Sunday, Apr 20th

Last update:18-04-2014 14:37

Caribbean: Cocaine Trafficking Continues Rise Say US Officials
The proportion of drugs trafficked through the Caribbean has more than tripled in the space of five years, according to US...
India: Election Officials Seize Cash and Drugs Used To Buy Votes
Since March 5, Indian election officials have seized US$ 36 million, 2.7 million liters of alcohol, and 100 kilograms of heroin...
Montenegro: NGO Accuses a Dozen High-Level Officials of Corruption
Yesterday, MANS, a non-governmental organization (NGO) focused on fighting corruption and organized crime in Montenegro, asked...
Italy: 13 Mobsters Arrested for Dumping Industrial Waste
On April 11, military police from Apulia, Italy arrested 13 people for illegally dumping 12,000 tons of industrial waste. One...
Serbia: Turbo Folk Star “Ceca” Acquitted of Assault Charges
On Wednesday, Belgrade courts acquitted popular Serbian turbo folk singer Svetlana “Ceca” Ražnatović and her sister’s...
Former President Had Big Plans
By Kateryna Kapliuk, Slidstvo.info Would you like to stay in the Kyiv hotel of...
Ukraine: The "Family" Business of a Mezhygirya Contractor
By Maksym Opanasenko (Bureau of journalistic investigations “Svidomo”)...
Arkan, Bojović Associate Murdered
Rade Rakonjac, Arkan's murdered former bodyguard  By Stevan Dojčinović ,...
How Kurchenko's offshores worked
By Anna Babinets People who used to know young billionaire-in-exile Serhiy...
The Silent Looting of Russia
Dmitry Klyuev (left) and Andrei Pavlov (right) at an OSCE meeting in Monaco, in...
Hungarian Media Law Doomed
19 January 2011 By Tamás Bodoky The widely criticised new Hungarian...
Google is Not Your Friend
  The internet is a powerful tool in the service of investigative...

Government and Central Bank React

Friday, 01 June 2012 20:17
Print PDF

Three days after the publication of reports that Montenegro’s First Bank violated banking laws were first published on Tuesday, the government and the regulatory institution have responded.

Montenegrin Central Bank Governor Radoje Zugic vowed Friday to find out who leaked confidential documents detailing the mismanagement of the country’s largest Montenegrin-owned bank.  It is the government’s first response to reports that First Bank, controlled by the family of former Prime Minister Milo Djukanovic, was mismanaged and violated the law. 

The documents, provided to the Organized Crime and Corruption Reporting Project, show that as early as the beginning of 2007, the Central Bank was concerned that policies employed by First Bank would lead to liquidity problems.  The documents address in detail how and why the bank needed a bailout in Dec 2008 and shows that the regulator repeatedly tried and failed to get First Bank to correct problems.

 The ongoing publication of the documents starting Tuesday caused an uproar in the small Adriatic country.

Zugic, who was on the board of directors of First Bank before he was installed as Central Bank Governor in 2010, has said the leak was illegal and that the source would be punished.

“Pursuant to section 103 of the Law on Banks, these documents are confidential evidence and cannot be disclosed without the consent of the Central Bank,” he said during a meeting convened to discuss the regulator’s 2011 annual report.

The documents cover the period from 2007 until 2010, when the regulator’s Governor was Ljubisa Krgovic.  Krgovic declined to talk with OCCRP, offering only his statement that “Montenegro needs an independent Central Bank which will not adjust its whole system and its basic policies (supervisory, regulatory and obligatory reserve policy) to a single bank.”

The President of the Parliamentary Assembly’s Committee for Economy, Finance and Budget Aleksandar Damjanovic said that the Central Bank must deal with the problems.

“If all of this is true, I can say that First Bank acted unprofessionally, because it gave a privileged loan with no basis for it. However, this question should be referred to those who regulated the bank and is regulating the  bank,” said Damjanovic at the assembly meeting, according to Radio Free Europe.

A spokesman for the bank Friday afternoon did not deny the findings.  “The bank does not intend to justify what happened six to seven years ago, because it has overcome those problems,” the director of corporate communications Jelena Pavicevic told Atlas TV.

Pancevic added that the reporting “harmed the overall banking and economic system of Montenegro.”

She added that current and future clients of First Bank and other banks could worry that their personal data would be compromised.  “This endangers the functioning of the economy and legal system,” said Pavicevic.

The Montenegrin embassy in London sent a letter to the BBC Newsnight saying that a segment of its May 29 broadcast “set out a series of false allegations and unsupportable arguments” and   characterized Montenegro, “contrary to the principles of journalistic ethics,” as a “mafia state” while “relying solely on information obtained from NGO protest organizers in the capital Podgorica.”

The Newsnight broadcast called into question Montenegro’s preparedness for European Union accession negotiations, slated to begin in June.

 
Re:Baltica Completes Series on Latvian Health Care System
The Baltic Center for Investigative Journalism Re:Baltica, an OCCRP partner, has published the last installment in its series about the health care...
Trafficking and Terrorism: How Organized Crime Thrives on Passport Fraud
By Ana Baric Passport Stamps. Photo Credit: Flickr. Jon Rawlinson The March 7 disappearance of a Malaysia Airlines plane one hour into its flight...
Colombia: A Country Torn Between Peace and Corruption
By: Maria Virginia Olano In Colombia, it is no secret that laws and rules there can be bent and moved around, especially with a couple of bills in...
Press Persecution in Azerbaijan: Where Investigative Journalism Is “Espionage”
By Ana Baric Azerbaijan is maintaining its usual approach to press “freedom”: sponsoring pro-regime media and unapologetically repressing...
Venezuela: The Battle Against a Corrupt, Authoritarian State
By Maria Virginia Olano It was supposed to be the day Venezuela celebrates its young people. Instead, three students were killed, more than 70...