The anti-corruption agency USKOK has launched an investigation into former regional development minister Petar Cobankovic and former Croatian Democratic Union MP Stjepan Fiolic, and most likely into former prime minister Ivo Sanader, and an expert witness for wrongdoing in the sale of an office building in Zagreb, whereby the state was defrauded of HRK 26.4 million.
At USKOK's proposal, the Zagreb County Court placed Fiolic in one month's custody to prevent witness tampering, said his attorney, Ante Madunic.
The four men are suspected of abuse of office and inciting the abuse. One company is also under suspicion.
There is no official confirmation that Sanader is one of the suspects.
According to unofficial reports, USKOK has already interrogated Cobankovic and he accused Sanader in this case. Sanader has already been indicted in several corruption cases.
Sanader's attorney Jadranka Slokovic told the media her client had not been interrogated about this case and that she did not know if he was under investigation.
USKOK suspects that Sanader and Fiolic agreed that the government would approve the purchase of a building owned by two companies at a price much higher than its market value, so that one of the companies could make considerable gain.
They then asked Cobankovic to have his ministry make preparations so that the government could buy the building for the ministry at a price much higher than its market value.
Fiolic asked an expert witness for construction to state in the appraisal that the property was much more valuable than it actually was, which the expert agreed to.
Based on the appraisal and at Sanader's instructions, Cobankovic had expert services draw up a government proposal for the purchase of the property through financial leasing and the conclusion of an EUR 8 million contract with the company in question.
USKOK contends that Cobankovic knew that the amount that would be paid for the property was significantly higher than its value, and that he informed Sanader, who said at an inner cabinet meeting that signing such a contract was good for the regional development ministry.
Based on Sanader's elaboration of the contract and the appraisal, the government approved the signing of the contract at a closed-door session in April 2009, whereby the suspected company made at least HRK 26.4 million at the state's expense.
According to the media, Fiolic first sold the building to Hypo Leasing Croatia, after which, in April 2009, Cobankovic's ministry took a 10-year lease on it at double the sale price.
