Although aware of the amount of damage caused to the Atlas Group and its companies, the position of the legal representatives is to find a compromise solution with the Government of Montenegro. So far, the settlement proposal has been submitted three times - to the Government Duško Marković, Zdravka Krivokapića i Dritan Abazović. The proposal will also be sent to the Prime Minister Milojko Spajić to reach an agreement and find a settlement solution, because it would be unfair for the citizens of Montenegro to pay for the damage caused by the actions of the recent president Milo Djukanovic.
This was officially announced in mid-April from Knežević's Atlas Group.
Atlas Capital Holding Limited, Meljine Complex Limited and Knežević initiated an arbitration case at the end of 2020, in which they demand 500 million euros in compensation from Montenegro, caused, as they said, by a flagrant violation of Montenegrin and international law.
Knežević's legal team is demanding from the state of Montenegro that the businessman and companies from the Atlas group be paid the damages caused, as they believe, by the "illegal introduction of bankruptcy in two banks" by the Central Bank of Montenegro. It is about Atlas and IBM Bank. The arbitration also covers the damage caused, as the Atlas Group claims, by "illegal actions of state authorities" in the Meljine complex in Herceg Novi.
The Prime Minister's Office did not reply yesterday to the "News" about Spajić's position regarding the settlement requests, and the arbitration procedure, as announced by the Atlas Group, should begin in mid-May.
Arbitration
Knežević publicly announced that he would not give up the court proceedings, but that he was ready for a settlement in which his property would be returned to him. Through bankruptcy proceedings in Atlas and IBM Bank, his business group had large assets seized or blocked in several municipalities on the coast and in Podgorica, some of which were sold.
Based on the bilateral agreement that the joint state of Serbia and Montenegro signed with Cyprus in 2005, and since Atlas Capital Holding Limited and Meljine Complex Limited are Cypriot companies, a lawsuit was filed against Montenegro for compensation.
"Montenegro is obliged to protect foreign investments according to internationally accepted obligations, and the behavior of state authorities indicates serious omissions and illegal actions against the Atlas group. With the brutal intrusion into Atlas and IBM Bank and the collapse of the stable banking system created for decades, the blocking of the operations of all Atlas Group companies, the halting of the multimillion-dollar Meljina project, the seizure of property that is still ongoing by the criminal elite of the Montenegrin government and the corrupt prosecutor's office, along with a merciless campaign against me, shamelessly accusing them of some non-existent acts, all with the clear intention of collapsing the business credibility and financial stability of the Atlas Group and the companies operating within it, enormous damage was caused," Knežević told "Vijesta" at the end of January 2022.
In November 2021, the Agency for the Prevention of Corruption (ASK) launched an investigation against the then Minister of Finance and Social Welfare and current Prime Minister Milojko Spajić to determine the existence of a threat to the public interest that points to the existence of corruption in connection with the choice of the Four Knights LLC law office from Switzerland to represents Montenegro in the arbitration proceedings initiated by Duško Knežević, Atlas Capital Holding Limited and Meljine Complex Limited. The agency then announced that it would send the opinion to the Special State Prosecutor's Office for further action. Since then, no details are known regarding this issue.
Property
Duško Knžević entered big business in 1995 by founding Atlas Bank in Belgrade. After that, with good political connections, his business empire only grew, and at the peak of success he had 30 companies in the fields of banking, financial services, insurance, real estate, manufacturing, trade, media and education. Their headquarters were in Montenegro, Serbia, Cyprus and Russia.
His companies owned over half a million square meters of land in the most exclusive locations along the Montenegrin coast and in Belgrade, for which real estate development projects worth several billion euros were prepared.
His company owns about 300 square meters of land on Cape Mimoza in Boka, where the construction of a large tourist resort of over 500 million euros is planned, over 50 square meters of the complex of the former Military Hospital in Meljine, where an investment of 200 million is planned, a complex of 40 square meters in Mogren near Budva, where the planned investment is 120 million...
He also controlled companies that had about 15 square meters of land at the Adriatic Fair in Budva with an investment plan of 90 million, 33 square meters in Kamenovo with an investment project of 100 million, 25 square meters of land in Topolica in Bar with a hotel and real estate construction project of 70 million,... His company owns valuable real estate in Petrovac, Pržno, Sutomor, Podgorica, New Belgrade, in the center of Belgrade, Takovska Street, Vojvode Mišić Boulevard,...
Bankruptcy
The Central Bank (CBCG) is under the mandate of the Governor Radoje Žugić in December 2018, first introduced temporary administration in Atlas Bank, and then in April 2019, bankruptcy. IBM was declared bankrupt in January 2019.
"Decisions on the introduction of temporary administration were made based on the results of controls that were previously carried out at Atlas and IBM Bank, which showed that the capital available to these banks does not correspond to the risk level of their operations. Taking into account the established facts, in order to protect the interests of depositors and prevent further deterioration of the financial situation in Atlas and IBM Bank, and acting in accordance with the Law on Banks, the CBCG passed decisions on the introduction of temporary administration in the mentioned banks", explained the CBCG.
Knežević said that Žugić, together with leaders in other state bodies and structures who "acted on the direct order of Milo Đukanović, worked to destroy Atlas and IBM Bank and other members of the Atlas Group."
"Praising himself, as a reliable guardian of a healthy banking system, all with the aim of recommending himself for a new mandate since the outgoing President of Montenegro, Milo Đukanović, proposed him to the Assembly to be re-elected as governor, Žugić said without batting an eye: "For almost nine years, I in this position and without a single affair"?! Only ovlaš mentioned "three non-systemically vulnerable banks". And on the direct accusations of the deputies that the CBCG was politicized and that all these years it was a political project of the DPS, he threatened to file a lawsuit," Knežević said in one of the announcements, adding that "only in the case of the bankruptcy of Atlas Bank and IBM Bank, Žugić repeatedly broke the law and committed criminal acts for which he will have to answer before the court"
The international company "Kroll Associates", which deals with financial consulting and risk assessments, at the request of the bankruptcy administration, conducted an investigation into the events that led to the bankruptcy of Atlas Bank, but that report was never presented to the public.
E-commerce
Before the introduction of bankruptcy in Atlas bank, at the request of the Special State Prosecutor's Office (SDT) in 2018, 63 million euros were blocked in the accounts of companies that use the e-commerce service of this Knežević bank.
The SDT, headed by him at the time, was recently arrested Milivoje Katnic it blocked that money due to suspicions of money laundering and tax evasion, while Knežević later said that the bank's work was made impossible by this block and that it was deliberately and artificially created a reason for the introduction of bankruptcy.
"As an additional argument used by the CBCG as a reason for introducing bankruptcy, it is the blocking of funds of e-commerce clients in the amount of 64 million euros. The blockade was carried out without a legal basis and with the intention of causing damage to the bank, which ultimately led to the bankruptcy of Atlas Bank," said Knežević at the time.
In the "e-comerc" case, the former SDT first filed an indictment against Knežević, 107 other persons and 248 companies due to suspicions that they facilitated tax evasion of 57 million euros through illegal activities.
This indictment was later sent back for revision, and the second one, from the beginning of 2021, when Katnić was still the special state prosecutor, a new indictment was filed that included Knežević, six other people and two companies.
The Special Prosecutor's Office previously explained that companies registered as resident legal entities that engage in trade and trade through websites participate in e-commerce. Their turnover, allegedly, was 73 million euros, 658 million dollars, 11 million British pounds and seven million Canadian dollars.
SDT claimed that these companies were liquidated after the turnover without paying profit tax. Knežević replied that those sums were sales for the trading service through e-comerc, and not the profit that would be taxed in that amount.
The first million
Knežević was one of the mediators who enabled former state president Milo Đukanović to earn his first legal million euros, 15 years ago.
As he said two years ago, in 2007 he had a company in Cyprus, "Comsel limited", to which businessmen paid one and a half million euros in 2007. Željko Mihailović i Dusan Ban. That money was then used as cash collateral in Piraeus Bank in London for a loan of one and a half million euros, granted to Đukanović's company "Capital Invest".
"Capital invest" used that money to buy shares in Prva banka in August 2007 at the then privileged price of 127 euros. After that, the value of these shares began to rise astronomically, so a year later Đukanović sold only a fifth of the purchased shares at a price of 610 euros and returned the loan of one and a half million euros. Đukanović later sold the remaining part of the shares at a lower price, but he made a profit of just over a million euros on this transaction.
In 2022, Ban confirmed in a statement to CIN-CG that one and a half million euros were paid from his and Mihailović's account abroad to the account of Knežević's company in Cyprus, and that with their consent it was used as collateral for Đukanović's loan. Ban then claimed that the money was legal and that Knežević did not return it to them.
Đukanović was in the Assembly in 2013, answering a question from a deputy Mladen Bojanić "about the first million", said that he got the loan thanks to his name and reputation and that there was no cash collateral of his.
When asked by TV Vijesti how the disagreement with Đukanović came about, Knežević said in 2018 that he was his loyal friend, but that the first conflict arose over the house in Gorica. Knežević then stated that the house next to the "Gorica" villa was being built for Đukanović, but that it was owned by his friend Vladan Ivanović.
"Đukanović offered me to lease the house in Gorica, when it was supposed to be built, but I refused and the house is leased to Vlad Ivanović - his friend. I'm sorry that I'm dragging the government into all this, but it's a reality and I think that the state authorities should immediately launch an investigation and see how that house was financed and who is behind that house formally," said Knežević at the time.
Đukanović subsequently denied that the house was being built for him.
Caspian
One of the indictments brought against Knežević refers to the "Kaspija" case.
According to SDT, Knežević refused to return to Atlas Bank, in which he was the majority owner, a total of 15,2 million euros, which was the cost of a guarantee with default interest for his business with the company "Kaspija Properti".
The indictment states that on May 20, 2015, Knežević deliberately persuaded Đorđe Đurđić, chief executive officer of "Atlas Bank", to sign a guarantee and certify with an official seal the guarantee for "Kaspia Properties Holdings Limited" from Dubai, for 12,5 million euros. He stated that the principal is Knežević, and that the beneficiary is "Kaspia Properti", and which guarantees that "Atlas banka" will pay this company a maximum of 12,5 million euros for the purchase of the "Princess" hotel.
The owners of "Caspija", which is registered in the United Arab Emirates, paid Knežević 12,5 million euros for the purchase of the "Princess" hotel. Since the purchase of the hotel failed, and Knežević did not return the money, Atlas Bank's guarantee was activated.
During the trial on the collection of the disputed guarantee, Atlas Bank stated several times that they did not issue the guarantee, but its draft, which is a non-binding legal act.
Party
The "Fiesta" case is also linked to Knežević. Namely, among the four companies in the USA, which in the settlement between Deutsche Telekom and the American Securities and Exchange Commission are stated to have provided fictitious services for Crnogorski Telekom as possible corruption for its privatization, was the company Fiesta Investments LTD registered on Mauritius.
It was this company that left the most traces about its operations in Montenegro and its connections with the Atlas group. In 2019, Knežević asserted that in the case of privatization of Telekom, the top of the state was corrupt, including the family of Milo Đukanović.
According to the American investigation, together with the company Activa Invest LTD, the company Fiesta received a total of 4,47 million euros "for fictitious consulting contracts" from the investor Magyar Telecom.
As previously announced, Activi was paid 2,32 million euros in cash through the former Euromarket bank, while the owner of Fiesta, who has never been reliably determined, received as much as 2,15 million euros. This company was also paid by the Government for mediating the broadcasting of the satellite signal of the state RTCG.
Hungarian Telecom and its owner Deutsche Telekom agreed to pay $2011 million to US authorities in late 95 to avoid prosecution for corruption during the privatization of telecommunications companies in Montenegro and Macedonia. The US Securities and Exchange Commission had the right to this investigation because Deutsche Telekom is listed on the New York Stock Exchange.
Milatović: If it is in the interest of the citizens, a settlement should be reached
President of the state Jakov Milatovic previously stated that the state should reach an agreement with Duško Knežević regarding arbitration in The Hague.
"Regarding this arbitration proceeding that Mr. Duško Knežević initiated against the state of Montenegro, I do not want to prejudge. You know that it is always ungrateful to comment on arbitration proceedings, and from the position of the president, I would somehow refrain from that... But, I think it is always good for two parties to make a certain agreement and come to an agreement in that way. Especially if it is in the interest of citizens. I am not an expert in arbitration procedures, but if the assessment is that it is in the interest of citizens to make a certain type of mutual agreement, such things should not be avoided. And it would be good if the state made some kind of agreement with Mr. Knežević regarding arbitration!" Milatović said for TV Adria.
Milatović, a former graduate of the Atlas Foundation, said that Knežević would be a good witness.
"If he would agree to that, he should be allowed such a status, and he should return to Montenegro, so that additionally and through his testimony, we would learn some possibly more important things for the recovery of our society," Milatović pointed out.
The position of the protector of property and legal interests of the state
Protector of property and legal interests of the state Bojana Cirovic stated in the opinion regarding the request for settlement between the Government and the consortium "Meljine Complex" that the invitation and proposal for settlement contains incorrect information and an attempt to present a legal situation that benefits the consortium.
"The representatives of the consortium state that the execution of the complete legal work was impossible due to certain omissions of the Government of Montenegro and that they continuously demanded through initiatives that the government fulfill its obligations, which resulted in the consortium not fulfilling its obligations. They propose a settlement model and offer the return of the property of the former Center of Military Medical Institutions Meljina", states, among other things, Ćirović, adding that the consortium proposes that the state compensate him for 80 million euros, which is the amount from the claim from the arbitration proceedings, and in return they would give up from arbitration.
She states that the Consortium's lawyers forgot (which they should have known) that the Consortium had all the preconditions to start the investment program, that there were no investments in the "Meljina" complex, that a security measure was adopted over the "Meljina2" property according to the proposal of SDT.
"Entering into any type of negotiations on this or a similar proposal, and with a business that is not legitimized for it, could mean potential damage to the state of Montenegro in the initiated arbitration proceedings. Coming out with favorable statements on this occasion in the media can also produce negative consequences for the state and its success in arbitration", Ćirović assessed in an opinion that "Vijesti" has access to.
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