Police Arrest Serbia’s Richest Man as Fraud Suspect

Serbian police arrested Miroslav Miskovic, the country’s richest man, and his son on suspicion they illegally earned more than 30 million euros ($39 million) on the sale of state road companies.

The 67-year-old entrepreneur was apprehended without being served a summons, the law firm representing him, Jankovic, Popovic & Mitic, said in an e-mailed statement. Miskovic, Milo Djuraskovic, and eight others were arrested today in connection with privatized road companies between 2005 and 2010 suspected of taking money and property valued at about 2.87 billion dinars ($33 million at the time), special prosecutor Miljko Radisavljevic said today in Belgrade.

Prosecutors will conduct “a serious financial investigation and determine if any one of the suspects possesses property gained through a criminal act,” said Radisavljevic.

Serbia needs to step up its fight against corruption and organized crime as part of its effort to convince the European Union that it is fit for membership talks. The government is reviewing the sale of 24 companies after criticism from the European Parliament and is waiting on a date to begin entry negotiations.

Miskovic is “fully cooperating” with investigators, said his law office.

Hemslade Investment

The partnership between Miskovic and Djuraskovic began in 2005, when Miskovic’s Cyprus-based company, Hemslade Trading Ltd., bought a road company in Belgrade for 23 million euros.

Miskovic, the owner of closely held Delta Holding, was twice questioned by police and the Prosecutor’s Office for Organized Crime before the arrest. Delta Holding’s interests in real estate and retail and its annual sales were equal to about 9 percent of Serbia’s economic output in 2010.

“We are absolutely certain that the activities of Delta Holding and its owner, Miroslav Miskovic, are in accordance with the law, and we are fully cooperating with the authorities,” the Belgrade-based company said in an e-mailed statement. Delta’s board of directors continues to run daily operations, it said.

Miskovic entered the Forbes list of billionaires in 2007 and has been ranked among the wealthiest people in eastern Europe. His fortune was estimated at $2.8 billion in 2010 by Forbes and Polish magazine Wprost.

Two-Day Detention

Miskovic will be detained for 48 hours, during which prosecutors can decide to hold him for as many as 30 days, state broadcaster RTS said. Police have stepped up security for Deputy Prime Minister Aleksandar Vucic, who is also defense minister and chief coordinator in the fight against corruption, RTS reported.

His security increased after Miskovic allegedly made verbal threats to Vucic, RTS broadcaster said today. Miskovic’s lawyers said their client’s words were misinterpreted and that he said “Vucic can’t go tonight to RTS without arresting me first,” referring to a scheduled interview the broadcaster has with the minister.

Vucic said the allegations appeared to be clear and that “prosecutors are satisfied with what they’ve got.” He said he heard about the threats from the police and vowed no one is “above the law and untouchable,” according to his televised statement.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE