Investigation 21 Nov 12

Lavish Party Donations Raise Hackles in Serbia

Curious pattern of donations to the Democratic Party – many from poorly paid civil servants - raises fresh questions about party financing.

Aleksandar Djordjevic

Questions about party financing are being raised in Serbia after a surprisingly large number of individuals gave the country’s former ruling party almost exactly the same amount of money on the same day.

Ninety individuals donated more than €5,000 to the Democratic Party, DS, this year. The party still runs the city of Belgrade.

The party’s financial report shows that on October 17, seven people donated about €5,000, two paid exactly €5,370, and three others donated €5,373.

Bait for parties

Djordje Vukovic, from CeSID, says the upper limit on donations was raised to 20 average monthly salaries so that political parties would feel more motivated to report all donations.

“This was ‘bait’ for the parties to put their money into legal channels,” he said.

“If the limit was five average salaries the parties would not report all their donations,” Vukovic added.

So far the Democrats are the only ones to have swallowed the so-called bait. Their report for 2012 listed over a thousand donations, while the Serbian Progressive Party listed only one.

After the Democrats, United Regions of Serbia, URS, has the highest number of listed individual donations, almost 900, but the total value of these payments was only €191,000.

The average donation to URS is €215 while for the Democrats it is €1,570.

The website of the Socialist Party of Serbia, SPS, contains a list of 23 names who donated a total of €53,867 over the year.

Over the past nine months 43 donors gave the Liberal Democratic Party, LDP, a total of €200,000.

Seven days later, another seven people from Belgrade donated sums from €5,050 to €5,720.

This pattern was repeated throughout the year. On July 20, 11 donors gave between €4,870 to €5,220, for example.

BIRN contacted 15 donors, all modestly paid employees of Belgrade public companies and agencies under the control of the Democrats. Eight responded to BIRN’s questions about the donations while seven refused contact.

All had donated about €5,000, a large sum for poorly paid Serbs on monthly average earnings of €350.

While the pattern of payments raises suspicions that the party is channelling funds from unverified sources into its accounts via city hall employees and low-ranking party officials, the donors interviewed by BIRN denied being used in this way. 

What actually happened will be hard to find out, however, because no state body is obliged to investigate the origin of this money.

Since last year, when Serbia adopted a Law on Financing Political Activities, all parties in Serbia are obliged to release regular reports on receipts of donations.

By law an individual may donate to all political parties in one year a maximum of 20 average monthly salaries, that is, €6,760.

The Democrats’ financial report shows that throughout this year the party obtained financial support from some 30 businessmen and over a thousand individuals worth a total of €1.6 million.

This contrasted with other parties that had just a few individuals providing donations.

Of 89 donors in Serbia who gave the Democrats €4,400 to €6,760 from January till November, all but two were from Belgrade.  

High-ranking party officials, with the exception of Bozidar Đelic who donated €5,000, donated less than junior public servants, BIRN found out.

Dragan Sutanovac, former minister of defence and DS outgoing vice-president gifted the party €320, Oliver Dulic gave €450 and Bojan Pajtic €390.  

At the same time, Marko Bastac, a 28-year-old Democrat municipal councillor in Belgrade, donated about €5,000.

He declared to the Anti-Corruption Agency that his monthly income was €756 with a 1993 Subaru as his only asset.

“It is meaningless to ask anyone about private matters. That [donation] was my personal decision,” he said.

“No one advised me how much to give, it was my decision,” Bastac said in a telephone statement to BIRN.

Marko Nikolic, a Democrat councillor in Vracar municipality, who told BIRN that he had recently graduated, gave €5,370.

“I wanted to do something for Serbia’s well-being in any possible way that I can,” Nikolic said.

Asked to comment on the origin of his gift, he said: “No one gave me money for the donation, this was my money.”

The head of the city’s day care agency for developmentally challenged children, Mirjana Bilbija, who donated €4,900, also said the donation was her private affair.

“It’s my personal business. I can give money to whoever I want and as much as I want and that’s none of your business,” she said.

“I love the Democratic Party and I would give everything for them,” Bilbija added.

Daniel Hadnadjev, programmer at the city-run Water Supply and Sewerage company, who donated €5,100, gave a similar response. 

“I’ve been a party member for ten years… they needed help and I helped,” Hadnadjev said.

The donation was his alone and no one had used him, or instructed him when or how much money to donate, he added.

Milan Cerovac, a business secretary with Belgrade City Council, until a few months ago a coordinator for the Stari Grad Youth Office, who donated €5,100, also said the gift “was my private decision to help the party”.

These statements are unlikely to be legally challenged. The Anti-Corruption Agency, the government body tasked with implementing the Law on Financing Political Activities, explains that donors working in public companies and institutions are free to give to parties.

The law does not oblige the Agency to check the origin of the money that individuals or legal entities donate to political entities, a written response to BIRN said.

Djordje Vukovic, an author of the Law on Financing Political Activities, from the Centre for Free Elections and Democracy, CeSID, an NGO, said if there are any indications of irregularities concerning donations to political parties, the Anti-Corruption Agency could order the Tax Administration to investigate.

Experts doubted this step would be taken as the Agency has never before checked the validity of parties’ financial reports or the origin of donations.

Some experts say that the body, whose members the government selects, is politically dependant and reluctant to act.

Transparency International Programme Director Nemanja Nenadic says all circumstances need to be investigated if there are signs that persons other than the listed donors are giving money to parties.

“Elements arousing suspicion are payments made on the same day and in similar amounts. This should certainly be subject to an investigation,” he said.

Democratic Party representatives say it is not their duty to know who is helping them, or investigate the origin of the donations.

“Whoever gives money is welcome. The one thing important to us is that the amount is within the allowed limits and that no one asks us for favours in return for the money,” the party secretary, Tamara Trpic, said.

The party says that it only runs checks on private companies wanting to support them.

“The Democratic Party is not an investigative body. We have 197,000 members; do you think it’s possible to check them all?” Trpic asked.

“The public has been informed and everything is in line with the law. Unlike the other parties, at least we release information on all our donations,” she concluded.

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