Former executives of the Croatian power supply company HEP and the Sibenik-based light metal factory TLM, Ivan Mravak and Ivan Kostan, were remanded in investigative custody for a month on Saturday on the suspicion that by abusing their powers they defrauded HEP of some HRK 600 million.
HEP was defrauded of most of the money in question because it sold electricity to TLM at prices that were several times lower than the price at which HEP bought electricity on foreign markets.
Zagreb County Court investigating judge Jadranka Mandusic ruled that Mravak and Kostan should be detained in custody because of the danger of witness tampering, Mravak's attorney Ante Madunic confirmed to Hina.
He added that Mravak was detained in custody also because there were fears that he could repeat the same offence since he still worked at HEP as an advisor.
Along with Mravak and Kostan, also suspected of wrongdoing in this case is former Deputy Prime Minister and Economy Minister Damir Polancec. USKOK suspects him of abusing his powers and causing harm to HEP and of conspiracy.
Retired general Ivan Kapular and former HEP Management Board member Zdenko Jurcic are suspected of inciting abuse of powers in this case, but they have not been taken in for questioning yet and will defend themselves without being detained.
Kapular, who worked at HEP as a part-time security advisor, allegedly received from HEP 40,000 kuna for holiday expenses. As for Jurcic, it is believed that Mravak paid him more than 260,000 kuna for fictitious contracts.
Since the investigation into this case is secret, there was no official information from the court today on the exact amount of funds HEP was defrauded of, but sources close to the investigation said HEP had been defrauded of around HRK 600 million.
Most of the funds in question were defrauded because HEP sold electricity bought on foreign markets to TLM at prices three times below its purchase price. TLM later gave the electricity to the aluminum factory Aluminij from Mostar, in neighbouring Bosnia-Herzegovina.
Kostan was arrested on Friday in Sibenik, while Mravak was arrested in Zagreb after his apartment was searched. He was taken for police questioning early in the afternoon and was later transferred to a detention unit where he spent the night after being questioned by USKOK investigators.
The two men will be in custody at Zagreb's Remetinec prison, where Polancec, arrested earlier on suspicion of involvement in wrongdoing in the Podravka food company, has been in custody.
Polancec has still not been questioned by USKOK investigators and they are expected to talk with him on Monday.
Commenting on the case earlier on Saturday, the leader of the HUS trade union federation, Ozren Matijasevic, said that the arrest of Mravak and Kostan was a case of political score-settling rather than the fight against crime.
Matijasevic said that the government must have known about the disputable deal between HEP and TLM.
"As the union representative on the Croatian Privatisation Fund (HFP) Supervisory Board, I took part in the adoption of a decision to accept a consortium's offer to buy TLM. Since the amount in question exceeded HRK 100 million, the Supervisory Board recommended that the final decision be made by the government," Matijasevic said, adding that apart from him, four government ministers sat on the HFP Supervisory Board.
The consortium in question - consisting of the Croatian companies Konstruktor Inzenjering, Zagrebmontaza, Dalekovod and Aluflexpack and the Feal company from Siroki Brijeg in Bosnia-Herzegovina - is the majority owner of TLM.
