Financial Crime and Corruption by Samuel Vaknin
3. The system alters its membership requirements in
13106 words | Chapter 80
direct response to public feedback and to the
changing social and economic environment.
To belong to a meritocracy one needs to satisfy a series of
demands, whose attainment is entirely up to he individual.
And that is all that one needs to do. The rules of joining
and of membership are cast in iron. The wishes and
opinions of those who happen to comprise the club at any
given moment are of no importance and of no
consequence. Meritocracy is a "fair play" by rules of equal
chance to derive benefits. Put differently, is the rule of
law.
To join a meritocratic club, one needs to demonstrate that
one is in possession of, or has access to, "inherent"
parameters, such as intelligence, a certain level of
education, a potential to contribute to society. An inherent
parameter must correspond to a criterion and the latter
must be applied independent of the views and
predilections of those who sometimes are forced to apply
it. The members of a committee or a board can disdain an
applicant, or they might wish not to approve a candidate.
Or they may prefer someone else for the job because they
owe her something, or because they play golf with him.
Yet, they are permitted to consider only the applicant's or
the candidate's "inherent" parameters: does he have the
necessary tenure, qualifications, education, experience?
Does he contribute to his workplace, community, society
at large? In other words: is he "worthy" or "deserving"?
Not WHO he is - but WHAT he is.
Granted, these processes of selection, admission,
incorporation and assimilation are administered by mere
humans and are, therefore, subject to human failings. Can
qualifications be always judged "objectively,
unambiguously and unequivocally"? Can "the right
personality traits" or "the ability to engage in teamwork"
be evaluated "objectively"? These are vague and
ambiguous enough to accommodate bias and bad will.
Still, at least appearances are kept in most cases - and
decisions can be challenged in courts.
What characterizes oligarchy is the extensive, relentless
and ruthless use of "transcendent" (in lieu of "inherent")
parameters to decide who will belong where, who will get
which job and, ultimately, who will enjoy which benefits.
The trouble with transcendent parameters is that there is
nothing much an applicant or a candidate can do about
them. Usually, they are accidents, occurrences absolutely
beyond the reach or control of those most affected by
them. Race is such a transcendent parameter and so are
gender, familial affiliation or contacts and influence.
In many corners of the globe, to join a closed, oligarchic
club, to get the right job, to enjoy excessive benefits - one
must be white (racism), male (sexual discrimination), born
to the right family (nepotism), or to have the right political
(or other) contacts (cronyism). And often, belonging to
one such club is the prerequisite for joining another.
In France, for instance, the whole country is politically
and economically run by graduates of the Ecole Normale
d'Administration (ENA). They are known as the
ENArques (=the royal dynasty of ENA graduates).
The privatization of state enterprises in most East and
Central European countries provided a glaring example of
oligarchic machinations. In most of these countries (the
Czech Republic, Macedonia, Serbia and Russia are
notorious examples) - state companies, the nation's only
assets, were "sold" to political cronies, creating in the
process a pernicious amalgam of capitalism and oligarchy,
known as "crony capitalism" or privateering. The national
wealth was passed on to the hands of relatively few, well
connected, individuals, at a ridiculously low price. The
nations involved were robbed, their riches either
squandered or smuggled abroad.
In the affairs of humans, not everything falls neatly into
place. Take money, for instance. Is it an inherent
parameter or an expressly transcendent one? Making
money indicates the existence of some merit, some
inherent advantageous traits of the money-making
individual. To make money consistently, a person needs
to be diligent, resilient, hard working, to prevail and
overcome hardships, to be far sighted and to possess a
host of other - universally acclaimed - traits. On the other
hand, is it fair when someone who made his fortune
through corruption, inheritance, or luck - be preferred to a
poor genius?
That is a contentious issue. In the USA money talks.
Being possessed of money means being virtuous and
meritorious. To preserve a fortune inherited is as difficult
a task as to make it in the first place, the thinking goes.
Thus, the source of the money is secondary.
An oligarchy tends to have long term devastating
economic effects.
The reason is that the best and the brightest - when shut
out by the members of the ruling elites - emigrate. In a
country where one's job is determined by his family
connections or by influence peddling - those best fit to do
the job are likely to be disappointed, then disgusted and
then to leave the place altogether.
This is the phenomenon known as "Brain Drain". It is one
of the biggest migratory tidal waves in human history.
Capable, well-trained, educated, young people leave their
oligarchic, arbitrary, influence peddling societies and
migrate to less arbitrary meritocracies (mostly to be found
in what is collectively known as "The West").
This is colonialism of the worst kind. The mercantilist
definition of a colony is a territory which exports raw
materials only to re-import them in the form of finished
products. The Brain drain is exactly that: the poorer
countries are exporting raw brains and buying back the
finished products masterminded, invented and
manufactured by theses brains.
Yet, while in classical colonialism, the colony at least
received some recompense for its goods - here the poor
country is actually the poorer for its exports. The bright
young people who depart (most of them never to return)
carry with them an investment of the scarce resources of
their homeland - and award it to their new, much richer,
host countries. This is an absurd situation, a subsidy
granted reluctantly by the poor to the rich. This is also one
of the largest capital transfers (really capital flight) in
history.
Some poor countries understood these basic, unpleasant,
facts of life. They extracted an "education fee" from those
emigrating. This fee was supposed to, at least partially,
recapture the costs of educating and training the
immigrants. Romania and the USSR imposed such levies
on Jews emigrating to Israel in the 1970s. Others
despairingly regard the brain drain as a natural
catastrophe. Very few countries are trying to tackle the
fundamental, structural and philosophical flaws of the
system, the roots of the disenchantment of those who
leave.
The Brain Drain is so serious that some countries lost up
to a third of their total young and educated population to it
(Macedonia in South-eastern Europe, some less developed
countries in South East Asia and in Africa). Others were
drained of almost one half of the growth in their educated
workforce (for instance, Israel during the 1980s).
Brains are an ideal natural resource: they can be
cultivated, directed, controlled, manipulated, regulated.
They are renewable and replicable. Brains tend to grow
exponentially through interaction and they have an
unparalleled economic value added. The profit margin in
knowledge and information related industries far exceeds
anything common to more traditional, second wave,
industries (not to mention first wave agriculture and
agribusiness).
What is even more important:
Poor countries are uniquely positioned to take advantage
of this third revolution. With cheap, educated workforce -
they can monopolize basic data processing and
telecommunications functions worldwide. True, this calls
for massive initial investments in physical infrastructure.
But the important input is the wetware, the brains. To
constrain them, to disappoint them, to make them run
away, to more merit-orientated places - is to sentence
oneself to a permanent disadvantage and deprivation.
This is what the countries in the Balkans are doing.
Driving away the best part of their population by
encouraging the worst part. Abandoning their future by
dwelling on their past. Caught in a fatal spider web of
family connections and political cronyism of their own
design. Their factories and universities and offices and
government filled to the brim with third rate relatives of
third rate professors and bureaucrats. Turning themselves
into third rate countries in a self perpetuating, self feeding
process of decline. And all the while eyeing the new and
the foreign with the paranoia that is the result of true guilt.
XLVIII. Rasputin in Transition
Frauds and Con-men in Countries in Transition from Communism
The mad glint in his eyes is likely to be nothing more
ominous than maladjusted contact lenses. If not clean
shaven, he is likely to sport nothing wilder than a goatee.
More likely an atheist than a priest, this mutation of the
ageless confidence artist is nonetheless the direct spiritual
descendent of Rasputin, the raving maniac who governed
Russia until his own execution by Russian noblemen and
patriots.
They are to be found in all countries in transition. Wild
and insidious weeds, the outcome of wayward pollination
by mutated capitalism. They prey on their victims, at first
acquiring their confidence and love, then penetrating their
political, social and financial structures almost as a virus
would: stealthily and treacherously. By the time their
quarry wakes up to its infection and subjugation - it is
already too late. By then, the invader will have become
part of the invaded or its master, either through blackmail
or via tempting subornation.
This region of the CEE and the Balkans provides for
fertile grounds. It is a Petrie dish upon which cultures of
corruption and scandalous conduct are fermented. The
typical exploiter of these vulnerabilities is a foreigner.
Things foreign are held in awe and adulation by a
populace so down trodden and made to feel inferior in
every way, not least by foreign tutors and advisors. The
craving to be loved, this gnawing urge to be accepted, to
be a member of the club, to be distinguished from one's
former neighbours - are irresistible. The modern Rasputin
doles out this unconditional acceptance, this all
encompassing affinity, the echoes of avuncularity. In
doing so, he evokes in the recipients such warmth, such
relief, such fervour and reciprocity - that he becomes an
idol, a symbol of a paradise long lost, a golden braid.
Having thus completed the first phase of his meticulous
attack - he moves on to the second chapter in this book of
body snatching.
Armed with his new-fangled popularity, the crook moves
on and leverages it to the hilt. He does so by feigning
charity, by faking interest, by false "constructive
criticism". To his slow forming army, he recruits the
media, the flower children, the bleeding hearts, reformers,
dissidents and the occasional freak. By holding old
authority in disdain, by declaring his contempt for the
methods of the "tried and true", by appearing to make war
upon all rot and immorality - this creature of expediency
emerges as a folk hero. It is the more cynical and world
weary and "sophisticated" members of society that lead
the way, succumbing to his ardour and conviction, to his
child-like innocence, to his unwavering agenda. He
cleverly thrusts at them the double edge of their own
disillusionment and disappointment. Thus mirrored, they
are transformed and converted into his camp of renewal
and clean promises by this epiphany. They hand him the
keys to every medium, the very codes and secrets that
make him so powerful. They pledge their alliance and
allegiance and render to him the access they possess to the
nerve centres of society. The castle gates thus opened
from inside, his victory assured, the rogue moves on to
consummate this unholy marriage between himself and
the deceived.
Always in fear of light, he surreptitiously and cunningly
begins to interact with the foci of power and money in the
land. However loathsome he is to them, however
repulsive the experience, however undesirable the effects
of their surrender - they are made to recognize him as
their equal. With the might of the media and a large part
of the people behind him, he can no longer be ignored.
Their conspiracy-prone mind, awash with superstitions
and its attaching phobias, tries to comprehend his
meteoric rise, the forcefulness with which he treads, his
unmitigated, inane, self confidence. Is he a spy? A
member of a secret order? The latent agent of a
hyperpower? The heart of a world conspiracy? Has he no
fear of retribution and no remorse? Before this great
unknown, they kneel and yield, an atavistic reaction to
atavistic fears. Now all doors are thrown open, all deals
are made available, all secrets are revealed. The more he
learns, the mightier he becomes - the more his might, the
more he learns. To him, a virtuous cycle, to his hosts - a
vicious one.
In all this tumult, he does not lose sight of his original
goals - power, money, fame, all three. It is a relentless
pursuit, an obsessive hunt, a ruthless and unscrupulous
chase. In his war, no prisoners are taken, no price too
dear, no human in his orbit left untouched. He will
manipulate and threat and beg and promise and plead and
blackmail and extort to accomplish that which he set out
to achieve: decision making powers, wealth, clout,
exposure and resultant fame. It is at this stage that the
latter day Rasputin emerges from the shadows and joins
officialdom or concludes lucrative transactions based on
favourably deflated prices and insider dealing. By now,
his shady past is no longer a hindrance. His prowess far
exceeds his invidious biography. Well installed, he
ignores both media and the people. He brushes aside
contemptuously all criticism and enquiry. His true,
narcissistic, face is exposed and it is hideous to behold.
But there is nothing to be done and all resistance is futile.
The con-man now is in a haste to maximize his hard
earned profits and exit the scene, on his way to another
realm of guile and naivet.
XLVIX. The Eureka Connection
How East and Central Europeans Defraud the Gullible West
A common, guttural cry of "Eureka" echoed as the
peoples of East Europe and the Balkan emerged from the
Communist steam bath. It was at once an expression of
joy and disbelief. That the West should be willing to
bankroll the unravelling of a failed social experiment,
freely entered into, exceeded the wildest imaginings. That
it would do so indefinitely and with no strings attached
was a downright outlandish fortuity.
Transition in the post communist countries was coupled
with a hubristic and haughty conviction in the
transforming powers of the Western values, Western
technology, and Western economics. The natives - awe
struck and grateful - were supposed to assimilate these
endowments and thus become honorary Westerners
("white men"). Where osmosis and immitation failed -
bayonets and bombs were called upon. These were later
replaced by soft credits and economic micromanagement
by a host of multilateral institutions.
Accustomed to Pavolvian interactions, adept at
manipulating "the system", experts in all manner of make
belief - the shrewd denizens of the East exercised the
reflexive levers of the Great Democracies. They adopted
stratagems whose sole purpose was to extract additional
aid, to foster a dependency of giving, to emotionally
extort. In one sentence: they learned how to corrupt the
donors.
The most obvious subterfuge involved the mindless
repetition of imported mantras. Possessed of the same
glazed eyes and furled lips, the loyal members of a
perfidious nomenklatura uttered with the same seemingly
perfervid conviction the catechism of a new religion.
Yesterday communism - today capitalism, unblushingly,
unhesitatingly, cynically. Yesterday, a recondite
dictatorship of the proletariat or, more often, a personality
cult - today "democracy". Yesterday - brotherhood and
unity, today - genocidal "self determination". Yesterday -
genocidal inclinations, today - a "growth and stability
pact". If required to bark in the nude in order to secure the
flow of unsupervised funding (mainly to their pockets),
these besuited "gentlemen" would have done so with self-
sacrificial ardour, no doubt.
When it dawned upon them that the West is willing to pay
for every phase of self-betterment, for every stage of self-
improvement, for every functioning institution and law
passed - this venal class (the soi-disant "elite" in
government, in industry and academe) embarked on a
gargantuan blackmail plot. The inventors of the most
contorted and impervious bureaucracies ever, have
recreated them. They have transformed the simplest tasks
of reform into tortuous, hellish processes, mired in a
miasma of numerous committees and deluged by cavils,
captious "working" papers and memoranda of stupefying
trumpery. They have stalled and retraced, reversed and
regressed, opined and debated, refused and accepted
grudgingly. The very processes of transformation and
transition - a simulacrum to begin with - acquired an aura
of somnolent lassitude and the nightmarish quality of
ensnarement. And they made the West bribe them into
yielding that which was ostensibly in their very own
interest. Every act of legislation was preceded and
followed by dollops of foreign cash. Every ministry
abolished was conditioned upon more aid. Every court
established, every bloodletting firm privatized, every bank
sold, every system made more efficient, every procedure
simplified, every tender concluded and every foreign
investor spared - had a tariff. "Pay or else ..." was the
overt message - and the West preferred to pay and to
appease, as it has always done.
The money lavished on these "new democracies" was
routed rather conspicuously into the private bank accounts
of the thin layer of vituperable "leaders", "academics" and
"businessmen" (often the same people). One third
cigarette smugglers, one third uncommon criminals and
one third cynical con-artists, these people looted the
coffers of their states. The IMF - this sanctuary of fourth
rate economists from third world countries, as I am never
wont of mentioning - collaborated with the US
government, the European Union and the World Bank in
covering up this stark reality. They turned a common
blind eye to the diversion of billions in aid and credits to
mysterious bank accounts in dubious tax havens. They
ignored fake trading deals, itinerant investment houses,
shady investors and shoddy accounting. They expressed
merely polite concern over blatant cronyism and rampant
nepotism. They kept pouring money into the rapidly
growing black hole that Eastern Europe and the Balkan
have become. They pretended not to know and feigned
surprise when confronted with the facts. In their
complicity, they have encouraged the emergence of a
criminal class of unprecedented proportions, hold and
penetration in many of the countries within their remit.
To qualify to participate in this grand larceny, one needed
only to have a "sovereign" "state". Sovereign states are
entitled to hold shares in multilateral financial institutions
and to receive international aid and credits. In other
words: sovereignty is the key to instant riches. The
unregenerate skulks that pass for political parties in many
countries in East Europe and the Balkan (though not in all
of them - there are exceptions), carved up the territory.
This led to a suspicious proliferation of "republics", each
with its own access to international funds. It also led to
"wars" among these emergent entities.
Recent revelations regarding the close and cordial co-
operation between Croatia's late president, Franjo
Tudjman and Yugoslavia's current strongman, Slobodan
Milosevic - ostensibly, bitter enemies - expose the role
that warfare and instability played in increasing the flow
of aid (both civil and military) to belligerent countries.
The more unstable the region, the more ominous its
rhetoric, the more fractured its geopolitics - the more
money flowed in. It was the right kind of money:
multilateral - not multinational, public - not private,
deliberately ignorant - not judiciously cognizant. It was
the "quantum fund" - capable of "tunnelling" (as the
Czechs called it) - vanishing in one place (the public
purse) and appearing in another (the private wallet)
simultaneously. Even the exception - the never-enforced
sanctions against Yugoslavia - served to enrich its
cankerous ruling class by way of smuggling and
monopolies.
And why did the West collaborate in this charade? Why
did it compromise its goodwill, its carefully crafted
institutions, its principles and ethos? The short and the
long of it is: to get rid of a nuisance at a minimal cost. It is
much cheaper to grease the palms of a deciding few - than
to embark on the winding path of true and painful growth.
It is more convenient to co-opt a political leader than to
confront an angry mob. It is by far easier to throw money
at a problem than to solve it.
It was not a sinister conspiracy of the Great Powers as
many would have it. Nor was it the result of foresight,
insight, perspicacity, or planning. It was a typical
improvident European default, adopted by a succession of
lacklustre and lame American administrations. It enriched
the few and impoverished the many. It fostered anti-
Western sentiments. It provoked skirmishes that provoked
wars that led to massacres. To reverse it would require
more resources than should have been committed in the
first place. These are not forthcoming. The West is again
misleading and deceiving and collaborating to defraud the
peoples of these unfortunate netherlands. It again
promises prosperity it cannot deliver, growth it will not
guarantee and stability it cannot ensure. This
prestidigitation is bound to lead to ever larger bills and to
the attrition of good will of both donor and recipient.
Never before was such a unique historical opportunity so
thoroughly missed. The consequences may well be as
unprecedented.
L. The Treasure Trove of Kosovo
Nothing like a juicy, photogenic human catastrophe to
enrich corrupt politicians and bottom-line-orientated,
stock-option-motivated corporate executives. The Balkan
is teeming with both these sad days.
Even as the war was raging, shortages of food and other
supplies led to the dispensation of political favours (in the
form of import licences, for instance) to the chosen few.
Bulgarian, Greek and Albanian firms, owned by ruthless
criminals and criminals-turned-politicians benefited
mightily. Millions were made and shared as artificially
high prices were maintained by various means while
cronies and crime controlled firms shared the spoils. This
orgiastic intercourse between the corrupt and the criminal
was not confined to one country. The whole region
partook in robbing the most impoverished populations in
Europe by "legal" means.
Their more refined and perfumed Western brethren were
never far behind in taking advantage of American largesse
on the one hand and re-emerging alarmist tendencies, on
the other. Thus, American, German, Greek, French and
Italian firms enjoyed funds allocated to international
humanitarian aid by the likes of the US government, the
United Nations, the World Bank, the IMF and other long
arms of the American octopus. Defence contractors and
the dubious characters known as weapons intermediaries
stoked the atavistic fires of war in securing defence
contracts. And aid workers resided in six star hotels,
driving the latest sports utility vehicles and brandishing
futuristic laptop computers as they went about the
business of dispensing aid. In the meantime, at least one
half of all aid money was pilfered - not to use a harsher
term. Aid rations were freely available in Macedonian,
Albanian, Greek and Bulgarian markets - offered at a
discount by aid workers who stole them from their
supposed recipients. The refugees were never given
mattresses, were short of blankets, water, showers and
toilets (I visited the camps - this is an eyewitness
account). Only bread was abundant.
Now that the war is over, some people are counting their
dead - while others are counting their blessings. But this
has all been a prelude. It is the next wave of aid which is
the main course in this bacchanalia. Outlandishly feverish
numbers are tossed around. Kosovo's immediate
reconstruction (housing and infrastructure) will require
well over 2 billion US dollars in the next 2 years. Of this,
1.5 billion dollars has already been raised. A further 2
billion USD is slated as direct aid to the shattered
economies of Macedonia and Albania. But the real booty
lies in Serbia. A minimum of 10-13 billion dollars will be
required simply to restore Serbia's infrastructure to its
former, inglorious self. To resuscitate the whole
languishing area, a staggering 30 billion dollars is touted
as the minimal bill.
Rest assured that at least one third of this generous
cornucopia will end up lining the pockets of the rich and
mighty. At least 1 billion dollars will end up festering in
Swiss, Cypriot, South African and Israeli bank accounts.
The politicians know it, the "grupirovki" (business cartels
controlled by mafia-style organizations) know it, Western
governments know it. This is the REAL stability pact.
Financially inebriated politicians are better motivated to
maintain peace and stability, or so the thinking goes.
The history of the Balkans will play a major role in
determining the topography and geography of this flood
of cronyism, nepotism, criminality and vice. The Balkan
is composed of states run by crime organizations and
crime organizations run by states. Old alliances last long
(as opposed to the Middle East where alliances, dune-like,
shift with the winds). Bulgaria and Macedonia, for
instance. Serbia and Greece. Albania and Kosovo. And
now Albania and Macedonia. Meetings of regional
"leaders" in the Balkans were always reminiscent of
scenes from "The Godfather". The dons, uncomfortably
clad in expensive business suits and wearing golden rings,
deciding life and death and a jovial yet vaguely menacing
atmosphere. Only the leaders of the New Balkans are
much younger, less experienced, more prone to
superstition, extremism and moodiness. The old tension
are bound to re-emerge, this time in the employ of
business interests. Expect a flare up of animosity between
Greece and Macedonia. Despite its Bulgarophile regime,
expect uneasy moments between Bulgaria and Macedonia.
And expect an unholy alliance of business interests
between Mr. Thaci and his sprawling business empire and
the governments of Albania and Macedonia. If not
assassinated before, Thaci is definitely the Man to watch.
Young, well educated, ruthless, involved in business
(read: corrupt to the core) - an aptly dangerous man in
dangerous times.
The problem is that everyone hold high expectations. This
is a poor recipe for an amicable carving of the cake of
international funding. Macedonia expects to lead the
reconstruction effort of Kosovo. It was offended greatly
by the decision to base the Kosovo reconstruction agency
in Pristina. Greek and Italian firms expect to snatch profits
out of the jaws of their near treacherous behaviour during
the war. Turkish firms except to be rewarded for the
loyalty of Turkey during the same. American and German
firms expect to exclude all else in gaining access to
American and German (=EU) funds (as they have done in
Bosnia). These all are mutually incompatible expectations
and they will lead to mutually exclusive behaviour.
Expect some very ugly scenes, including spilt doses of
this cheap, red liquid, blood.
Albania, already governed by the ungovernable crime
gangs it spawned in the last few years, has formed an
alliance with the KLA, never a moral standard-bearer.
This expanded amusement park of drug trafficking,
prostitution, weapons smuggling, contraband and much
worse is now threatening to take over its more virtuous
(though by no means virginal) neighbour, Macedonia. A
flare up of hitherto unimaginable brotherly love has
indicated this sacrilegious rapprochement. The
Macedonian Prime Minister - encumbered by a
demanding Albanian coalition partner - has met Thaci and
the encounter had all the trappings of a state visit. Soon
after senior albanian politicians started talking about a
Macedonian recognition of an independent state of
Kosovo and an Albanian language university (the reason
for student riots just two years before).
To a large extent, the Kosovo war was a gang warfare.
The Serb criminal organization known as Yugoslavia
against the Albanian gang known as the KLA. It was a
war over turf and lucrative businesses. In what used to be
the Third World and moreso in the post-communist
countries in transition, criminal activities often
accompany "wars of liberation". In Congo, in Sierra
Leone, in Chechnyia, in Kashmir - wars are as much
about diamonds, oil and opium poppies as about national
aspirations. Kosovo is no exception but it was here that
the West was duped into intervention. NATO was called
upon to arbiter between two crime gangs. There is no end
to the mischievous irony of history.
Perhaps the following incidents are more telling than any
learned analysis:
In late April, the Albanian telecom switched off the
roaming facility of cell phones in Albania. Foreigners -
including aid workers - had to pay the company 1000
dollars for a special roaming-enabled chip.
Rumour has it that the post of the Chief of Police in the
Tirana Airport was "sold" at the beginning of April for an
undisclosed amount (presumably 250,000 US dollars).
The reasons: all shippers (including NATO and aid
organizations) have to pay enormous kickbacks to airport
and customs officials to release their goods.
Most Albanian families charged refugee families an
average of 500 DM a month for their accommodation in
subhuman conditions. Refugees who could not pay (or
who had no relatives in Germany and Switzerland to pay
for them) were evicted, often cruelly.
As Serbs were murdering their supposed brothers in
Kosovo, Albanian crime gangs laid an oil pipeline
(through Lake Shkoder) to Serbia and supplied the Serb
army with the oil it was deprived of by NATO.
Welcome to the Balkans.
LI. Milosevic's Treasure Island
Milosevic and his cronies stand accused of plundering
Serbia's wealth - both pecuniary and natural. Yet, the
media tends to confuse three modes of action with two
diametrically opposed goals. There was state sanctioned
capital flight. Gold and foreign exchange were smuggled
out of Yugoslavia and deposited in other countries. This
was meant to provide a cushion against embargo and
sanctions imposed on Yugoslavia by the West.
The scale of these operations has been wildly over-
estimated at 4 billion US dollars. A figure half as big is
more reasonable. Most of the money was used
legitimately, to finance the purchase of food, medicines,
and energy products. Yugoslavia would have frozen to
death had its leaders not have the foresight to act as they
did.
This had nothing to do with party officials, cronies, and
their family members enriching themselves by "diverting"
export proceeds and commodities into private accounts in
foreign lands. The culprits often disguised these acts of
plunder as sanctions-busting operations. Hence the
confusion.
Thirdly, members of the establishment and their relatives
were allowed to run lucrative smuggling and black market
operations fuelled by cheap credits coerced out of the
dilapidated and politicised "banking" system.
As early as 1987, a network of off-shore bank accounts
and holding companies was established by Serbia's
Communist party and, later, by Yugoslavia. This frantic
groping for alternatives reached a peak during 1989 and
1991 and after 1992 when accounts were opened in
Cyprus, Israel, Greece, and Switzerland and virtually all
major Yugoslav firms opened Cypriot subsidiaries or
holding structures. Starting in 1991, the Central Bank's
gold (and a small part of the foreign exchange reserves)
were deposited in Switzerland (mainly in Zurich). A
company by the name of "Metalurski Kombinat
Smederevo - MKS" (renamed "Sartid" after its bogus
privatisation) was instrumental in this through its MKS
Zurich subsidiary. MKS was a giant complex of metal
processing factories, headed by a former Minister of
Industry and a Milosevic loyalist, Dusko Matkovic. The
latter also served as deputy chairman of Milosevic's party.
The lines between party, state and personal fortunes
blurred fast. Small banking institutions were established
everywhere, even in London (the AY Bank) and
conducted operations throughout the world. They were
owned by bogus shareholders, out of the reach of the
international sanctions regime.
When UN sanctions were imposed in stages (1992-5), the
state made sure its export proceeds were out of harm's
way and never in sanctions-bound UK and USA banks.
The main financial agent was "Beogradska Banka" and its
branch in Novi Sad. In a series of complex transactions
involving foreign exchange trades, smuggled privatisation
proceeds, and inflated import invoices, it was able to stash
away hundreds of millions of dollars. This money was
used to finance imports and defray the exorbitant
commissions, fees, and costs charged by numerous
intermediaries. Yugoslavia (and the regime) had no choice
- it was either that or starvation, freezing and explosive
social discontent.
Concurrently, a massive and deeply criminalized web of
smuggling, illegal (customs-exempt) imports, bribe and
corruption has stifled all legal manufacturing and
commerce activities. Cigarettes through Montenegro,
alcohol and oil through Romania, petrol, other goods
(finished and semi-finished) and raw materials from
Greece through the Vardar river (Macedonia), absolutely
everything through Croatia, drugs from Turkey (and
Afghanistan). UN personnel happily colluded and
collaborated - for a fee, of course. The export of
commodities - such as grain or precious metals (gold,
even Uranium) - was granted in monopoly to Milosevic
stalwarts. These were vast fiefdoms controlled by a few
prominent "families" and Milosevic favourites. It was also
immensely lucrative. Even minor figures were able to
deposit millions of US dollars in their Russian, Cypriot,
Lebanese, Greek, Austrian, Swiss, and South African
accounts. The regime leaned heavily on Yugoslav banks
to finance these new rich with cheap, soft, and often non-
returnable, credits. These were often used to speculate in
the frenetic informal foreign exchange markets for
immediate windfalls.
The new Yugoslav authorities are likely to be deeply
frustrated and disappointed. Most of the money was
expended on essentials for the population. The personal
fortunes made are tiny by comparison and well-shielded
in off-shore banking havens. Milosevic himself has almost
nothing to his name. His son and daughter may constitute
richer pickings but not by much. The hunt for the
Milosevic treasure is bound to be an expensive, futile
undertaking.
LII. Macedonia's Augean Stables,
or: Don't Hurry to Invest in Macedonia
In the near past, Macedonia seemed to have been bent on
breaking its own record of surrealism. While politicians in
other countries in transition from communism and
socialism strive to be noticed for not stealing, their
Macedonian counterparts, without a single exception, aim
to steal without being noticed.
The previous VMRO-DPMNE government (1999-2002),
in which Nikola Gruevski, the current Prime Minister,
served as Minister of Finance, plundered the country
shamelessly. The local papers accused then outgoing
prime minister, Ljubco Georgievski - a virtual pauper
when he attained power - of owning land and a residential
building in the capital's most expensive neighborhood.
The erstwhile Minister of Defense, Ljuben Paunovski,
was recently sentenced to 42 months in prison for his
pecuniary shenanigans during his tenure. Another leading
figure, the former Minister of interior, Ljube Boskovski, is
in the dock in the Hague on war crime charges.
Inevitably, VMRO-DPMNE lost power to the SDSM in
the heated elections of 2002 and then fractured as its new
leader, Gruevski, purged the old guard and installed his
own cohorts everywhere.
Then prime minister designate, Branko Crvnkovski (the
country's current President whose legitimacy is contested
by the Gruevski government), vowed to learn from his
party's (SDSM) past mistakes when they venally ruled the
land until 1998. In a sudden and politically-motivated
resurrection, the high court began scrutinizing the "Okta"
deal: the opaque sale of the country's loss-making refinery
to the Greeks in 1999. Heads will roll, promised both the
election victors (the SDSM) and their Western sponsors.
Nothing happened.
The country's current Governor of the Central bank and
then minister of finance, Petar Goshev, a former socialist
high-level functionary known for his integrity, announced
that his top priority would be to eradicate corruption by
instituting structural and legal reforms. His newfound
socialist partners - he headed a center-right outfit - found
this bizarre ardor unpalatable and promptly kicked him
out of office.
Four years later, with Georgievski relegated to the
political wasteland, Crvnkovski ensconced in the
presidential suite, and his successor, Buckovski a
resounding failure, Gruevski's ascent in 2006 was all but
secure. It was the SDSM's turn to crumble acrimoniously
amid a virulent contest for its leadership. It has never
recovered and Macedonia has had no viable opposition
ever since.
Macedonia's post-electoral euphoria faded, in July 2006,
into arduous coalition-building negotiations replete with
arm-twisting by the worried representatives of the
"international community".
The country's new VMRO-DPMNE Prime Minister,
Nikola Gruevski (36), excluded from his government the
party that won the majority of Albanian votes because of
its roots in the much-hated Albanian NLA, National
Liberation Army, the instigator of the 2001 near-civil-war.
Albanian factions clashed in a chilling reminder of the
country's inter-ethnic fragility.
To add to Macedonia's precarious standing, its greenhorn
Minister of Foreign Affairs, Antonio Milososki, engaged
in intermittent - and utterly avoidable - spats with its
neighbor and biggest foreign investor, Greece, virtually
guarantee delayed accession to both NATO and the
European Union, the much ballyhooed strategic goals of
the current administration. Milososki adopted a similarly
belligerent and ill-informed stance against Bulgaria,
another flanking polity and the newest member of the
coveted European club.
Where the government claims great strides is in its
uncompromising stance against all forms of malfeasance
and delinquency in both the public and the private sectors.
From the army to various municipalities, scandals erupt
daily in an atmosphere often bordering on a frenzied,
media saturated, witch-hunt.
Gruevski is alleged to have rejected a bribe of 3 million
euros (c. 4 million USD) offered to him by a Serb firm.
His government embarked on highly publicized
campaigns against illegal construction (the "urban mafia")
and other festering nests of corruption.
Alas, Gruevski himself appointed members of his family
and innumerable political hacks to senior government
positions in a series of blatant acts of nepotism and
cronyism decried by the European Union and other
watchdogs. Consequently, with one exception (Zoran
Stavreski, the talented vice-premier), the government in
all echelons is largely made up of utterly inexperienced
operators. Plus ca change.
Politics, venality, and terrorism are the sole venues of
social mobility in this tiny, landlocked, country of 2
million impoverished people. Immediately following their
insurgency, the former terrorists of the Albanian National
Liberation - courtesy of Western pressure and the
Albanian voters - occupied crucial ministries with
lucrative opportunities of patronage of which they are
rumored to have availed themselves abundantly.
Comic relief is often provided by bumbling NGOs, such
as the International Crisis Group. In 2001, its
representative in Macedonia, Edward Joseph, went to
Prilep to conduct an impromptu investigation of the
thriving cigarette smuggling trade. Posing to the cameras
he declared that only the local leaf-rolling plant was not
involved in this pernicious line of work.
Macedonia is a hub of expats and consultants in the
Balkans. Ante Markovic, an Austria-based former
Yugoslav prime minister, who served as an oft-criticized
economic advisor to the government until he was dumped,
sued Macedonia for $1 million. In 2001-3, the youthful
former minister of finance, Nikola Gruevski, was asked
by USAID, on behalf of the Serbian-Montenegrin
government, to serve as its consultant on matters of
reform of the financial system. The author of this article
acted as Economic Advisor to Georgievski's government
and, later, to Gruevski himself.
But to no avail. The country is a shambles. In the wake of
a civil war, the official unemployment rate is 31-35
percent. Close to 70,000 people work in the bloated
central and local administrations. The trade deficit is an
unparalleled 17 percent of GDP. In 2001, the budget
deficit climbed to 5 percent, though it was since halved.
"The Heritage Foundation" has consistently ranked
Macedonia 95-97 out of 155 countries in terms of
economic freedom. The country is "mostly unfree" it
correctly concludes in its reports, though it cites
sometimes erroneous data. A moderate level of trade
protectionism, low tax rates, moderate inflation, a
moderate burden of the government, moderate barriers to
capital flows and foreign investment, and moderate
interference in the economy are offset by a dysfunctional
banking system, intervention in wages and prices, low
level of protection of property, a high level of regulation,
and a very high level of activity of the black market.
Owing to the IMF's misguided emphasis on exchange rate
stability, the currency is inanely overvalued. The
manufacturing sector has all but evaporated. Industrial
production declined by a vertiginous 20 percent in August
2002 compared to the average the year before - or by 11
percent year on year. The trend has not been reversed
since.
Macedonian steel is exempt from the latest bout of
American protectionism, but not so its textile industry.
Europe is fending off the country's agricultural products.
People make their meager and desultory living catering to
the needs of an ever-expanding international presence or
dabbling in illicit activities. Piracy of intellectual property,
for instance, is thought to yield c. 1 percent of GDP.
Close to half the population is under the poverty line. The
number of welfare cases increased by 70 percent between
1994 and 2002. Generous and incessant multilateral and
bilateral credits sustain the faltering economy (and line
politicians' ever-deepening pockets). The country is
alternately buffeted by floods and droughts. There has
been only one day of rain in all of January 2007.
In a much-touted donor conference after the 2001
skirmishes, the pledges amounted to a whopping 15
percent of GDP. Then governor of the central bank, Ljube
Trpski (currently detained for his role in a murky affair
involving the country's foreign exchange reserves),
cheerfully predicted that these handouts will cover the
gaping hole in the balance of payments.
Macedonia also received 7.5 percent of the gold reserves
of the former federated Yugoslavia of which it was a
component. At between $700 million and one billion USD
net, foreign exchange reserves are at an all-time high.
Macedonia has recently decided to prepay its $104 million
debt to the Paris Club creditors.
Both the IMF and the World Bank, who did their best to
obstruct the previous VMRO-DPMNE government in its
last few months in power, promised a speedy return to
business as usual. An hitherto elusive standby
arrangement is likely to be concluded by the end of the
year. World Bank funds, frozen in material breach of its
written contracts with the state, will flow again. The EU
promised development funds if the new government acts
in a "European spirit" - i.e., obeys the diktats of Brussels.
The incoming administration is likely to enjoy a period of
grace with both the trade unions and international
creditors. Strikes and demonstrations by dispossessed
miners and underpaid railways workers have waned. But
Macedonia joined the WTO in 2002 and will thus be
forced to open even more to devastating competition.
Labor unrest is likely to re-erupt soon.
Foreign investment in the country mysteriously wanes and
waxes - some of it laundered money reinvested in
legitimate businesses. The government is doing a great job
of building up the image of Macedonia as an FDI (Foreign
Direct Investment) destination. But public relations and
perceptions management must be followed by palpable
actions and the new government is woefully short on
concrete steps. It talks the talk but hitherto does not walk
the walk.
The government's attempts to attract foreign investors by
introducing lower taxes may backfire: studies clearly
evince that multinationals worry less about taxation and
more about functioning institutions, a commodity that
Macedonia is irreparably short of. Moreover, vanishingly
lower taxes signal desperation and Macedonia indeed
sounds more desperate than confident. No one wants to
buy the country's leading bank, long on offer. Only one
contender (Mobilkom Austria) entered a bid for
Macedonia's third operator cellular network licence.
On a few occasions, domestic firms, using international
fronts, have bid for local factories, such as the textile plant
"Astibo". The national payment card project has been
guzzled by two banks incestuously close to the outgoing
ruling party, VMRO-DPMNE.
But there are real investments, too. The capital's central
heating utility was purchased by a unidentified French
energy outfit, announced the general manager. The
utility's shares were listed in the Athens stock exchange.
The Macedonian construction firm "Granit" will build a
$59 million highway in Ukraine, with which Macedonia
enjoyed an unusually cordial relationship, to American
chagrin. Johnson Controls and others are eying a string of
free trade zones and infrastructure projects (dams, roads,
railways, oil pipeline). A much hyped Vardar Silicone
Valley is in the works.
The contentious census in the first two weeks of
November 2002, a part of the "Ohrid Framework
Agreement" which ended the internecine fighting the year
before, was conducted fairly. The count showed that
Albanians make c. one quarter of the population rather
than one third, as most Albanians spuriously insisted.
But, with Kosovo's independence looming across the
border, the restive Albanians are likely to coerce the
enfeebled Macedonia into translating this numerical
reality into political and economic clout. The
Macedonians are likely to resist. The West will intervene.
Macedonia is facing a hot spring and a sizzling summer.
LIII. The Macedonian Lottery
Every conflict has its economic moments and dimensions.
The current conflict in Macedonia perhaps even more so.
The USA and its Western allies regard Macedonia as a
bridge between Greece, Bulgaria, Serbia and Albania.
Hence the EU's plans for the revival of transport corridors
8 and 10 connecting these countries. If all goes well (and
nothing has hitherto), railways will connect Bulgaria to
Macedonia and river traffic will flow to Serbia from its
southern neighbours. All this is envisioned in the Stability
Pact. There are talks of an oil pipeline across Macedonia's
territory. A pacified Macedonia is fairly crucial to Serbia's
recovery and to the prospects of the whole region to
attract FDI.
NATO is afraid of Turkish-Greek clashes in the aftermath
of Kosovo and Macedonia. Turkey has increasingly cast
itself in its ancient role of "protector of the Balkan
Muslims". Greece is the only Orthodox-Christian member
of the EU and an old foe of the erstwhile Sick Man of
Europe from which it won bloody independence at the
beginning of the 19th century. Such clashes are likely to
destabilize the southern flank of NATO and block the
West's access to Iraq, the Middle East, oil-rich Central
Asia, and northern China. This will seriously dent the new
"Pacific and Middle East Orientations" of the Bush
Administration.
And what about the actual combatants?
Albanians and Macedonian crime gangs (in cahoots with
kleptocratic and venal local politicians) regard Macedonia
as a vital route for drugs, stolen cars, smuggled cigarettes
and soft drinks, illegal immigrants, white slavery, and
weapons dealing. These criminal activities far outweigh
the GDP of all the adversary states combined. This
conflict is about controlling territory and the economic
benefits attendant to such control.
Crime and war provide employment, status, regular
income, perks, and livelihood to many denizens of
Macedonia, Albania, and Bulgaria. They constitute an
outlet for entrepreneurship, however perverted. Fighting
for the cause and smuggling often means travel abroad
(for instance, on fund raising missions), five star
accommodation, and a lavish lifestyle. It also translates
into powers of patronage and excesses of self-enrichment.
Moreover, in ossified, socially stratified, ethnically
polarized, and economically impoverished societies, war
and crime engender social mobility. The likes of Hashim
Thaci, Ramush Harajdini, and Ali Ahmeti often start as
rebels and end as part of the cosseted establishment. Many
a criminal dabble in politics and business.
Hence the tenacity of both phenomena. Hence the bleak
and pessimistic outlook for this region. The "formal"
economies simply cannot compete. Jobs are not created,
the educated are often bitterly idle, salaries are minuscule
if paid at all, the future is past. Crime and politics (one
and the same in the Balkan) are alluring alternatives.
Moreover, the NLA and its political successor DUI is not
a monolithic entity. It is more like an umbrella
organization with serious and fracturing differences of
opinion regarding the ultimate goals of the insurrection
four years ago (2001) and the means to obtain these goals.
Roughly, NLA was made up of one third veteran Kosovo
fighters, some of them professional soldiers, who also
fought in Croatia, or in the Foreign Legion. These people
are bitter and disgruntled by what they see as the betrayal
of the West in refusing to guarantee an independent
Kosovo and the failure of the current Kosovar leadership
to integrate them economically into the emerging polity
there. Their motives for joining the fighting in Macedonia
were part emotional and part pecuniary.
Another third was made of unemployed, young Albanians,
mainly from Macedonia itself. Their fighting is self-
interested. They get a monthly salary and perks and,
lacking education and skills, they don't have much of a
choice outside the killing fields.
The rest are diehard, hardcore, idealists who either
fervently espouse a Great Albania, or would like to take
over Western Macedonian in a "constitutional coup"
which will grant them their own police force,
municipalities, institutions, universities, budgets, and
semi-political structures.
The NLA itself was not directly involved in criminal
activities, though a few of its members are. But the money
that financed it (from the Czech Republic, Switzerland,
Germany, and the USA) is tainted by drug dealing, white
slavery, illegal immigration, and the smuggling of
everything illicit, from cigarettes to stolen cars, to
weapons. In this they collaborate with politicians and
criminals in Macedonia - both Albanian and Macedonian.
Being a politician in the Balkan is an extremely lucrative
proposition. Both Albanian and Macedonian politicians
will abandon the peace process if they believe it leads to
electoral ruin. Given the current atmosphere, it pays to be
a pacifist. Virulent nationalism is a guaranteed vote
loser. But every re-election ticket still requires a modicum
of xenophobia, ethnic exclusivity, and radicalism. Here
lies the future.
LIV. Crime Fighting Computer Systems and Databases
As crime globalizes, so does crime fighting. Mobsters,
serial killers, and terrorists cross state lines and borders
effortlessly, making use of the latest advances in mass
media, public transportation, telecommunications, and
computer networks. The police - there are 16,000 law
enforcement agencies in the Unites States alone - is never
very far behind.
Quotes from the official Web pages of some of these
databases:
National Center for the Analysis of Violent Crime
(NCAVC)
Its mission is to combine investigative and operational
support functions, research, and training in order to
provide assistance, without charge, to federal, state, local,
and foreign law enforcement agencies investigating
unusual or repetitive violent crimes. The NCAVC also
provides support through expertise and consultation in
non-violent matters such as national security, corruption,
and white-collar crime investigations.
It comprises the Behavioral Analysis Unit (BAU), Child
Abduction and Serial Murder Investigative Resources
Center (CASMIRC), and Violent Criminal
Apprehension Program (VICAP).
VICAP is a nationwide data information center designed
to collect, collate, and analyze crimes of violence -
specifically murder. It collates and analyzes the
significant characteristics of all murders, and other violent
offenses.
Homicide Investigation Tracking System (HITS)
A program within the Washington state's Attorney
General's Office that tracks and investigates homicides
and rapes.
Violent Crime Linkage System (ViCLAS)
Canada-wide computer system that assists specially
trained investigators to identify serial crimes and
criminals by focusing on the linkages that exist among
crimes by the same offender. This system was developed
by the RCMP (Royal Canadian Mounted Police) in the
early 1990s.
UTAP, stands for The Utah Criminal Tracking and
Analysis Project
Gathers experts from forensic science, crime scene
analysis, psychiatry and other fields to screen unsolved
cases for local law enforcement agencies.
International Criminal Police Organization (ICPO) -
Interpol's DNA Gateway
Provides for the transfer of profile data between two or
more countries and for the comparison of profiles that
conform to Interpol standards in a centralized database.
Investigators can access the database via their Interpol
National Central Bureau (NCB) using Interpol's secure
global police communications system, I-24/7.
Interpol's I-24/7
Global communication system to connect its member
countries and provide them with user-friendly access to
police information. Using this system, Interpol National
Central Bureaus (NCBs) can search and cross-check data
in a matter of seconds, with direct and immediate access
to databases containing critical information (ASF
Nominal database of international criminals, electronic
notices, stolen motor vehicles, stolen/lost/counterfeit
travel and ID documents, stolen works of art, payment
cards, fingerprints and photographs, a terrorism watch list,
a DNA database, disaster victim identification,
international weapons tracking and trafficking in human
beings-related information, etc).
Interpol Fingerprints
Provides information on the development and
implementation of fingerprinting systems for the general
public and international law enforcement entities.
Europol (European Union's criminal intelligence
agency) Computer System (TECS)
Member States can directly input data into the information
system in compliance with their national procedures, and
Europol can directly input data supplied by non EU
Member States and third bodies. Also provides analyses
and indexing services.
http://www.atg.wa.gov/hits/index.shtml
http://www.mass.gov/msp/unitpage/vicap.htm
http://www.fbi.gov/hq/isd/cirg/ncavc.htm
http://www.rcmp.ca/techops/viclas_e.htm
http://www.justicejunction.com/innocence_lost_ian_wing
_utap.htm
http://www.interpol.int/Public/ICPO/FactSheets/fsADN20
0501.asp
http://www.interpol.int/Public/ICPO/FactSheets/i247.asp
http://www.europol.eu.int/index.asp?page=facts
T H E A U T H O R
SHMUEL (SAM) VAKNIN
Curriculum Vitae
Click on blue text to access relevant web sites - thank
you.
Born in 1961 in Qiryat-Yam, Israel.
Served in the Israeli Defence Force (1979-1982) in
training and education units.
Education
Completed a few semesters in the Technion - Israel
Institute of Technology, Haifa.
Ph.D. in Philosophy (major: Philosophy of Physics) -
Pacific Western University, California, USA.
Graduate of numerous courses in Finance Theory and
International Trading.
Certified E-Commerce Concepts Analyst by Brainbench.
Certified in Psychological Counselling Techniques by
Brainbench.
Certified Financial Analyst by Brainbench.
Full proficiency in Hebrew and in English.
Business Experience
1980 to 1983
Founder and co-owner of a chain of computerised
information kiosks in Tel-Aviv, Israel.
1982 to 1985
Senior positions with the Nessim D. Gaon Group of
Companies in Geneva, Paris and New-York (NOGA and
APROFIM SA):
- Chief Analyst of Edible Commodities in the Group's
Headquarters in Switzerland
- Manager of the Research and Analysis Division
- Manager of the Data Processing Division
- Project Manager of the Nigerian Computerised Census
- Vice President in charge of RND and Advanced
Technologies
- Vice President in charge of Sovereign Debt Financing
1985 to 1986
Represented Canadian Venture Capital Funds in Israel.
1986 to 1987
General Manager of IPE Ltd. in London. The firm
financed international multi-lateral countertrade and
leasing transactions.
1988 to 1990
Co-founder and Director of "Mikbats-Tesuah", a portfolio
management firm based in Tel-Aviv.
Activities included large-scale portfolio management,
underwriting, forex trading and general financial advisory
services.
1990 to Present
Freelance consultant to many of Israel's Blue-Chip firms,
mainly on issues related to the capital markets in Israel,
Canada, the UK and the USA.
Consultant to foreign RND ventures and to Governments
on macro-economic matters.
Freelance journalist in various media in the United States.
1990 to 1995
President of the Israel chapter of the Professors World
Peace Academy (PWPA) and (briefly) Israel
representative of the "Washington Times".
1993 to 1994
Co-owner and Director of many business enterprises:
- The Omega and Energy Air-Conditioning Concern
- AVP Financial Consultants
- Handiman Legal Services
Total annual turnover of the group: 10 million USD.
Co-owner, Director and Finance Manager of COSTI Ltd.
- Israel's largest computerised information vendor and
developer. Raised funds through a series of private
placements locally in the USA, Canada and London.
1993 to 1996
Publisher and Editor of a Capital Markets Newsletter
distributed by subscription only to dozens of subscribers
countrywide.
In a legal precedent in 1995 - studied in business schools
and law faculties across Israel - was tried for his role in
an attempted takeover of Israel's Agriculture Bank.
Was interned in the State School of Prison Wardens.
Managed the Central School Library, wrote, published
and lectured on various occasions.
Managed the Internet and International News Department
of an Israeli mass media group, "Ha-Tikshoret and
Namer".
Assistant in the Law Faculty in Tel-Aviv University (to
Prof. S.G. Shoham).
1996 to 1999
Financial consultant to leading businesses in Macedonia,
Russia and the Czech Republic.
Economic commentator in "Nova Makedonija",
"Dnevnik", "Makedonija Denes", "Izvestia", "Argumenti i
Fakti", "The Middle East Times", "The New Presence",
"Central Europe Review", and other periodicals, and in
the economic programs on various channels of
Macedonian Television.
Chief Lecturer in courses in Macedonia organised by the
Agency of Privatization, by the Stock Exchange, and by
the Ministry of Trade.
1999 to 2002
Economic Advisor to the Government of the Republic of
Macedonia and to the Ministry of Finance.
2001 to 2003
Senior Business Correspondent for United Press
International (UPI).
2007
Associate Editor, Global Politician
Founding Analyst, The Analyst Network
Contributing Writer, The American Chronicle Media
Group
Web and Journalistic Activities
Author of extensive Web sites in:
- Psychology ("Malignant Self Love") - An Open
Directory Cool Site,
- Philosophy ("Philosophical Musings"),
- Economics and Geopolitics ("World in Conflict and
Transition").
Owner of the Narcissistic Abuse Study List and the
Abusive Relationships Newsletter (more than 6000
members).
Owner of the Economies in Conflict and Transition Study
List , the Toxic Relationships Study List, and the Link and
Factoid Study List.
Editor of mental health disorders and Central and Eastern
Europe categories in various Web directories (Open
Directory, Search Europe, Mentalhelp.net).
Editor of the Personality Disorders, Narcissistic
Personality Disorder, the Verbal and Emotional Abuse,
and the Spousal (Domestic) Abuse and Violence topics on
Suite 101 and Bellaonline.
Columnist and commentator in "The New Presence",
United Press International (UPI), InternetContent,
eBookWeb, PopMatters, Global Politician, eBookNet.org,
and "Central Europe Review".
Publications and Awards
"Managing Investment Portfolios in States of
Uncertainty", Limon Publishers, Tel-Aviv, 1988
"The Gambling Industry", Limon Publishers, Tel-Aviv,
1990
"Requesting My Loved One - Short Stories", Yedioth
Aharonot, Tel-Aviv, 1997
"The Suffering of Being Kafka" (electronic book of
Hebrew and English Short Fiction), Prague and Skopje,
1998-2004
"The Macedonian Economy at a Crossroads - On the Way
to a Healthier Economy" (dialogues with Nikola
Gruevski), Skopje, 1998
"The Exporters' Pocketbook", Ministry of Trade, Republic
of Macedonia, Skopje, 1999
"Malignant Self Love - Narcissism Revisited", Narcissus
Publications, Prague and Skopje, 1999-2007 (Read
excerpts - click here)
The Narcissism Series (e-books regarding relationships
with abusive narcissists), Skopje, 1999-2007
"After the Rain - How the West Lost the East", Narcissus
Publications in association with Central Europe
Review/CEENMI, Prague and Skopje, 2000
Winner of numerous awards, among them Israel's Council
of Culture and Art Prize for Maiden Prose (1997), The
Rotary Club Award for Social Studies (1976), and the
Bilateral Relations Studies Award of the American
Embassy in Israel (1978).
Hundreds of professional articles in all fields of finances
and the economy, and numerous articles dealing with
geopolitical and political economic issues published in
both print and Web periodicals in many countries.
Many appearances in the electronic media on subjects in
philosophy and the sciences, and concerning economic
matters.
Contact Details:
[email protected]
My Web Sites:
Economy / Politics:
http://ceeandbalkan.tripod.com/
Psychology:
http://samvak.tripod.com/index.html
Philosophy:
http://philosophos.tripod.com/
Poetry:
http://samvak.tripod.com/contents.html
After the Rain
How the West
Lost the East
The Book
This is a series of articles written and published in 1996-2000 in Macedonia, in Russia,
in Egypt and in the Czech Republic.
How the West lost the East. The economics, the politics, the geopolitics, the
conspiracies, the corruption, the old and the new, the plough and the internet - it is all
here, in colourful and provocative prose.
From "The Mind of Darkness":
"'The Balkans' - I say - 'is the unconscious of the world'. People stop to digest this
metaphor and then they nod enthusiastically. It is here that the repressed memories of
history, its traumas and fears and images reside. It is here that the psychodynamics of
humanity - the tectonic clash between Rome and Byzantium, West and East, Judeo-
Christianity and Islam - is still easily discernible. We are seated at a New Year's dining
table, loaded with a roasted pig and exotic salads. I, the Jew, only half foreign to this
cradle of Slavonics. Four Serbs, five Macedonians. It is in the Balkans that all ethnic
distinctions fail and it is here that they prevail anachronistically and atavistically.
Contradiction and change the only two fixtures of this tormented region. The women of
the Balkan - buried under provocative mask-like make up, retro hairstyles and too
narrow dresses. The men, clad in sepia colours, old fashioned suits and turn of the
century moustaches. In the background there is the crying game that is Balkanian
music: liturgy and folk and elegy combined. The smells are heavy with muskular
perfumes. It is like time travel. It is like revisiting one's childhood."
LV. The Author
Sam Vaknin is the author of Malignant Self Love -
Narcissism Revisited and After the Rain - How the West
Lost the East. He is a columnist for Central Europe
Review, PopMatters, and eBookWeb , a United Press
International (UPI) Senior Business Correspondent, and
the editor of mental health and Central East Europe
categories in The Open Directory and Suite101 .
Until recently, he served as the Economic Advisor to the
Government of Macedonia.
Visit Sam's Web site at http://samvak.tripod.com
End of Project Gutenberg's Financial Crime and Corruption, by Sam Vaknin
*** END OF THE PROJECT GUTENBERG EBOOK FINANCIAL CRIME AND CORRUPTION ***
Updated editions will replace the previous one—the old editions will
be renamed.
Creating the works from print editions not protected by U.S. copyright
law means that no one owns a United States copyright in these works,
so the Foundation (and you!) can copy and distribute it in the United
States without permission and without paying copyright
royalties. Special rules, set forth in the General Terms of Use part
of this license, apply to copying and distributing Project
Gutenberg™ electronic works to protect the PROJECT GUTENBERG™
concept and trademark. Project Gutenberg is a registered trademark,
and may not be used if you charge for an eBook, except by following
the terms of the trademark license, including paying royalties for use
of the Project Gutenberg trademark. If you do not charge anything for
copies of this eBook, complying with the trademark license is very
easy. You may use this eBook for nearly any purpose such as creation
of derivative works, reports, performances and research. Project
Gutenberg eBooks may be modified and printed and given away—you may
do practically ANYTHING in the United States with eBooks not protected
by U.S. copyright law. Redistribution is subject to the trademark
license, especially commercial redistribution.
START: FULL LICENSE
THE FULL PROJECT GUTENBERG™ LICENSE
PLEASE READ THIS BEFORE YOU DISTRIBUTE OR USE THIS WORK
To protect the Project Gutenberg™ mission of promoting the free
distribution of electronic works, by using or distributing this work
(or any other work associated in any way with the phrase “Project
Gutenberg”), you agree to comply with all the terms of the Full
Project Gutenberg License available with this file or online at
www.gutenberg.org/license.
Section 1. General Terms of Use and Redistributing Project Gutenberg
electronic works
1.A. By reading or using any part of this Project Gutenberg
electronic work, you indicate that you have read, understand, agree to
and accept all the terms of this license and intellectual property
(trademark/copyright) agreement. If you do not agree to abide by all
the terms of this agreement, you must cease using and return or
destroy all copies of Project Gutenberg electronic works in your
possession. If you paid a fee for obtaining a copy of or access to a
Project Gutenberg electronic work and you do not agree to be bound
by the terms of this agreement, you may obtain a refund from the person
or entity to whom you paid the fee as set forth in paragraph 1.E.8.
1.B. “Project Gutenberg” is a registered trademark. It may only be
used on or associated in any way with an electronic work by people who
agree to be bound by the terms of this agreement. There are a few
things that you can do with most Project Gutenberg electronic works
even without complying with the full terms of this agreement. See
paragraph 1.C below. There are a lot of things you can do with Project
Gutenberg electronic works if you follow the terms of this
agreement and help preserve free future access to Project Gutenberg
electronic works. See paragraph 1.E below.
1.C. The Project Gutenberg Literary Archive Foundation (“the
Foundation” or PGLAF), owns a compilation copyright in the collection
of Project Gutenberg electronic works. Nearly all the individual
works in the collection are in the public domain in the United
States. If an individual work is unprotected by copyright law in the
United States and you are located in the United States, we do not
claim a right to prevent you from copying, distributing, performing,
displaying or creating derivative works based on the work as long as
all references to Project Gutenberg are removed. Of course, we hope
that you will support the Project Gutenberg mission of promoting
free access to electronic works by freely sharing Project Gutenberg
works in compliance with the terms of this agreement for keeping the
Project Gutenberg name associated with the work. You can easily
comply with the terms of this agreement by keeping this work in the
same format with its attached full Project Gutenberg License when
you share it without charge with others.
This particular work is one of the few individual works protected
by copyright law in the United States and most of the remainder of the
world, included in the Project Gutenberg collection with the
permission of the copyright holder. Information on the copyright owner
for this particular work and the terms of use imposed by the copyright
holder on this work are set forth at the beginning of this work.
1.D. The copyright laws of the place where you are located also govern
what you can do with this work. Copyright laws in most countries are
in a constant state of change. If you are outside the United States,
check the laws of your country in addition to the terms of this
agreement before downloading, copying, displaying, performing,
distributing or creating derivative works based on this work or any
other Project Gutenberg work. The Foundation makes no
representations concerning the copyright status of any work in any
country other than the United States.
1.E. Unless you have removed all references to Project Gutenberg:
1.E.1. The following sentence, with active links to, or other
immediate access to, the full Project Gutenberg License must appear
prominently whenever any copy of a Project Gutenberg work (any work
on which the phrase “Project Gutenberg” appears, or with which the
phrase “Project Gutenberg” is associated) is accessed, displayed,
performed, viewed, copied or distributed:
This eBook is for the use of anyone anywhere in the United States and most
other parts of the world at no cost and with almost no restrictions
whatsoever. You may copy it, give it away or re-use it under the terms
of the Project Gutenberg™ License included with this eBook or online
at www.gutenberg.org. If you
are not located in the United States, you will have to check the laws
of the country where you are located before using this eBook.
1.E.2. If an individual Project Gutenberg electronic work is
derived from texts not protected by U.S. copyright law (does not
contain a notice indicating that it is posted with permission of the
copyright holder), the work can be copied and distributed to anyone in
the United States without paying any fees or charges. If you are
redistributing or providing access to a work with the phrase “Project
Gutenberg” associated with or appearing on the work, you must comply
either with the requirements of paragraphs 1.E.1 through 1.E.7 or
obtain permission for the use of the work and the Project Gutenberg
trademark as set forth in paragraphs 1.E.8 or 1.E.9.
1.E.3. If an individual Project Gutenberg electronic work is posted
with the permission of the copyright holder, your use and distribution
must comply with both paragraphs 1.E.1 through 1.E.7 and any
additional terms imposed by the copyright holder. Additional terms
will be linked to the Project Gutenberg License for all works
posted with the permission of the copyright holder found at the
beginning of this work.
1.E.4. Do not unlink or detach or remove the full Project Gutenberg
License terms from this work, or any files containing a part of this
work or any other work associated with Project Gutenberg.
1.E.5. Do not copy, display, perform, distribute or redistribute this
electronic work, or any part of this electronic work, without
prominently displaying the sentence set forth in paragraph 1.E.1 with
active links or immediate access to the full terms of the Project
Gutenberg License.
1.E.6. You may convert to and distribute this work in any binary,
compressed, marked up, nonproprietary or proprietary form, including
any word processing or hypertext form. However, if you provide access
to or distribute copies of a Project Gutenberg work in a format
other than “Plain Vanilla ASCII” or other format used in the official
version posted on the official Project Gutenberg website
(www.gutenberg.org), you must, at no additional cost, fee or expense
to the user, provide a copy, a means of exporting a copy, or a means
of obtaining a copy upon request, of the work in its original “Plain
Vanilla ASCII” or other form. Any alternate format must include the
full Project Gutenberg License as specified in paragraph 1.E.1.
1.E.7. Do not charge a fee for access to, viewing, displaying,
performing, copying or distributing any Project Gutenberg works
unless you comply with paragraph 1.E.8 or 1.E.9.
1.E.8. You may charge a reasonable fee for copies of or providing
access to or distributing Project Gutenberg electronic works
provided that:
• You pay a royalty fee of 20% of the gross profits you derive from
the use of Project Gutenberg works calculated using the method
you already use to calculate your applicable taxes. The fee is owed
to the owner of the Project Gutenberg trademark, but he has
agreed to donate royalties under this paragraph to the Project
Gutenberg Literary Archive Foundation. Royalty payments must be paid
within 60 days following each date on which you prepare (or are
legally required to prepare) your periodic tax returns. Royalty
payments should be clearly marked as such and sent to the Project
Gutenberg Literary Archive Foundation at the address specified in
Section 4, “Information about donations to the Project Gutenberg
Literary Archive Foundation.”
• You provide a full refund of any money paid by a user who notifies
you in writing (or by e-mail) within 30 days of receipt that s/he
does not agree to the terms of the full Project Gutenberg™
License. You must require such a user to return or destroy all
copies of the works possessed in a physical medium and discontinue
all use of and all access to other copies of Project Gutenberg™
works.
• You provide, in accordance with paragraph 1.F.3, a full refund of
any money paid for a work or a replacement copy, if a defect in the
electronic work is discovered and reported to you within 90 days of
receipt of the work.
• You comply with all other terms of this agreement for free
distribution of Project Gutenberg™ works.
1.E.9. If you wish to charge a fee or distribute a Project
Gutenberg™ electronic work or group of works on different terms than
are set forth in this agreement, you must obtain permission in writing
from the Project Gutenberg Literary Archive Foundation, the manager of
the Project Gutenberg™ trademark. Contact the Foundation as set
forth in Section 3 below.
1.F.
1.F.1. Project Gutenberg volunteers and employees expend considerable
effort to identify, do copyright research on, transcribe and proofread
works not protected by U.S. copyright law in creating the Project
Gutenberg™ collection. Despite these efforts, Project Gutenberg™
electronic works, and the medium on which they may be stored, may
contain “Defects,” such as, but not limited to, incomplete, inaccurate
or corrupt data, transcription errors, a copyright or other
intellectual property infringement, a defective or damaged disk or
other medium, a computer virus, or computer codes that damage or
cannot be read by your equipment.
1.F.2. LIMITED WARRANTY, DISCLAIMER OF DAMAGES - Except for the “Right
of Replacement or Refund” described in paragraph 1.F.3, the Project
Gutenberg Literary Archive Foundation, the owner of the Project
Gutenberg™ trademark, and any other party distributing a Project
Gutenberg™ electronic work under this agreement, disclaim all
liability to you for damages, costs and expenses, including legal
fees. YOU AGREE THAT YOU HAVE NO REMEDIES FOR NEGLIGENCE, STRICT
LIABILITY, BREACH OF WARRANTY OR BREACH OF CONTRACT EXCEPT THOSE
PROVIDED IN PARAGRAPH 1.F.3. YOU AGREE THAT THE FOUNDATION, THE
TRADEMARK OWNER, AND ANY DISTRIBUTOR UNDER THIS AGREEMENT WILL NOT BE
LIABLE TO YOU FOR ACTUAL, DIRECT, INDIRECT, CONSEQUENTIAL, PUNITIVE OR
INCIDENTAL DAMAGES EVEN IF YOU GIVE NOTICE OF THE POSSIBILITY OF SUCH
DAMAGE.
1.F.3. LIMITED RIGHT OF REPLACEMENT OR REFUND - If you discover a
defect in this electronic work within 90 days of receiving it, you can
receive a refund of the money (if any) you paid for it by sending a
written explanation to the person you received the work from. If you
received the work on a physical medium, you must return the medium
with your written explanation. The person or entity that provided you
with the defective work may elect to provide a replacement copy in
lieu of a refund. If you received the work electronically, the person
or entity providing it to you may choose to give you a second
opportunity to receive the work electronically in lieu of a refund. If
the second copy is also defective, you may demand a refund in writing
without further opportunities to fix the problem.
1.F.4. Except for the limited right of replacement or refund set forth
in paragraph 1.F.3, this work is provided to you ‘AS-IS’, WITH NO
OTHER WARRANTIES OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING BUT NOT
LIMITED TO WARRANTIES OF MERCHANTABILITY OR FITNESS FOR ANY PURPOSE.
1.F.5. Some states do not allow disclaimers of certain implied
warranties or the exclusion or limitation of certain types of
damages. If any disclaimer or limitation set forth in this agreement
violates the law of the state applicable to this agreement, the
agreement shall be interpreted to make the maximum disclaimer or
limitation permitted by the applicable state law. The invalidity or
unenforceability of any provision of this agreement shall not void the
remaining provisions.
1.F.6. INDEMNITY - You agree to indemnify and hold the Foundation, the
trademark owner, any agent or employee of the Foundation, anyone
providing copies of Project Gutenberg™ electronic works in
accordance with this agreement, and any volunteers associated with the
production, promotion and distribution of Project Gutenberg™
electronic works, harmless from all liability, costs and expenses,
including legal fees, that arise directly or indirectly from any of
the following which you do or cause to occur: (a) distribution of this
or any Project Gutenberg work, (b) alteration, modification, or
additions or deletions to any Project Gutenberg work, and (c) any
Defect you cause.
Section 2. Information about the Mission of Project Gutenberg
Project Gutenberg is synonymous with the free distribution of
electronic works in formats readable by the widest variety of
computers including obsolete, old, middle-aged and new computers. It
exists because of the efforts of hundreds of volunteers and donations
from people in all walks of life.
Volunteers and financial support to provide volunteers with the
assistance they need are critical to reaching Project Gutenberg’s
goals and ensuring that the Project Gutenberg collection will
remain freely available for generations to come. In 2001, the Project
Gutenberg Literary Archive Foundation was created to provide a secure
and permanent future for Project Gutenberg and future
generations. To learn more about the Project Gutenberg Literary
Archive Foundation and how your efforts and donations can help, see
Sections 3 and 4 and the Foundation information page at www.gutenberg.org.
Section 3. Information about the Project Gutenberg Literary Archive Foundation
The Project Gutenberg Literary Archive Foundation is a non-profit
501(c)(3) educational corporation organized under the laws of the
state of Mississippi and granted tax exempt status by the Internal
Revenue Service. The Foundation’s EIN or federal tax identification
number is 64-6221541. Contributions to the Project Gutenberg Literary
Archive Foundation are tax deductible to the full extent permitted by
U.S. federal laws and your state’s laws.
The Foundation’s business office is located at 41 Watchung Plaza #516,
Montclair NJ 07042, USA, +1 (862) 621-9288. Email contact links and up
to date contact information can be found at the Foundation’s website
and official page at www.gutenberg.org/contact
Section 4. Information about Donations to the Project Gutenberg
Literary Archive Foundation
Project Gutenberg™ depends upon and cannot survive without widespread
public support and donations to carry out its mission of
increasing the number of public domain and licensed works that can be
freely distributed in machine-readable form accessible by the widest
array of equipment including outdated equipment. Many small donations
($1 to $5,000) are particularly important to maintaining tax exempt
status with the IRS.
The Foundation is committed to complying with the laws regulating
charities and charitable donations in all 50 states of the United
States. Compliance requirements are not uniform and it takes a
considerable effort, much paperwork and many fees to meet and keep up
with these requirements. We do not solicit donations in locations
where we have not received written confirmation of compliance. To SEND
DONATIONS or determine the status of compliance for any particular state
visit www.gutenberg.org/donate.
While we cannot and do not solicit contributions from states where we
have not met the solicitation requirements, we know of no prohibition
against accepting unsolicited donations from donors in such states who
approach us with offers to donate.
International donations are gratefully accepted, but we cannot make
any statements concerning tax treatment of donations received from
outside the United States. U.S. laws alone swamp our small staff.
Please check the Project Gutenberg web pages for current donation
methods and addresses. Donations are accepted in a number of other
ways including checks, online payments and credit card donations. To
donate, please visit: www.gutenberg.org/donate.
Section 5. General Information About Project Gutenberg electronic works
Professor Michael S. Hart was the originator of the Project
Gutenberg concept of a library of electronic works that could be
freely shared with anyone. For forty years, he produced and
distributed Project Gutenberg eBooks with only a loose network of
volunteer support.
Project Gutenberg eBooks are often created from several printed
editions, all of which are confirmed as not protected by copyright in
the U.S. unless a copyright notice is included. Thus, we do not
necessarily keep eBooks in compliance with any particular paper
edition.
Most people start at our website which has the main PG search
facility: www.gutenberg.org.
This website includes information about Project Gutenberg,
including how to make donations to the Project Gutenberg Literary
Archive Foundation, how to help produce our new eBooks, and how to
subscribe to our email newsletter to hear about new eBooks.
Reading Tips
Use arrow keys to navigate
Press 'N' for next chapter
Press 'P' for previous chapter