High Court hands Todorić major legal victory

The former owner one of the region's largest companies, Agrokor, business tycoon Ivica Todorić, has won a major legal victory that is likely to deal a major blow to the prosecution’s case against him.

The High Criminal Court in Zagreb has affirmed a lower-court ruling, throwing out a key piece of evidence in the case against him and 14 other defendants. Namely, the court ruled on Monday that a review of Agrokor's books by a Polish auditing firm - the foundation of the prosecution's case - was inadmissible because of a conflict of interest. This is due to the fact that the auditing firm KPMG Poland had previously worked with the crisis management team that the Croatian government installed in 2017 to run Agrokor after seizing it from Todorić to prevent its failure from upending the rest of the economy.

Todorić and the other defendants have consistently claimed that this evidence was illegal. It should be noted that Croatia paid more than 1 million euros to KMPG Poland for the audit. The court said KMPG Poland, instead of collecting and analyzing Agrokor’s books themselves, had relied on KMPG Croatia to do so. KPMG Croatia had previous ties to Agrokor's government-appointed management team.

Attorney Anto Nobilo, who represents another defendant in the case, said this was all part of a ploy by prosecutors to present evidence they knew was inadmissible.

"I believe the State's Attorney's Office abused its power by taking a series of planned steps that is in fact fraud. They tried to plant a false expert witness while the people who were actually the expert witnesses were paid by Agrokor's temporary management,” said Nobilo.

At the time, Chief State's Attorney Dražen Jelenić had issued an international tender for the audit, claiming it was the only way to avoid a conflict of interest for Croatian auditors.

Todorić and the other defendants are charged with various business crimes, including fraud, forgery, and false accounting. According to prosecutors their crimes defrauded Agrokor of around 110 million euros.

This case addresses alleged fraud by Agrokor's top executives. However, in a separate legal matter, there are on-going arbitration proceedings in Washington, DC alleging Agrokor's state-managed emergency restructuring caused the company's former owners multibillion-euro losses.