affairs, taking advantage of her unfamiliarity with the case at hand (…) and collected another 196,000 dinars from the Public Health Institute,’’ read the damages claim lodged by the institute with the Ministry of Interior.

Mr Branislav Švonja did not respond to the CINS requests for an interview.


Confidential but Free Data


In July 2014, Branislav Švonja set up a company, Nacionalni privredni operater, registered at the same address in Novi Sad as his other firm, SB Company, representing South Korean car manufacturer Kia.

According to the Serbian Treasury’s data, from its establishment until April 2016, budget beneficiaries, including the City of Belgrade, Vojvodina’s Secretariat for Health Care, Social Policy and Demographics and 11 health care institutions, paid over 4.2 million dinars in aggregate into the account of Nacionalni privredni operater. The institutions, which responded to requests by CINS journalists, paid this company for data on legal entities.

The City of Belgrade paid 294,000 dinars for USB sticks with 15 types of data of which all, except one, could be freely accessed online. Almost all such information is available at the Serbian Business Registers Agency which may provide these data free of charge to state organs and local governments.

 

Branislav Švonja’s Political Career

Branislav Švonja’s Political Career

In late 2015, Branislav Švonja was convicted of vote buying at local polls in the municipality of Odžaci, according to the District Court in Sombor. With another accomplice he organised a network of people who had been offering 1,000 or 2,000 dinars, as well as consumer goods, to local residents in exchange for casting ballots for SDS in the local election held on the 15th of December 2013.

At the time SDS won two out of 27 seats in the local council. Švonja was fined 200,000 dinars which he was to pay in 12 equal monthly instalments, starting in January 2016.

Even though SDS held its electoral convention in February 2016, the records of the Ministry of Public Administration and Local Self-Government show that this party was renamed in mid-2015 as Serbian Renewal and that today there is no political party registered under the name of SDS.

Mr Švonja was politically active even earlier. Association Community of Serbs from Croatia and Bosnia-Herzegovina, whose representative was Mr Švonja himself, signed in 2002 an agreement on cooperation with the Democratic Party of Serbia (DSS) and backed Vojislav Koštunica as a presidential hopeful. In the parliamentary election the following year, Mr Švonja was a candidate on the joint election list fielded by the Serbian Renewal Movement (SPO) and New Serbia (NS), while he run for mayor of Novi Sad in 2004. In Croatia, in 2010 he was elected a councillor in Zadar County, but being already a member of Obrovac Town Council he relinquished the new post in favour of Dušan Oluić. In 2013 Croatian elections, Mr Branislav Švonja was re-elected as Obrovac councillor.


Former DSS president Sanda Rašković Ivić brought charges against Švonja in 2011 alleging that he posed as ‘a fellow fighter, like-minded person and friend’ of her father Jovan Rašković, the founder of SDS in Croatia. District Court in Novi Sad dismissed the charges as groundless.

Photo: Media Center

In November 2014, a representative of Nacionalni privredni operater company put forward an offer to compile sets of comprehensive data on legal entities in Serbia, according to officials of the Belgrade City public procurement department, which they accepted ‘’for the purpose of market research, ensuring competition and implementation of centralised public procurement procedures”.

Belgrade public procurement officials attempted to terminate the three-year contract a week after the signing, but they failed to serve the cancellation notice to the other contracting party as Nacionalni privredni operater could not be found at its registered address. The following year, the Belgrade public procurement department refused to receive the data bundles and the bill.

By mid-March 2016, sixty-four cases involving Nacionalni privredni operater had been brought to the Commercial Court in Belgrade. Some lawsuits were pursued by this very company seeking enforced collection of a total of 7.6 million dinars, whereas the remaining cases were brought by clients disputing such claims who saw themselves instead as the victims of fraud.

Amongst others, these are the companies which have taken legal action thus far: Elektromreže Srbije (electricity distribution company), Zavod za udžbenike (textbook institute), KBC Bežanijska kosa (a clinical centre in Belgrade), Telekom Srbije (national telecommunications company), Knjaz Miloš (privately-owned carbonated mineral water producer), Infostan (Belgrade public utility), etc.

Some of them allege that a sales manager of Nacionalni privredni operater introduced himself as a person from the Ministry of Economy, Ministry of Health or Ministry of Finance and offered supposedly confidential data free of charge.

A complaint intended to invalidate the contract was also brought by Hidroelektrane Đerdap public enterprise, and the value of the matter in dispute was a million dinars.

According to the allegations in the complaint, an employee of Nacionalni privredni operater Dušan Oluić handed over eight packages to responsible persons in that company, but requested only the signing of a receipt.

‘‘I signed it, the paper with fine print over which he held his hand and pointed with his finger where I should sign,’’ testified director of Đerdap 2 branch office Ljiljana Milicanović before the Commercial Court in May 2015.

Milicanović found it suspicious when her secretary said that she had ‘an altercation’ with Oluić as he was refusing to have the document photocopied. She looked in the copy and found fine print in a part of the text stipulating that this was a contract. Oluić handed to her three folders for 98,000 dinars apiece. That same day earlier, he handed over five packages at the same price to Đerdap 1 branch office director Ljubiša Jokić.

At the trial Oluić denied that he posed as a person from the Ministry of Economy. The then Nacionalni privredni operater general manager Dušan Šaponja also testified, but the court found both statements to be ‘contradictory and confusing’ as well as ‘calculated and designed to avoid liability’.

The court accepted the testimonies of Hidroelektrana Đerdap officials and rescinded the contracts. The Commercial Court of Appeals upheld the ruling on the 21st of January this year.

Nacionalni privredni operater
’s bank account was blocked on the 8th of April this year. At present the outstanding debt totals 529,479 dinars.


Business as Usual for Years On End


In 2013 local election in Croatian Zadar County, Branislav Švonja and Dušan Oluić were nominated on the election list of the Democratic Party of Serbs. Slobodan Švonja featured as a candidate on the same election list. In 2010, he set up Privredni propisi company which has been in the same line of business as Nacionalni privredni operater.

According to the Business Registers Agency’s reports, from 2011 until the end of 2015, Privredni propisi generated around 9.5 million dinars in revenue. The Treasury’s records showed that from 2011 to April 2016 this company collected almost 2.9 million dinars from budget beneficiaries.

In the first two months of 2016 only, Privredni propisi had a revenue of 784,000 dinars thanks to payments from Smederevo, Zrenjanin and Ruma municipality. Other local governments had made payments earlier such as Niš, Kragujevac, Negotin and Krupanj.

 

Bundle of legal entities’ data sent to Vitalikum company by Privredni Propisi

In September 2015, a man who claimed that he was from the Serbian Chamber of Commerce first called and then came, said Borisav Ičagić of Novi Sad-based Vitalikum company. The man handed USB sticks, but Mr Ičagić could not access the contents. Several months later Mr Ičagić received an invoice of 196,000 dinars and a contract from Privredni propisi.

‘‘No one had ever mentioned any contract, expenses or any services at any time whatsoever either by phone or at the point of receiving the USB sticks,’’ explained Mr Ičagić. ‘‘I saw the contract for the first time when the mail arrived.’’

Branislav and Slobodan Švonja and Oluić have been doing business in this manner for years, using various companies registered in Serbia, Croatia, Slovenia, Montenegro and Bosnia-Herzegovina.

Branislav Švonja and Oluić are from Obrovac in Croatia by origin, and the first record of both of them together in Serbia dates back to a purchase of a plot of land in Novi Sad. According to the 2004 property sales contract, Oluić and Nenad Opačić sold the foundations of a petrol station in Novi Sad to Novina, a company owned by Branislav Švonja, for 6.5 million dinars. Opačić had been sentenced to 14 years’ imprisonment over drug dealing and was assassinated in 2015.

Oluić’s company Centar za finansije (Centre for Finances) was selling data in the same manner as Nacionalni privredni operater and Privredni propisi. This company crops up as one of the parties involved in over 600 cases brought to the Commercial Court in Belgrade from 2007 until 2014.

Dušan Oluić had been charged with having attempted to defraud Telenor company of almost 600,000 dinars through Centar za finansije in 2006, but was acquitted in 2013. The court accepted the testimonies of Telenor employees that Dušan and Slobodan Oluić had been offering CDs for free only to subsequently demand money, however, the ruling was that culpability of the defendants was not proved indisputably and beyond any doubt.

In 2011, CINS discovered five companies which were selling publicly available information. These companies had the old acronym of Pošte Srbije (Post of Serbia public enterprise) – PTT – contained in their names.

CINS tried to contact Slobodan Švonja, Dušan Oluić and Dušan Šaponja on several occasions using the phone numbers from publicly accessible phone books as well as contact details – phone numbers and addresses of their companies – available on APR web site, but without any success.

 


The story has been produced under an EU funded grant, awarded in the Media Programme 2014. The contents of this publication are the sole responsibility of the Center for Investigative Journalism of Serbia and can in no way be taken to reflect the views of the EU.


  

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