BANSKÁ BYSTRICA COURT TO RULE ON WHETHER STATE OFFICIAL BILKED PUBLIC IN RESTITUTION SCAM

Land Fund manager on trial for fraud

VALUABLE undeveloped land beneath the High Tatras mountains handed out to companies with ties to the ruling coalition. Dozens of hectares sold for a song to a firm that helped a senior coalition figure, Vladimír Mečiar, explain where he got the money to pay for his estate. The Slovak Land Fund (SPF) has been at the centre of some of the gravest scandals involving the handling of public property during the Fico government.

Land for the Majer-Šalková industrial zone. Land for the Majer-Šalková industrial zone. (Source: SME)

VALUABLE undeveloped land beneath the High Tatras mountains handed out to companies with ties to the ruling coalition. Dozens of hectares sold for a song to a firm that helped a senior coalition figure, Vladimír Mečiar, explain where he got the money to pay for his estate. The Slovak Land Fund (SPF) has been at the centre of some of the gravest scandals involving the handling of public property during the Fico government.

Most of these cases remain under investigation by the police. But last week, a suspect land deal involving the SPF during the previous Dzurinda government finally went before the courts.


The Banská Bystrica district court on March 3 began hearing fraud charges against Dušan Caban, former director of the SPF office in Banská Bystrica. The prosecution claims that Caban caused Sk31.6 million (€1 million) in damages in 2005 by declaring as “agricultural” land that was actually zoned for construction.

The SPF controls thousands of hectares of state land in Slovakia. The purpose of the Fund is to use these resources to compensate people whose property was confiscated by the Communists from 1948 to 1989. The process is known as restitution.

According to the prosecution, Caban failed to ensure that the land issued in Banská Bystrica to restitution claimants Andrej and Eleonóra Sopóci was appraised properly. While the land at that time was being used for agricultural purposes, and was appraised accordingly at 4-6 crowns per square metre, it was actually zoned for construction purposes, and was thus worth 117 crowns per square metre.

Although Caban is the only one accused of fraud, the prosecution notes that the supporting documents prepared for him by the Banská Bystrica town office, including former city mayor Ján Králik, were “misleading and incomplete”.

Caban also allegedly took no notice of SPF Banská Bystrica employees Marta Makušová and Ján Spevák, who informed him that the land had been improperly appraised.

“When I told Mr Caban, my boss, that the appraisal was wrong, he said I should do it like the Sopóci wanted,” Makušová said.



Farmers for a day



On the basis of a 10-year-old restitution claim on land near Komárno, south Slovakia, the Sopóci of Bratislava were allotted some 300,000 square metres of land in the Šalková district of Banská Bystrica in 2005.

The year before, the area had been approved as the “Majer-Šalková Industrial Zone” within the Banská Bystrica land use plan. The Dzurinda government had also recommended Šalková as the site for an industrial park in 2003.

In their restitution application, the Sopóci claimed that they or a family acquaintance intended to continue to use the land for agricultural purposes.

The land was valued accordingly, at about Sk1.6 million. In fact, on the day the deal was approved, on May 12, 2005, the Sopócis sold the land to Profinex Engineering of Banská Bystrica for Sk20 million – 10 million for each of the sellers. The sum came to about Sk80 per square meter, or more than 10 times the value the SPF had ascribed to the land.

The owner of Profinex, Roman Kvasnička, was a well- known land broker in the area. In 2006 he became one of the candidates of the HZDS party for the position of deputy director of the SPF, even though HZDS boss Mečiar later chose Branislav Bríza instead.

According to his own statement to TASR in October 2006 regarding the Šalková property, Kvasnička was under no illusion that the land was going to be used for agricultural purposes.

“Our intention is to build infrastructure and transport connections in a way that the land can serve multiple users as an industrial park.”

Nor was the purchase of 30 hectares in Šalková an unexpected windfall for the developer. Kvasnička’s 85-year-old grandmother, Františka Halajová, represented the Sopóciovci to the SPF during the restitution process. However, as she told The Slovak Spectator, she had never met her “clients”, and the whole arrangement had been set up by her grandson.

“He told me it would be more convenient for them (Sopóci) if they didn’t have to keep traveling to Banská Bystrica, and if I could just sign things for them,” she said.



Town pays full price



Kvasnička sold the Šalková land in June 2007 to the Perul company of Bratislava; the sale price was already 300 crowns per square meter.

Four days later, on June 29, Perul sold the land to MBB, a company owned by the city of Banská Bystrica, for 654 crowns per square meter, or well over 100 times the SPF valuation. The purchase price was nearly Sk180 million. MBB did not respond to questions from The Slovak Spectator sent in mid February. Caban refused to comment on the case.

“I’ve already said everything I have to say,” he said, before hanging up. But the prosecution has no doubts. “Mr Caban’s mistake was in not ensuring that a proper evaluation was conducted, especially after being informed by SPF employees that the value of the land was at least Sk117 per square meter,” said a source from the prosecutor’s office.



Land Fund withdraws charges



Curiously, the SPF has withdrawn several civil court cases it filed regarding the Banská Bystrica properties without waiting for the outcome of the criminal case against Caban. If the Fund had waited, the evidence submitted during the trial and the damages determined by the court could have greatly strengthened its civil arguments.

On October 23 last year, for example, the Bratislava II district court halted proceedings in the civil case of the SPF vs Eleonóra and Andrej Sopóci.

The damages had been set at Sk13.8 million, and the SPF had sued the mother and son couple for “unjustified enrichment” in May 2008.

Eighteen months later, however, the two parties reached an out-of-court settlement. It is not clear what the Sopóci’s were required to pay.

SPF spokesman Ľudovít Kavjak said only that the couple had turned over to the Fund a receivable that was worth more than the land in question.

In another civil case, MBB had been allowed to hand over 4 hectares of land in Banská Bystrica to settle with the SPF.

“Given that this involved a transfer rather than a sale, the value of the land was not set,” Kavjak said.

This is not the first time that Land Fund managers appointed by the current Fico government have shown an unusual level of cooperation with managers from the previous political era.

In 2007 it emerged that the newly appointed deputy director of the Land Fund, Branislav Bríza (HZDS), had found a holiday taken by his boss, František Hidegety of the Hungarian Coalition Party (SMK) from the previous ruling coalition, a convenient time to sign contracts enriching businesses with ties to HZDS chairman.


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