Bosnia nails 16 people in biggest post-Dayton Bobar Bank scam case

Bank Gate InfoPhoto by sk8geek

Bosnia’s Prosecutor’s Office said on Tuesday it has issued indictments against sixteen people for the embezzlement of funds through now defunct lender Bobar Bank in what is considered to be one of the biggest financial scams in the country.

Sixteen people are charged with financial crimes and misconduct causing damages of approximately 122.5 million marka ($67.7 million/62.6 million euro) to citizens, businesses and legal entities in Bosnia, the Prosecutor’s Office said in a statement.

The accused are charged with having seized control over all affairs of Bobar Bank a.d. Bijeljina, acting as a group of connected persons, and hence making possible the approval of multimillion loans without adequate collateral to Bobar Group- affiliated legal entities, the Prosecutor’s Office said.

This led to collapse of the bank, whose operating license was revoked in 2014.

“Considering the fact that health institutes, electricity distributing companies, municipalities and other legal entities, as well as individual citizens have invested funds in the bank, its collapse has directly or indirectly caused damages to many citizens of both Bosnia’s entities, as well as the Brcko District,” the Prosecutor’s Office said.

The Prosecutor’s Office added that it will call to the stand some 60 witnesses.

Problems with Bobar Bank bank began to surface in 2014, following the death of its owner Gavrilo Bobar. The bank shortly went into liquidation and its operating license was revoked, leaving some 206 employees jobless and numerous clients at risk of losing their deposits.

Bobar Bank was based in Bijeljina, in the Serb Republic, which together with the Federation forms Bosnia and Herzegovina.

Among the 16 defendants indicted on Thursday, who include the suspects who were briefly held last year, are the former head of the Serb Republic Banking Agency Slavica Injac and the ex-manager of the region’s Investment and Development Bank (IRB) Snezana Vujnic, as well as senior management of the Bobar Bank.

The Serb Republic banking sector posted a loss of nearly 80 million marka in 2015, down from 28.1 million marka profit in 2014, according to the region’s banking agency’s data.