Former Croatian Democratic Union (HDZ) Prime Minister Ivo Sanader faces investigations over accusations he pocketed huge sums in connection to Hypo Group Alpe Adria's (HGAA) careless lending activities in the country, according to reports.Local weekly magazine Nacional claims the former HDZ boss – who sensationally stepped down last year – received hundreds of thousands of Euros in the 1990s from Croatian firms to ensure they received loans from HGAA.HGAA had to be nationalised last December as it emerged that the bank faced annual losses of 1.6 billion Euros. SoKo Hypo – a special commission set up by Austrian People's Party (ÖVP) Finance Minister Josef Pröll to investigate alleged corruption, fraud and embezzlement by political decision-makers and former bankers – said recently there were 40 suspects across Europe linked to the bank's near collapse.Media have speculated Sanader was entangled in corruption activities after his shock retirement from politics in July 2009. The former prime minister rubbished accusations as "baseless". Croatian state prosecutors, however, have denied they have been investigating Sanader.Meanwhile, former HGAA boss Wolfgang Kulterer – who was taken into custody last week – faces organised crime charges over the bank's loan policy in Central and Eastern Europe (CEE) during his 14-year term as CEO, Austrian Times has reported.Reports have it that the bank also helped former Croatian deputy Defence Minister Vladimir Zagorec finance military armament and controversial real estate projects.The credibility of new HGAA chief Gottwald Kranebitter – assigned to get the bank back on track – suffered a huge blow recently when it was uncovered that his former employer KPMG had been on the payroll of a firm cooperating with ex-HGAA boss Tilo Berlin. The financial consulting company carried out a due diligence report on the bank for Kingsbridge, which is linked to German investor Berlin.Berlin headed a commission of 46 investors in 2006 before briefly becoming the bank's head. The group reportedly made 150 million Euros when the former Carinthian provincial bank was acquired by Germany's Bayerische Landesbank (BayernLB) for around 1.7 billion Euros the next year.Prosecutors, police and financial market specialists in Klagenfurt, Vienna and Munich, Germany, have been investigating for months about who knew about the dismal state the bank was already in when BayernLB snatched a major stake for what was most likely too high a price.
Source: Croatian Times Online News
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