Former Prime Minister Sentenced to Prison for War Profiteering

Total Croatia News

ZAGREB, October 22, 2018 – Former prime minister and former HDZ president Ivo Sanader was found guilty of war profiteering on Monday in a Hypo case retrial and sentenced to two and a half years pending appeal. Zagreb County Court judge Jasna Galešić said Sanader must return 3.6 million kuna into the state budget.

In the Hypo case, Sanader was accused of taking a commission in that amount when he was a deputy foreign minister after Austria’s Hypo bank gave Croatia a loan to buy diplomatic office buildings. At the time, Croatia was in immediate war danger, so Sanader was also accused of war profiteering.

At the end of the trial, Sanader said he was not a war profiteer. The prosecution said the opposite, claiming in closing arguments that war profiteering had been proved and that he had been downplaying his role the whole time.

Sanader was already sentenced in this case, when he was also sentenced for taking a bribe from MOL director Zsolt Hernadi in exchange of management rights in INA. However, the Constitutional Court quashed the ruling in the Hypo case and requested a retrial.

The quashed sentence was the first sentence for war profiteering delivered after the Constitutional Court ruled that there was no statute of limitations on that crime. Quashing it, the Court said the Zagreb County Court and the Supreme Court did not establish if the statute of limitations applied when Sanader was accused and that they failed to enforce a milder law.

Explaining the court’s conviction war profiteering, Judge Galešić overturned the claims by the defence that a statute of limitations had occurred and confirmed that as deputy foreign minister, Sanader was responsible for negotiations with the Hypo Bank and that he had exploited the circumstances of war in the country for his own personal gain.

In that way he “unscrupulously assisted in the destruction of the democratic system, the deterioration of the economy and of the country’s reputation,” Judge Galešić said.

The time Sanader has already spent in prison since the charges were filed both in Croatia and Austria will be counted against his sentence. Therefore, once the conviction becomes final, he won’t need to go behind bars. He does, however, have to pay back the amount of money he illegally gained to the state budget and that is 3.6 million kuna.

According to the trial chamber, at the end of 1994 and early 1995, Sanader exploited his position to negotiate with the Hypo Bank, promising the bank a preferential treatment on the Croatian market, which is obvious in later loan arrangements by several Croatian companies with that bank.

Even though he was authorised to conduct the negotiations with the bank he was not authorised to take a commission which was agreed to tete a tete with the bank’s then director, Guenter Striedinger.

The fact that he exploited the circumstances of war is obvious from the fact that the offence was committed when the major part of the budget was allocated to the country’s defence. During the war, the country’s credit rating was so low, which is why it was difficult for the country to find a bank that would provide favourable loans, the court concluded.

At the same time, Croatia had to expand its diplomatic network, in order to spread the truth about the war, among other things, and taking a commission in those circumstances by the deputy foreign minister whose role it was to represent Croatia’s interests “is nothing but war profiteering,” Judge Galešić concluded.

She explained that had there not been an impending danger of war, Sanader would not have been in a position to take that commission. For Sanader to earn that much money as he received in the commission, he would have to have worked for 64 years or earn two thousand average pays, the judge said.

The judge said that mitigating circumstances existed due to the period of time that has elapsed, the fact that Sanader had no previous final convictions against him, and his participation in the Homeland War. On the other hand, she considered the fact that he was a senior official whose duty it was to protect law and order and promote the country abroad and not act greedily, to be aggravating circumstances in this case.

Public interest, however, cannot be satisfied merely by a sentence which Sanader has already served (during the pretrial detention), but it is also important that he repays the illegally gained money, the judge concluded.


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