Wherever you look, corruption dogs the Balkans

BELGRADE, Serbia – Bags of cash delivered to the office of a prime minister with a penchant for expensive watches. A dizzying fortune amassed by another from years of tobacco smuggling.

Or the plain grotesque: A head of state who allegedly led a mafia-like gang trafficking kidneys cut from murdered prisoners in the 1990s.

Wherever you look, accusations are flying about high-level corruption in the Balkans. But while some say it's endemic, others see progress: In a region torn apart by war two decades ago, nations now aspire to join the European Union and there's a more urgent need to pursue and prosecute.

"For many years, organized crime and corruption encountered few obstacles preventing their growth or stunting their influence in southeastern Europe," says Balkan political analyst Misha Glenny. "That is now changing largely because of the conditions imposed by the European Union on regional governments to clean up their acts."

The accusations are being fought by former and current leaders of Croatia, Montenegro and Kosovo. But nerves are being rattled far beyond their nations' borders.

EU members Romania and Bulgaria are under pressure from Brussels to fight graft and bribery more than three years after joining the 27-nation bloc, with Germany and France recently warning that allowing them to join the continent's visa-free travel zone too quickly could have "grave consequences" for the bloc's security.

That is slowing momentum to expand the union deeper into the Balkans.

Clearing the higher bar could prove difficult for Croatia, Montenegro, Macedonia, Serbia, Bosnia and Kosovo — all ex-Yugoslav states tinged with a reputation for corruption.

The 170-nation list of Transparency International's 2010 Corruption Perceptions Index places Macedonia and Croatia joint 62nd, Romania 69th and Bulgaria 73rd. Compared to established EU nations like Germany at 15 or France at 25, the results show they have a lot of catching up to do.

That's particularly true for Bosnia, listed at 91 and Kosovo, at 110.

While Croatia — the next likely EU member — has fulfilled most membership requirements, it must increase "the fight against corruption at all levels," says EU enlargement commissioner Stefan Fuele.

At first, probes in Croatia involved minor players — university professors giving passing grades in exams in exchange for bribes, or clerks at land registry offices who took money in return for quickly issuing construction permits.

But then higher-level figures were targeted.

Former Prime Minister Ivo Sanader was arrested in Austria last month after apparently fleeing on suspicion of "conspiracy to commit crime and abuse office." He abruptly resigned in 2009 after media reports questioned the source of his wealth and photos showed him sporting a range of watches valued at around euro150,000.

Media reports of bags of money brought into the ruling party's offices during his tenure gained firmer footing after a former party treasurer told investigators of handing wads of cash directly to Sanader, who, he said, disposed of the money at his will.

U.S. embassy cables released by WikiLeaks show prosecutors are examining his possible role in several cases. The investigation is the first against such a high-level politician in Croatia.

Hashim Thaci, in Kosovo, is accused of more sensational crimes.

A day after emerging victorious in December elections, Council of Europe investigator Dick Marty published a report describing the former Kosovo guerrilla leader as the head of a mafia-style organization that trafficked arms, drugs and organs of Serbs in the 1990s.

Thaci dismissed the allegations as "ill-intentioned propaganda," driven by a Serb-inspired agenda to undermine Kosovo's statehood and its 2008 declaration of independence. But Marty stood firm, even saying he committed his crimes with Western connivance.

"I reread the secret documents on Thaci drafted by Western analysts, with a feeling of horror and moral shame," Marty wrote in the report. "They knew everything, but were betting on Thaci."

Milo Djukanovic resigned a short time later in Montenegro — but denied his move was prompted by international pressure over his alleged criminal past.

Italian authorities have investigated Djukanovic for allegedly being part of a smuggling ring in the 1990s that brought cigarettes on motorboats into Italy and then the rest of western Europe from across the Adriatic. The probe was dropped in 2009 because of his diplomatic immunity.

He has denied the accusations, but said the smuggling — a multi-million-dollar operation — helped Montenegro survive international sanctions imposed on the regime of late Serbian leader Slobodan Milosevic for fomenting the wars in the Balkans.

The charges against the three men have put a dent in the trust accorded them by the West.

Thaci was an emblem of Kosovo's struggle against Milosevic. Djukanovic was praised for defying Milosevic in breaking Montenegro away from Serbia. Sanader was considered a symbol of Western values who broke with the kind of Croatian nationalism that contributed to the violent breakup of Yugoslavia.

Authorities across the region are casting a visibly wider net against crime and corruption.

Montenegro's deputy premier, Svetozar Marovic, resigned alongside Djukanovic. Days later, prosecutors arrested 10 people, including Marovic's brother, for alleged receipt of kickbacks from a Russian billionaire in the sale of prized seaside property near the resort of Budva.

Serbian prosecutors have initiated proceedings against individuals from the health care and the state railway company amid expectations that — if proven — the allegations against Sanader will reach into their country.

"Since crime and corruption in the Balkans are tightly connected between states, I expect the arrests of the 'big fish' in Serbia as well," said Verica Barac, the head of a Belgrade-based anti-corruption group.

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Associated Press writers George Jahn in Vienna, Snjezana Vukic in Croatia, Predrag Milic in Montenegro, Jovana Gec in Serbia and Slobodan Lekic in Brussels contributed to this report.