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The Multibillion-Euro Lawsuit Facing Montenegro Over Seized Gemstones


The South Africans' lawyers argue that the high-quality opals that were seized are worth 3 billion euros ($3.2 billion), or around 4,800 euros per resident in this country of around 620,000. (illustrative photo)
The South Africans' lawyers argue that the high-quality opals that were seized are worth 3 billion euros ($3.2 billion), or around 4,800 euros per resident in this country of around 620,000. (illustrative photo)

PODGORICA -- In July 2011, with a recently independent Montenegro emerging as a nexus of corruption and transnational crime, two men with South African passports and at least 28 kilograms of opals boarded a plane in Zurich and flew to Podgorica.

What happened next ignited a decade of Balkan intrigue over the fate of the confiscated gemstones involving courtiers to a dubious dynasty, a real-estate entrepreneur and his seaside safe, and a trail of abortive lawsuits culminating in a claim for damages that's more than half of Montenegro's gross domestic product (GDP).

In between, there have been charges of smuggling and theft along with halting government efforts to appraise or even sell off the seizure, which is said to include the world's largest opal.

Now, a court in the ancient city of Kotor is scheduled to unpack the case on August 31 to settle the tug-of-war, which has dragged the former Yugoslav republic's Central Bank into the uncomfortable role of custodian and pits shadowy plaintiffs against the state's protector of property and legal interests.

"The plaintiffs are demanding the return of the seized opals," Kotor court Judge Veljko Bulatovic told RFE/RL's Balkan Service. "The case has been sent to an attempt to resolve it peacefully."

Opal is a mineraloid that falls under the category of precious or common, depending on its iridescence and density. Precious opal was particularly highly prized among European royalty when its only known source was mines in what is now eastern Slovakia. That changed with the discovery of vast opal deposits in Australia in the 19th century, but top-quality stones still fetch tens of thousands of dollars per carat.

The South Africans' lawyers argue that the high-quality opals that were seized are worth 3 billion euros ($3.2 billion), or around 4,800 euros per resident in this country of around 620,000.

Little is known about the South African nationals at the center of the case, Robert Fenjek and Antony Vernon Strelensky, or why they brought the gemstones to Montenegro in July 2011.

Fenjek and Strelensky founded a company in Podgorica with an initial capital of just 2 euros a little over a month before their flight from Zurich. While the company, Canyon Holdings AD, is still registered, there is no official indication that it is active financially. The revenue and customs authority website shows no financial reports from the company for years.

Both men introduced themselves in the past as representatives of a self-styled royal, Stefan Tchernetich, who claims to be a "prince of Montenegro and Macedonia, Serbia, Albania, and Vojvodina." Tchernetich is perhaps best-known to Montenegrins for his baffling attendance -- in the capacity of "hereditary prince" -- at a Statehood Day reception in 2022. Longtime ruler of Montenegro Milo Djukanovic, who lost the presidential election in April, sparked an investigation into how he got into the VIP event.

Fenjek has claimed to be an honorary count and Strelensky a consul in Pretoria for the House of Tchernetich. The men have acknowledged traveling with the jewels to Podgorica in July 2011, when Montenegro was five years into independence from Serbia and coming into its own as a destination for organized criminals from cigarette smugglers to a ring of jewel thieves known to Interpol as Pink Panther.

Fenjek and Strelensky were silent for nearly a year before suddenly contacting Montenegrin police to allege that Branko Cupic, a well-connected real-estate entrepreneur who has specialized in high-profile historical objects, had "fraudulently taken" their jewels.

They told authorities that Cupic had waited for them at the airport a year earlier and "bypassed customs" to take them to one of his properties, the Belvi Hotel on the Adriatic Coast outside of Budva, where the gemstones were put in a hotel safe. When Cupic refused to return the stones a year later, they allege, they turned to the police. None of their allegations against Cupic have been verified and their claims will be examined in the Kotor proceedings. Cupic was quoted as saying in early 2012 that he "gave [police] the semiprecious stones, which [had been] deposited in the hotel safe by foreign guests."

Police seized the gemstones and, in September 2012, a court in the capital, Podgorica, concluded that they had been brought into the country illegally and ordered them confiscated permanently. They were eventually moved to a Central Bank safe.

By April 2013, a misdemeanor court had fined Cupic, Fenjek, and Strelensky 4,000 euros each in connection with the case, but there was still no public clarity on the provenance or fate of the jewels.

Fenjek and Strelensky have been trying to recover them ever since.

Montenegrin authorities say an inventory they conducted in 2014 determined that the seizure amounted to 28.172 kilograms of unprocessed, semiprecious opal of nine different types, including fire, white, and black opal. One of the stones weighed more than 4 kilograms, suggesting it outsizes the world's largest and most valuable gem opal, the 3.4-kilogram Olympic Australis and the world's most valuable black opal, the Aurora Australis. The collection also included more than a kilogram worth of animal figurines cut from the stone.

The plaintiffs, who suggested in an earlier filing that their damages from the seizure amounted to 30 million euros and at another point estimated the worth of the gemstones at 2 billion euros, also allege that part of their original 33-kilogram stash has disappeared since its confiscation in 2012.

The Montenegrin Special Prosecutor's Office announced in September 2022 that it had opened a case based on a criminal complaint asserting that 5.7 kilograms of semiprecious opals had disappeared from unspecified institutions.

Asked at the time by a journalist about the confiscated stones, Governor Radoje Zugic said the Central Bank's only responsibility was to keep them. "And we are doing that perfectly," he said.

More recently, the Central Bank declined to provide details to a query by RFE/RL's Balkan Service, saying it "has no right to provide information regarding items that are kept in the Treasury and are not the property of the bank."

The South Africans previously filed abortive suits seeking the return of the gemstones or damages in Podgorica in 2014, in Niksic in 2017, and again in Podgorica in 2019. They have also previously estimated the value of the seized jewels at 2 billion euros.

They are being represented in the current case in Kotor, which was launched in January, by the firm of Podgorica lawyer Dragan Prevelic.

Prevelic's office told RFE/RL's Balkan Service ahead of the August court date that the Montenegrin state illegally confiscated 33 kilograms of high-quality black opal from its clients: "Whereby the state disproportionately sanctioned our clients, violated their right to property, protected by law, the constitution, and the European Convention on Human Rights. In such cases, states under the jurisdiction of the European Court of Human Rights are regularly obliged to return confiscated property and compensate damages."

The lawyers insist the opals are worth 3 billion euros and warn that if they win their case, it will inflict serious damage on the Montenegrin state. "We estimate that the damage caused by the illegal actions of the state and gross negligence after the confiscation will be close to or even exceed the annual amount of the budget of Montenegro," Prevelic's office said. Montenegro's approved budget for 2023 predicts spending of 2.8 billion euros.

Montenegro's protector of property and legal interests, Bojana Cirovic, who operates under the auspices of the government, will represent the state in the Kotor mediation proceedings this week.

Cirovic confirmed to RFE/RL's Balkan Service that the plaintiffs are seeking a return of the confiscated items, damages for what they claim is a "missing 5 kilograms," and compensation for lost profits. She also said that experts will appraise the stones' value for the proceedings.

Cirovic also told RFE/RL that the burden of proof will lie with the plaintiffs to establish "primarily the right of ownership over the opals and then also the other allegations in the lawsuit."

An evaluation was commissioned by the Montenegrin Administration for State Property under current Prime Minister and then-Finance Minister Milojko Spajic in 2021 to determine the identification, size, and potential value of the confiscated stones as the government had decided to "enter into the procedure for selling the jewels." The Administration for State Property, however, has since confirmed that the process of determining the opals' worth -- a precursor to certification and sale -- had been suspended.

Veljko Bulatovic, a spokesman for the Kotor court, told RFE/RL's Balkan Service that the court had issued a temporary decision prohibiting "disposing of or alienating the opal" pending a decision, thus blocking any government effort to ship samples abroad for testing.

Montenegro has been plagued for decades by corruption and transnational crime following the breakup of Yugoslavia and since its declaration of independence from Serbia in 2006, with some accusing leader Djukanovic of turning a blind eye, or worse, to the problem.

Montenegro joined NATO in 2017 but the fight against organized crime remains a key talking point in discussions about Podgorica's candidacy for the European Union.

International law enforcement experts regard it as a significant transit route for arms smuggling, as well as for drugs like cocaine and heroin.

Kotor has been the scene of some of its fiercest violence, with turf warfare and battles for control of illicit markets among rival criminal gangs blamed for dozens of killings there and in towns like Skaljari and Kavac.

Written by Andy Heil based on reporting by Lela Scepanovic
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    Lela Scepanovic

    Lela Scepanovic is a correspondent for RFE/RL's Balkan Service.

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    Andy Heil

    Andy Heil is a Prague-based senior correspondent covering central and southeastern Europe and the North Caucasus, and occasionally science and the environment. Before joining RFE/RL in 2001, he was a longtime reporter and editor of business, economic, and political news in Central Europe, including for the Prague Business Journal, Reuters, Oxford Analytica, and Acquisitions Monthly, and a freelance contributor to the Christian Science Monitor, Respekt, and Tyden. 

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