Money Laundering and Irregularities Cost the Sarajevo Canton Employment Service Millions of Marks

SARAJEVO, (Patria) - The Management Board of the Public Institution "Sarajevo Canton Employment Service" on July 20, 2018, made a decision to appoint Muhamed Bekt as acting director for a maximum of six months from the date of appointment, and the KS Government on July 23, 2018, gave its consent for only three months from the date of appointment. This means that Bekt remained illegally in the position of acting director for about ten months after the expiry of the three months approved by the KS Government. Although the Management Board made a Decision on the appointment of an acting director on January 18, 2019, the KS Government never gave its consent to that decision. The legitimacy of holding this position and all decisions and projects approved by Bekt is questionable. Bekt is still employed by the Sarajevo Canton Employment Service today.

These and other irregularities related to the Employment Service have been reported to the competent institutions, and the KS Prosecutor's Office is also conducting certain checks and investigative actions. Due to all the irregularities, the Sarajevo Canton Employment Service has suffered financial damage in the amount of several million marks.

Thus, a number of criminal offenses in the Sarajevo Canton Employment Service related to abuse of position, exceeding authority, concluding harmful contracts, embezzlement, and unprofessional and negligent work in the service have been reported to the KS Ministry of Internal Affairs, the KS Prosecutor's Office, and the KS Office for Combating Corruption.

The report relates to the period when Midhat Osmanbegović, who resigned on May 7, 2018, was managing the Service. More criminal charges have been filed against him in the KS Prosecutor's Office alone.

After Nermin Pećanac became the director of the Public Institution Sarajevo Canton Employment Service in August 2019, numerous irregularities were discovered and reported.

"Upon reviewing the status of all accounts with the Service's commercial banks, it was determined that there are funds in the amount of 865,598.98 KM in the Nova Banka AD Banja Luka account with imprecise and unclear accounting records in the Service, and that the sole signatory of that account with the right to dispose of funds was Midhat Osmanbegović, who was dismissed from the position of director on May 9, 2018," the report sent to the competent institutions states.

Furthermore, two seals were found in the Service, which suggests the possibility of seal abuse. The duplicate seals were procured on the order of Midhat Osmanbegović.

Among other things, uncollected receivables from commission loans and receivables from inactive bills of exchange were recorded in the Service, and irregularities in the financial operations of the Service were determined.
The Tax Administration conducted an inspection in 2018, which revealed a number of irregularities in its operations.

"Due to non-compliance with tax legislation, omissions in work, non-observance of adequate procedures, failure to conduct regular and adequate controls and respect financial regulations, missing legal deadlines for calculation and payment of special taxes, non-compliance with the Law on Contributions and the Law on Income Tax, and incorrect financial management for the period 2009-2018, financial and material damage was caused to the Service, for which default interest on public revenues in the amount of 1,123,925.55 KM with default interest of 0.4% for each day of delay was calculated."
The Tax Administration of the Federation of Bosnia and Herzegovina charges the Service with over 2 million KM for all outstanding debts.

It was also determined that the Service did not record receivables from employee Sead Đurđević in the amount of 574,859.78 KM, who is accused of embezzlement, and the case is being handled by the KS Prosecutor's Office.

The heads of the Sector for Economic Affairs and Treasury during the period 2012-2016 were Asifa Vrabac, and from 2016 to the beginning of July 2019, Edina Ljubuškić. Asifa Vrabac was a member of the Service's Management Board and head of the Finance Sector when nearly 600,000 KM was embezzled.