A participant in the “Investigative Reporting and Organized Crime” program implemented by the Media Centar Sarajevo NetNovinar Training Center, after working on her investigation for just two months, deserved an announcement on the front page of the Zagreb Večernji List for uncovering hidden documentation about judges who withdrew their money from a collapsed savings and loan association through real estate when “ordinary” savers couldn’t.Marija Mikolić’s article was published in Večernji List on 27 October 2006 in the following form:SUPERSCRIPT HEADLINE: Corruption in Virovitica: Municipal Court Judge Blanka Pacaloš-Torbaj and Virovitica County Court President Darko Domšić involved in “Association case”HEADLINE: Through connections, judges compensate family with apartments and landSUBHEADLINE: Those who got real estate in 2005 could do it exclusively through connections. How else can we explain that some 20 people got land in Crikvenica within three months, although more than 1,200 had been saving at the Association? At the same time, among those privileged are as many as two families of Virovitica judges and families of then Association heads – says Siniša Prpić.SIGNATURE: Marija MikolićVIROVITICA – Municipal Court Judge Blanka Pacaloš-Torbaj and Virovitica County Court President Darko Domšić are people whom the Board of Creditors of the “Virovitica Savings and Loan Association” (ŠKZ - Štedno-kreditna zadruga Virovitica) in bankruptcy, led by  Siniša Prpić, announced it would accuse in today’s (Friday) gathering and peaceful protest in Zagreb. Their names are among people from the judiciary and Ministry of Finance whom some 2,000 savers of the ŠKZ in bankruptcy, among whom part of the ZŠKZ in bankruptcy, consider co-responsible for the collapse of the Association and disappearance of 105 million kunas in savings deposits.- We accuse them of evident immorality and corruption. Their families, according to documents we possess, were privileged Association savers. In March, April and May 2005 they managed to gain the right to real estate in Crikvenica as counter-value for their savings. At the same time, savers hadn’t been able to withdraw their money for six months because the Association heads were telling them there was no money, that with their money disappeared the possibility of obtaining real estate which, through the company “Jedra d.o.o.”, had guaranteed for their savings deposits. The connections are evident: in three months only some 20 people got real estate in Crikvenica, although more than 1200 had been saving with the Association. Among those privileged are as many as two families of Virovitica judges and families of then Association heads – says Siniša Prpić, President of the Board of Creditors of ŠKZ in bankruptcy. – In the course of 2004 and 2005 suspicious transactions were being made at the Association which went through the cashier’s office, not the transfer account. Sales contracts concluded in this period between savers and the company Jedra d.o.o. are related solely to exchange of money deposits with real estate. The Association at that time had no way of returning the savers’ money, except this way. But, not everyone could get real estate in exchange for their deposits – explained Franjo Otročak, Public Receiver for ŠKZ in bankruptcy. The suspicious transactions have also been investigated by the MUP (Ministry of Interior), which is following the trail of payments and money circulation related to purchase of real estate via Jedra. – Criminal processing and police inquests are underway related to the course of sale of real estate, business and housing units in Crikvenica, of which there are more than 140 in four buildings – according to a statement by Virovitica-Podravina Police Administration Spokesman Slavko Kopjar. With the aim of protecting the investigation, police did not tell us if the Virovitica judges’ contracts were among them. 

BOX 1:Pacaloš-Torbaj: Real estate is owned by ex husbandVIROVITICA – Municipal Court Judge Blanka Pacaloš-Torbaj comments on accusations of immorality and corruption: “I don’t feel called upon, because this is about real estate owned by my now ex husband, but if they want, they can accuse me publicly. At the time the real estate was bought, my husband and I were in very poor relations and facing divorce which followed later. I can’t answer for his actions and I myself have never saved there, nor have I ever influenced the procurement of his property.” Judge Pacaloš-Torbaj is best known in her department for distress proceedings related to ZŠKZ, the predecessor of ŠKZ. Debtors who took loans from the ZŠKZ could not pay them back because of the enormous interest rates, which in the majority of cases reached 400 percent annually. The Association proposed distress for collection of debts, the court approved a public auction, and in 90 percent of cases its debtors’ houses and other real estate were bought by the Association itself, some for 1 or 500 kunas!
BOX 2:Domšić: The connection wasn’t me, it was dad VIROVITICA – “My wife and brother were savers at the Association and they bought apartments in buildings in Crikvenica with money, with their savings deposits; they didn’t get them as a gift. Before the Association collapsed, they wanted to salvage their money and settle the issue of savings deposits. I didn’t pull any strings; rather, before the collapse of the Association, we managed to carry out the real estate purchase through dad – Darko Domšić, Virovitica County Court President and Judge, told us in a telephone conversation. In an anxious voice, he said he hadn’t been a saver, but the case keeps following him, and he asked us not to question him any more. Darko Domšić had also worked as a judge of the Virovitica Municipal Court, and during his career he had tried cases having to do with the Trade Savings and Loan Association of Virovitica (ZŠKZ – Zanatsko štedno-kreditna zadruga), the predecessor of ŠKZ. His father Martin Domšić is the principal defendant in the criminal trial of six people responsible for the collapse of the Association taking place right now before Bjelovar County Court.
BOX 3:What went to Virovitica judges’ families?VIROVITICA – Vera and Igor Domšić, wife and brother of Virovitica County Court President Darko Domšić, are owners of a 28 square flat and part of an apartment in Crikvenica, according to sales contracts with the company Jedra d.o.o., dated 29 March and 21 April 2005. Rajko Pacaloš, husband of Blanka Pacaloš-Torbaj, Virovitica Municipal Court Judge, based on a sales contract with Jedra d.o.o., dated 12 April 2005, is the owner of part of a yard in Crikvenica. Transfer of property in the Crikvenica land register was made in April 2005 under land registry title deeds 5621 and 4947.You can see scanned articles of the investigative story “Through connections, judges compensate family with apartments and land” and the announcement on the Večernji List front page here picture 1, picture 2. Linked articles No money for savers