Lawyer Branislav Lutovac said that the former director Milka Ljumović is being tried in the High Court for the second time, because she was already "convicted" once in part of the electronic and print media.
He stated this in his closing remarks before judge Ana Vuković.
"Milka Ljumović is exposed to a real personal and family unprecedented media campaign, in which her children and grandchildren were not spared either. There they were found guilty and the maximum sentence was demanded for them. Instead of their names, they were called black and yellow. It is an unprecedented case in Montenegrin journalism that two ladies in serious years are called such pejorative names. In this way, not only is journalism as a profession invalidated, but the media sends a message of intolerance and disparagement. Such an environment was created so that we defend, not the accused, but the people condemned by the media," said Lutovac. He said that in the period covered by the indictment against the bank's former management, there were hundreds of thousands of loans and guarantees issued, with a total placement of over three billion euros, an annual turnover of over 20 billion euros and over 20 million banking transactions, a hundred thousand " of living" loans...
"It happened that problems arose with the registration of additional security for a negligible number of loans that are classified as operational risk of the bank and have a negligible value compared to the total placement. All disputed loans were approved in the regular procedure, through the credit committee, which automatically means that the basic security funds were taken, and the credit agreements provided for the clients' obligations to provide additional security funds as well," said Lutovac.
He reminded that from 2005 to 2007, CKB was very successful in business: "What was the reputational guarantee of general manager Milka Ljumović, the fact that upon her phone call, the largest German Commerz bank paid CKB the amount of 30 million euros, without any guarantee other than her word. Let the current management try to get through a phone call, not 30 million, but 30.000 euros. There is no chance”.
He stated that Ljumović did not participate in credit operations and loan approval, because that was not her job.
"As a general manager, she was the bank's strategist. The indictment treats her as a credit officer. No act in the bank obliged it to deal with loans. The decision to grant a loan is made by the bank's credit committee, which is an independent body. The regulations do not provide that the general manager should know about the current decisions of the credit committee".
He said that the Hungarian owner was familiar with everything that was done in the bank even before he bought CKB: "In August 2006, the Bank Purchase Agreement was signed, according to which in December of that year they paid 85 percent of the agreed price, keeping the rest 15 percent for a period of one year in the event that some losses or expenses that were not known at the time of document review are discovered. After 14 months, this 15 percent was also paid, which meant that there was nothing in the bank's operations that was not presented to the customer".
He recalled the report of the Central Bank dated December 31, 12, in which it is written that the credit files contain the necessary documentation.
Everything according to regulations
Lutovac said that the indictment completely wrongly treats the bank's operational risk as damage.
"Operational risk explicitly includes legal risk, which also exists in the bank as untimely entry of security, absence of entry of security, binding of loan agreement with deposit agreement, insufficient application of procedures... The evidence provided for the disputed six loans confirms that the procedure was implemented with them as with all other loans in the loan portfolio, and any defaults fall under the legal operational risk based on credit risk".
He said that the risk from disputed loans was managed at the level of individual placements and the portfolio as a whole, by allocating an adequate level of provisions to the appropriate accounts in accordance with the law and regulations of the Central Bank.
"These six disputed loans are classified in a category according to the status they had, at the time of their approval, together with other loans. By collecting certain loans, the set-aside provisions are released and directed to other loans, new or those that have become risky in the meantime. It all takes place automatically and that is a risk from credit business, even with these six loans, and that is not and cannot be a harm as the prosecution claims, and the experts calculate. The conclusion is that operational credit risk, for all six loans, occurred due to the human factor, primarily due to the wrong activity or inactivity of the Hungarian management, which changed the concept of work. He did not deal with loan collection as it was done before and the risk only happened after the departure of the old management. The conclusion is that what the experts call damage in connection with these six loans is a lawful event in the business of each bank in connection with the business of measuring and managing credit and operational risk, in accordance with the standards of the Central Bank for measuring and managing risks in banks, and most importantly - that it's not a shame. Provisions were set aside for these loans from the moment of approval, according to the status of these and other loans in the loan portfolio, and these provisions are used to cover business losses for these and other loans," Lutovac said.
Only the truth is missing from the expert report
Lutovac stated that the expert report is such that it lacks nothing, except true facts.
"The finding was made on the basis of incomplete, selectively selected and subsequently created documentation in a photocopy, without an insight into the original documentation. Therefore, the finding is incomplete, inaccurate and unusable, because it does not show the real conditions as a whole and individually. The finding did not at any point indicate which provision of the Statute or decision of the Shareholders' Assembly was acted against. In the part related to the subject loans and guarantees, the experts, contrary to the rules of the profession, gave a conclusion based on unilaterally presented documentation in a photocopy, without insight into the original documentation, without insight into the clients' documentation. The experts reviewed the documentation without the presence of the accused, without inviting the accused to possibly submit their documentation, with tendentious and wrong conclusions. As it is, the finding is completely unusable and a court decision cannot be based on it," said Lutovac.
Lutovac: There is no intention, no evidence, no criminal act...
"My client is accused of having committed the criminal offense of abuse of power in the economy in six cases during the granting of six disputed loans. It is prescribed for this criminal offense that it can only be committed with intent. In addition to intent, the subjective feature of this criminal offense is also the intention to obtain illegal property benefit, in this case for other legal entities, as stated in the indictment. As there is no evidence that my client has committed any of the criminal offenses she is charged with, I suggest that the court acquit her of the charges," said Lutovac, Milka Ljumović's defense attorney.
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