Football in Serbia took unusual—and illegal—steps to deal with the embargo during the wars of the 1990s.
Žarko Nikolić, "Someone had to bring the money to Serbia; it was in bank accounts in Cyprus and other countries. Because they trusted me, I was the one who brought the money for two transfers."
Those steps, which resulted in loose accounting for payments arising from lucrative player transfers, drew interest from corrupt officials and elements of organized crime.
Now that the issue of privatizing Serbian clubs has been raised, those in powerful positions in business and within the clubs could wind up as their owners.
The problems facing Serbian football date back to long before the war, according to Zvezdan Terzić, former president of FC Beograd and the Football Association of Serbia. He fled the country in 2008 to avoid arrest in connection with the transfer of FC Beograd players.
In December, Terzić sent a letter to several newspapers stating: “There were black funds in Serbian sport for the last 50 years and the state in a tacit way approved this system. Nobody was doing it for personal benefit, but to help the sport survive and develop. There is no player who, during his playing career, did not receive the money under the table, money for which nobody paid taxes. This system has been set back many decades, the system that I found, first as a player and then as sports director.”
During the war, however, money was handled in especially secretive ways, as the embargo prohibited foreign clubs from paying money into the bank accounts of Serbian clubs for the transfer of players. Club officials resorted to arranging clandestine payoffs and the use of tax shelters and private bank accounts to conceal the transactions. Some officials say they did what they had to in order to keep their clubs going, including avoiding taxes, which they say were exorbitant.
A Suitcase of Money at the Border
Articles, lawsuits and other documents reviewed by reporters for the Organized Crime and Corruption Reporting Project (OCCRP), along with recent interviews, give a glimpse of how things worked at that time. In a 1993 interview with the sports newspaper “Tempo,” FC Partizan’s general secretary, Žarko Zečević, talked about selling midfielder Džoni Novak to Turkish FC Fenerbache. “From Istanbul, we travelled to Sofia by car with a suitcase full of money. A Turkish guy was the diver. At the border, an associate asked me what we’d do if the driver told the border guards. That was a moment I will never forget. Luckily, they let us through without problems.”
Žarko Nikolić, onetime president and a former official of FC Obilić, told OCCRP reporters of similar behavior when he was vice president of Obilić in 1999. “Someone had to bring the money to Serbia; it was in bank accounts in Cyprus and other countries. Because they trusted me, I was the one who brought the money for two transfers." He said he brought the money from Germany to Serbia and handed it over to the heads of the club.
In the immediate aftermath of the war, secret dealings such as these involving bags full of money attracted criminals who sensed opportunities in football. Chief among them were Željko Ražnatović, also known as Arkan, and Jusuf Bulić. Arkan became famous as the ruthless leader of the paramilitary group the Tigers and Bulić was a well known Serbian criminal whose activity across Europe dated back to the 1970's.
Bulić was arrested several times during the 70's and, in the mid 80's, returned to Serbia. When he was shot dead as he left a Belgrade cafe by two masked attackers with automatic weapons in 1998, Bulić ran a betting and casino chain. He had bought the second-league club Železnik, an unusual club because it was not publicly owned, and moved it to the first league. His widow, Snežana, still owns the club and his Lavovi bet shops. His son, Aca, who later became president of the Union of First League Clubs, was once a member of Arkan’s Tigers.
As leader of the Tigers, Arkan had been involved in smuggling and became well-known as one of the most dangerous war criminals that emerged from the wars of the 90's. Arkan had led the Belgrade football club Red Star’s fan club and, during the war, filled the ranks of his paramilitary unit with fans and hooligans. He later became president of FC Obilić and moved the club to the first league before he stepped down in 1998 and turned the club over to his singer-celebrity wife, Svetlana Ražnatović, who goes by her stage name, Ceca. He retained his position with the youth club asociated with Obilić until his death in 2000. He was shot three times in the head in the lobby of Belgrade’s elite Hotel Intercontinental in 2000. Ceca continued to lead Obilić but the youth club has been renamed.
Arkan and Ceca and Player Transfers
OCCRP reporters examining documents in cases in which they were involved found some that detailed how Arkan and Ceca took money from the transfers of players.
The financial reports of FC Obilić for 1998 and 1999 submitted to the National Bank of Yugoslavia show that Arkan asserted that Obilić players would be transferred to foreign clubs without charge. Police investigations showed that these trades were paid for by the foreign clubs, but that the money went into private accounts controlled by Ceca, her sister, friends and football agents who were close to FC Obilić. Ceca is now under investigation for 15 suspicious transfers. Police reports said that she used the majority of the money (22.529.000 DM and 480.000 USD) for her personal benefit.
Part of the money (6.590.000 DM) she transferred to the club as a personal investment and as investments from two companies, Vizantin Trade and Ari. According to documents from the archives of the Serbian Business Register Agency and of the Commercial court, these companies were established by Arkan during the war and were crucial for his business, mainly for trading alcohol, cigarettes, wood products and construction work. He transferred Vizantin to Ceca in 1997, who controlled it until its liquidation in 2002. A financial report of Obilić shows that Vizantin was a chief sponsor of FC Obilić and that Obilić was in debt to Vizantin for construction work the company had done for the club. A police source and a former club official both told an OCCRP reporter that they suspect Ceca of investing stolen money in FC Obilić to secure most of the shares and be in a good position to get the club for herself if it were privatized.
Ceca’s sister, Lidija Veličković Ocokoljić, is also under investigation in those cases. A FIFA-licensed agent facing legal trouble of his own and Žarko Nikolić are set to testify against the sisters.
Stanislava Čočorovski Poletan was a partner to Arkan and Ceca in some dealings. Poletan, a relative of the former chief of Macedonian police, Slobodan Bogojevski, assisted in the transfer of several players through the use of her private bank accounts. She was, according to sources, Arkan’s partner during the war in his cigarette trading. Last year Stanislava Poletan was convicted in Macedonia and sentenced to 14.5 years in prison for her involvement in smuggling 500 kg of cocaine.
Bulić, Arkan and Ceca were not the only ones to see the illegal profits to be had from football.
Wave of Investigations into Football
A Serbian police investigation resulted in a wave of arrests in 2008—and in Terzić’s flight from the country. According to police and prosecutors, Dragan Džajić, one of Serbia’s top players and later president of FC Red Star, was among the club officials who obtained money from transfers by opening false bank accounts in the names of players, who themselves knew nothing of the scheme. Džajić and two other former Red Star officials spent five months in custody and were released in July. Their case is still under investigation.
The FIFA-licensed agent who will testify against Ceca and her sister, Ranko Stojić, also is under investigation. Authorities said they suspect that he and Džajic took 5 million DM from the transfer of defender Ivan Dudić in 2000, a transfer made through the Pro Agency, a company registered in Belgrade and owned by Stojić. The Pro Agency has been liquidated and Stojić now owns another agency, the Dynamic Agency, and helps finance FC Rad and is close to its leadership.
FC Partizan, according to documents, processed transfers during the 90s through Karrane Ltd., which is registered in England, and has a bank account in Luxemburg. Raymond Henschen, director of the company, confirmed this to an OCCRP reporter by phone. He said everything had been done legally. Zečević said last year on the talk show TV Enter, that during his 23-year tenure, “FC Partizan sold about 150 players and nobody complained and nobody was tricked.“
After Arkan, the Zemun Clan
Things changed after Arkan’s murder, but hardly improved. The Serbian underworld shifted and a wave of murders hit Belgrade from the end of 2001 until the end of 2002, with about 20 men shot dead. The Zemun criminal clan became the most powerful in Serbia and a major new player in the football business.
According to a witness in the trial of the of assassination of Prime Minister Zoran Đinđić, two leaders of the Zemun clan, Dušan Spasojević and Mile Luković, were involved in football transfers as unofficial agents. They had private contracts with various Serbian players. Two of those players, Danko Lazović, a striker who played in the Netherlands and Germany, and Dragoljub Jeremić, a defender who played in Macedonia and Greece and now plays for FC Bežanija, were arrested in 2003 on suspicion of involvement with Zemun clan members.
Ceca was also arrested in 2003 for gun possession and involvement with the Zemun clan. She has publicly confirmed that she told prosecutors that Spasojević had asked her for an alibi a few days before Đinđić was killed. Spasojević and Luković were both killed and the Zemun clan was broken up in a 2003 police operation.
That operation also resulted in the arrest of Nenad Opačić, financier of FC Veternik from Novi Sad and Dušan Zličić, the club’s vice president. According to police, Opačić was the leader of the Veternik clan and Zličić was a member. They and six others arrested as members of the Veternik clan were convicted and sentenced to prison for dealing drugs, mostly cocaine as well as heroin and ecstasy. Opačić was sentenced in 2005 to 15 years.
Goran Mijatović, also known as Mita, the president of FC Bežanija, was arrested in the same police operation with two other members of his Bežanija crime clan, and was later released. He was suspected of multiple murders and smuggling cocaine and faced sentencing for extortion when he and one of his bodyguards were killed by a bomb set in a car parked next to his in 2006. Two former presidents of FC Bežanija, Radoslav Trlajić and Petar Milošević, were also killed. Trlajić was gunned down near his apartment in 2000, and Milošević by attackers in front of a Belgrade hotel in 1999.
Help to Preserve the System
Throughout many of those years, the system operated under the protection of powerful people on the boards of clubs who shielded those involved in shady dealings. Mirko Marjanović, the former prime minister, was president of the FC Partizan executive board from 1989 to 1994 before being named Partizan’s honorary president. From 1995 to 2007, Mirko Vučurević, listed in 2003 by police as involved in cigarette smuggling in Serbia, was a member of Partizan’s board. And Slobodan Radulović, the former vice prime minister of Serbia, one of Interpol’s most wanted suspects and identified by prosecutors as one of the leaders of the “bankruptcy mafia” accused of devaluing privatized firms and selling them off, was once on FC Red Star’s board. Two other members accused of participation in the bankruptcy mafia, Mirko Brašnjević and Nemanja Jolović, were president and vice president, respectively, of FC Beograde until 2005. Brašnjević hanged himself with a sheet in his cell in 2006 while awaiting trial; Jolović’s trial is ongoing.
All of these people were involved in a system that largely resisted transition and retained its structure from the socialist era. Serbian clubs predominantly remained under public ownership, a model inherited from socialism and now mentioned as a possible target of privatization. Numerous businessmen, who made their early profits during the Milošević era of embargos, sponsor or hold leadership positions in clubs and are poised to become owners.
This could leave present club officials, including brewery owners, heads of investment firms and stakeholders in large corporations to determine the future of Serbian football.