Serbia: Nobody’s Policing the Security Guards

As many as 60,000 armed men roam the streets and cities of Serbia without any rules or government supervision. Many of them are criminals; thousands more work for crime bosses engaged in extortion, shakedowns and violence.

But all have one thing in common:

They operate in Serbia’s unregulated, powerful and sometimes dangerous private security industry.

Serbia is the only country in the region with no laws governing the private security sector.

There are no licensing requirements, no background checks and security agencies can be opened even by criminal gangs looking for a cheap, legal way to arm their members and commit crimes. An Organized Crime and Corruption Reporting Project investigation found repeated examples of drug dealers and mob bosses operating security companies. They use them for racketeering, drug and weapon smuggling, money laundering and fixing government tenders.

One of the men convicted of killing Serbia’s prime minister and linked to several other murders opened a security firm while in prison – it was closed only after the public found out. Another accused killer, known for using bombs to attack his rivals and the police, operated his agency for two years, losing it only when he too went to prison for unrelated crimes.

OCCRP’s investigation found that this sector, which could be an important part of public security, can easily become a threat to the public. And these agencies are guarding some of the most visible and vulnerable public buildings: elementary and high school, sport venues, government buildings and swimming pools.

Because security agencies aren’t licensed, the state doesn’t keep track of how many security guards are working or how many weapons are issued. The agencies get a simple business license, just as a fast food stand or dressmaking shop would do.

To determine an exact number of agencies, OCCRP examined the entire database of the Serbian Business Register Agency and found 310 companies listing their business activity as “finding missing persons and protection” (A*) which is the most common activity by which security firms are registered.

Those companies employ 18,552 full-time workers although there are probably more. When part-time workers and others are factored in, the total grows to between 40,000 and 60,000, according to an OSCE study in 2008. That means the private security agencies have manpower levels roughly equivalent to the Serbian military, or with all Serbian police agencies combined.

All of that business activity isn’t helping the state budget, however. Government financial reports show that in 2008, all 310 agencies claimed a total profit of just €6,000, or less than €20 per agency, meaning they paid virtually no taxes.

A review of ownership structures showed that some of the largest security agencies are controlled by companies with strong political ties.

Milan Milošević, a member of main board of Democratic Serbian Party (DSS), owns System FTO. Another firm, Stracon, is owned by Gradimir Nalić, an advisor to a former president of Serbia and by William Montgomery, former American ambassador to Serbia.

But political connections are only one part of the security sector’s power. The records reveal dozens of small companies headed by men with long criminal records, histories of violence or who were named in Serbia’s “White Book,” a police list of suspected organized crime figures.

That didn’t surprise Dragiša Jovanović, president of the security agencies association of Serbia. While individual gun licenses require background checks, security firms don’t have such requirements, and when they get permits they simply give them to their employees, no matter what their history.

“That is how many criminals arm their members. They understand that if they have a five or six of their guys with guns and no licenses, they can be stopped by police,” Jovanović said. “They can take their weapons, or even charge them.

“So they just form security companies and their weapons are now legal,” he said. “The problem is that there is no law.”

Physical, financial toll on victims

A look beyond the criminal records and depleted tax payments shows the real damage being inflicted on the Serbian people.

In April, Strahinja Milošević, a talented basketball player for the Belgrade-based KK Partizan, was out with friends at the Studio club in Novi Sad when he got into an altercation with private security guards working there. The 25-year-old was badly beaten, suffering two fractures of the vertebrae and minor head injuries, jeopardizing his dream of going to the Euroleague basketball final tournament in Paris.

His high-profile prompted a quick police response and arrest of the security workers. But many others are victimized with little fanfare.

Nenad Marković is under investigation (B*) for economic crimes, including falsifying documents, illegally producing goods and other crimes connected with the privatization of Vojvodina a.d., according to prosecution records obtained by OCCRP.

Vojvodina a.d., is an agricultural firm established in the 1980s to grow corn and other crops. It was privatized in 2007 and sold to Marković (C*). Marković is also owner of Sfinga Pro, the most powerful security firm in the town of Pančevo.

In November, Živorad Milošević went to Vojvodina a.d. to collect payment on four wagons of grain he delivered to the company. Instead of a payment, he was badly beaten by a Sfinga Pro security guard, he told prosecutors according to court records.

Police never followed up on the case and no one has been charged in the beating.

Private security companies and crime have overlapped since the breakup of Yugoslavia in the 1990s.

Pioneers in this business included Željko Ražnatović, known as “Arkan”, the feared paramilitary leader and criminal linked to murders around Europe. The United Nations charged him with crimes against humanity for his ethnic cleansing during the war in Bosnia and Herzegovina but he was assassinated in Belgrade before his trial.

Arkan operated his security agency Delije as a racketeering operation that extorted money and dealt violently with anyone who got in his way. Iso Lero Džamba, a violent criminal himself and owner of the agency Karmen, disappeared on Sept. 23, 1992 after he got into a fight with security workers at Arkan’s casino.

That violent tradition continues today. With no regulations, and no political push to change the laws and reign in security companies, today’s owners operate much like their predecessors.

Milan Lazarević, who is named in a criminal indictment (D*) as the head of an organized crime group in the town of Valjevo, and his Polito security firm have been engaged in just those activities, according to court records obtained by OCCRP.

Lazarević was sentenced to 10 years in prison for armed attacks on police officers and (E]({:target=”_blank”}) didn’t waste much time getting into the security business when he was released in 2002 ([F).

He partnered with a former police officer, Desimir Obradović, and hired a front man to be the public face of Polito, while he ran things in the background.

That front man was Goran Mitrović, who told OCCRP that he was an owner only on paper.

“I was just the official owner of Polito. I was not involved in making decisions and that didn’t interest me,” said Mitrović, who owns his own video surveillance operation and said he had met Lazarević just once before Polito. He said Obradović brought him into the business, and Lazarević was presented as “an advisor.”

Polito got contracts to secure public buildings, including the National Museum of Valjevo, for about €1,000 per year (G*).

City officials confirmed that Polito was engaged in securing public events in Valjevo, but said that there were not any contracts signed with them and that the company was working for free (H*).

Either way, Polito and Lazarević had other ways of making money, according to court records.

Milan Pavlović, owner of the Sky bar in Valjevo, told prosecutors that Lazarević called him in November, 2006 and asked him to come to another bar. When he arrived, Lazarević was there with seven gang members.

Pavlović said Lazarević gave a stern threat: “Dogs are hungry, and they must be fed. I was in prison for 10 years and someone has to pay for that,” according to the records. Then came the demand: Pavlović must employ his people to work security in his bar and also give him €12.000 in cash.

If not, “an avalanche will fall on your family!” One of Lazarević’s men approached the scared bar owner several times and asked Lazarević for permission to beat Pavlović.

Several other bar owners in Valjevo gave identical accounts, saying Lazarevič forced them to employ workers from his agency. Two bars which refused to pay were destroyed, according to several bar owners who asked to remain anonymous because they feared for their safety.

But the owner of Knez, Goran Jović, did speak with OCCRP about his dealings with Lazarević. Knez was destroyed by a bulldozer after Jović refused to pay extortion money, he said. No charges have been filed.

“My bar was demolished to make others afraid. They knew I have close contacts in the police, so it sent a message that if they can destroy my bar, then they can destroy everyone’s,” Jović said. “After this, everyone started to hire Polito.”

Last year police special forces arrested Lazarević on charges he ordered the murder of a criminal rival, Željko Đedović (D*). Lazarević is awaiting trial, along with eight members of his gang, and Polito has gone into liquidation.

He’s also under investigation for widespread extortion and racketeering, prosecutors said.

Polito is just one of dozens of security companies run by convicted or suspected criminals. In April, police special forces raided offices connected to Total Security System, which operates out of an apartment controlled by fugitive Darko Sarić, who is accused of trying to import 2.7 tons of cocaine from South America (I*).

According to documents obtained by OCCRP, the Serbian Ministry of Interior (MUP) issued permits in 2006 and 2007 (J*) to Total Security System and owner Marko Šarić allowing them to buy and carry eight guns.

Another firm, Pro Tech Team, uses Branislav Lukić on occasion for debt collection, according to police records.

The Serbian “White Book,” a high-profile chronicle of organized crime released in 2002, lists Branislav Lukić as a violent criminal with a talent for bombings (K*).

And then there is Lupus, whose owner, Milorad Ulemek Luković, also known as Legija, is serving a 40-year prison sentence for murdering Prime Minister Zoran Đinđić, along with other political murders, kidnapping and terror attacks. But four months after his 2004 arrest, Ulemek opened the security firm the Lupus Group with his wife (L*).

The government finally shut down Lupus (M*) – which joins Polito as the only two agencies ever liquidated – only because of loud public protests when Ulemek continued operating the firm from prison.

The list of agencies in legal trouble is staggering. The owner of Net Security is on trial in Montenegro on charges he tried to smuggle 14 tons of weapons, mostly machine guns through the Serbian-Montenegrin border. The owner of Gvozden agency is on trial for corruption and stealing from the town of Zrenjanin.

But all of the arrests and even the beating of the young basketball player haven’t been enough to bring law and order to the security sector.

Some government officials are hoping that may change.

Ivica Dačić, Minister of Internal Affairs, talked at a press conference about the need for new laws to curb abuses in the security sector. He said that he expects to soon begin a public debate on new legislation.

“We want to create the legal framework to make functional and effective the public security system,” Dačić said. “We must control who has the right to form companies and make sure we have licensed workers who work to protect people and property.”

But Dačić expects there will be stiff opposition from security agencies, some politicians and mobsters who have been happy with the status quo.

“In the design of any law, various parties have their own interests,” Dačić said. “The question in the end is whether people will still be allowed to have their own private forces and whether criminals will still have quasi-legal ways of arming themselves.”

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