Novica Toncev, Serbia's minister in charge of underdeveloped municipalities, secretly founded an offshore company in the British Virgin Islands in 2010, without reporting it to the Anti-Corruption Agency, the Crime and Corruption Reporting Network, KRIK, reported, citing documents from the Pandora's Papers project.
Toncev first denied he was linked to an offshore company, „Service for Efficient Energy, „claiming his signature was probably forged. A few days later, however, he admitted he owned it.
KRIK’s report resulted from the international project ‘Pandora’s Papers’ whose journalists disclosed some 12 million documents on the founding of companies. The project was led by reporters from the International Consortium of Investigative Journalists (ICIJ). KRIK took part in the investigation analysing papers related to Serbia.
The other official from Serbia mentioned in the ‘Pandora Papers’ is the current Finance Minister Sinisa Mali, who denies all allegations.
In 2010, Toncev was elected a member of the Main Board of the Socialist Party of Serbia (SPS), the leading coalition partner of President Aleksandar Vucic’s Serbian Progressive Party (SNS) when it won general elections two years later.
Toncev’s company ‘Toncev Gradnja’ (Construction)“ signed contracts with the state to built roads, reconstruct the Clinical Center in the southern city of Nis, the Interior Ministry’s buildings and the Djerdap hydroelectric power plant.
At the same time, the company became the owner of a house in the Belgrade prestigious residential district Dedinje, worth 1.2 million euros.
Through his „Service for Efficient Energy „company, Toncev also owned an account in Switzerland. That is seen in the documents leaked from the SFM Swiss agency, which deals with establishing offshore companies.
After Toncev founded the company, the agency issued an invoice for its services, including opening an account in this country.
Toncev first denied to KRIK journalists he had anything to do with the firm.
„This is not my signature. Maybe it’s fake; it has nothing to do with me. I never had that firm. I did not take or bring a single dinar from BVI (British Virgin Islands). I don’t know where the Virgin Islands are,“ Toncev said then.
However, a few days later, he told KRIK that he remembered being the owner of ‘Service for Efficient Energy,’ explaining he planned to start a business with the company but changed his mind. Hence, the company never did any business.
„I wanted to work with that company on mini-hydropower plants in Serbia. I saw that I could do it through ‘Tončev Gradnja’, and I told my lawyers to close it (the offshore company) in 2-3 years. The company did not work,“ Toncev said.
He said that was the reason for not reporting the company to the Anti-Corruption Agency.
„When a company starts working, I report it; while it doesn’t, I don’t report,“ Toncev said