The German Development Bank (KfW), the main creditor of tens of millions worth of water and sewerage infrastructure improvement projects on the Montenegrin coast, has closed the investigation into alleged corrupt behavior in the implementation of these projects in Montenegro.
He confirmed this to "Vijesti" yesterday Dragan Roganović, director of "Vodacom", the Montenegrin state company through which these projects have been implemented for years.
Roganović pointed out that during this procedure, which KfW initiated at the end of September, about which "Vijesti" previously wrote, "did not establish a single piece of evidence that would support the allegations against" Vodacom."
He also submitted to the editorial office the official letter about the closure of the investigation that he sent to "Vodacom". Arnd Klein, head of KfW's compliance unit, ie Deniz Volter, a senior official at KfW in charge of regulatory compliance.
"KfW bank has closed the investigation regarding corrupt behavior on projects implemented by 'Vodacom' in the municipalities of Ulcinj and Tivat. During the investigation process, KfW Bank did not find any evidence to support the allegations against Vodacom. Therefore, we are informing you of the closure of the investigation and the resulting closure of the suspicious case for consideration of which the Compliance Department is responsible. We thank you and your staff for your cooperation during the investigation process and remain at your disposal for any additional questions. We also ask that you contact us if any new indications of fraudulent or corrupt practices arise in connection with the closed investigation," the memo states.
Roganović pointed out that this outcome of the investigation is very important for the business reputation of Vodacom, but also for the entire country "considering that it is a respectable foreign partner that finances significant projects in Montenegro."
"Vijesti" previously reported that on September 20, KfW informed "Vodacom" that the bank "received information about allegations of corrupt behavior on projects implemented by Vodacom in the municipalities of Ulcinj and Tivat, for which it expresses its great concern."
"We have received indications that there are irregularities and criminal acts, such as influencing tenders and accepting financial resources in order to represent the interests of certain construction companies in the procurement process in connection with the aforementioned project," the letter reads. Karina Benig from the Compliance Department of KfW then sent it to Roganović and the Ministry of Finance.
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The German bankers told them that "KfW takes allegations of illegal and improper behavior very seriously and implements a zero-tolerance policy regarding sanctioned practices, directly or indirectly related to partners, financed projects or agents involved in KfW bank projects" and requested that Vodacom and the ministry have until October 4 to respond to these allegations of possible corruption.
They demanded that these allegations be "thoroughly and comprehensively followed up and investigated", pointing out that KfW implements a "zero tolerance" policy, which is also reflected in the compliance agreements that the bank has signed with "Vodacom", which gave the Germans the opportunity to this Montenegrin send a request to the state-owned company for a statement on information that "Vodacom" is allegedly carrying out corrupt practices in favor of certain contractors on behalf of the state, the German creditor and coastal municipalities, carried out by that company.
KfW Bank, however, did not want to officially announce to "Vijesta" more details about the information that the German bank received about the alleged corrupt actions of the Montenegrin state company through which those projects are implemented, nor to explain from whom and how they received such accusations. Vodacom".
That company told us at the beginning of October that Vodacom itself implements a policy of zero tolerance for corrupt practices and stated that it would request more specific information from the Germans that KfW allegedly received about it and that, accordingly, if there is a basis, it would take all legal measures against those responsible.
"Vodacom" was founded in 2005 by the Government of Montenegro and the municipalities of Bar, Kotor, Tivat, Budva and Herceg Novi as an agency for the implementation of the nationally significant project "Improving water supply and wastewater disposal on the Montenegrin coast." This project has a total value of several tens of millions of euros and has been implemented in phases for years by building new or modernizing the existing water and sewage infrastructure in those municipalities. The project is financed by loans from KfW, and all tenders and processes for the selection of contractors, supervision and consultants go through Vodacom, while the municipalities, which are the end users, finance these works by repaying long-term loans to a German bank.
"Vodacom" is currently implementing the so-called Phase V of works on the sewerage and water supply infrastructure in Ulcinj with a total value of about 20 million euros, as well as Phase V-component 2 of works on that infrastructure in the municipalities of Tivat and Kotor, of which only the works in Tivat are worth more than 28 million euros. The selected contractor for all these projects is the company "MPP Jedinstvo" from Užice.
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