Former Montenegrin Prime Minister Denies Corruption Accusations

Published: 09 March 2012


Former Montenegrin president and prime minister Milo Djukanovic rejected charges of corruption in the 2005 privatization of the Montenegro Telekom (TCG) in an interview with Pobjeda news Thursday night. He also said that a lawyer accused by the U.S. of accepting payments for phantom consulting services in the Telekom case is probably his sister.

When asked whether the “sister of a senior Montenegrin government official” mentioned in U.S. Securities and Exchange Commission’s (SEC) complaint versus the executives in the TCG case is his sister, lawyer Ana Kolarevic, Djukanovic said that he believes so. He said that he doesn’t know of any other high ranking Montenegrin government official whose sister is a lawyer. At the time of the privatization, Djukanovic was serving his fourth term as the prime minister of Montenegro.

Kolarevic represented Slovenian Telekom in the bid for the Montenegrin telecommunication provider in 2005. Magyar Telekom offered US$150 million, while the Slovenians came in second place with an offer of US$123 million. After its privatization, TCG hired Kolarevic’s law firm for “consulting services.”

Djukanovic further explained that the SEC’s complaint mentions a contract to which his sister’s law firm was a party. The contract was supposedly made for consulting services related to the integration of TCG into Magyar Telekom’s corporate structure, SEC states in their complaint. Some US$767,000 was paid under the contract.

According to SEC, “This contract actually was intended to conceal payments made to the sister of a senior Montenegrin government official…[who] did not actually render any bona fide services to Magyar Telekom or TCG under the contract.” The SEC states that the Magyar Telekom “falsely recorded the payments under this contract as a consulting expense on its accounting books and records.”

Djukanovic told the Montenegrin daily that the bribery charges regarding this contract are nonsense because, by definition, you cannot bribe a lawyer. A lawyer “offers services that you can either choose to pay for, or you can find a cheaper lawyer.” After privatization, the TCG hired Ana Kolarevic’s law firm to help out with the “rationalization of the workforce, ” or making it more efficient, said Djukanovic. He added that Kolarevic’s firm was paid around US$264,000 for their services.

Djukanovic stressed that the Montenegro Telekom was never a defendant in the case brought by the US Securities and Exchange Commission (SEC) against Magyar Telecom, its parent company Deutsche Telekom, and three high-ranking executives from Magyar Telekom.

He also added that there was no trial against Magyar Telekom and Deutsche Telekom, and that agreeing to pay a settlement does not constitute an admission of guilt.

Djukanovic said that cases like this are not uncommon, listing as an example the US$800 million settlement by Siemens in 2008, in response to worldwide bribery charges brought against them by the SEC.

This story has been corrected. The interview was given to Montenegro national TV, RTCG.
OCCRP regrets the mistake."