London. February 2005. The British Serious Fraud Office (SFO) inspects the headquarters of the London companies EFT and GML and confiscates some of their documents. In the meantime, the SFO investigation also begins in Luxembourg and Bosnia-Hercegovina.
Bucharest. December 2002: The Romanian Government closes a contract with the GML company for recovering Libia's debts towards Romania; these debts were accumulated through the exterior commerce activities with Romania during the Communist period and are evaluated to aproximately $152 million.
Bucharest. December 2002. A Romanian company and EFT close a contract for delivering the electric power produced by S.C. HIDROELECTRICA S.A, at Portile de Fier.
Portile de Fier. February 2005. The hydro-electric plant on the Danube goes partly out of order. The Ministry of Economy evaluates the damages at almost $4 million.
The range of events we have previously mentioned are mere reflections of a hidden world. But after a long investigation we are able to introduce you into this world where the tension reaches its highest peaks; a world where cards are held by a small number of people, who are fighting for the energy markets in the Balkans . This series of articles is meant to represent a radiography of this world where major business interests of the Balkan governments have entered the dealings of some very controversial individuals.
The exploitation of poor countries
An article published in the February issue of the British daily The Guardian made public some information that shocked the world of electric power commerce: a British company activating in the electric power field has been accused of exploiting poor countries in the Balkans and is investigated by the Serious Fraud Office for involvement in a potential case of corruption.
According to The Guardian, the SFO's investigation included searches at the headquarters of the companies EFT and GML. EFT is in fact an abbreviation of Energy Financing Team, while GML stands for Growth Management Limited. These two companies are related by the fact that they develop business in the Balkans, but also because a few years ago EFT separated from GML, a company that draws up financial projects.
EFT is, in fact, the main company that intermediates the electric power business in the Balkan area. EFT has contracts with the state companies that administrate energy in countries such as Romania, Greece, Serbia or Bosnia-Hercegovina and it intermediates the electric power sales in these countries . For instance, the electric power produced in Romania can arrive to Greece or Serbia if these countries have problems during some periods of the year (a.n.-for example, in times of drought, when the electric power plants run at low capacity) with producing the quantity of electric power necessary for covering the domestic needs.
SFO began their inquest in this case because EFT and representatives of the Electric State Company of the Srpska Republic (a.n.-region of Bosnia-Hecegovina where most of the inhabitants are Serbian) are allegedly involved in the embezzlement of $11 million. This amount of money represents the aid granted by the US government for supplying electric power to the Republic of Srpska (RS). The investigators of SFO and OHR (Office of the High Representative) claim that the money went illegally to some RS officials' bank accounts in off-shore areas such as Jersey and Channel Islands .
The investigation started off due to the initiative of the High Representative of the United Nations in Bosnia , Lord Ashdown. According to the article in The Guardian , the latter requested evaluations and audits, which mention the fact that some electric companies' officials have been bribed in order to close advantageous contracts of electric power exchange with some private companies.
EFT representatives declared: “EFT has not been contacted by the investigators during the inquest, nor have they been solicited to provide information for this inquest. Our company hasn't been given the possibility to answer to the problems raised by the investigators or to explain our business activities. EFT has become aware of the object of the investigations only by means of the mass-media.” In fact, EFT representatives claim that the investigators do not wish to clarify things by collaborating with their company. Moreover, they added that they have accused in court the inquest performed by SFO.
The Romanian partner
The documents that have been obtained (see the facsimile) show that EFT is led by the Serbian citizens Vuk Hamovic and Vojin Lazarevic together with the British James Gregor Nye. Lazarevic is an ex-minister of the government in Muntenegru, James Nye is a financial expert, specialised in risk management, and Vuk Hamovic is one of the energy moguls in the Balkans, a man who has very good relationships with persons in the governments in former Yugoslavia, but also from our country. These three men are in fact “white collars”, individuals who play with hundreds of millions of dollars throughout the world.
Moreoever, according to the documents that we have in our possession, Vuk Hamovic and James Nye have activated until 2003 and 2002 respectively in the executive board of the British company GML (Holdings) Ltd, which is a company also supervised by the inquest of the British authorities.
Both companies are also involved in business activities in Romania, where they have as partners either the State or some controversial persons. Among these business activities we can also mention the energy export to Greece, energy that is produced by Hidroelectrica SA.
Therefore, one of the most important partners of EFT in Romania is Energy Holding, which intermediates more than half of the energy sales of Hidroelectrica SA on the free market. The shares of Energy Holding are divided between the Swiss company Energy Consult SA and Atell Investments from Cyprus.
Documents of the Swiss Register of Commerce show that the sole manager of Energy Consult SA (a company founded in Fribourg at the end of 1997) is Nicolae Bogdan Buzaianu, a man with Romanian-Swiss citizenship; this company declares that its activity consists in: “counselling the companies and the governmental institutions, from Europe but not only, especially in the field of electric power.”
Buzaianu, one of the richest Romanian multi-millionaires in dollars, declared to us that he had indeed had business affairs with EFT and he also added that Serbians are very reliable businessmen, who have always complied with the terms established in the contract.
Buzaianu-Sorin Ovidiu Vantu-BID
Nevertheless, it would be very interesting to analyse Buzaianu's business connections. With respect to this issue, one of his companies in Switzerland has been co- shareholder with the company of the controversial man Constantin Iavorski in the management of Seven Trust. At the time when this partnership was taking place, Buzaianu was represented by HT Swiss Hydropower Technologies, a company that changed its name on several occasions, and is currently known under the name Aspell Magnus.
Iavorski, another mogul on the market of electric power commerce is an ex-minister of the Republic of Moldavia and a former associate of the Russian oligarch Roman Abramovich (who is, among others, the owner of the Chelsea London footbal team). Iavorski has been Abramovich's employee for the Swiss company Runicom, a company that has been accused of having embezzled European funds.
On the other hand, Buzaianu is a shareholder within a company in Great Britain, Medrose Limited (a consultancy company in the energetic field), along with two Cyprus citizens who are connected to other controversial affairs. Buzaianu is associated in Medrose with Maria Hassabis and Vaso Hadjiconstanti. According to “Adevarul”, Mrs. Hassabis has purchased the shares that the controversial businessman Sorin Ovidiu Vantu had had at the Bank for Investment and Development (BID), at a time when Vantu's accounts in Romania were locked up.
In 2003, one issue of Adevar ul mentioned that Vantu had sold 1,600,000 shares, which represents the almost 89% share that he owned at BID. At this point, we also need to mention that Ioana Maria Vlas, the mother of FNI (National Investment Fund), declared that Vantu had used the FNI money in order to found BID. Moreover, Vantu was sentenced to two years of prison for the BID affair, at the beginning of the summer. However, the Court of Justice subsequently decided that this case should be tried once again.
The same Mrs. Hassabis is a shareholder in the British company Bostina & Associates, a law firm that has its Romanian correspondent in Bostina and Associates. This law firm provides counseling for the modernization of the hydro-electric plants Portile de Fier 1 and 2.
Bostina and Associates haven't responded to the invitation of discussing with the press.
During interviews, Buzaianu claimed that he had no knowledge of any association whatsoever with Mrs. Hassabis. When faced with the documents that certified the association within Medrose , Buzaianu requested a one-week respite in order to clarify this issue. He subsequently requested another two more weeks. Nevertheless, the lawyer hasn't stated nor provided evidence for his position with respect to this case so far.
At this point we should say that Buzaianu also represented VA Tech, a company that ensures the modernization of the hydro-electric plants Portile de Fier, a process which faced a lot of setbacks until now, because the hydro-electric plant at Portile de Fier 1 has partly stopped working since the beginning of the year.
Moreoever, the modernization contract with PF is also under observation, since the sums contracted with VA Tech initially have been greatly exceeded.
Sorin Ovidiu Vantu claims that he does not know Maria Hassabis. He says that he has had various business deals which were assisted by several law firms. Vantu also added that he knows how the Romanian press works, claiming that this journalistic material is directed against him .
Libia's debts towards Romania
We shall now come back to the Serbian Vuk Hamovic, Buzaianu's business partner, and to the business that his companies have had in Romania.
On the 12 th of December 2002, the Romanian governement issued a decision signed by Adrian Nastase, prime- minister at that time. The government decision HG 1383/2002 stipulated that GML International Limited was commissioned with recovering the debts that Libia had towards the Socialist Republic of Romania. With that end in view , the government closed a contract with GML. According to the Ministry of Finance, the sum would add up to approximately $152 million, which represents an amount that Libia owes to Romania since the 80s.
In accordance with the law 544 of 2001 regarding the free access to public interest information, we have applied a petition to the Ministry of Finance in order to find out the current situation with respect to recovering these debts, as a consequence of GML's intervention. The Ministry replied that, during the 24 th and 25 th of January 2005 , the third meeting of the Romanian-Libian Financial Committee took place in Bucharest and that there have been discussions about the situation of Libia' debts towards Romania. The Ministry of Finance mentioned that during this meeting they noticed “the Libian authorities' attitude of denial with respect to some documents concluded between the two governments, a desire to postpone the negotiations for regulating the financial debts towards the Romanian government and, recently, making claims, without any justificatory documents, which could change the status of Romania from a creditor into a debtor state.”
T he Ministry of Finance says, two years after closing the contract with GML for recovering Libia's debts towards Romania, that Romania runs the risk of becoming itself indebted to Libia. It is a surprising step and we tried to solve the mystery by addressing a new petition to the Ministry, a petition in which we request a copy of the contract signed between Romania and GML. The authorities have put forward the fact that this contract represents classified information. The Ministry of Finance communicated to us that publishing this contract might “cause serious damage both to the Romanian state, as well as to the assisting c ompany, rendering thus the process of recovering the debts more difficult.”
A final key issue
At the same time that the reporters of the “Romanian Center for Investigative Journalism” were working at this investigation, more precisely on the 4th of May 2005, the company Energy Financing Team Romania SRL was founded in Romania. The company deals with “the distribution and sale of electric power” and it has as sole shareholder the Danish company EFT (Holdings) APS. The documents provided by the register of companies in Denmark show that the persons involved in EFT (Holdings)APS are: James Gregor David Nye, Svetislav Bulatovic and Bertil Bak Wogensen. The founder of the very same company is no one else but Hamovic.
Nigeria 's debts
Within the context of GML's involvement in recovering Libia's debts towards Romania , we should also mention another noteworthy episode, when GML was involved in recovering some Nigerian debts, which lay at the basis of the greatest scandal of this African country very rich in petrol . In 2000, the publication Africa Confidential mentioned the fact that the ex-president of Nigeria, general Ibrahim Babangida, was said to be involved in an operation of canceling the debts that Nigeria was having towards several countries and international institutions, an operation which made the members of the Babangida regime very rich , after a large sum of the 6 billion dollars entered into their accounts in Austria or Switzerland.