November 3, 2011 / 10:05 AM / 8 years ago

Former Croatian PM rejects corruption charges

ZAGREB (Reuters) - Former Croatian Prime Minister Ivo Sanader dismissed “with indignation” charges that he took a bribe from Austria’s Hypo Bank in 1995, at the start of his corruption and war profiteering trial in Zagreb on Thursday.

Former Croatian Prime Minister Ivo Sanader sits in the main courtroom at the Zagreb county court, October 28, 2011, to enter a plea in the first corruption trial against him. REUTERS/Nikola Solic

“I reject with indignation and disdain the accusations of war profiteering. I never asked for or received a bribe for the loan our foreign ministry took from the Austrian bank,” Sanader told the Zagreb county court.

Sanader, dressed in a dark suit and looking fully composed, said he was only an agent for the ministry in talks with Hypo Bank.

To underscore his claims, Sanader told the court Austrian prosecutors investigating malpractice at Hypo Bank had called him as a witness and not as a suspect.

Prosecutors accuse him of taking a bribe of 3.6 million kuna (416,700 pounds) in 1995 to facilitate a loan worth 140 million Austrian shillings (around 8 million pounds) by Austrian bank Hypo Alpe Adria to Croatia. In return, Hypo was to get a privileged status in Croatia.

At the time Sanader was deputy foreign minister, Croatia was fighting a war for independence from federal Yugoslavia and no foreign banks operated in its market.

The process against the man who led the former Yugoslav republic from 2004 to 2009 is part of an anti-corruption campaign which his hand-picked successor Jadranka Kosor has launched to help meet criteria to join the European Union in 2013.

The trial started last week but was immediately adjourned because of Sanader’s health problems.

Sanader is the most senior state official to answer corruption charges since Croatia gained independence from Yugoslavia in 1991. He has been held in a Zagreb prison since Austria extradited him in early July.

Sanader has also been indicted for allegedly taking bribes worth 10 million euros (8.4 million pounds) from Hungarian energy group MOL in exchange for allowing MOL a dominant position in Croatia’s oil and gas group INA. The court’s decision on that indictment is still pending.

There are four more current investigations against Sanader, the biggest related to his alleged creation and use of slush funds for his former party HDZ. He has denied any wrongdoing.

State prosecutors have also started investigating the entire HDZ party.

Croatia’s anti-graft drive remains under scrutiny from Brussels although the Kosor government completed accession talks in June.

Reporting by Zoran Radosavljevic; editing by Andrew Roche

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