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Friday November 24th, 2017 3:34PM

Croatian businessman arrested in London over huge bankruptcy

By The Associated Press
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LONDON (AP) — Croatia's richest businessman was arrested Tuesday in Britain amid allegations he embezzled millions from his large retail company, leading it into a massive bankruptcy that is now an issue of national concern in Croatia and the Balkans.

Ivica Todoric, 66, the founder of Croatia's biggest private food and retail company, Agrokor, appeared in Westminster Magistrates' Court, where his lawyer said he will fight extradition to Croatia.

District Judge Richard Blake granted Todoric freedom on 100,000 pounds ($132,000) bail.

"The context in which I grant you bail is the knowledge that both within this country and throughout the world, your assets are frozen and your ability to obtain money is limited," the judge said. "The security is a very small sum in the context of what sums I have heard being spoken of."

The judge also set conditions requiring that Todoric wear an electronic tag between midnight and 3 a.m., sign in at a London police station three times a week and give up his travel documents.

He is accused of misrepresenting Agrokor's business and financial reports by "concealing expenses, debts and financial claims."

Todoric was put on Europol's list of the continent's most wanted fugitives for suspected corruption, forgery of administrative documents and fraud.

He and his former aides are being investigated over the company's financial downfall. Todoric, who denies wrongdoing, has been accused of embezzling tens of millions of euros of Agrokor's funds for personal gain.

Agrokor, which began as a flower-growing operation in the former Yugoslavia in the 1970s, underwent a rapid expansion over the past decades that saw it run up debts of about 6 billion euros ($7 billion). The company employs about 60,000 people throughout the Balkans and is so large it now accounts for about 15 percent of Croatia's gross domestic product. Its debt is too large for the government to rescue it without endangering the state's financial stability.

Although Todoric still formally owns 95 percent of Agrokor, the Croatian government has taken over management of the company. It is now trying to keep it alive through restructuring and negotiations with major creditors, which include Russia's Sberbank and VTB bank, to which it owes 1.4 billion euros.

Croatian Prime Minister Andrej Plenkovic said he wasn't surprised by Todoric's surrender to the London police and that he wouldn't comment on when he will be handed over to Croatian authorities.

"Now we face the usual (extradition) procedure," Plenkovic said. "As a suspect, Todoric has his rights that I believe he will use."

Croatian President Kolinda Grabar-Kitarovic said Tuesday that the Agrokor affair is the biggest scandal in the country with "repercussions on the stability of (Croatia's) economy, creditors and suppliers."

Police raided Todoric's home in Croatia last month along with the homes of former top aides. Twelve people were briefly arrested, including his two sons, who managed the company with him.

After he appeared on Europol's fugitive arrest list, Todoric wrote on his blog that he was not hiding and that his conscience was clear.

"As a man whose human rights are deeply violated I have the right to oppose political persecution," Todoric wrote.

Todoric has always claimed that the government illegally took over his company and indicated that he will fight his extradition on the grounds that he is the victim of political pursuit.

___

Dusan Stojanovic reported from Belgrade, Serbia.

  • Associated Categories: Associated Press (AP), AP World News, AP Business, AP Business - Corporate News
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