Short Circuit: The Stunning Simplicity of Top-Level Corruption in Albania

Prosecutors in Albania say a former minister used a remarkably simple scheme to funnel big bribes for public contracts. It still took them several years to find him out.
On September 26, 2016, a warehouseman at state-owned Albania Railways called Arber Denizi opened his own business for the import and export of food and transportation of goods including construction materials. He called it Pivot-04.

Denizi’s pay at the state rail company was roughly 220 euros per month. In the first four months of its existence, Pivot-04 invoiced two related companies – Albtek Energy and Integrated Technology Services, ITS – for 160 million leks, or roughly 1.33 million euros.

ITS would eventually pay Pivot-04 some 214 million leks, or almost two million euros, money that Pivot-04 would use to buy sugar and rice from a company called Sucrabla, then owned by Ilir Koka, brother of Lefter Koka, who was Albania’s environment minister at the time. The deal completed, both Pivot-04 and Sucrabla suspended operations in early 2018.

Prosecutors now allege that Pivot-04 was one of seven companies used as conduits for the payment of bribes from concessionary firms to close relatives of Koka, who handed out public concessionary contracts via direct procurement procedures.

A well-known powerbroker in the Albanian port city of Durres, Koka abruptly quit politics after winning a parliamentary seat on behalf of the ruling Socialist Party in the last general election in April last year. He was arrested in December on charges of corruption and money laundering.

According to the prosecution request for Koka to be remanded in custody, presented to the court and seen by BIRN, these seven companies sent invoices totalling 460 million leks, roughly 3.7 million euros, to companies involved in waste incinerator concessions.

Prosecutors of the Special Structure Against Corruption and Organised Crime, SPAK, say the sum ended up in Koka’s pockets via a simple laundering scheme that civil society groups and media had drawn attention to repeatedly since 2018.

Two other people sought by prosecutors are still at large – Albtek Energy owner Stela Gugallja and ITS owner Klodjan Zoto. ITS submitted unsolicited proposals for construction of waste incinerators in Fier and the capital, Tirana, both awarded by the government of current Prime Minister Edi Rama, while Albtek won the concession in Elbasan via a contract awarded by Koka through direct negotiations.

Prosecutors say they can prove that the seven companies performed no real activity and that their “employees” have denied ever actually doing any work for them.

Koka has denied any wrongdoing while his lawyer, Fatmir Braka, says the case is politically motivated.

“The same hand”

SPAK began investigating in 2020 after charges were filed by the opposition Democratic Party and the Socialist Movement for Integration, SMI. The probe, however, was limited to the Elbasan plant, the smallest of the three disputed projects.

According to prosecutors, seven companies – Pivot-04, Sh.Sh., Deto, Bellar Inert, Sili, J.P.Y and R.B. – Ital Beton – were used to transfer bribes. Three of the companies – J.P.Y., Sili and Sh.Sh. –were registered at the same address in Durres, while six had listed identical business activities when registering with the National Business Centre.

In the documents submitted to the court, prosecutors say the signatures on the invoices issued by each company were the work “of the same hand”. Invoices purportedly issued by Gugallja, they said, appear to have been signed by the same person as both buyer and seller, only under different names.

“The graphical examination proves that the companies “Pivot 04”, “Sili”. Bellar Inert” (Bio Blend Fruit), “J.P.Y”, “Deto”, “R.B. – Ital Beton” (R.B-General Servis) and “SH.SH”, are connected to each other and the invoices issued by them are apparently prepared and undersigned by the same person,” the prosecutors wrote.

Friendly relations

Prosecutors allege that Koka enlisted the help of his own friends and those of his son as well as employees of companies owned by his relatives.

While issuing invoices for significant sums, the owners of the companies involved were officially earning fairly meagre salaries.

Pivot-04 owner Denizi, for example, had a monthly wage at Albania Railways of 28,000 leks, some 220 euros. But prosecutors say he was a friend of Koka’s son, Arbi, and say border crossing data show the pair often travelled outside Albania together.

Under questioning, Denizi said he had supplied construction material for the Elbasan incinerator, but acknowledged he did not actually own the means of transport. Instead, he used vehicles supplies by local residents, the names of whom he was unable to recall. He acknowledged not knowing any of the people listed as employees of Pivot-04.

“At the time when Pivot-04 supposedly conducted economic activity and Albtek Energy and ITS companies transferred large sums of money to Pivot-04 and Pivot-04 made “purchases” from Sucrabla, Arber Denizi continued to work as a warehouseman,” prosecutor Klodian Braho wrote.

Sili owner Silvester Driza was also employed at Albania Railways and later the Durres Port authority, another state-owned firm, while also apparently invoicing Albtek, ITS and Integrated Technology Waste Treatment Fier for hundreds of thousands of euros.

Sili transferred the money received to Wind Co, owned by Brunilda Koka, the former minister’s wife, for the purchase of real estate.

Another Albania Railways employee, Ardian Bello, fronted Bellar Inert, which invoiced Albtek for almost half a billion leks. He began working at the state rail company in 1980 and has a wage of 30,000 leks, or 250 euros.

Using border data showing their movement in and out of the country, prosecutors alleged that one of the company owners is friends with Koka and the others are friends of his son, Arbi. Yet the only people charged in the case are Koka, Gugallja and Zoto, the latter two having secured three waste management contracts worth hundreds of millions of euros.

Check Also

China’s Expansion Could Meet Challenges in Balkans in 2022

The rising superpower may confront some checks from its rivals in the Western Balkans this …