NO TRACE has remained of a now-defunct offshore company, it emerged in court yesterday in the case of Predrag Djordjevic vs the Popular Bank.
Djordjevic, a Serbian businessman based in Nicosia, is suing the bank for compensation and damages in a 900,000 deutschmark transaction that was never completed.
The first witness on the day was Theodoros Parperis, an accountant with auditors Costouris & Michaelides (now PriceWaterHouseCoopers), auditors of Antexol Trade Ltd.
“It is normal practice to destroy the data seven years after a company ceases to be a customer,” Parperis said.
He did, however, recall the specific company and knew by name its nominees (or representatives).
Antexol was incorporated in 1992 with the Tassos Papadopoulos law firm as the nominees. But since it was an offshore company, its real owners or beneficiaries could not be Cypriots. The beneficiaries were named as Yugoslav nationals Ljljana Radenkovic and Radmila Budicin.
But neither Radenkovic nor Budicin had ever heard of Antexol, and had no idea their names were being used to front an offshore company in Cyprus.
Djordjevic says he first heard of Antexol in 1994, after arranging to sell raw cotton worth DM900,000 purchased from a Russian company to a Serbian businessman.
The businessman had a licence issued on humanitarian grounds by the United Nations that allowed him to sell cotton for making medical products to a Serbian company while sanctions were in force against Yugoslavia.
To facilitate payment, Djordjevic opened an account at Beogradska Banka in Nicosia in the name of Genemp, his trading company. But instead of receiving the full amount from Belgrade directly, Genemp was credited with DM537,000, which had been transferred from Antexol’s account at Popular Bank.
Djordjevic is claiming the remaining DM360,000 plus damages from Popular Bank. He believes this amount was also credited to Antexol’s account at Popular Bank but was used for other purposes.
The Popular Bank accepted Antexol made the DM537,000 payment, but claimed it had no knowledge of the DM900,000 transaction.
Antexol and several other Serbian-owned offshore companies were used for sanctions-busting by the government of Slobodan Milosevic, the former Yugoslav president.
Many of these were registered as “trading corporations” by the Tassos Papadopoulos law firm.
Antexol was struck off the company registrar’s record in August 2003.
It is Djordjevic’s contention that his company was mistaken for one of these fronts, and inadvertently caught in the money-laundering web at the height of the Bosnian war.
Several billion dollars transferred illegally to the island by the government of Milosevic were deposited in the Cyprus Popular Bank.
The funds were used to buy weapons, equipment and fuel for the Milosevic regime to pursue wars in Bosnia and Kosovo, according to an investigation by the United Nations war crimes tribunal at The Hague.
At a previous hearing, a former Serbian bank treasurer had told the court how millions of pounds in cash were jammed in plastic bags and then shipped from Yugoslavia to Cyprus.
The paper trail used by Djordjevic’s lawyers has been obtained from The Hague court, which investigated Serbian money-laundering in the 1990s.
According to a balance sheet dating to 1994 that was submitted as evidence, Antexol had a turnover of £2.35 million, over £1 million in payable interest, and hundreds of thousands of pounds in “management fees”.
There was no explanation of what these management fees were or any indication of commercial transactions by Antexol, which had been registered as a trading corporation.
Next a Central Bank employee took the stand. Witness Mary Piki was asked whether the Central Bank had any surviving files on Antexol.
She said the Central Bank destroyed foreign transactions records every seven years, so it was “possible, or probable that this data does not exist”.
And although she had heard of Antexol in the media, she was not aware in her capacity as a bank employee that any investigation was carried out.
Records of the real owners of offshore company are kept only by the Central Bank.
