Wartime Donations to Croatia Come Under Scrutiny

When war raged during Croatia’s secession from Yugoslavia a decade ago, Croats begged their brethren abroad to help. Andjelko Vlajic didn’t hesitate: He donated a large chunk of his savings to defend his homeland.

Eleven years later, he can’t help but wonder: Where did the money go?

“If it indeed was used for defense, I’m more than happy I have helped,” said Vlajic, a 59-year-old construction worker who lives in Germany. “But if it ended up in someone’s pocket, I’m really angry.”

Questions about the millions, or even billions, of dollars in wartime donations by Croat expatriates began emerging in June, when the state prosecutor blocked a bank account linked to the former governing party led by the late Franjo Tudjman, Croatia’s president for nine years.

The move was triggered by a newspaper’s interview with a former close aide to Tudjman, Hrvoje Sarinic. In it, Sarinic said that at Tudjman’s request, nearly $1.5 million worth of German marks was transferred four years ago from a secret account in Austria to the Croatian account of the Trust of the State Plight, which is an arm of Tudjman’s party, the Croatian Democratic Union.

The accounts in Austria and elsewhere were opened in 1990-91, when Croatian Serbs took up arms to try to keep the country part of Yugoslavia. The Austria account was labeled “For Croatian Defense and Economic Recovery,” and expatriate money poured in.

Jelena Lovric, a political analyst for the newspaper Novi List, said the fact that at least some of the contributions ended up in the party’s coffers showed that Tudjman “took upon himself a right to use donations at will.”

The chief prosecutor, Mladen Bajic, contends that the money belongs to the state, not the party, and should be handed over. He has launched an investigation and, until it is over, the trust cannot use the account.

Ivic Pasalic, another close Tudjman aide who headed the trust for years, insists that the money merely sat in the account and is still there. The trust spent only the interest, he said.

Now many expatriates are asking how much of the money they gave ended up in the hands of other parties or in private accounts.

When the war began, the Croatian army was made up largely of unarmed volunteers. A 1991 U.N. weapons embargo hit both the Croats and the Serbs, but the Serbs had the powerful Yugoslav army on their side.

The government needed money to illegally buy weapons, so it turned to expatriates, estimated to number 2 million -- a population half as large as Croatia’s own.

Cash poured in. Some went straight to bank accounts; other money was collected in briefcases, plastic bags and hats at expatriate dinners. Few Croats abroad sought receipts or asked for detailed explanations.

Although it is believed that the vast majority of the money did, in fact, go for arms and other legitimate needs of the war-torn country, many people suspect that at least some was siphoned off.

Marinka Orlic, head of the government’s anti-corruption office, which is involved in the investigation, said there are “suspicions that some of the money paid as donations was transferred to private bank accounts and that some individuals used it to buy themselves companies.”

Tudjman’s party has replaced Pasalic as head of the trust and has revoked his membership.

Pasalic contends that the investigation is a politically motivated attack by the current government, which defeated Tudjman’s party in elections two years ago. The government has been criticized for failing to prosecute the corruption that flourished during Tudjman’s rule.

Anka Cenic, a 44-year-old worker unemployed since her Croatian factory went out of business five years ago, said she hopes that the investigation will mean “someone will end up behind bars this time.”

“For more than 10 years, we were watching some people getting extremely rich, while most of us were steadily getting poorer,” she said. “We all know it was a dirty business -- it’s just up to the judiciary to confirm it.”