Bill Stalled in Parliament

In an unexpected twist, criminals are reaping the benefits of the breakup of the ruling coalition because Parliament, now disbanded ahead of elections due on May 11, is unable to debate draft legislation that would confiscate criminal assets.

So much for the expert conferences, public debates, calls for the passage of the bill, and media speculation as to what Milorad Ulemek, his brothers in crime from the notorious Zemun Gang, and their fellow mobsters from what has been dubbed the Bankruptcy Mob stand to lose once the bill passes.

The rationale behind asset confiscation is that unlike putting criminals behind bars, it deprives the organizations to which they belong of funds. The general consensus is that is a much more painful punishment.

Stemming the Cash Flow

Although several different versions of the bill have been drafted to date, the one with the greatest chances of getting through Parliament is titled "Draft Law on the Confiscation of Assets Derived from Criminal Activity". It was recently completed by a Ministry of Justice working group and presented to the public not long ago.

"The basic idea is that individuals convicted of organized crime, crimes against humanity, and corruption must provide proof that they came by their assets legally. If they can't, the state has a right and obligation to impound that property," outgoing Justice Minister Dusan Petrovic said at a presentation of the bill. "Property" means the following: movable goods and real estate, ownership papers for property or securities, income or other benefits derived from criminal enterprise, or assets created or mixed with the profits of criminal enterprise, according to the draft.

The bill envisions the creation of a special unit for financial investigations and an office for the management of impounded assets. The head of the unit would be appointed by the police director, while the head of the office would be named by the cabinet. This would be preceded by a proposal from the Justice Ministry and opinions from the Supreme Court of Appeals and public prosecutor.

Asset confiscation would be an option in cases being tried by the Special Court for Organized Crime and the Special Court for War Crimes, both of which are divisions of the District Court in Belgrade. Prosecutors would be able to take action in the early stages of an investigation.

Permanent confiscation would happen within two years of conviction in cases where the defendant opts to fight confiscation. In other cases a decision would be included in the final judgement handed down by the court and would enable the convict to file an appeal. Additional, permanent confiscation would be usable only against individuals convicted of a crime. Assets obtained in this way would be distributed to the court and prosecutors. Another part of the bill deals with international cooperation.

As is the case in countries that have an effective system for combating organized crime, confiscation cases would transfer the burden of proof to the accused. In other words, prosecutors would compile a list of assets belonging to the accused, who would then have to provide proof that none of these assets were derived from criminal activity.

The law would apply to all assets procured prior to the beginning of an investigation. This is important because, as one expert put it, it would allow prosecutors to question the origin of all property proven to have been obtained through crime. "It doesn't matter whether it was obtained through one or more crimes. The only thing that matters is whether there is a conviction," Goran Ilic, a member of the working group that drafted the bill, said. He recalled the judgements against several gangsters convicted of abduction who were required to pay the complainants EUR12 million, as well as that in the case of a doctor convicted of making drugs ordered to repay EUR10 million.

"The idea is to tear down the financial framework holding up organized crime, which the proposed bill would achieve," according to Ilic.

Property can also be confiscated from people who received criminal assets, including heirs and friends, even after the death of the criminal who originally acquired it. As an example Ilic gave the case of former deputy interior minister Radovan Stojicic, who was gunned down 11 years ago. Stojicic was as alleged criminal involved in cigarette smuggling. If the proposed law passes and the group to which he belonged gets convicted, Stojicic's heirs could lose some property.

Elections and Coverups

Miodrag Majic, president of the Belgrade First Municipal Court, took part in the drafting of the bill and sums up the differences between current regulations and the bill as follows: say a drug lord is arrested for the sale of two grams of heroin. Currently, he can lose only assets worth the equivalent of two grams of heroin. Conversely, under the proposed legislation, the drug lord would have to prove the origin of all his assets. He would also lose everything that he could not account for. "This is a powerful weapon in combating organized crime," according to Majic, who also points out that follow-up legislation on asset origin also needs to be passed.

The financial investigation unit would have the authority to seek information on contested property from state institutions, which, in such cases, would not be able to deny that information due to security concerns. It would also be able to search vaults and personal safes, as well as the personal and business bank accounts of defendants.

Majic also believes that the law will cause quite a stir when it passes.

However, now that Parliament has been disbanded, that stir is unlikely to happen anytime soon. The people who are most likely to be affected by the law have been given more time to come up with ways to hide assets acquired through trafficking in drugs and people, abductions, illicit privatization, and corruption.

Tomislav Nikolic of the Serbian Radical Party recently gave an interesting twist to this idea. Asked to comment on his party's pledge to restore order in the public services, including the police and courts. "The vast majority of police officers want to do their job. But if they want higher salaries, they will have to earn them. Let them put the criminals behind bars and then we can used their confiscated property to raise their salaries. Let them work on commission," Nikolic remarked.