(Podgorica, 28 May 2012) – MANS again today submitted new charges to the State Prosecutor for Organized Crime. The charges relate to the violations of the re-capitalization agreement for the Electric Power Company of Montenegro (EPCG) and the holding of moneys in that process with the First Bank. Individuals charged include the former and current Prime Ministers Milo Đukanović and Igor Lukšić, as well as vice-president Vujica Lazović.
The charges were filed against the eight-member strong management team of the EPCG, including executive director Enrik Malerbe and board members Nikola Martinović, Miodrag Čanović, Boris Bušković, Mauro Miglio, Renato Ravaneli and Emilio Ria.
They are suspected of committing an organized abuse of power by using their positions to ensure that tens of millions of euros from the recapitalization of the EPCG be held at the First Bank, instead of investing this money in upgrades.
Due to the lack of investments, the energy network’s infrastructure is decaying, leading to enormous losses on the grid. The costs are born by citizens through higher electricity prices. Thus consumers are directly affected, while only the First Bank benefits from the situation through this vital liquidity injection that has allowed it to turn around the millions of euros deposited to realize further profits.
The Government stated that their main aim in recapitalizing the EPCG was to secure the entry of a strategic partner that could reinvest their own money in the modernization of existing and building of new energy potential. Investments were intended to reduce losses on the power grid and increase the reliability of the electricity supply.
In September 2009, following a problematic tender, the Government refused the offer of the Greek consortium – which was offering €11.10 per share – accepting instead the offer of Italy’s A2A (which was only offering €8.40 per share). In the end the total cost of the recapitalization offer proposed by A2A was €96-million. Instead of investing this money, the bulk of it ended up in the First Bank. A2A held €81-million of this amount in the First Bank throughout 2009 at an interest rate of 5.6%.
The following year, A2A still held €45-million in deposits at an interest rate of 6%, while €42-million was transfered to deposits with three month maturities with an interest rate of 2%, resulting in direct financial losses for the EPCG.
According to the most recent statements by the president of the EPCG Board of Directors, Srđan Kovačević, finishing last year with losses of €66-million, the company still holds a comparable sum with the Đukanović family’s First Bank.
At the top of the pyramid of those being accused is the former Prime Minister Milo Đukanović whose brother Aco is the majority owner of the First Bank (Đukanović himself is one of the firm’s shareholders through Capital Invest, which he founded).
Đukanović has a direct interest to keep the money from the recapitalization of the EPCG with the First Bank, which throughout 2010 was placed under oversight by the Central Bank of Montenegro (CBCG) and was using money from a government backed bailout. Thanks to these injections, the liquidity of the First Bank was maintained.
Through his position in the government, Đukanović used his influence on the other accused in order to keep the money in the First Bank. Later, after withdrawing from the post of Prime Minister, he continued to use his influence as the president of the ruling Democratic Party of Socialists (DPS).
The actual prime minister Igor Lukšić, with his replacement Lazović, only continued the praxis of his predecessor and didn’t undertake anything to ensure that this money be invested and through this secure the public interest. The only beneficiary continues to be the Đukanović brothers’ bank.
We call on the Special State Prosecutor for Organized Crime, Đurđina Ivanović, to immediately undertake an investigation into the criminal charges filed by MANS.
