Montenegrin Paradise by Fahrudin Radončić

Political leader and media magnate from Sarajevo Fahrudin Radončić acquired real estate and shares in companies worth more than 11 million convertible marks in Montenegro in two years. That's how much four luxury apartments in the Montenegrin marina "Porto Montenegro" and a share in Crnogorski Telekom cost.

He drew money for investments in the neighboring country from the Sarajevo companies "Avaz" and "Avaz-roto press", which he transferred or sold to his wife Azra Radončić in mid-2012, after the divorce. He paid for one of the properties by borrowing a million-dollar loan from a Montenegrin bank.

Although he is not formally the owner of these two companies, the documents he collected Center for Investigative Journalism (CIN) show that Radončić retained the right to influence the important business decisions of "Avaz-roto pressa", the editorial policy of "Dnevni avaza" and the selection of personnel.

Radončić refused to speak for CIN.

The leader of the Alliance for a Better Future (SBB) started investing in Montenegro shortly after the 2014 General Elections, in which he lost the race for the Presidency of Bosnia and Herzegovina (BiH). He was particularly attracted to real estate in the marina "Porto Montenegro" in Tivat in the Bay of Kotor. This fashionable place was created on the remains of the former base of the Navy of the Yugoslav People's Army. The Montenegrin government gave this space to foreign investors for use for a period of 90 years, and they built a modern marina and seven residential buildings and one hotel, along with which about 50 restaurants, bars and boutiques were also created. Apartments built according to high-class standards were sold to a wealthy clientele. Some of them anchored their megayachts and other luxury ships that sail in the marina under the flags of Gibraltar and the Cayman Islands and other offshore zones.

High real estate prices in "Porto Montenegro" are not the only expense for their owners. After purchasing real estate, they are obliged to pay for the maintenance of buildings, swimming pools and physical security. According to data from real estate agencies in Tivat, these costs amount to 3.000 convertible marks per apartment per month.

In the neighborhood of billionaires

Radončić bought his first apartment at the end of December 2014 in the "Teuta" residence, one of the most luxurious residential buildings in "Porto Montenegro", where real estate is owned by some of the world's richest people, such as the Canadian billionaire Peter Munk or the British Simon Murray.

Radončić paid 96 million convertible marks for a 13-square-meter apartment with a 1,33-square-meter garage. At the end of February of the following year, he gave this property to his son Irhad, and a few days later, at the beginning of March, he bought a new apartment in the neighboring residential villa "Ksenija".

Along with the 153 square meter apartment, Radončić also got three parking spaces in the underground garage in "Ksenia". Real estate in "Ksenia" cost almost 2,1 million convertible marks.

In 2015, Radončić continued to passionately spend money on real estate, but also to invest in shares in Montenegro. So in September of the same year, he buys one of the largest apartments in this Mediterranean gathering place of rich people.

Again, the choice fell on "Teuta", but this time Radončić bought an apartment of 351 square meters, also with a garage space. The owner, Nathaniel Rothschild, a prominent member of the most famous banking family in the world, transferred this property to Radončić for almost 4,2 million convertible marks.

With this property, Rothschild guaranteed the loan that Radončić took out at Hipotekarna banka in Podgorica. With a loan of 4,2 million convertible marks, Radončić paid Rothschild the apartment, having the obligation to return the money to the Bank by September 2016.

However, the Bank withdrew the mortgage more than a year after the expiry of the deadline for repayment of the loan, with the explanation that Radončić had settled all due obligations. It is unclear from which sources he was repaying this loan.

Eight days before the removal of the mortgage, the same bank gave Radončić a new loan, this time for two million convertible marks, with the obligation to repay it by November 2020. A large apartment in "Teuta" and a garage were remortgaged.

In September 2015, Radončić also invested 1,95 million convertible marks in the purchase of shares of Crnogorski Telekom from Podgorica. For this money, he received 250.000 shares, which he paid from his account to "CG Broker-Dealer" from Podgorica, a brokerage house that mediated the trade.

Part of the real estate that Radončić bought in "Porto Montenegro" was already used. However, in 2016, the "Regent Pool Club Aqua", an attractive residential building in "Porto Montenegro" with a magnificent swimming pool, was under construction. The owners of these apartments claim the right to private parts of the garden, areas next to the swimming pools, spa center and other facilities that are located on over 9.500 square meters and which become their joint property with the purchase.

At the same time, he had the opportunity to make money on one of the properties that he already owned, and on December 7 of the same year, he sold an apartment of 153 square meters and one garage space in the "Ksenija" residence. The buyer, Russian citizen Andrey Enin, paid Radončić almost 2,4 million convertible marks for these two properties. The remaining two garage spaces in "Ksenia" remained in Radončić's ownership.

After selling the apartment in "Ksenia", on December 26, 2016, Radončić bought for one euro the company "PM 1.25", which until then was owned by the company "Adriatic Marinas", which manages the port of "Porto Montenegro". On the same day, "PM 1.25" concludes a contract for the purchase of an apartment of almost 140 square meters in "Regent Pool Club Aqua", as well as a garage space. The purchase contract determined the price of the property at two million and 83 thousand convertible marks. The buyer immediately paid 1,56 million convertible marks. The building was opened in July this year.

After the purchase, Radončić changed the statute of the company, registering it for the purchase, sale and rental of real estate, as well as gambling and betting. On February 28, 2017, he transferred the ownership of the company to his son Irhad.

According to the financial report, last year the company had no income. Her reported assets amounted to 1,56 million convertible marks in real estate and about 200 thousand convertible marks in money. She had one employee.

Amicable divorce

Two and a half years before investing in Montenegro, Radončić formally left his media empire to his wife Azra, from whom he divorced by mutual consent on May 22, 2012, after almost two decades of marriage.

Shortly after the divorce, Azra Radončić filed a lawsuit for the division of marital property, and after an agreement between the spouses, the Municipal Court in Sarajevo on June 19 made a decision and awarded her the company "Avaz" doo and 372.266 shares of the graphic publishing house "OKO" doo. and a two-story apartment of 166 square meters, bought before the divorce, in the Importanne center. In the divorce case, Fahrudin Radončić won the company "Avaz-roto press", which includes several media publications, including the newspaper "Dnevni avaz". Fahrudin Radončić also received two houses and large land holdings in Vogošća near Sarajevo.

However, only 15 days after the division of property, Radončić sold "Avaz-roto press" to his wife for 200 million convertible marks, i.e. to her company "Avaz" doo. "Avaza" doo

According to the contract on the transfer of shares in "Avaz-roto press", which was signed on July 6, 2012, "Avaz" doo was supposed to pay Radončić half a million marks on the same day, and the same amount by October 1 of the same year. He did not receive the second tranche of half a million marks within the agreed period.

He was supposed to collect the remaining 199 million convertible marks by the end of 2015, in three annual installments of 67 and 66 million convertible marks each. However, according to the available data, by the end of the deadline, he managed to collect only 8,5 million, which is less than five percent of the contracted amount.

The contract for the sale of the company "Avaz-roto press" was difficult to implement because the two companies owned by Azra Radončić from 2012 to 2015 did not generate enough profit from which they could pay the contracted 200 million convertible marks.

Namely, in this period "Avaz-roto press" and "Avaz" had a total of 71 million convertible marks available for payment to Radončić, with the exception that the companies had no other investments. The third company - Graphic publishing house "OKO" - mostly operated at a loss.

The purchase agreement allowed Fahrudin Radončić to formally withdraw from "Avaz-roto press", while continuing to enjoy almost all the rights he had as an owner.

"Avaz" d.o.o. committed in the transfer agreement of "Avaz-roto pressa" that until the final payment of the agreed amount, it will not: transfer or alienate shares in the company, make changes in the management or initiate investments and borrow the company without the written consent of Radončić.

By severing relations with his companies, Radončić avoided being in a conflict of interest because in November 2012 he was appointed Minister of Security of Bosnia and Herzegovina. After he was dismissed, in 2014 he became a delegate of the House of Peoples of the BiH Parliament. He still holds this position today.

However, Radončić did not only retain the right to control the economic affairs of his company. Four months after concluding the sales contract, he and "Avaz" sign an annex justifying his participation in editing the newspaper and selecting staff. Aneksom undertook that within five years after the transfer of shares, it will provide consulting services free of charge to "Avaz-roto pressa" in the areas of: content and appearance of newspaper editions, market preservation, personnel organization and company operations.

In 2014, in an interview with CIN, Radončić said that he no longer owns any company: "What will I do?! I have 200 million".

A salary of 2.000 KM for the owner of Avaz

Although "Avaz" did not pay the contracted price according to the planned dynamics, Radončić did not terminate the contract, but signed a new annex to the contract with his former company on March 9, 2015, which moves the payment deadline by ten years.

This time, the dynamics of the further payment were not defined, but "Avaz" was left with the right to pay according to its capabilities.

Given that after the divorce she became the owner of two companies with annual profits of several million marks each, Azra Radončić, according to the available data, did not have a large income. Her ex-husband paid her alimony of 4.000 convertible marks per month, while in "Avaz" she received a salary ranging from 1.500 to 2.000 convertible marks. Azra Radončić did not respond to CIN's calls for an interview.

According to available data, during these three years, Azra Radončić did not pay herself a dividend, unlike Fahrudin Radončić, who from January 2013 to November 2014 collected slightly more than one million convertible marks in dividends from "Avaz-roto press". Namely, on the same day when they concluded the contract on the transfer of shares in "Avaz-roto pressa", "Avaz" and Radončić signed an amendment to the contract, which states that Radončić is also entitled to 50 percent of the dividend, that is, the profit from 2012.

Other data also show that the payments of "Avaz" and "Avaz-roto pressa" after mid-2012 were in accordance with Fahrudin Radončić's needs. Although he was supposed to collect 2013 million convertible marks by the end of 68, his account contained only 550.000 convertible marks based on the share transfer.

Things change significantly when Radončić decides to buy the first apartment in "Teuta". In just eight days, in the period from December 18 to 29, 2014, "Avaz" paid him 1,52 million convertible marks, almost three times more than in the past 15 months. Radončić used most of this money to pay for the first apartment in "Teuta". The next big payment from "Avaz" came before the purchase of an apartment in "Ksenia".

During 2015, Radončić's investments in property in Montenegro increased, and all this was monitored by "Avaz", paying money based on the contract on the transfer of shares. At the time of the purchase of the apartment in "Ksenia", "Avaz" paid him about two million marks in less than two weeks, and then another amount on August 31 and September 1, when he bought the shares of Crnogorski Telekom.

"Avaz's" payments to Radončić were always timed, regardless of whether they were investments in real estate or some other expenses of the former owner of this company. Whenever the amount on his account dropped to a few thousand convertible marks, "Avaz" payments of several hundred thousand convertible marks to over a million convertible marks arrived.

He invested most of the money in property in Montenegro. With the money of "Avaza", he also covered various current expenses, such as high fees for lawyers and courts, giving donations for the treatment of various people or providing scholarships to students.

After the divorce with his wife, he withdrew about three million convertible marks in cash from bank accounts. He withdrew the money himself or it was done by an employee of "Avaza" whom he authorized to do so.