Dirty Millions in Legal Businesses: Lending in Montenegro (25)

Some "larger" usurers are trying to funnel their ill-gotten millions into legal channels, offering businessmen joint investments in construction projects, for renting beaches, purchasing construction materials...

This is claimed by "Vijesti" sources from the security sector, stating that in recent years, and especially after the media published the extent of usury, it has been registered that a large number of usurers are switching to new ways of behaving.

"They offer users of financial resources, as well as individual businessmen, joint business arrangements and investments, after which they share the profits proportionally. This is especially evident when purchasing land for the construction of residential and commercial buildings, when leasing beaches, purchasing construction materials, investing in the hospitality industry... In this way, loan sharks avoid directly giving money with a certain usurious commission and forced debt collection, they secure property, 'launder' illegally acquired money, or legalize it. In all cities, and especially on the coast and in Podgorica, more loan sharks have 'turned' into 'builders' in recent years. According to our information, they are helped in this by certain lawyers and notaries, drawing up contracts that fully protect them, so that these documents look legal," said one of the interlocutors of "Vijesti".

The same source adds that financial investigations, which would determine the origin of money, would significantly contribute to reducing the scourge of usury.

"The adoption of the law on the origin of property would make the work of the competent state authorities easier, including in terms of proving these criminal acts, which carry the most serious consequences for both the economy and the entire social community. This is especially true considering that the security sector has recorded dozens of suicides related to usurious loans," Vijesti was told.

By investigating the extensive network of usury and the severe systemic consequences that this crime leaves for citizens, the newspaper previously came across data that dozens of suicides in Montenegro are linked to interest-bearing debts.

Survey evidence indicates that loan sharking in Montenegro functions as a system of violence and control, in which threats are the primary mechanism for collection, and physical violence, destruction of property, and family mistreatment are means of maintaining fear.

Data shows that the price of this system is not only paid by debtors, but also by their families, often through permanent loss of security, property, and even life.

The Police Directorate officially told "Vijesti" that loan sharking is difficult to prove, because victims do not report it or withdraw after they do.

This is also shown by the data, according to which, even when the trial comes, victims most often change their minds and change their statements under pressure, explaining that the loan shark only helped them at one point...

In the last five years, a total of 39 proceedings have been conducted before all Montenegrin courts for the criminal offense of usury...

Just as the investigative series was being published, the first institutional response arrived - the Police Directorate announced last weekend that combating usury would be a special focus of its work. In the security institution, which is headed by Lazar Scepanovic, have formed special teams tasked with systematically investigating reported cases, reviewing previous actions, and intensifying activities to detect and prosecute perpetrators of the criminal offense of usury...

Research by "Vijesti" shows that debt bondage does not only happen to the "irresponsible". Anyone can fall into it - both the calm and the hardworking, both the hardworking and the responsible, both the strong and the weak. The loan sharks are just waiting for a moment of weakness.

This is confirmed by the survey results - some citizens took on debt out of necessity, when institutional assistance was unavailable or too slow, while a significant number went into debt to maintain a lifestyle beyond their realistic means or to cover gambling losses, decisions that today, in a conversation with a journalist, they recognize as serious personal mistakes.

Whoever lends money or other consumable items and thereby contracts a disproportionate material benefit shall be punished by imprisonment for up to three years and a fine, reads the description of the criminal offense of "usury" in the Criminal Code (CC) of Montenegro.

If the usurer "takes advantage of the poor financial situation, difficult circumstances, necessity, frivolity or insufficient ability to reason of the injured party", he will be punished with imprisonment from three months to three years and a fine.

The Criminal Code stipulates that a loan shark can be punished with imprisonment from six months to five years and a fine if serious consequences have occurred for the injured party or the perpetrator has obtained material gain in an amount exceeding three thousand euros.

They stole half of Boka Bay.

One of the victims of the loan shark SS iz Herceg Novog za “Vijesti” je pričao o progonu koji njegova familija trpi još od kraja prošlog vijeka. Navodeći da su taj Novljanin, članovi njegove porodice is njima povezane osobe, “otele pola Boke iu crno zavile desetine familija”, sagovornik lista objašnjava da je sve počelo davne 1997. godine, kada je njegov, sada osamdesetpetogodišnji otac, upao u poslovne probleme...

"It was around 1997. A man I knew from the town of SS, who knew our family and knew that we were not poor, somehow found out about my father's business problems and approached me. Not as a threat then, but as a person offering help or a solution. He almost approached me during a walk and said - I can give you money. No problem. It somehow seemed like a casual thing," says the interviewee of "Vijesti".

He explains that his father worked privately at the time - trucks, excavators, construction, a job that required cash, fuel, repairs, and people.

"An old man today, 85 years old, in poor health. Back then, still strong, one of those who think they can push through everything with work, during those months he was facing a problem that needed to be overcome, a hole closed, and overdue work paid off. And so, naively, it started. The first time I took out a loan, everything was fine - I paid back the interest, paid off the principal, and there were no problems," he says.

He adds that problems arose again after seven years and that his father then turned to the SS, who presented himself as someone who, despite the interest, "helps fellow citizens...".

"The payments stopped at the moment my father started opening the factory. Then he had to ask S for money again. First 25.000 euros, then two five thousand each. That was around 2004. From then until 2007, when he borrowed something again, the debt grew to around 40.000 euros. As the business stalled, the debt started to grow. And I don't remember all the details, because during those years I was living in Bosnia and Herzegovina and working in a mine. I got sick for a while and ended up in the hospital a little over ten years ago, when my father came to visit me, I found out about his problems, because he was constantly being threatened," he says.

He states that during those days S. demanded 250.000 euros in interest from his father, demanding that he transfer the property to him.

"I realized that he was already threatening them, persecuting them, harassing them, and I asked my father what was going on. He told me that S. was threatening to kill him, to cut his throat, to hang him... All of this was stated in the testimonies during the court proceedings we conducted against S. after he forced my father and mother to transfer his property to him, through a contract, with a lawyer in Herceg Novi. That's when the real problems started. The loan shark and his associate, who has since been killed, would come every now and then and take 10.000 euros. If they didn't find my father or the money, they would look for me and I would give it to them," says the interlocutor of "Vijesti"...

Rape threats

Ten years ago, according to an interviewee for "Vijesti", the loan shark and his debt collectors went a step further - they came to his house and threatened to rape his wife.

"The persecution did not stop, we heard almost every day - 'give me money, sell something'... Then they started coming to my house to threaten me. I was married at the time, and several times, when I was not at home, they threatened my then-wife in front of our two minor children that they would rape her if I did not make them money. You know, it was chaos... The SS personally threatened her with that. She called me and my parents, then we called him, but he did not answer us... This lasted until 2016, when we were dragged into court proceedings," he said.

The lender, the newspaper's interlocutor claims, initiated proceedings against his parents based on the contract.

In the period 2017 and 2018, he states, the Basic Court in Herceg Novi issued a verdict declaring the disputed contract null and void, with the explanation that it was concluded under duress.

However, as he states, the other party filed an appeal, and the case ended up before a higher court.

According to his statement, in that proceeding, the opposing party hired lawyers (names known to the editorial staff) who, as he says, "through some unknown force" managed to overturn the first-instance decision of the Herceg Novi court and change it in favor of the opposing party.

The interviewee claims that the entire process was accompanied by pressure and "buying" of influence, but that his family did not have the money to adequately fight through the system.

He also states that there were controversial moments in the proceedings regarding testimony and legal advice.

"A lawyer, who drafted the disputed contract, suggested during the trial to my parents to acknowledge what was written in the contract, even though the real situation was not like that. That is, to admit that we owed S. 250.000 euros. Believe it or not, she claimed as a witness that she saw S. counting 250.000 euros, not far from the Basic Court building, and that she saw the money being handed over. When they asked her how she saw it, she said that she was 250 meters away, but that she saw it," he says.

The interviewee says that his parents were seriously ill at one point, and that his father was unable to attend hearings and that some were held without their statements, after which the process turned even more against the family.

In the meantime, he says, a new dispute has been opened - the opposing party is now suing him personally.

He explains that they did this because his parents do not have any property in their name, so the claim is directed towards him.

"Everything here is a problem. And the fact that we can't prove in court that he is a loan shark, even though he took half of Boka from a dozen families, in the same way, with the same scheme. He claims that my father owes him 250.000 euros, even though my dad paid the money back in installments - several times in 25.000, 30.000 and 5.000 euros. Now, counting the interest, there is still 40.000 euros in debt, I don't know how to prove that we are innocent and that the loan shark has been haunting us for years," he said.

In tomorrow's "Vijesti", read about what the interviewees and interlocutors of "Vijesti" asked for help from loan sharks, and the confession of a family from the capital...