Agricultural Grants for False Square Meters

Tuesday May 22nd, 2018
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Farmers in the Federation of BiH received grants based on appraisals done by expert witnesses who falsely date the time of construction and the number of barns and production facilities.

By The Center for Investigative Reporting

In 2012, an expert architecture witness from Doboj, Radenko Vasić, appraised 11 agricultural facilities without ever laying eyes on them. He based his opinions on statements from the people who hired him. He told the Center for Investigative Reporting in Sarajevo (CIN) that he met his clients in bars.

Three years later, inspectors from the Federal Department for Inspection Affairs (FUZIP) found that seven of his appraisals did not correspond with what they found in the field. He is not the only one with problematic appraisals.

Inspectors have refuted opinions by 22 construction expert witnesses because they falsely established the time of construction, and overstated property investment or the size of facilities. Some also described nonexistent facilities. Based on appraisals such as these, farmers collected a 588,000 KM in grants from the Federation of Bosnia and Herzegovina (FBiH) Ministry of Agriculture, Waterworks and Forestry. Later they were ordered to return the money, but not one-tenth of the amount has been returned.

Vasić told CIN reporters that he signed and stamped the estimate appraisals based on what he heard from his clients. He said that Drago Grgić, then candidate of the People’s Party Work for Betterment for the local elections, enlisted him. He explained that Grgić told him that he would be later contracted to finalize the appraisals, but neither Grgić nor his clients ever showed up again. While Vasić claimed that he was defrauded, Grgić told CIN that the expert witness was not speaking the truth. He refused further comment.

Based on Vasićs’ appraisals, grants worth nearly 370,000 KM were approved. Before the farmers got the money, the payments were suspended because inspectors had detected irregularities.

Radenko Vasić

Expert witness Radenko Vasić collected information he used in appraisals in a bar. (Photo: CIN)

Refuted opinions of 22 expert witnesses

Six years ago the ministry started a program to subsidize agricultural facilities. It defined eligible farmers as those who invested in their farms between mid-2010 and the end of 2011. The ministry, then headed by Jerko Ivanković-Lijanović, established a new rule: farmers could prove their investment by submitting an appraisal. In the past they had to provide receipts to prove the date and the amount of money invested. The ministry offered a 25 percent subsidy on the cost of a project.

Ivanković-Lijanović told CIN that he did not introduce this novelty. However, the documents tell another story. The 2010 rules that define grant criteria state that an investment can only be proved by receipts and there’s no mention of expert witnesses.

To a call for applications for agricultural investments, 1,128 farmers responded. Most attached expert witness opinions to their applications. One-quarter of the applications were approved and money was being shelled out when inspectors started reviewing appraisals.

They found discrepancies between appraisals of property and buildings that they visited in the field, so the FBiH government issued 40 decisions suspending payments or ordering return of money paid out.

The only one who returned anything was Nedim Zejćirović from Čelić. He owns a farm with agricultural facilities for which he received a grant worth 104,000 KM. Expert witness Ivan Katić appraised the facilities, but misrepresented a restaurant on the farm’s premises as warehouse space. Zejćirović got his grant based on this. Katić told CIN that the restaurant existed but the owners used it as a checkroom and cafeteria for workers.

“So, they did not use it as a restaurant,” said Katić.

During their visit to the farm this April, CIN reporters found abandoned facilities. Zejćirović was not at the farm or responding to telephone calls.

This was not the only flaw in Katić’s appraisal. He wrote that two other facilities on the farm were built between June 2010 and December 2011. Inspectors established that they had existed before and that Zejćirović received them as a gift back in 2007.

In 2016, he was convicted by the Municipal Court in Tuzla for deception to obtain subsidies. He returned 40,000 KM, less than half what he got. The Ministry of Agriculture is demanding that he pay the rest.

Because of similar abuses, Tuzla Canton prosecutors are investigating Katić and checking on several other expert witnesses. The court had already convicted two expert witnesses because of abuse and forgery in relation to agricultural grants.

They are Džemal Polutan, a construction expert witness from Fojnica, and Nedžad Izić from Tuzla. Polutan was sentenced by the Municipal Court in Kiseljak to a deferred sentenced for forging paperwork.

Polutan had no permit to do appraisals in the area of hydro technology and environmental engineering, so he forged the permit of a colleague. He changed the names on the permit and used it to appraise troughs for horses and sheep belonging to Jure Iviš.

The fake permit was attached to the appraisal. Based on that, the ministry approved nearly 24,000 KM in subsidies to Iviš. Inspectors also discovered that Polutan overstated Iviš’s investment and some work for which the grants had been approved but never done. In an interview with CIN, he admitted that he came across a well and dug out soil while there was no concrete construction.

“I did include it because he said he would finish it,” said Polutan adding that he quit after he was convicted.

Iviš refused to speak with CIN reporters.

The other convicted expert witness Izić received a deferred sentence because of a faulty appraisal of the Stojak firm’s hen farm nearby Tuzla. Tuzla Canton prosecutor Ćazim Serhatlić said that a court-ordered appraisal established that the building was constructed before the date Izić put in his opinion.

Nedim Zejćirović

Nedim Zejćirović received grants for a building that is not used for agricultural purposes. He is the only one who returned anything and then, only after he was convicted. (Photo: CIN)

A barn worth half a million KM

CIN reporters visited 15 farms where they did not see what expert witnesses described in their opinions.

An agricultural co-op’s breeding goats farm Capra in Velika Bukovica near Travnik does not look like what Enisa Pašalić described in her opinion. She painted it as a barn for goats 50 meters long, 12 meters wide and worth 779 KM per a square meter. According to Pašalić’s appraisal, the owner had invested more than half a million KM into the barn and fence.

Inspectors came to another conclusion – they found that the facility was 150 square meters smaller than Pašalić stated and, thus, its value overstated by about 117,000 KM.

In her first interview with the reporters Pašalić was unsure about the appraisal. She said that a colleague she later stopped cooperating did the measuring.

CIN reporters have visited the farm and saw for themselves that the building was narrower than described in the opinion. In a second interview with CIN reporters, Pašalić acknowledged this: “It is (true), I saw a photo, an error has been made.”

Unlike Pašalić, a Bugojno expert witness Zdenko Antunović maintains that he did not err in his appraisal. In an opinion, he stated that during the reconstruction of three barns, a Glamoč firm Bili Kamen invested 160,000 KM. The inspectors found that the investment was worth 11,000 KM.

One can see what repairs went into the two barns – some roof tiles were changed and smaller repairs done to walls and foundation pillars. The third barn was covered with cement roof tiles dating from before the war when these barns were built. No investment in reconstruction that Antunović appraised to around 50,000 KM is visible.

The FBiH government suspended payments to the owner Filip Vujeva because of the expert witnesses’ error, but unlike some of his colleagues, Antunović has not been punished. Despite his appraisal being refuted, the Ministry of Agriculture enlisted him to carry out control appraisals in five other cases in which the inspection had established errors in appraisals.

Appraisals carried out by expert witness Vahida Žujo also did not correspond with what CIN reporters found during their field trip in Mostar. She produced an opinion for Dževad Kovač’s firm “Eko Koza”, a goat farm. She stated that the size of a milking facility was 140 square meters. According to the inspection’s report, she overstated it by nearly 70 square meters. Due to these errors, the milking area was over-appraised by around 44,000 KM.

Kovač never returned the money. He said that he sued Žujo because the ministry suspended the grant payments.

“She should have done the appraisal fairly. Why should I have been banned because of her opinion?” said Kovač. “Mind you, the ban says ‘based on incorrect data and the abuse of funds’. That’s what it says. It was not me who worked on the data, but the expert witness.”

Žujo did not want to comment. In a written statement to CIN, she said that she has had no complaints about her work during the past 20 years.

Zdenko Antunović

Bugojno expert witness Zdenko Antunović overstated the investment made to barns in Glamoč by about 150,000 KM. (Photo: CIN)

From Field to a Table

FBiH Police Authority conducted an investigation against Kladanj expert witness Rešad Sultanović, because of appraisals that led to grants. One had to do with the appraisal of investment into Rumeni Fishery whose owner is another Kladanj native, Ramiz Halilović.

Near the fishery, Halilović has built a restaurant with a pension on the top floor. In his appraisal of the fishery’s value and the value of other accompanying facilities, Sultanović kept mum about these. Due to this, Halilović received 127,000 KM in grants — for which hospitality buildings are not eligible.

Halilović does not see why his grant request should be questionable. He’s been on trial before the Municipal Court in Živinice on charges of deceit to obtain grants.

Inspectors established that this was a hospitality building, not an agricultural one, and explained how the Ministry of Agriculture called the program “From Field to Table”.

“Look there, isn’t this a field?” asked Halilović, pointing to the fish pools. “Isn’t there a table? You go in, sit down, I take a fish out and you consume it.”

Ribnjak „Rumeni“

The owner of Rumeni Fishery, Ramiz Halilović, received an agricultural grant for hospitality buildings which is not allowed. He’s been on trial before in the Municipal Court in Živinice for deception to obtain subsidies. (Photo: CIN)

The inspectors established also that the building was constructed before the period relevant for the public call. Sultanović said that he did not know why he was doing the appraisal and that he had put the construction date based on Halilović’s statement. Halilović said that the building had existed, but it was knocked down and a new one was built in its place.

He did not give up on saying that he was in fish processing business, not in hospitality or tourism. “How would you eat it if I did not process it?” said Halilović. “If there’s no processing of fish, then you cannot consume it. This you can understand as agro-tourism.”

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The Center for Investigative Reporting in Sarajevo (CIN) work is available for free to all organizations that credit CIN as their source and link to www.cin.ba.

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