KOSOVO: ASSEMBLY INVESTIGATES FORMER SPEAKER DACI,

C O N F I D E N T I A L SECTION 01 OF 03 PRISTINA 000181 SIPDIS SIPDIS DEPT FOR DRL, INL, AND EUR/SCE, NSC FOR BRAUN, USUN FOR DREW SCHUFLETOWSKI, USOSCE FOR STEVE STEGER ******************************************** ZFR ZFR ZFR ZFR ZFR ZFR ZFR ZFR ZFR ZFR ZFR PLEASE CANCEL PRISTINA 181 IN ITS ENTIRETY. IT WAS ACCIDENTALLY RETRANSMITTED AND IS AN EXACT DUPLICATE OF PRISTINA 180. ********************************************* E.O. 12958: DECL: 03/08/2017 TAGS: PGOV PREL PHUM KDEM UNMIK YI SUBJECT: KOSOVO: ASSEMBLY INVESTIGATES FORMER SPEAKER DACI, RESULTS BOTH PROMISING AND DISAPPOINTING PRISTINA 00000181 001.2 OF 003 KAIDAINOW PRISTINA 00000181 002 OF 003 admitted to us the language of the condemnation was not as strident against Daci as many had expected, but only because the committee had agreed to reach a cross-party consensus, and Daci loyalists were on the committee. End Comment.) UNMIK's Role ¶5. (C) Aside from this Assembly role, responsibility for holding wrongdoers legally accountable for their crimes lies with the international judges, prosecutors, and investigators of UNMIK's Department of Justice (DoJ) and the Financial Investigations Unit (FIU). The FIU began its work shortly after the July 2006 completion of the AG's report, which alerted it to possible crimes and defined the scope of its Assembly investigation. Alleged Assembly financial impropriety falls into three specific categories: an armored car ordered for Daci (but never delivered),the construction of the Villa Germia conference center without proper authorization, and misuse of petty cash. ¶6. (C) The FIU has thus far only completed investigation of the armored car - that file now moves to new Canadian prosecutor Andrew Mayes, who will decide if and when to issue indictments and move the case forward. Former Assembly budget director Jusuf Nikqi, Daci advisor Ahmet Alishani, and businesswoman Shefka Shasivari (who apparently failed to import the vehice in question) were arrested in connection with this part of the case, but all were released pending investigation. According to FIU sources, former Assembly sec Isuf Demaj may face charges as well, but Daci, who scrupulously kept his fingerprints off the armored car deal, will likely not. (NOTE: Shasivari, who pled poverty to ward off a high bail determination, was eventually released after paying the 100,000 euro bail in cash. As a result, she is now also under investigation for money laundering. END NOTE.) FIU Says Daci Could Eventually Face Criminal Charges ¶7. (C) However, Daci may face criminal charges eventually. FIU sources told us that since they already seized from Assembly premises the evidence related to the Villa Germia construction, that part of the case will keep well. Therefore, they are focusing next on the petty cash portion, where alleged illegal expenditures included watches from the Zurich airport, various perfume and cologne purchases, new porcelain teeth for Daci, and clothing and ski lessons for his staff. FIU claims to have a sufficient paper trail and other evidence (for example, the porcelain teeth remain on Daci's person) to support criminal charges against the former Assembly speaker. Though the amount of money in question is dwarfed by the Villa Germia expenses, Daci's role as ringleader could conceivably put him on the high end of any possible sentence. In the FIU's assessment, budget director Jusuf Nikci, former secretary Isuf Demaj, former logistics officer Burim Latifi, and Daci aide Alishani are also vulnerable to being charged in this section of the case. ¶8. (C) Only four Assembly staffers have lost their jobs in the wake of the AG's report; many more were likely involved in Daci's schemes or at least illegally received his largesse. These people may be eligible for administrative disciplinary procedures which have not yet been undertaken. ¶9. (C) COMMENT: The "glass half-full" interpretation of these events is that the Kosovar Assembly initiated and conducted an inquiry into allegations of malfeasance, one that featured prominently in local press reporting and became an oft-cited parable of official corruption. The "half-empty" analysis is that the Assembly reacted fecklessly to the investigation and continues to rely on internationals. Our judgment is that it is a positive development and a useful precedent that the conduct of a former senior official was subjected to this scrutiny. While many ordinary Kosovars undoubtedly want to see senior officials doing the "perp-walk", this is at least a start. END COMMENT. PRISTINA 00000181 003.2 OF 003 ¶10. (SBU) U.S. Office Pristina clears this cable in its entirety for release to U.N. Special Envoy Martti Ahtisaari. KAIDANOW