World

The Case Of The Missing Money Bags

By CBSNews.com staff CBSNews.com staff

December 8, 2000 / 12:33 PM EST / CBS

Yugoslavia's central bank chief is accusing former President Slobodan Milosevic's regime of stealing more than $4 billion, some of it spirited out of the country in bags of cash marked "citizens' savings."

"We will launch a major money hunt right away," said Mladjan Dinkic, Yugoslav National Bank governor, in an interview published Friday in Belgrade's leading daily, Politika.

The amount is nearly four times the previous estimates of what the new government believes to have been stolen. Dinkic did not describe how he compiled the new estimate.

The new pro-democracy government of President Vojislav Kostunica has faced a financial crisis since a popular uprising ousted Milosevic in October. Despite pledges from Western nations of hundreds of millions of dollars in aid, the country's economy is in a shambles after a decade of wars and ill-fated economic policies.

Kosovo Border Flare-Up

Serb police and ethnic Albanian rebels exchanged fire Friday in the tense buffer zone at the Kosovo border, as the Yugoslav parliament debated how to respond. The shoot-out occurred near the village of Bukovac, inside a 3-mile zone between Kosovo and the rest of Serbia, said Yugoslavia's police chief, Zoran Zivkovic.
In an emergency session of parliament, Yugoslavia demanded NATO-led troops in Kosovo expel the rebels from the buffer zone or Yugoslav security forces would take action. But commanders of international troops in Kosovo said they have no authority to enter the buffer zone, where the insurgents killed four Serb policemen and seized several strategic positions and villages last month.
- Source: AP

Some officials have demanded that Milosevic be put on trial because of his alleged murky dealings.

Dinkic said that the money drain was at its peak during the bloody wars of the early 1990s, following the disintegration of the former six-state Yugoslav federation. Milosevic's regime smuggled the money out in the huge "citizens' savings" sacks and deposited them in foreign bank accounts, he charged.

Last week, the government reported that the United States has traced $1 billion transferred from Yugoslavia to bank accounts in Cyprus.

The U.S. Office of Foreign Assets Control, which administers and enforces economic and trade sanctions against targeted foreign countries, has offered to help the new Yugoslavian government regan control of the money.

Dinkic said that his team has formed a special board to find ways to bring the money back to Yugoslavia.

"It is interesting that the lion's share of the money was taken out as foreign currency savings, mostly in cash," Dinkic said. "Bags marked as foreign currency savings somehow got through customs borders and reached Cyprus, to be transferred elsewhere."

He acknowledged that it would not be easy to get it back, saying the experience of other countries headed by "dictators" indicates that sometimes stolen money never resurfaces.

AP Photo
This poster, spotted in the
first days of the Kostunica
regime, shows a retreating
Milosevic and proclaims "He's
Finished!" He finished in the
money, according to the chief
of Yugoslavia's central bank.

"Some of that money has been spent, a part has been returned, but some of it is still in private accounts. Members of the (former) establishment have no intention of giving it back," he told the newspaper.

If the money is not returned voluntarily, it would be done with the help of the federal justice ministry, other federal institutions and the international community, he said. "It has to be done because this money belongs to our citizens."

Milosevic, who continues to be the leader of the Socialist Party, is an indicted war criminal for the actions his soldiers took against ethnic Albanians in Kosovo.

The Kostunica government has repeatedly indicated that it does not intend to turn him over to an international tribunal for trial on those charges.