Russian money pumping in BiH: Financing suspicious activities, influencing elections, corruption, propaganda…
In recent years, Russia has been expanding its malignant influence in the unstable countries of the Western Balkans, including Bosnia and Herzegovina (BiH), while supporting actors who are targeting democratization processes. The goal is to prevent the region's integration into the EU and NATO.
In order to achieve this goal, significant funds from Russia are "pumped" in various ways into Russian companies in BiH in order to later be used to finance suspicious activities, propaganda, influence on election processes, "soft power", enrichment of individuals and much more. In the context of this "disruptive power", the issue of money movement is particularly indicative.
Russia has no economic interests in BiH. However, there is a strong political interest and that is why investments are one of the means to achieve political goals, which practically means that there are goals that are outside the sound economic logic that requires capital to be invested on a realistic basis, in the belief that it will be enriched. This is supported by the fact that most Russian companies in BH, despite "financial injections", operate at a loss.
"Optima Group" and refineries
This primarily refers to the "Brod Oil Refinery", the "Modriča Oil Refinery" and the "Optima Group", which has been reported by the media several times. "Optima Group" operates within the "Nestro" Group together with "Brod Oil Refinery", "Modrica Oil Refinery" and "Nestro Petrol" gas stations. "Optima Group" deals with the wholesale of petroleum products produced in the ship's refinery, as well as oils and lubricants produced in Modriča, while they sell retail through "Nestro Petrol".
However, what is indicative is that in the last few years there has been a "pumping" of money into these companies through their recapitalization. Thus, for example, the owners of "Optima Group" Banja Luka - investors from Russia, pumped 1.77 billion marks into that company in less than three years through its recapitalization. Although this is the largest foreign investment in the entity of Republika Srpska (RS) since its existence and an opportunity that the government, as well as investors, would not fail to use for promotion, everything took place under a veil of secrecy and away from the public eye.
Passivity of competent institutions
What is strange, but also very worrying, is that the competent institutions are not too knowledgeable about these transfers, nor are they aware of the intentions for which the Russians are doing all this. Despite the fact that it is a huge amount of money invested in one company, few in RS have an idea of the ultimate goal of investors, not even the Republic Foreign Exchange Inspectorate, whose job description is "to supervise foreign exchange and foreign trade operations, cooperate with the authorities prosecutors' offices and other competent bodies in case of suspicion of criminal offenses, conduct misdemeanor proceedings and the like ”.
It is not yet known through which banks the transfers took place, but in March and April this year there was an increase in foreign exchange payments of RS banks, which is mostly a consequence of a significant increase in foreign exchange payments made by one bank in business with one client. It is assumed that this is the "Optima Group". By the way, in the first quarter of 2021, according to the submitted reports, foreign currency payment operations (non-cash) realized in banks based in RS amounted to a total of 2.7 billion KM.
Data from court registers, owned by the CAPITAL portal, which monitors economic developments in BiH, show that until December 2018, the paid-in founding capital of "Optima Group" amounted to only 50,000 marks. However, then there are drastic changes in the founding capital, which seem to continue today. Namely, from December 21, 2018 to April 27 this year, six recapitalizations were made in cash, after which, out of the initially paid 50,000 marks, the amount of an incredible 1,777,618,089 KM was reached. This year alone, in four tranches, over 900 million marks were paid.
Bad situation despite cash inflows
The sister company "Brod Oil Refinery" is also in the black, which reported a profit of 71.7 million KM last year, although it did not process a single liter of oil for two years. How difficult it is to keep track of what is happening in these affiliated companies is best shown by the fact that the auditors themselves are confused. The auditing company "Deloitte" refrained from giving an opinion on the financial report of the "Refinery" for 2020 because they could not obtain enough evidence on the basis of which they could form an opinion.
The mentioned Portal CAPITAL analyzed the financial reports of "Optima Group" and came to the indicator "that despite the presented recapitalization, this company is in an extremely bad situation, and its financial status received the lowest rating". However, despite all these losses, the institutions of the BiH entity of RS make decisions that further privilege this and other Russian companies. According to analysts, when money is "pumped" in this way, it can mean money laundering and taking money out of Russia or any other country, under some pretext. In this case, it can be considered that it is the legalization of money through the "Refinery", and after that the money will disappear and will be used for some other purposes.
There are many companies in BiH that are affiliated with companies, usually from Russia, and that operate at a loss or on the brink of profitability, so it is obvious that the millions shown had to come from outside. Although the banks had to report the inflow, they did not do so because it was probably under the pretext that they were sending the money to the "Refinery" to expand the business, buy a machine, etc. However, the question remains what will happen with that money and what purposes will be used.
"Losing" money to spread interest ?!
What is surprising is that Russian diplomats in BiH have never been very worried about the heavy losses of the mentioned companies, unlike the diplomatic "noise" they raised due to the appointment of the new High Representative for BiH, Christian Schmidt. This raises the question of why someone would consciously lose money, unless they see a "broader" interest in it?
It has long been known that Russia exerts its malignant influence in BiH mainly through the RS entity and the most exposed Milorad Dodik, but also through Serbia and Croatia. Both countries are in some ways Putin's debtors. Serbia pays obedience for the veto in the UN Security Council, and Croatia for the money "pumped" into Agrokor. Dodik and Covic, ie their parties HDZ and SNSD, are proxy entities through which the influence of both countries is exercised.
Russia's influence is refined and in these relations it comes down to returning services, "pumping" money, and emphasizing Russia's image as a "great power" and a "brotherly state." In essence, it is about corruption, and that corruption is covered up by patriotic texts, references to the glorious past, unique traditions and everything that you do not have to prove with anything, but only accept as the truth.
Suspicious financial flows
The Russians have developed corrupt activities, as one of the methods of gaining Russian influence, to the extent that they do so very skillfully - by trading in influence, bribing various political officials in the region, expanding their influence through some religious instruments. This includes bank financing, financing of large projects in some countries in the region, and even energy blackmail, given that they are the largest exporters of gas and oil.
Suspicious financial flows related to Russia, which circulate in the countries of the region, often serve as a logistical basis for financing Russia's murky political interests in the West. It is often very visible that the flow of money for these murky projects goes through Banja Luka, or some other cities in RS. The most transparent was the murky financing of the current ruling party of Janez Janša in Slovenia a few years ago, and even now, when Janša is in power, we have very open channels of money laundering in RS from Slovenia, which is very important for the functioning of Janša's administration.
In addition to the already known role of Serbia, which transmits Russian influence in BiH, the role of Croatia, on which Russia has a strong influence, is becoming more and more visible. He is already very visible in the Balkans, not only in BiH but also in Croatia, which is becoming a "special" proxy fighter for Russian nationalist policy and the agenda of endangering everything and everyone. Croatia is angry with the EU because European institutions have rejected Croatia's requests to "remake" BiH (division into three entities).
Therefore, Croatia, together with Jansa, Orban, and other Russian players, is strongly committed to the project of strengthening the "Visegrad Group", regional integration of several Central European countries, as a malignant tissue on the body of the European Union, in order to oppose the EU. In
this context, the recent harsh statements of Croatian President Zoran Milanovic towards BiH and the support of Russian and pro-Russian players in BiH should also be viewed.
Influence on elections
We should not forget that the General Elections in BiH are coming up in 2022, and that Russia has its favorites that it wants to hold, which is why it will use all available financial and other means. Those favorites are corrupt pro-Russian politicians who have given Russia dubious Finnish money laundering flows through Russian firms. First of all, there is the leader of the SNSD and a member of the Presidency of BiH, Milorad Dodik, who will be rewarded with financial and any other support in the upcoming elections, so that Russian financial flows will be increasingly important in political terms and less in economic terms see also through non-transparent recapitalization and "pumping" of money of unknown origin into failed Russian companies in RS.
Thus, BiH is once again becoming an ideal training ground for Russia's cold, replacement war against the West. The exemple is especially when it is not clear "whether the West speaks one language", which was seen in the context of Moscow's disagreement with the election of the new head of the OHR, M. Christian Schmidt.
Taking into account the fact that Russia has taken full control over the import, refining and distribution on the BiH market through the privatization of "Brod Refinery" with the current monopoly on imports into BiH, it will be the main trump card of Russian policy and a powerful tool to influence BiH, at least until BiH provides gas through an alternative route.