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ZAGREB, March 30, 2010 - Police on Tuesday arrested a former Croatian deputy prime minister and economy minister who had been the subject of a probe over his role in a major corruption affair, the interior ministry said.

 

Damir Polancec was detained at his home in Koprivnica, some 70 kilometers (43 miles) northeast of Zagreb, interior ministry spokesman Krunoslav Borovec told AFP. He refused to give further details in the case. The national Bureau for the Fight Against Corruption and Organised Crime (USKOK) in January opened a probe into Polancec on suspicion of "illegal mediation" in a corruption affair at Croatia's leading food company Podravka.

 


Polancec is the country's highest ranking official to be investigated over corruption. Zagreb has recently stepped up the fight against corruption which is among the key criteria it has to meet if it wants to join the European Union. Croatia hopes to become the bloc's 28th member by 2012.



The 42-year-old resigned in last October after USKOK began investigating Podravka, leading to the arrest of the company's four top officials. Three of them were freed earlier this month, but they remain suspects.


They are suspected of trying to acquire a 25 percent stake in Podravka with the company's money, by means of financial transactions through a local food firm and a brokerage company. Polancec, a former longtime manager of the food firm, was allegedly mediating in the illegal dealings.


Podravka lost some 35 million euros (46 million dollars) because of the affair, according to local media reports.


The company which operates in eastern and central Europe was privatised in 1993 and the state owns a 26-percent stake.


According to Podravka's figures, in 2008 its revenue amounted to 512 million euros (692 million dollars) while net profits were some six million euros (8.1 million dollars).


Croatian media have alleged that Ivo Sanader, a former prime minister who unexpectedly resigned last July knew what was happening in Podravka but kept quiet about it.

Another minister from Sanader's cabinet, former Defence Minister Berislav Roncevic, was indicted and put on trial in January over suspicious deals in a 2004 purchase of army trucks.

Everyone who participated in the (devastating) privatization in Croatia could be arrested under the criteria applied in this occasion, Damir Kajin (representative in the Croatian Parliament) commented.