The Special State Prosecutor's Office (SDT) is checking whether there were any abuses in the operations of the state company Regionalni vodovodov, which manages the water supply system for the Montenegrin coast.
The SDT confirmed unofficial information to "VIjesti" that they are investigating the operations of the state-owned company managed by Goran Jevrić, but they did not provide detailed information about several cases that were formed.
"The mentioned cases are in the stage of reconnaissance and appropriate investigative actions are being taken in them", was the official answer to "Vijesti" from SDT.
Jevrić did not answer the questions of "Vijesti" about the reasons for which the prosecution initiated the investigation.
Account blocking
"Vijesti" unofficially learned that SDT started to deal with the company's operations after the State Audit Institution (DRI) published an audit report on the operations of the Regional Water Supply at the end of 2017. The supreme audit issued a negative opinion due to the numerous omissions it found, and according to unofficial information from "Vijesti", the SAI is currently conducting a control audit.
The regional water supply company came into the public eye in August last year when the Austrian company Štrabag blocked its account in order to collect 12 million euros that it received in a court case that it initiated against them nine years ago.
The SAI previously warned in the audit that the financial position of the company could be affected by the court case, which had not been concluded by the end of the audit.
"The most significant legal dispute that can affect the financial position of the company is the dispute with the contractor Štrabag, who initiated arbitration proceedings against it before the International Chamber of Commerce in Paris, because the company terminated the contract for the construction of the regional water system due to non-compliance with contractual obligations by the contractor In November 2014, Štrabag submitted a request to the Commercial Court in Podgorica to confirm the arbitration decision in order to make it legally binding," the SAI report says.
In March 2013, the International Chamber of Commerce in Paris ruled that Regional Waterworks must pay the Austrian company 9.457.280 euros in principal, 1.063.912 in interest, 501.693 in court costs, as well as interest on the amount of 190.000 euros given by Strabag as guarantee at the court in Vienna against the activation of the effective guarantee.
After that, the regional water supply company announced that it does not recognize the decision of the Paris arbitration and asked for new negotiations with Strabag. However, in 2014, Štrabag initiated the procedure of recognition of the decision of the arbitration procedure with the domestic courts. The Commercial Court refused to confirm the decision three times, and the Court of Appeal annulled the decision each time and asked for a re-decision, which it finally did in August last year.
So far, no one has been held accountable for the damage caused to taxpayers in the amount of 12 million euros.
Government guarantee
Due to blocked accounts, the Regional Waterworks had problems in regular operations, so its due obligations by April 24 of this year reached the sum of 2,51 million euros.
At the end of April this year, the government gave the Regional Waterworks a guarantee to take a total of 10 million euros from Prva banka and Erste banka and use that money to pay off the accumulated debts of about 9,29 million euros.
The blocking of accounts mostly affected the employees of that company who have not received their salary since July 26 last year. The debt for employees' wages, including taxes and contributions, reached 870.000 euros at the end of April.
During the blocking of the account, the employees were paid wages in the name of credit loans they took from Prva banka, in the amount of two-thirds of the wages, which they return with interest.
"According to the information received from the Regional Waterworks, on April 24, 4, for the 2019 days of the blockade, Štrabag collected EUR 253 million from the account, while the remaining debt amounts to EUR 5,69 million (not counting the associated interest that is estimated to over 6,28 euros)" was written in the Government document that was adopted at the end of April when the guarantee stipulated in this year's Budget Law was given. Among other due obligations is a debt to the Ministry of Finance of 500.000 euros, which instead of that public company paid the installment for a loan taken from the European Bank for Reconstruction and Development (EBRD).
The revenue of the Regional Waterworks last year amounted to 7,9 million euros.
If the amount of the loan was false, tax controls were not carried out
In the audit, the SAI found that the Regional Water Supply did not provide a true and objective account of the debt in the documents on financial operations in 2016.
As explained in the report, the company's balance sheet shows long-term loans in the amount of 19,52 million euros, while the audit determined that they amount to 2016 million euros at the end of 21,04.
The audit found that the company also showed the calculation of interest on the loan from the International Development Association (IDA) in the amount of 249.100 in the financial expenses, although "it did not repay the fee (interest) on the loan, but the same was done by the Ministry of Finance".
"The audit established that the company is not subject to controls of any business segment by the tax authority (the Tax Administration or local self-government unit whose jurisdiction is the determination, collection and control of taxes) even though the company is a taxpayer in accordance with the Law on Tax Administration which is subject to the obligation to pay taxes" it says, among other things, in the report of the SAI.
Many years of business with Prva banka
Regional water supply and Prva banka were in the public spotlight in 2010 when it was revealed that the bank returned 11 out of a total of 44 million euros of loans to the government. The money for the first installment was returned by paying one million euros from the state treasury to the account of the Regional Waterworks in Prva banka. The bank immediately paid that million to the treasury to repay the loan, i.e. the first installment.
In less than half an hour, the treasury paid 11 million euros each to the Regional Waterworks in Prva banka, and the bank made 11 payments to the treasury of one million euros each, and "settled" the first installment of the loan. Based on a special law, the government then helped Prva Bank, which fell into serious financial problems.
The first bank is controlled by Aco Đukanović, the brother-in-law of President Milo Đukanović.
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