CROATIA,S INTEL SERVICE SHAKE UP EXPECTED TO

S E C R E T ZAGREB 001717

SIPDIS


DEPARTMENT FOR EUR/SCE

E.O. 12958: DECL: 09/27/2029
TAGS: PINR PREL KAWC HR
SUBJECT: CROATIA,S INTEL SERVICE SHAKE UP EXPECTED TO
IMPROVE COOPERATION WITH U.S.


Classified By: PolOff Justin Friedman, reasons 1.4 (b),(c) & (d)

SUMMARY AND COMMENT
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1. (S) With the confirmation of Veselko Grubisic as new
Director of the Croatian Intelligence Agency (OA),the GoC is
asserting positive control over the intel services. Along
with new chief of Counterintelligence Agency (POA) Josko
Podbevsek, (named earlier this year),Grubisic should be more
willing to cooperate with us and more forceful in pursuit of
ICTY fugitive general Gotovina. President Mesic appears to
have approved this move despite previously telling the
Ambassador he opposed putting a party person at the top of
the OA. The press speculates that the GoC will recreate the
National Security Bureau (NSB) to coordinate among the three
intel services (including military intelligence),with former
NSB head and President Mesic loyalist Tomislav Karamarko
returning to run it, although Karamarko may not be
confirmable in this position. We will welcome these changes
for their promise of improving our intel cooperation, but
will watch closely for signs of the services straying back
into political waters. END SUMMARY AND COMMENT.


2. (U) On September 15 the Parliamentary Committee on
Internal Affairs and National Security upheld the nomination
of Veselko Grubisic as the new Director of the Intelligence
Agency (OA). Grubisic was jointly proposed by President
Mesic and Prime Minister Sanader to replace outgoing OA chief
Damir Loncaric, who had recently announced his resignation.


3. (C) Loncaric was forced out of his position in large part
due to pressure on Mesic by Western governments for his
removal. Media have speculated that Loncaric was leaving as
part of an understanding between the President and the PM
whereby Mesic would agree to Sanader bringing his people to
the leading positions in the intelligence community in
exchange for a) HDZ not running a negative campaign against
him during the presidential race, and b) re-establishing a
supervisory and coordination body (such as the former
National Security Bureau) which would be headed by someone of
his choice. Parliament may be unwilling to approve
recreating the NSB; opposition parties fear a return to the
unsavory mix of intel and politics of the Tudjman era.


4. (C) Mesic's former campaign chief and National Security
Bureau head Tomislav Karamarko has publicly denied rumors
that he would return to the post. Karamarko told Emboff only
that he would be meeting with Mesic this week, but Karamarko
did not contradict his business partners at the Soboli
security consulting firm when they asserted that they fully
expect him to leave the private sector and take up a
recreated NSB post in the coming months. We have heard
rumors that Karamarko has political skeletons in his closet
that may make him unconfirmable, should this post be created.


5. (S) Veselko Grubisic is a veteran of the Ministry of
Foreign Affairs, and prior to his appointment was Assistant
Minister in charge of security analysis and communications
security. In February 2004, he co-led the GoC delegation to
Washington for the Senior Policy Exchange on Export Control
Issues. FM Zuzul designated Grubisic as our primary point of
contact with MFA on intelligence issues, including the search
for Gotovina.


6. (U) Earlier in his diplomatic career Grubisic dealt with
NATO and international security issues. From 1991 to 1996 he
lived in Sydney, Australia where he managed an electronic
company and led the local HDZ chapter in 1995-96. During his
confirmation hearing testimony, Grubisic told the Sabor
Committee that his focus would be business intelligence.
Grubisic holds an M.A. in international relations and B.S. in
mechanical engineering. The press has reported his close
links with Foreign Minister Miomir Zuzul and current
Ambassador to the U.S. Neven Jurica.


7. (U) The new deputy chief of OA, Stribor Kikerec (whose
appointment was announced in the press in June) comes from
inside the intelligence community. Until recently he was
chief of the OA station in Moscow. Earlier in his career he
was an assistant director of HIS, the intelligence agency
that has now been replaced by OA. The press notes that he
was Sanader's personal choice, in much the same way as was
the new chief of Counterintelligence Agency (POA) Josko
Podbevsek, who replaced Franjo Turek earlier this year.
Together with President Mesic's former national security
advisor Zeljko Bagic, Turek was reported to be in touch with
people from organized criminal circles that allegedly assist
fugitive general Ante Gotovina, and therefore had to go.
FRANK


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