Page 1532
1 Monday, 17 November 2008
2 [Open session]
3 [The accused entered court]
4 [The witness entered court]
5 --- Upon commencing at 2.17 p.m.
6 JUDGE MOLOTO: Good afternoon to everybody in and around the
7 courtroom.
8 Madam Registrar, will you please call the case.
9 THE REGISTRAR: Good afternoon, Your Honours. Good afternoon,
10 everyone in and around the courtroom. This is case number IT-04-81-T,
11 the Prosecutor versus Momcilo Perisic.
12 JUDGE MOLOTO: Thank you very much.
13 Could we have appearances, please, starting with the Prosecution.
14 MR. SAXON: Good afternoon, Mr. President. Good afternoon, Your
15 Honours. Dan Saxon for the Prosecution, together with my colleagues
16 Ms. Bronagh McKenna and Ms. Carmela Javier.
17 JUDGE MOLOTO: Thank you.
18 For the Defence, Mr. Lukic.
19 MR. LUKIC: [Interpretation] Good afternoon, Your Honours. Good
20 afternoon to everyone in the courtroom.
21 Appearing today for Mr. Perisic are legal assistants Tina Drolec,
22 Milos Androvic, Chad Mair, and our case manager, Daniela Tasic,
23 Mr. Gregor Guy-Smith, and Novak Lukic, myself, as Defence counsel.
24 JUDGE MOLOTO: Thank you very much.
25 Good afternoon, Mr. Torkildsen. May I just warn you that you are
Page 1533
1 still bound by the declaration you made at the beginning of your
2 testimony to tell the truth, the whole truth, and nothing else but the
3 truth. Thank you very much.
4 Mr. Lukic.
5 WITNESS: MORTEN TORKILDSEN [Resumed]
6 Cross-examination by Mr. Lukic: [Continued]
7 Q. [Interpretation] Good afternoon, Mr. Torkildsen.
8 MR. LUKIC: [Interpretation] If I may ask the usher to give
9 Mr. Torkildsen a hard copy of his report. When I refer to certain
10 paragraphs, I will reference also the number in e-court, but I believe
11 Mr. Torkildsen will find it easier to find it by the number of the
12 paragraph.
13 Q. Mr. Torkildsen, I should like to broach a topic in your report in
14 chapter 3, paragraph 16 onwards. That's the financing of the Yugoslav
15 Peoples' Army in 1991 and 1992. When I refer to a specific paragraph, I
16 will give you the number, but first of all I'd start with a few general
17 questions.
18 Would you agree if I said that the budget of the Socialist
19 Federal Republic of Yugoslavia, but generally speaking that the budget of
20 a state is a public document and that it is always shown in the form of a
21 law?
22 A. At least I would agree with your first statement that it's a
23 public document that is always shown in the form of a law that I cannot
24 say. But at least these budgets have been shown in the form of a law
25 when it comes to the SFRY.
Page 1534
1 Q. In the Socialist Federal Republic of Yugoslavia
2 that this is the period up to, let's say, 1991, although formally
3 speaking the Federal Republic of Yugoslavia was established in 1992,
4 would you agree with me that there was a federal budget as well as
5 republican and provincial budgets?
6 A. Yes, that is correct.
7 Q. Do you agree that in the course of 1990, and 1991 especially, the
8 public revenues of the citizens of Yugoslavia provided much less to the
9 federal budget than to the republic budgets?
10 A. Yes, that -- just trying to make your point of what actually
11 makes up these budgets. The republican budgets, meaning on the
12 republican level, they were, to a large extent, financed by income tax on
13 the citizens, while the federal budgets, they again will be made up by
14 contributions by the socialist republics and the two autonomous regions
15 and the likes of custom taxes.
16 Q. Do you know any other sources of revenues to the federal budget?
17 What else financed the federal budget? In paragraph 16 you enumerate
18 these sources specifically. You can look at that paragraph. It lists
19 the sources of the federal budget. Are there any sources that you did
20 not include there in the first sentence?
21 A. I'm here pointing out in paragraph 16 that the customs and import
22 taxes, the contributions, as I mentioned, and also by loans from the
23 National Bank of Yugoslavia
24 Q. You don't know, do you, whether the loans from the National Bank
25 of Yugoslavia
Page 1535
1 primary issue?
2 A. Most likely they were, but the magnitude of this financing,
3 meaning the loans and the primary issues, were much less. I have, for
4 instance, also reviewed the SFRY budget, all the annual accounts for
5 1990, and then the proportion coming from loans or primary issues from
6 the National Bank of Yugoslavia
7 Q. When I looked up that budget I noticed another source of
8 financing for the budget which you did not include here. Perhaps it's
9 not important. But do you agree that federal taxes were also a source of
10 financing for the federal budget?
11 A. Probably. I have to posit back. I don't know what type of
12 federal taxes you would be referring to.
13 Q. Literally, in the budget of the SFRY and later in the budget of
14 the FRY and even Republika Srpska, one of the original sources of
15 financing was the taxes paid by citizens for services rendered by federal
16 authorities, federal agencies. Do you know anything about that?
17 I have to be more precise, because the word "tax" is a bit
18 different from the English word "tax," because in Serbian the word
19 "taksa" means a fee, an administrative or other fee, paid for services
20 rendered by the federal agencies.
21 JUDGE MOLOTO: Yes, Mr. Saxon.
22 MR. SAXON: I'm very sorry to interrupt, but I have a similar
23 concern as I expressed, I believe, last week. Page 4, lines 6 to 8,
24 Mr. Lukic says: "When I looked up that budget, I noticed another source
25 of financing for the budget which you did not include here. Perhaps it's
Page 1536
1 not important." And then lower down, line 12: "Literally, in the budget
2 of the SFRY and later in the budget of the FRY and even Republika Srpska,
3 one of the original sources of financing was the taxes paid by citizens
4 for services rendered by federal authorities, federal agencies."
5 My concern is simply this: It seems to me that these are
6 statements of fact as opposed to questions, Your Honour. And I don't
7 know what the source of this is or whether the witness can say the source
8 of this, but it's simply a concern that what is coming into the record is
9 somehow not being shown here in this courtroom.
10 JUDGE MOLOTO: Mr. Lukic.
11 MR. LUKIC: [Interpretation] I think it is ambiguous in the record
12 what has or has not been shown to the witness. I put it to the witness
13 because in paragraph 16 he lists item by item what he established to have
14 been the direct revenues to the budget. I'm asking him about another
15 source of direct revenue. If he doesn't know, he doesn't know. I just
16 wanted to remind him.
17 JUDGE MOLOTO: The point is, Mr. Lukic, this is an expert
18 witness. He's not a fact witness, so you are not trying to test his
19 memory whether he knows the facts. If you know of any other source of
20 income, show it to him; let him comment on it. Because he has given us
21 in his report what he has considered to be sources of income, and if you
22 are aware of any other sources of income that is not there, say to him,
23 Are you aware of whether this was another source, and he will say whether
24 he was, and let's see the source.
25 I think the point being made by the Prosecution is that you're
Page 1537
1 making a statement and either the witness believes what you say or he
2 doesn't believe you. But if you confront him with real evidence and say,
3 This is another source; did you consider it, then it's a different story.
4 MR. LUKIC: [Interpretation] I agree with you completely, Your
5 Honours, concerning the documents that I intend to put to this witness,
6 concerning some of my assertions. But I am just testing here some of the
7 claims he made in his report based on his own sources. I don't want to
8 show the documents to him and open some new issues. I will in my case
9 present new documents, whereas here I'm just testing the credibility of
10 the expert witness.
11 MR. SAXON: Your Honour, the problem that I see is that the
12 testing, at least at this stage, is being done in the form of assertions
13 of fact, rather than questions being put to the witness.
14 JUDGE MOLOTO: Assertions of fact, Mr. Lukic, which are not
15 substantiated and this witness, therefore, will not be in a position to
16 comment on those assertions. But your learned friend is making a point.
17 Do you have a response to it?
18 MR. LUKIC: [Interpretation] No, Your Honour. In any case, I will
19 formulate my questions in such a way as to get an answer from the
20 witness. If I don't have a document in front of me, I won't ask
21 questions of that sort.
22 JUDGE MOLOTO: Thank you very much.
23 MR. LUKIC: [Interpretation]
24 Q. Would I be right in saying, Mr. Torkildsen, that a large deficit
25 in the federal budget in 1991 derived mainly from the fact that the
Page 1538
1 republics had stopped paying their compulsory contributions?
2 A. I think that that would be an important reason for the deficit,
3 but it would also be at that time that they had actually started to print
4 money in order to finance the deficit, because when you start printing
5 money, things get out of hand in terms of that the inflation starts to
6 accelerate. And that means that the only option left, if this printing
7 of money continues, is to continue printing money in order to finance
8 this deficit. So it would not only be that the contributions have
9 stopped, but also the fact that you have started to print money in order
10 to -- in order to make up for the budget deficit.
11 JUDGE MOLOTO: But, Mr. Torkildsen, isn't that a "cause and
12 effect" kind of situation? Isn't the printing of money resorted to
13 because the citizens -- the provinces have stopped contributing, and
14 therefore, there is a deficit because they are not contributing?
15 Therefore, money gets printed to make up the shortfall.
16 THE WITNESS: That is the way that I understand it, because there
17 were no other sources of finance.
18 JUDGE MOLOTO: So would you then agree with Mr. Lukic's
19 proposition?
20 THE WITNESS: Yes, I do.
21 JUDGE MOLOTO: Thank you.
22 MR. LUKIC: [Interpretation]
23 Q. That's precisely what I wanted to emphasise, what is the cause
24 and what is the effect.
25 In the next sentence of paragraph 16 you say that increasing
Page 1539
1 disintegration of the SFRY in 1991 adversely affected the budget,
2 especially in the area of revenues. Were you aware that Slovenia and
3 Croatia
4 before they had declared their independence?
5 A. That sounds natural, yes, that they stopped contributing when
6 they proclaimed independence.
7 Q. No. In fact, I asked you whether you knew they had stopped
8 paying contributions even before - before - the declaration of
9 independence.
10 A. I haven't seen any facts to that, but I am -- I assume that what
11 you're saying here is correct.
12 Q. In the same paragraph you refer to the reason for the resignation
13 of Prime Minister Ante Markovic, and you quote a newspaper article
14 regarding his resignation, and this quotation says that as much as 81 per
15 cent of the budget for 1992 was envisaged to finance the JNA.
16 As a percentage it creates the impression that we are talking
17 about a militarist state, seeing how large a proportion of the budget was
18 used for the army. But do you know who the other beneficiaries of the
19 federal budget were?
20 A. That I can't remember.
21 Q. Do you recall from reviewing the documents whether you had
22 established that most of the institutions, such as police, the justice
23 system, the healthcare system, were financed at the republic level? The
24 education system, the pension funds.
25 A. That may be correct, but today I cannot remember which
Page 1540
1 institutions were financed at the republican level and which institutions
2 were financed at the federal level.
3 JUDGE MOLOTO: Just now coming out from that question, my
4 question is: This 81 per cent, was it 81 per cent of the federal budget?
5 THE WITNESS: Yes, that's my understanding.
6 MR. LUKIC: [Interpretation]
7 Q. Would you agree with me that the government led by Mr. Ante
8 Markovic had proposed enacting a law for financing certain requirements
9 of the national defence in September 1991? I believe that's mentioned in
10 the next paragraph, or perhaps a bit further down below.
11 A. Yes, I agree with that. That is actually discussed in, I think,
12 a couple of the other documents that is attached to my report.
13 Q. Correct.
14 MR. LUKIC: [Interpretation] I would now like to call up 65 ter
15 6560.
16 Q. That is the document you referred to in your report and which has
17 not been introduced by the Prosecution. So this is September 1991. A
18 draft law made by the Federal Executive Council, still led by
19 Ante Markovic, a draft law on revenue sources for financing certain
20 requirements of national defence in 1991.
21 MR. LUKIC: [Interpretation] I would like to move to the statement
22 of reasons. That's page 4 in B/C/S and page 6 in English.
23 Q. I'll read one passage. That's the penultimate paragraph in
24 B/C/S.
25 "As of 26 August 1991
Page 1541
1 of the plan for 1991 has been realised from direct revenues."
2 And now on the next page, it says just below these numbers.
3 MR. LUKIC: [Interpretation] Can we have the next page in English
4 and the next one in English.
5 Q. It says:
6 "Due to the insufficient in-flow of revenue, problems in
7 financing the JNA have reached a critical point, because in addition to
8 regular expenditures, there have also been considerable extra expenses
9 incurred by the relocation of units and institutions from the territory
10 of Slovenia
11 crisis in the country."
12 Now, this document that you see in front of you proposed by the
13 federal government, did it follow that session of the Presidency you said
14 took place in August?
15 A. Yes. As far as I understand it, yes.
16 Q. And after that session of the Presidency, the federal government,
17 called the Federal Executive Council, proposes the enactment of this law
18 to cover the shortfall in the federal budget for purposes of financing
19 the army, to the benefit of the army.
20 A. Yes.
21 Q. This law was, in fact, enacted; correct?
22 A. That is my understanding, yes.
23 Q. The writer of this draft law suggests that the deficit be covered
24 from loans from the National Bank of Yugoslavia
25 A. Yes.
Page 1542
1 Q. These loans stated in this draft law, were they to be from the
2 primary issue?
3 A. That is my understanding.
4 Q. And the law is proposed by Ante Markovic; correct?
5 A. He was at least the prime minister for the SFRY at that time,
6 yes.
7 Q. Do you know the ethnicity of Mr. Markovic, perhaps?
8 A. Yes. He was from -- he is from Croatia.
9 Q. Do you know by any chance if he remained in Belgrade after his
10 resignation?
11 A. From what I've understood, he left Belgrade after his
12 resignation.
13 MR. LUKIC: [Interpretation] Let's now take a look at another
14 document. It is --
15 JUDGE MOLOTO: Before we get another document, Mr. Lukic, what do
16 you want to do with this one?
17 MR. LUKIC: [Interpretation] Yes, Your Honour, I apologise. I'd
18 like to tender this document in evidence.
19 JUDGE MOLOTO: You --
20 MR. LUKIC: [Interpretation] If possible, Your Honour, I'd like to
21 propose that the document be tendered, both the proposal and the
22 supplement to the document, both.
23 JUDGE MOLOTO: We've not heard anything about the supplement of
24 the document. I do have a question for you, though --
25 THE INTERPRETER: The statement of reasons.
Page 1543
1 JUDGE MOLOTO: You asked the witness whether this draft was
2 passed into law. Do we have the law as passed, not in draft form? I
3 think that would be a better exhibit to tender rather than this one, if
4 indeed it was passed into law.
5 MR. LUKIC: [Interpretation] Yes, I agree, Your Honour. I don't
6 have the law with me, but I read that the law was passed in the report.
7 But I'd like this draft to be admitted because there it includes the
8 statement of reasons, explaining the motives for which the government is
9 proposing the law, and I think that's the important point, to understand
10 the motives for the law to be imposed, and that is found in the statement
11 of reasons proposed by the government. But I'm sure I could find the law
12 and then tender that, too.
13 JUDGE MOLOTO: Thank you very much. 65 ter 6560 is admitted into
14 evidence. May it please be given an exhibit number.
15 THE REGISTRAR: That will be Exhibit D10, Your Honours.
16 JUDGE MOLOTO: Thank you so much.
17 Yes, Mr. Lukic.
18 MR. LUKIC: [Interpretation]
19 Q. I'd now like to move on to another area and some other documents.
20 You analysed a document which -- just let me take a moment to find it.
21 Let me put it this way: Which means of payment in the Republic of Srpska
22 Krajina existed when it was founded? Were there any changes, any
23 currency changes, that were used in the Serbian Republic of Krajina?
24 A. From the documents that I have reviewed, this appears that both
25 the RS and the RSK had their own currency in 1992 and 1993, but I would
Page 1544
1 like to elaborate on that, because their own currency was set at an
2 exchange rate with the FRY dinar at parity, meaning that it could be
3 exchanged on a 1:1 scale. It was fully convertible, meaning that an RSK
4 dinar could be exchanged for one FRY dinar.
5 JUDGE MOLOTO: That currency was also called a dinar?
6 THE WITNESS: Yes.
7 JUDGE MOLOTO: And in the RS, what was it called?
8 THE WITNESS: An RS dinar.
9 JUDGE MOLOTO: Also.
10 THE WITNESS: That's my understanding.
11 JUDGE MOLOTO: Thank you.
12 MR. LUKIC: [Interpretation]
13 Q. What about the dinar from Republika Srpska and the Serbian
14 Republic of Krajina
15 throughout Yugoslavia
16 A. I assume so, but that would -- I mean, either -- if you could pay
17 in the RS dinar or you actually had to exchange it for a Yugoslav or an
18 FRY dinar first, that I'm not sure about. But the consequences or the
19 result would have been the same in any way.
20 Q. When did they move on to the Yugoslav dinar in the Republika
21 Srpska and the Republic of Serbian
22 A. After they introduced the super-dinar that we discussed on
23 Thursday. That would have been from early 1994.
24 Q. You say "super-dinar," and I know what you mean by that. But
25 just to avoid any misunderstanding, that is to say after Mr. Avramovic's
Page 1545
1 programme was passed, that's when the super-dinar came into being; right?
2 A. That's my understanding, yes.
3 Q. Would you agree with me that the monetary system in the Republika
4 Srpska and the Republic of Srpska Krajina, in the legal sense, that they
5 were systems that were regulated as separate autonomous monetary systems,
6 and they had all the necessary legal provisions covered that would cover
7 the monetary system of any state? Would that be right?
8 A. Then we would have to go to the Miletic report that was being
9 referred to on Thursday in order to see the details on that. I can't
10 state that what you are putting to me here is absolutely correct, without
11 looking back at that report to see what is actually stated in there.
12 Q. Yes. We'll deal with Miletic's report separately and then you
13 can comment on that as well. We'll do that in due course. But can we
14 agree that the monetary systems, as they were regulated by the provisions
15 in Republika Srpska and Republika Srpska Krajina and in the FRY, on the
16 basis of the regulations and everything, were formed and formulated, in
17 fact, in similar fashion, that they were similar?
18 A. That is my understanding, that the whole of the RSK and the RS
19 and the FRY had a similar organisation and it was all tied together.
20 Q. Just to avoid misunderstanding with my previous question, I
21 wanted to ask you if you knew that RS and RSK enacted their own laws
22 governing the national bank, currency generally, the payments, and so on.
23 In that sense that's how I saw legal regulations, in that sense.
24 A. Well, I can see your point. But also again the documents that I
25 have reviewed also show the total subordination that the national banks
Page 1546
1 of the RS and RSK had for the National Bank of Yugoslavia in Belgrade
2 Q. Yes, that's one of your thesis and we'll deal with that
3 separately. That's one of the things you put forward. We'll discuss it.
4 Now, I am saying that there was a relationship of cooperation
5 during 1992 and 1993 and that after the provisions, or, rather, programme
6 for the reconstruction of the monetary system of the FRY, there was
7 monetary control by the National Bank of Yugoslavia for specific reasons
8 towards the banks of the RS and RSK, but that it was not a relationship
9 of subordination. That's what I'm putting to you.
10 A. I would totally disagree with that. And I would like to refer
11 back to the -- back to the loan that we discussed on Thursday and refer
12 to actually what was stated in there, where it's actually stated that it
13 is the National Bank of Yugoslavia
14 loan, if I remember correctly.
15 Q. Yes, we'll discuss the document, certainly. But you say you
16 don't agree with me; right?
17 A. No, I don't agree with you, at least not to the full extent of
18 that. They were sort of moving from 1992 and onwards to 1994 in terms of
19 trying to achieve a total integration, and of course they were having
20 their cooperation and so on, but they were moving in the direction of the
21 NBY
22 Q. Do you agree with me that the monetary union is not the same
23 thing as the economic union, that they are two different categories?
24 A. That -- that could be correct, yes.
25 Q. Economic systems between the Federal Republic of Yugoslavia and
Page 1547
1 the RS and RSK were similar but were not the same; right? Do you agree
2 with me there?
3 A. Yeah, they were -- the economic systems were not -- were not the
4 same basically because the RS, in particular, was from the beginning of
5 the part of the poorest region of the SFRY.
6 Q. There wasn't a uniform custom system, right, between these three,
7 let me call them, states, but you know what I'm referring to, the three
8 entities, anyway.
9 A. As far as I know, there were no uniform customs system because at
10 least officially the RS and the RSK was not part of the FRY.
11 Q. They had their revenue from taxes, right, direct revenue from
12 taxes?
13 A. Yes. We saw that in the budget that we went through on Thursday
14 regarding the 1993 finances, where we saw that the primary issues more or
15 less financed the whole budget. But, of course, I assume that there
16 would be a very small proportion of that coming from direct revenue, like
17 taxes.
18 Q. I think there might have been a mistake in the interpretation
19 here. Just give me a brief answer. My question was this: Whether there
20 were direct -- whether there was direct revenue from taxes, from customs
21 levies?
22 THE INTERPRETER: Interpreter's correction: From customs levies.
23 JUDGE MOLOTO: Just before the witness answers, who are you
24 talking about? Because your first question at line 9, you said: "They
25 had their revenue from taxes, right, direct revenue from taxes?" And who
Page 1548
1 are the "they," if you can just tell us who are the "they"?
2 MR. LUKIC: [Interpretation] I was thinking of the budgets of the
3 Republika Srpska and the RSK, whether from their own customs they had
4 direct revenue in the budget.
5 JUDGE MOLOTO: Thank you, Mr. Lukic.
6 Yes, Mr. Torkildsen.
7 THE WITNESS: Yes, I think that would be correct. A very small
8 proportion would also come from various taxes, yes.
9 MR. LUKIC: [Interpretation]
10 Q. There was no uniform price policy either between the FRY and the
11 RS and RSK; right?
12 A. Well, you have to be more specific there, Mr. Lukic. I'm sorry.
13 When it comes to uniform price policy, regarding what?
14 Q. For example, let's look at the prices determined by the state,
15 for example, for cigarettes, fuel, and so on. Excise taxes, in fact.
16 A. I don't know whether it was a uniform pricing system or not.
17 Q. There wasn't a uniform system of taxation either, was there?
18 A. I don't know.
19 MR. LUKIC: [Interpretation] Can we now have on the screens P311,
20 please, the next document. And the page I'd like to look at is -- just
21 let me take a moment to check with the registrar, but I think that only
22 page 12 has been admitted into evidence, or, rather, pages 12 and 13 of
23 this decision but not the entire Official Gazette, just the decision.
24 Yes, that's right. Now can we have it in the B/C/S as well? Page 12 and
25 13.
Page 1549
1 Q. This is a decision by the Government of Republika Srpska on the
2 use of funds from primary issue, which was passed on the 2nd of June,
3 1992, or, rather, it was passed on the 14th of May, to be precise, and
4 published in the Official Gazette of Republika Srpska on the 2nd of June,
5 1992. That's right, isn't it?
6 Now, this decision speaks about the methodology of how the
7 primary issue funds would be used, those funds that would be applied
8 pursuant to this decision of the National Bank of Yugoslavia, the funds
9 that would be released by that decision.
10 A. Yes.
11 Q. In your analysis and in the research you did, did you come across
12 any document of the commercial banks or some state organ, for that
13 matter, which could confirm that this decision was acted upon?
14 A. That I can't remember.
15 Q. From this decision can we see who the benefits of the primary
16 issue sources was, the beneficiary of the primary issue sources was?
17 A. As is listed here in Article 1, it's the National Bank of
18 Yugoslavia
19 to their decision.
20 Q. Perhaps you misunderstood. Can we see from this decision who is
21 going to use the funds given by the National Bank of Yugoslavia --
22 A. No.
23 Q. -- who's going to benefit from them? Very well.
24 MR. LUKIC: [Interpretation] Now may we have document P314, an MFI
25 document, put up, please. It is a document that I asked you to decide
Page 1550
1 upon its admission after I conduct my cross-examination, Your Honour.
2 JUDGE MOLOTO: Thank you very much. We'll do that.
3 Just for my own edification, this Article 1 refers to a common
4 monetary policy and common elements. Do you know, Mr. Torkildsen, what
5 was the common monetary policy?
6 THE WITNESS: Your Honour, then I would have to refer back to the
7 Miletic report again where this is outlined. I'm sorry, but I can't
8 state the details regarding that now.
9 JUDGE MOLOTO: Thank you very much.
10 May we have P314 on the screen, please.
11 MR. LUKIC: [Interpretation]
12 Q. It's like this: This is a decision, Mr. Torkildsen, or, rather,
13 I assume that you found this decision in the Prosecution database that
14 you were provided, just like the other documents that you refer to.
15 A. That is correct, yes.
16 Q. You agree with me, I believe -- or, rather, first, can you tell
17 me when this decision was passed? Can you see this on the basis of this
18 document?
19 A. I can see there is a date up in the right-hand corner, mentioning
20 the 8th of July, 1992.
21 Q. Look at the B/C/S version and you'll see that the date is written
22 in hand there, so it's not a question of you not knowing the language.
23 But anyway, the date that is mentioned in the English version is a hand
24 edition on the B/C/S document, right, written in hand?
25 A. Yes, I can see this handwriting there. Yes.
Page 1551
1 Q. And in the introduction to the decision, in the preamble, there's
2 a space for the date. There's a dash there and there's no date written
3 in in the space; right?
4 A. That is correct. It is mentioned here "4/92" in the first
5 sentence.
6 MR. LUKIC: [Interpretation] May we now go on to page 2. Can we
7 see page 2 in both versions, the B/C/S and English.
8 Q. And you can see on the original, the B/C/S original, and indeed
9 on the English version, this document has not been signed and there's no
10 government stamp, or any other stamp for that matter; right?
11 A. I see no stamp. That is correct, yes.
12 Q. In the left-hand corner -- on the left-hand side, there's an
13 empty space for the number; right? We call it the reference number, and
14 all official documents are recorded and then the reference number is
15 written into the document. And you agree here that there's no number
16 here, right, in either version?
17 A. Yes.
18 Q. Now, paragraph 5 of this decision says: "The Republic ..." I
19 assume it means Republika Srpska "... and the National Bank shall sign a
20 contract within 30 days from the day this decision comes into force."
21 During your research, did you come across any contract which
22 would be linked to this decision?
23 A. Not specifically a contract. No, I can't remember that.
24 Q. Furthermore, Article 6 or paragraph 6 reads as follows:
25 "This decision comes into force on this day and shall be
Page 1552
1 published in the Official Gazette of the Serbian People of Bosnia and
2 Herzegovina
3 And we saw that the previous government decision that we
4 discussed was, indeed, published in the Official Gazette. Now, during
5 your investigations did you come across this decision having been
6 published in the Official Gazette of RS anywhere?
7 A. I can't remember having seen a decision regarding this, no.
8 MR. LUKIC: [Interpretation] Let's just go back for a moment to
9 the first page and see that handwritten edition. May we have the B/C/S
10 version and the English of the first page? Thank you.
11 Q. I'm going to read out what it says there, what the inscription in
12 writing: "Minister Subotic," and then that's underlined, and underneath
13 that line it says: "Coordinate these with the needs of the army," and we
14 have a signature and probably the date. "Coordinate installments with
15 the army."
16 Now, my question is this: From these contents and from that note
17 there, remark there, can you make any conclusions as to whether the
18 decision was passed, or is this just a proposal and remained a proposal?
19 A. I'm not sure that I get your question, sir. I'm sorry, if you
20 can repeat that, please. I can't -- well, I'm reading the text now, and
21 I can't see whether the -- whether the decision was passed or not.
22 Q. Yes, that was my question. So from this decision, you cannot
23 establish and ascertain whether the decision was passed and put into
24 force or not; right?
25 A. That is correct, yes.
Page 1553
1 MR. LUKIC: [Interpretation] Your Honours, I would still like to
2 ask you not to admit this document into evidence. At this point in time
3 I'm challenging both relevancy and authenticity. Now, I can provide the
4 documents later on. Perhaps Mr. Saxon would like to put some questions
5 in the re-direct with respect to his -- with respect to this document,
6 but I think it is just a proposal and not a decision. And the expert
7 witness during his work used this document and said that it was a
8 government decision, but he has now confirmed that he believes that this
9 is a government proposal and not a final decision that was taken.
10 JUDGE MOLOTO: You're saying you'd still like to ask that it not
11 be admitted into evidence. Is it not already P314, or are you saying
12 it's going to be expunged from the evidence?
13 MR. LUKIC: [Interpretation] Yes. If you recall --
14 [Trial Chamber and registrar confer]
15 JUDGE MOLOTO: I've now been told. An MFI.
16 Yes, Mr. Saxon.
17 MR. SAXON: Your Honour, this document was seized by the Office
18 of the Prosecutor from the archives of the Ministry of Defence of the
19 Republika Srpska in Banja Luka on the 6th of December, 2001. Your
20 Honour, obviously governments keep documents in their archives because
21 these documents record the official business of the government. Whether
22 this was merely a proposal or whether it was a decision that was
23 eventually passed, the point is this was a business record kept by this
24 institution of the Government of Republika Srpska, and so the fact that
25 the government -- the document was kept in the government archives should
Page 1554
1 be sufficient indicia of reliability, at least for purposes of admission,
2 Your Honour.
3 MR. LUKIC: [Interpretation] Your Honour, I still challenge the
4 relevance of this document because in his work this expert witness
5 analysed the document as being a government decision. But from this
6 document we can't actually see, and I'm claiming that this is, in fact, a
7 draft decision and we cannot know whether there was a decision passed.
8 So I don't see what -- how this document can be of assistance to the
9 Trial Chamber if we don't know whether it was put into effect in any way.
10 And that is why I suggest that either you do not adopt and admit
11 this document because it's not relevant, or if the Prosecution finds that
12 there was a final decision on the basis of this draft, then I won't have
13 anything against it being admitted into evidence ultimately.
14 MR. SAXON: Your Honour, an item is relevant if it speaks to an
15 issue that is pertinent in these proceedings, and this document does just
16 that, Your Honour. It speaks to the issue of how the Government of
17 Republika Srpska was financed in 1992. Whether it was simply a proposal
18 or whether it became a final decision, it doesn't change the fact that it
19 is relevant.
20 Quite frankly, Your Honour, on Thursday Your Honour admitted, I
21 believe, other proposals - I can't name the exhibit number - but
22 certainly Your Honour admitted requests, although there is no evidence
23 right now that those were -- those requests were fulfilled. And I submit
24 we are in the same position with this document, Your Honour.
25 JUDGE MOLOTO: The document will remain marked for identification
Page 1555
1 until -- whether or not you can give us an original -- a final decision.
2 MR. LUKIC: [Interpretation] Now I'd like to ask a few questions
3 on the Miletic report. I believe that's P310. No, it's P315, because
4 there have been certain changes.
5 Q. In your report you analyse it in paragraph 45.
6 MR. LUKIC: [Interpretation] And I don't know if the Trial Chamber
7 has Mr. Torkildsen's report in front of them. If not, we should maybe
8 first call up this passage in his report, paragraph 45. It's page 16 in
9 English and 15 in B/C/S.
10 Q. We're talking about the next stage, and I quote here, from your
11 analysis of the Miletic report. In paragraph 45 you say:
12 "The programme created a single monetary region to include the
13 FRY, the RS, and the RSK. This programme came into effect on the 1st of
14 March, 1994."
15 My first question is: Where did you find this date?
16 A. The date mentioned here must have come from the report itself.
17 Q. I have read the whole report, and I haven't found that date
18 anywhere.
19 MR. LUKIC: [Interpretation] Perhaps it would be a good idea to
20 give the witness a hard copy of his -- sorry, the Miletic report, during
21 the break so that we don't have to go through it page by page now.
22 Q. But is this date significant in any way?
23 A. The date is significant in the way that that's from approximately
24 the point in time where the super-dinar was introduced and when they used
25 the same currency across the three entities in question.
Page 1556
1 Q. I maintain that the programme of the restructuring of the
2 monetary system and the economic recovery of Yugoslavia was adopted on
3 the 24th of January, 1994, and it entered into force on that day and it
4 was on that day that the super-dinar started to apply. Does that date
5 mean anything to you?
6 A. Well, I can't remember the exact date now, but I'm sure that what
7 you're putting to me in terms of the super-dinar being introduced on the
8 24th of January, 1994, that that is correct. That sounds right, from
9 what I remember.
10 Q. Now, the way you analysed the Miletic report, I understood and
11 you will correct me if I'm wrong, so that the third stage of this
12 monetary union between the FRY, the Republika Srpska, and Republika
13 Srpska Krajina, you call it "The Programme of Reconstruction of the
14 Monetary System and the Strategy for the Economic Recovery of
15 Yugoslavia
16 A. Yes, that is correct.
17 Q. Because, quite frankly, I understand it quite differently, this
18 Miletic report. But we'll see. Maybe I'm wrong.
19 MR. LUKIC: [Interpretation] Can we now call up the Miletic
20 report. In B/C/S, page 2. That's P315. We need page 2 in B/C/S and
21 page 3 in English.
22 Q. Item 3, Miletic writes:
23 "The period of commencement of the implementation of the
24 reconstruction of the monetary system and the strategy for the economic
25 recovery of Yugoslavia
Page 1557
1 Republika Srpska and the Serbian Republic
2 Now, I asked you this last Friday, and I can't remember your
3 answer. The programme of Governor Avramovic that came into effect on the
4 24th of January, 1994, was called "The Programme of Economic Recovery of
5 Yugoslavia
6 maintain. To be more precise, in this part 3, Miletic describes how this
7 programme adopted by the Federal Republic of Yugoslavia and for the FRY
8 was implemented in the RS and the RSK.
9 A. Sorry, I didn't get your question.
10 Q. I maintain, I put it to you that Miletic quotes in his report
11 under number 3, and it's called "The Programme of Reconstruction of
12 Monetary System and the Strategy for Economic Recovery of Yugoslavia" was
13 a programme adopted for the FRY, not for the Republic of Serbian Krajina
14 or Republika Srpska. It's just that they implemented certain parts of it
15 that were relevant to them. It's not about a monetary union of the three
16 entities.
17 A. That I totally disagree on.
18 Q. Have you read, let me repeat this, "The Programme of
19 Reconstruction of Monetary System and the Strategy for Economic
20 Recovery"? It's a thousand-page public document.
21 A. No, I have not read that.
22 Q. Thank you. And do you know the name of the Avramovic programme,
23 designated, to effect, an economic recovery of the country and the whole
24 system, or do you believe it is a programme destined for all the three
25 entities?
Page 1558
1 A. I can't comment on that 1.000-page programme because I haven't
2 read it.
3 Q. Just a moment. Would you agree with me that the gist of the
4 programme for the economic recovery of Yugoslavia, that is, the
5 reconstruction of the monetary system and the strategy for economic
6 recovery, was to stop financing the state by printing money, and thus to
7 stop inflation?
8 A. Yes, that is my understanding, without having read the 1.000-page
9 programme.
10 Q. And one of the means to reach that end was the introduction of
11 the new dinar, the super-dinar.
12 A. Yes.
13 Q. I suppose you are very familiar with the Miletic report. And my
14 thesis is that the whole point of this Miletic report was to establish
15 whether the National Bank of Republika Srpska was able to successfully
16 join the Avramovic programme that it would implement in one of its
17 segments.
18 A. Yes.
19 Q. And that applied exclusively to the monetary system, didn't it?
20 A. Yes. The Miletic report is discussing the monetary system, yes.
21 Q. And nowhere in the Miletic report do we find the word
22 "subordination"; only the word "cooperation" is used.
23 A. Again, that means I would have to look through the Miletic
24 report. It's one thing that you are using the word "subordination" as
25 such. The other thing, if there are certain facts described in the
Page 1559
1 report that is actually speaking about subordination without using the
2 term, again, I would have to look at the report in detail in order to
3 answer that.
4 MR. LUKIC: [Interpretation] I have no objection to the witness
5 reviewing the Miletic report during the break, if the Trial Chamber
6 agrees, so that he can answer this question. Before the break, just a
7 few brief questions.
8 Q. In a monetary union, is it the case that the one who prints money
9 and makes it available to another, is it normal for the former to have
10 control over the flow of monies so that the interests and the existence
11 of the money printer are not jeopardised?
12 A. Yes.
13 Q. I will ask you even more simply: Legally, in contractual
14 relations, is it important for the lender to ensure that the borrower is
15 credit-worthy, solvent, so that the loan be eventually repaid?
16 A. In normal circumstances that would be the case, yes.
17 Q. By introducing the new dinar, hyperinflation was completely
18 stopped; isn't that the case?
19 A. Yes, that is my understanding. Yes.
20 Q. And if this new super-dinar had been used without any control,
21 that would have been running the risk of a new round of hyperinflation in
22 the Federal Republic of Yugoslavia; correct?
23 A. Yes.
24 MR. LUKIC: [Interpretation] Perhaps it's a good time for a break,
25 Your Honour.
Page 1560
1 JUDGE MOLOTO: Thank you very much, Mr. Lukic.
2 We'll take a break and come back at 4.00. Court adjourned.
3 --- Recess taken at 3.30 p.m.
4 --- On resuming at 4.00 p.m.
5 JUDGE MOLOTO: Yes, Mr. Lukic.
6 MR. LUKIC: [Interpretation]
7 Q. Mr. Torkildsen, let us now go back to the two questions I asked
8 earlier regarding the Miletic report.
9 One, did you see in the Miletic report the word "subordination"
10 or any reference to a relationship of subordination between the National
11 Bank of Yugoslavia
12 Srpska and Republika Srpska Krajina? Did you find any references that
13 would indicate such a relationship?
14 A. Well, to answer the first part of your question, I did not see
15 the word "subordination" being used in the translation at all, but I did
16 find references within this Miletic report that actually describes the
17 relationship of subordination, and I would like to point out page 3,
18 paragraph 4, in the English translation.
19 JUDGE MOLOTO: Is it possible to have it on the screen, or is it
20 part of your report, Mr. Torkildsen?
21 THE WITNESS: What I can do is to read out the relevant
22 paragraph, if it is okay.
23 JUDGE MOLOTO: Fine. Go ahead.
24 THE WITNESS: It is stated here that: "The competent
25 institutions of Republika Srpska and the Republic of Serbian Krajina
Page 1561
1 would bring all other regulations on which the implementation of the
2 agreed single monetary and credit policy depended on into line with
3 regulations adopted by the Federal Republic of Yugoslavia."
4 And then I would like to point out at -- also, paragraph 5, on
5 the same page.
6 JUDGE MOLOTO: Would you like to read that for us?
7 THE WITNESS: Yes. "Monetary policy projections for certain
8 periods and their provision were carried out in accordance with the
9 relevant elements in the programme and were brought into line with the
10 relevant portions of the quantitative tasks of the monetary policy
11 carried out by the National Bank of Yugoslavia
12 "In this context, it is especially worth mentioning that the
13 quantity frameworks for the amounts of dinars that the National Bank of
14 Republika Srpska issued to the banks from the area of Republika Srpska
15 were also brought into line by relevant decisions of the National Bank of
16 Republika Srpska."
17 THE INTERPRETER: Would you kindly slow down for the
18 interpreters. Thank you very much.
19 THE WITNESS: Sorry. "They are established in accordance with
20 the valid set of instruments and valid decisions of the National Bank of
21 Yugoslavia
22 Sorry, I made a note of this during the break and now I was
23 referring to page -- page 4, I think, but I actually meant to start
24 referring on page 3. I just need to find -- back to that. Sorry about
25 this, Your Honours.
Page 1562
1 JUDGE MOLOTO: Take your time.
2 THE WITNESS: Okay. The fourth paragraph on page 3, this is
3 actually what I made a note of now during the break and not what I just
4 referred to.
5 "The National Bank of Republika Srpska and the National Bank of
6 the Republic of Serbian Krajina would bring all monetary and credit
7 regulation instruments in line with relevant monetary and credit
8 regulation decisions of the National Bank of Yugoslavia."
9 And then I would, in particular, like to highlight the paragraph
10 on the bottom here.
11 "All necessary changes resulting from the achieved monetary and
12 credit movements would be agreed upon through standard expert cooperation
13 and through decisions taken at a meeting of national bank governors,
14 which would then be verified at sessions of national bank boards."
15 And then the question then arises, and I would like to refer back
16 to the document that we pointed out last Thursday regarding the voting
17 rights concerning these meetings, and where it was in particular pointed
18 out that the voting rights not being there for the National Bank of the
19 RS and the RSK.
20 And I would also like then to go further on to page 4, the first
21 paragraph, where it is stated.
22 "The corner currency reserving of the National Bank of Republika
23 Srpska and the National Bank of the Republic of Serbian Krajina would be
24 a constituent part of the foreign currency reserves of the National Bank
25 of Yugoslavia
Page 1563
1 subsidiary accounts of the National Bank of Yugoslavia. The National
2 Bank of Yugoslavia
3 reserves from the National Bank of Republika Srpska and the National Bank
4 of the Republic of Serbian Krajina through the relevant national bank."
5 It is basically stated here that it is the National Bank of
6 Yugoslavia
7 the National Bank of Republika Srpska and Republika Srpska Krajina should
8 be used, and in my view that is -- that is a good example of
9 subordination in this respect.
10 MR. LUKIC: [Interpretation]
11 Q. I want to follow up on the last thing you said. The foreign
12 exchange reserves of the National Bank of Republika Srpska, did they
13 serve as collateral for obtaining dinars from the National Bank of
14 Yugoslavia
15 A. That is my understanding from -- from -- from the period after
16 approximately February 1994.
17 Q. Was the National Bank of Yugoslavia
18 foreign exchange monies it had deposited with it without the consent of
19 the National Bank of Republika Srpska?
20 A. That's the way that I read this, that it was up to the NBY in
21 Belgrade
22 Q. That's your interpretation from what you're reading.
23 A. Yes.
24 Q. Just one more clarification on what you've said a moment ago when
25 you said that the representatives of the National Banks of Republika
Page 1564
1 Srpska and the RSK attended the sessions of the Board of Governors of the
2 National Bank of Yugoslavia
3 referring to another document, not the Miletic report; correct?
4 A. That is correct, yes.
5 Q. In the Miletic report, quite the opposite is written. It
6 describes how decisions were made in the National Banks of Republika
7 Srpska and the RSK. There is no mention of any interference in the
8 decision-making of the Board of Governors of the National Bank of
9 Yugoslavia
10 assistance.
11 A. It is not specifically mentioned, anything about the voting
12 rights in the Miletic report. That is correct.
13 MR. LUKIC: [Interpretation] Can we have page 3 in English. We
14 need to look at the last paragraph.
15 Q. The last paragraph stipulates the method of decision-making
16 concerning monetary policy; correct.
17 A. Yes. It's mentioned here, "standard expert cooperation" and
18 "through decisions taken at the meeting of national bank governors."
19 Q. And it says in English:
20 [In English] "... credit movements would be agreed upon through
21 standard expert cooperation."
22 A. Yes, that is correct.
23 Q. [Interpretation] Right. Let me remind you of another question I
24 put to you earlier concerning the date, the 1st of March, 1994, mentioned
25 in your report. Did you see it anywhere in the Miletic report, or
Page 1565
1 alternatively, did you remember why you wrote it in your report?
2 A. First of all, I checked the document, and I could not find a
3 specific date, as you pointed out, within the report. I would just like
4 to add to that, and that is that this Miletic report, when I reviewed
5 this, was part of a bundle of other financial documents, a total of six
6 documents, and I have at least not invented those dates myself. So that
7 means that those dates must come from one of the five other documents
8 that was contained within that bundle of documents.
9 MR. LUKIC: [Interpretation] I'd like to move to page 8 in B/C/S
10 of the same document and page 9 in English.
11 Q. In B/C/S, towards the middle of the page, it says:
12 "Finally, as a very important segment in the implementation of
13 the programme, there remains the question of regulating real direct
14 revenues of the budget of Republika Srpska. In this area the National
15 Bank of Republika Srpska is in constant contact with the competent
16 authorities of Republika Srpska with which this issue needs to be
17 regulated in line with the intentions of the programme."
18 Do you agree that this paragraph, and, indeed, the whole report,
19 does not mention anywhere that the collection of direct revenues by
20 Republika Srpska would be in any way connected with the FRY?
21 A. That is my understanding as well, yes.
22 Q. Thank you.
23 MR. LUKIC: [Interpretation] Let's now move to another document.
24 It's an MFI
25 on admission after my examination. P323, MFI.
Page 1566
1 Q. This is an Official Note dated 12 May 1994, and you refer to it
2 several times in your report and you mentioned it again when you spoke
3 about the relationship of subordination. You agree, correct, that's the
4 document on the basis of which you claim there was a relationship of
5 subordination between the National Bank of the FRY and the National Banks
6 of Republika Srpska and the Republic of Serbian Krajina; correct?
7 A. That is correct, if this is the document mentioning the issue of
8 no voting rights and also other -- other issues.
9 Q. You found this document in the Prosecution's collection of
10 documents when you were doing your report; correct?
11 A. Yes.
12 MR. LUKIC: [Interpretation] Page 2, please, or, rather, page 3,
13 the last page of the document. It's a three-page document. In fact, the
14 English version has five pages and the B/C/S has three.
15 Q. Can we see who the author of this document is? I don't know if
16 you heard the question.
17 A. Sorry, no.
18 Q. I asked you, can we see from this document who authored it? Can
19 you conclude who the author is?
20 A. No, I can't read the signature on the last page, if that is a
21 signature at all, unless it is stated in the beginning of the document,
22 the author.
23 MR. LUKIC: [Interpretation] We can go back to page 1.
24 Q. Now, in view of the contents of this document, would it be
25 standard procedure for this document to be signed, have a stamp and
Page 1567
1 reference number, if it's an Official Note made at a kind of important
2 meeting, that seems to be the case from the introduction?
3 A. Whether that would be standard procedure, I wouldn't know. But
4 since it's an Official Note, it wouldn't be unlikely at least.
5 Q. Now, we are still discussing this document because I have new
6 problems with it.
7 MR. LUKIC: [Interpretation] Can we call up 65 ter 6526. That's
8 P315. In English we need page 13, and in B/C/S, page 11.
9 Q. This is the document which, as you said earlier, you reviewed
10 together with the Miletic report, that there were many of them, and they
11 have the same 65 ter number. I maintained that this document is
12 absolutely identical to the previous one in terms of substance. I don't
13 know how best to deal with this, if we can return to the English version
14 of the previous document for you to compare. There are only certain
15 differences in the format.
16 MR. LUKIC: [Interpretation] Can we put the English version of the
17 previous document alongside?
18 Q. Here, have a look at these two documents, or perhaps you've done
19 it before during your own research. The language is absolutely the same.
20 Perhaps there are certain differences in the English translation, but do
21 you think it's the same substance?
22 A. Well, I assumed at the time that I reviewed these documents that
23 it was the same document, yes.
24 MR. LUKIC: [Interpretation] Now, I'm sorry about complicating the
25 work of the registrar. I'd like the B/C/S version of the previous
Page 1568
1 document and the B/C/S version of the current one, the last page. Leave
2 the first page for now.
3 Q. I will read what it says in B/C/S because it's a problem for me.
4 This Official Note, which is of the same substance as the previous one,
5 is written in a different dialect. Unfortunately, that's not -- this is
6 the one. Right. In the document on the left, and the interpreters can
7 confirm this, it says "Official Note" with the word "beleska" used, and
8 the document on the right is called "Official Note" with the word
9 "zabiljeska" used and it's written in the Ijekavian dialect. Maybe you
10 weren't able to establish this, but perhaps you had a language assistant
11 helping with you. This dialect is not written in Serbia. If you don't
12 know, just say so, we can move on.
13 A. I don't know. And in general terms, I can't testify to the
14 authentication of these documents.
15 MR. LUKIC: [Interpretation] Let's look at just the last pages of
16 both documents. That's page 3. We've seen this one. And now I'd like
17 to see the last page of the zabiljeska document, in B/C/S. The other
18 document. P315, the last page. Thank you. That's it. Thank you very
19 much.
20 Q. You can see there is a difference in the ending. On the
21 right-hand side, I will read it in Serbian, it says, "The Governor of the
22 National Bank of Yugoslavia
23 My question is: When you were reviewing the Official Note of
24 Mr. Miletic, you said that attached to it you saw a whole group of other
25 documents; correct?
Page 1569
1 A. That's correct. Actually, it was, if I remember correctly, five
2 other documents, but they were not attached to the Miletic report as
3 such. But it was filed with the Prosecution's evidence system as a
4 complete batch of documents, but I always viewed these documents as being
5 separate.
6 Q. That was precisely my problem when I had certain doubts on
7 Thursday regarding the date quoted in Miletic and the date of this
8 Official Note. It's part of a set of documents but it's obviously not
9 related to the report. You don't know who the source is of this document
10 on the right-hand side, which has "Governor of the National Bank of
11 Yugoslavia
12 document, do you?
13 A. No.
14 MR. LUKIC: [Interpretation] Your Honours, I still stand by the
15 arguments I presented earlier. I don't know how clear a picture I
16 succeeded in drawing for you, but before us we have two documents, both
17 unsigned, absolutely the same in substance but written in different
18 dialects. I suppose it is indeed -- both documents are indeed from the
19 database of the Prosecution, but we cannot ascertain the authenticity
20 because even the expert witness cannot tell us who authored it, and we
21 know nothing else that could corroborate its authenticity. The document
22 tendered by the Prosecution is P315, MFI, and they did not tender this
23 other one, probably to avoid complications.
24 JUDGE MOLOTO: Mr. Lukic, let me just make sure that I'm
25 following everything that is happening. Am I right in saying, in fact,
Page 1570
1 it's not only two documents here, but there are three? I thought before
2 you called the document on the right side of the screen, there was
3 another document here in B/C/S with a signature or a handwriting similar
4 to the one on the left. So it will be those two with their handwritings
5 plus this one on the right. Am I right?
6 MR. LUKIC: [Interpretation] There are -- there is a total of two
7 documents.
8 [Trial Chamber and registrar confer]
9 JUDGE MOLOTO: The registrar has answered my query. Thank you so
10 much. You may proceed. Thank you.
11 MR. LUKIC: [Interpretation] Perhaps we could hear the arguments
12 that my colleague wishes to put forward. I have said why I think the
13 document is not an authentic one. Perhaps he can take the floor now.
14 MR. SAXON: Your Honour, it's correct that the Prosecution has
15 tendered what is now MFI
16 tender both documents. Your Honour, the fact that both documents are
17 substantively the same is an indication of their authenticity because
18 they corroborate each other.
19 Can we turn, please -- for the document on the left, we see what
20 looks like it's an illegible signature in the bottom left-hand corner.
21 Can we turn back to the first page, please. This document, Your Honour,
22 MFI
23 2001, was the head of the Government of Croatia's Office for Cooperation
24 with the Hague Tribunal. You'll see here in the upper right-hand corner,
25 it contains -- let me start with the left-hand corner. I'm apologising.
Page 1571
1 I'm messing up my left and right.
2 In the upper right-hand corner, there are clerical notes. Do you
3 see the letters "12.05" and then "1994," indicating that this document
4 has been formally processed. This document is on the letterhead of the
5 National Bank of Yugoslavia
6 appears to be a signature at the end, albeit illegible.
7 Those, Your Honour, should be sufficient indicators of
8 reliability and authenticity for the admission of this document.
9 MR. LUKIC: [Interpretation] Just briefly, now that brings me to
10 an even greater problem. I now have greater problems with authenticity
11 since it is from the Government of the Republic of Croatia
12 see how they could come into possession of this document. That's my
13 first point; and secondly, what it says there is a memorandum, not a
14 stamp. It's not the reference number of the National Bank of Yugoslavia
15 It's an Official Document - the expert can tell us about that - issued by
16 the National Bank of Yugoslavia
17 and the number -- the reference number of the document.
18 So this reinforces my doubts about this document. And the fact
19 that it exists in Ijekavian, which is the other dialect used in
20 Bosnia-Herzegovina and Croatia
21 written in the Cyrillic adds to my confusion and tells me that all this
22 is problematic, and I challenge the authenticity on that basis.
23 MR. SAXON: Actually, Your Honour, the fact that the OTP received
24 this from the Government of Croatia, again, is an indicator of its
25 authenticity.
Page 1572
1 At the time this document was produced in May 1994, the Federal
2 Republic of Yugoslavia
3 reasons why the Government of Croatia might have obtained this document,
4 and certainly the Government of Croatia thought the document was
5 important enough to keep in its possession until 2001 when it turned it
6 over to the Office of the Prosecutor, pursuant to a request.
7 JUDGE MOLOTO: Thank you.
8 Mr. Lukic, I have a slight problem. Your submissions, at page
9 40, starting at line 4 to line 16, constitute in my prima facie view
10 essentially some kind of testimony, rather than argument. But be that as
11 it may, I'm not holding it against you because obviously you are doing
12 your best to come to the rescue of the Chamber, and the Chamber does not
13 understand Cyrillic or B/C/S.
14 But be that as it may, our guidelines on the admission and
15 presentation of evidence and the conduct of counsel in court, at
16 paragraph 34, read as follows, and I would like to, in the light of your
17 objection, to give guidance to the Chamber as to what to do.
18 "There is no general prohibition on the admission of documents
19 simply on the grounds that their purported author has not been called to
20 testify. Similarly, the fact that a document is unsigned or unstamped
21 does not a priori render it void of authenticity."
22 That is the guideline we have all agreed to go by, and I would
23 imagine that where a document is unsigned and unstamped, if it shows
24 relevance to the issues before the Court, we could accept it. What do
25 you say we should say, given those guidelines?
Page 1573
1 MR. LUKIC: [Interpretation] I am fully conscious of your
2 guidelines, Your Honour, and you will recall that a large number of
3 documents were admitted here during the proceedings so far that didn't
4 take the form that I am presenting now and the Defence made no opposition
5 to that large number of documents, because we considered that the
6 contents of the documents were such that we were not in a position to
7 challenge their authenticity.
8 But looking at the format and form of this document, although it
9 fulfills the conditions set down by the guidelines which would allow you
10 to accept its authenticity, because of the facts that I just presented, I
11 still challenge its authenticity.
12 Now, I would like the translation service perhaps to be called in
13 to a assist, if this is still a problem and you don't wish me to testify,
14 that the CLSS can give you their positions, stating whether they are
15 substantively the same text, provided in two different forms, if that
16 would help you.
17 I know that you have to weigh up the validity of the documents,
18 if you accept their authenticity or not. But as I have just learnt from
19 the Prosecutor, except from the fact that they received it from the
20 Government of the Republic of Croatia
21 document is truly authentic. The doors have just been closed. So could
22 we retain the MFI
23 exactly about the source of the document and then we can establish its
24 authenticity better later on, in due course.
25 MR. SAXON: May I respond?
Page 1574
1 JUDGE MOLOTO: If you may, sir.
2 MR. SAXON: What I find inconsistent, Your Honour, with the
3 Defence's position, for example, just one example, on Thursday the Trial
4 Chamber, without any objection from the Defence, admitted Exhibit P315.
5 That is the Miletic report which, as far as I can see, has no stamp or
6 signature. And I don't understand why we're in a different situation
7 with this document.
8 JUDGE MOLOTO: I guess we're in a different situation with this
9 document, Mr. Saxon, because, as you say, the Miletic report is the
10 Miletic report, so the author is Miletic, so it is known who the author
11 is. That may make the difference. But I don't know why they objected --
12 they didn't object, rather, to that one.
13 At this stage, Mr. Lukic, what I wanted to ask you before
14 Mr. Saxon stood up was, you are now suggesting that we go to CLSS to
15 clear the problem. I didn't get the feeling, or the impression, rather,
16 from your objection that you are challenging the substance of these
17 documents.
18 In fact, I thought your submission was that the substance was the
19 same, with slight language differences, but that they are talking to the
20 same issues. So I do not think that referring these documents to CLSS
21 will resolve our problem.
22 Therefore, I am not quite sure whether you have responded
23 pertinently to the problem that I have posed, that the guidelines say we
24 can admit an unsigned, unstamped document, as long as it is relevant,
25 because when I put that to you, you then raised the question of CLSS. I
Page 1575
1 don't know whether you would like to respond to that again, or is that
2 the end of your argument?
3 MR. LUKIC: [Interpretation] No, I have no problem as far as the
4 CLSS is concerned, as long as -- I see you've understood what I'm saying,
5 that it is substantively the same where it says the governor of the
6 National Bank of Yugoslavia
7 the contents are the same.
8 Now, with respect to the guidelines is my doubt. Looking at the
9 format of this document, I am challenging its authenticity, but I am
10 fully conscious of the fact that it can be admitted into evidence as it
11 stands, even if the form doesn't correspond fully to what it should be.
12 JUDGE MOLOTO: If you are aware of that, then may -- I think we
13 should then admit the document. Obviously, the Chamber will give
14 whatever weight it gives to it.
15 MR. LUKIC: [Interpretation] Yes, I agree, Your Honour.
16 JUDGE MOLOTO: Now, you must excuse me. What document is this?
17 Is this P315, MFI
18 MR. LUKIC: [Interpretation] That's right.
19 JUDGE MOLOTO: That's the Miletic report?
20 MR. SAXON: May I help?
21 JUDGE MOLOTO: Yes, please.
22 MR. SAXON: I believe this document is P323 that was marked for
23 identification.
24 JUDGE MOLOTO: Oh, P323.
25 MR. SAXON: Yes.
Page 1576
1 JUDGE MOLOTO: It is not 65 ter 6526, which you called P315, MFI,
2 Mr. Lukic.
3 MR. LUKIC: [Interpretation] No.
4 JUDGE MOLOTO: Okay.
5 MR. LUKIC: [Interpretation] What Mr. Saxon just said, that's the
6 note proposed by the Prosecutor, and it had the MFI number. So I now
7 agree to having the document admitted, but I'd also like to propose, Your
8 Honours, that we admit the other document, the one we compared it to, so
9 that you have both documents before you when you come to weigh up the
10 two, and that is part of ...
11 JUDGE MOLOTO: If you finish your sentence, then I'll respond.
12 MR. LUKIC: [Interpretation] You know where the problem is, Your
13 Honour, the problem, as we see it, and I really do not wish to complicate
14 matters. The problem is that it's 315 is Miletic's report; that's in
15 e-court. The entire document, 80 pages long, within the frameworks of
16 which you will find this to, and as far as I understood your decision, it
17 was that only Miletic's report, 10-page report, be admitted. So that's
18 why the whole issue has been complicated.
19 JUDGE MOLOTO: You've confused me even further.
20 [Trial Chamber and registrar confer]
21 JUDGE MOLOTO: Mr. Lukic, I'm advised P315 is the first ten pages
22 of the Miletic report. P323 is the Official Note. Now, where I sit, I
23 am assuming that what we have on the screen are the two versions of the
24 Official Note; therefore, what we have on the screen is P323. What I
25 don't know is which of these versions is actually P323, MFI, because the
Page 1577
1 one you proposed now to tender so that we can compare, but I would like
2 to be certain which one is already P323, MFI, between these two.
3 [Trial Chamber and registrar confer]
4 MR. LUKIC: [Interpretation] It is the document, the MFI document,
5 which is on the left-hand side of the screen. To be precise it has the
6 ERN number 0207-6891.
7 JUDGE MOLOTO: Okay. That is P323, MFI. And you are saying yes,
8 we can now admit it into evidence. May it then be admitted into evidence
9 as an exhibit P323.
10 THE REGISTRAR: The exhibit status of P323 will be changed, Your
11 Honours, accordingly.
12 JUDGE MOLOTO: Fine.
13 Now, the other one on the right-hand side you now wish to tender
14 into evidence.
15 MR. LUKIC: [Interpretation] That's right.
16 MR. SAXON: The Prosecution does not object, Your Honour.
17 JUDGE MOLOTO: Then shall be give it a D exhibit number, please?
18 It is admitted into evidence. Madam Registrar.
19 MR. LUKIC: [Interpretation] It is document, 65 ter list, 6526,
20 but I don't know now, because it is a large document, what the page
21 numbers are, or, rather, it's page 11. If you can give us a number and
22 then I'll provide the Registry with the right numbers.
23 JUDGE MOLOTO: Number of pages?
24 MR. LUKIC: [Interpretation] Yes, just three pages.
25 JUDGE MOLOTO: Okay. Can you give us a Defence exhibit number
Page 1578
1 for that document, please. 65 ter 6526 is admitted into evidence.
2 THE REGISTRAR: That will be Exhibit D11, Your Honours.
3 JUDGE MOLOTO: Thank you so much.
4 MR. LUKIC: [Interpretation]
5 Q. Well, we can move on now, Mr. Torkildsen, I believe. I'm going
6 on to another area altogether. You mentioned a number of times during
7 the examination-in-chief the fact that financing of the budget of
8 Republika Srpska and the RSK, was from primary issue and that that ceased
9 at the beginning of 1994; right?
10 A. Correct, yes. At least it stopped coming from sources without
11 any real backing in terms of the foreign currency deposits that we have
12 discussed.
13 Q. Now, I've moved on to the period from 1994 onwards, and I'm going
14 to focus on that in my questions. You didn't offer us a single document
15 which would show that the FRY in any other way took part in the financing
16 of the budget of RS and RSK in the 1994-1995 period.
17 A. Not directly involving the budgets, no.
18 Q. Yes. That's what I was wondering. Now, do you know what period
19 the indictment against Mr. Perisic incorporates, or, rather, have you
20 read the indictment against Mr. Perisic?
21 A. I've never seen or read the indictment of Mr. Perisic.
22 Q. The Prosecutor claims that it took -- he took over the function
23 of the Chief of the General Staff of the Army of Yugoslavia at the end of
24 August 1993. That's what the Prosecution alleges. Now, in analysing
25 your documents, did you come across any document which would have shown
Page 1579
1 you that he, Mr. Perisic, was involved in any decision linked to primary
2 issue and loans from primary issue of RS and RSK? So I mean until the
3 end of 1993, for instance.
4 A. No.
5 Q. You analysed, in particular, a document --
6 MR. LUKIC: [Interpretation] May we have it called up. It is
7 P316. May we have the English version, page 1, and the B/C/S. It is a
8 decision on the adoption of the rebalance for Republika Srpska for 1993,
9 the budget revision for that period.
10 Q. Now, do you know what the difference is between the budget
11 revision, or rebalance, and the final balance, final account balance?
12 A. In this case I view this as the final accounts, since it's
13 mentioning here the session held on the 25th of March, 1994, and it is
14 regarding what took place in 1993. I would then assume that they would
15 have managed to get all their figures correct so that this should
16 actually be -- be the annual accounts of Republika Srpska for 1993.
17 That's as far as I understand this. Whether there are any sort of minor
18 adjustments after this, maybe --
19 Q. I didn't actually ask you that. We see the decision there. I
20 asked you where the difference was in the professional sense, as an
21 expert here. What's the difference between the rebalance or budget
22 revision and the final account, because -- the final balance, because
23 these are two different terms, as far as I'm concerned. Can you explain
24 the difference?
25 JUDGE MOLOTO: Mr. Lukic, I have a problem that I thought you
Page 1580
1 used four terms, and I'm trying to look at your first question. You're
2 saying there are two issues. Yes, you say at page 48, starting at line
3 2: "Now, do you know what the difference is between the budget revision,
4 or rebalance, and the final balance, final account balance?" I'm not
5 quite sure whether you attach different meanings to those concepts. How
6 many concepts are you putting across to the witness here? Budget
7 revision, rebalance, final balance, final account balance?
8 THE INTERPRETER: Interpreter's note: They used "budget
9 revision" to mean "rebalance."
10 JUDGE MOLOTO: Thank you very much, interpreter.
11 Sorry, what is the question, Mr. Lukic?
12 MR. LUKIC: [Interpretation] The question is: Can the witness
13 explain to us, the expert witness explain to us, where the difference
14 lies between rebalance of the budget and final balance?
15 JUDGE MOLOTO: Now, do we have "final balance" anywhere in these
16 documents?
17 MR. LUKIC: [Interpretation] No, it's not mentioned in this
18 document. Just "rebalance" is mentioned here.
19 JUDGE MOLOTO: Now, my question, then, is: Of what relevance is
20 an interpretation of "final account" if it is not used here in these
21 documents?
22 MR. LUKIC: [Interpretation] Your Honour, I didn't say that. The
23 witness said it. The witness said that he considered this document to be
24 the final balance, and I'm saying that this document is called
25 "rebalance" and that "final balance" and "rebalance" are two different
Page 1581
1 concepts.
2 JUDGE MOLOTO: I hope the question is slightly clearer -- is
3 clearer to you and you can now answer. Apparently "final account" is
4 attributed to you.
5 THE WITNESS: I've never seen the term "rebalance" being used on
6 the issue of accounting before in such a way, so I'm not even sure
7 whether the translation is absolutely correct. We all know that a budget
8 is a plan and the accounts is what actually took place in the year. But
9 this term is something lying in between, the "rebalance." Again, the way
10 that I view this is that this must either be the final accounts or it
11 must be very close to the final accounts, since the date here is a long
12 time after the year of 1993.
13 MR. LUKIC: [Interpretation]
14 Q. Do you know that there's a law on the adoption of the final
15 account of the budget of a republic, whether it be RS or FRY or RSK, for
16 every fiscal year?
17 A. I've heard that, yes.
18 MR. LUKIC: [Interpretation] Your Honour, I'd like to correct the
19 transcript. On page 47, I didn't want to interrupt before, line 20, when
20 I asked the question linked to Mr. Perisic and the period when he was
21 appointed Chief of the General Staff, what I meant to say, and I think
22 the witness understood me correctly, I meant to say "from the point of
23 his appointment to the end of 1993, when primary issue was still
24 functioning," whether he came across a document of that kind, and he gave
25 us his answer.
Page 1582
1 JUDGE MOLOTO: You do say at line 20 --
2 THE INTERPRETER: Microphone, Your Honour, please.
3 JUDGE MOLOTO: I'm sorry. "So I mean until the end of 1993, for
4 instance," so you do say so. Thank you. You may proceed.
5 MR. LUKIC: [Interpretation]
6 Q. Based on this decision, the decision we have before us on the
7 adoption of the rebalance, as it says - interpreter's note - of RS
8 budget, we see that considerable funds came from loans, and that's
9 something you wrote in your report, too.
10 A. Yes. It's the credits, meaning the primary emissions,
11 originating from the NBY
12 side of this budget, yes, or annual accounts. I'm sorry.
13 Q. And you interpret that -- that's your interpretation. But it
14 doesn't say what the source of these credits are in this decision, does
15 it?
16 A. No, it doesn't.
17 Q. Nor does it say when during the fiscal year those credits were
18 given.
19 A. That is correct.
20 Q. At all events, and you've already answered this question -
21 perhaps I'm focusing on this too much - but you didn't check or verify
22 whether any kind of crediting existed by the FRY in the budget of RS and
23 RSK in 1994 and 1995.
24 A. I haven't seen anything in the FRY budget, if that was your
25 meaning, whether it's notification in that budget regarding the financing
Page 1583
1 of the RS and RSK, if that's what you're -- if that is your question.
2 Q. Do you know whether the Army of Republika Srpska and RSK was
3 financed exclusively from the budget, or not?
4 A. As we can see from this document, most of it would have been
5 financed from the budget. Whether there were other sources of finance,
6 that I wouldn't know.
7 Also, again, back to one of the documents that we saw on
8 Thursday, it was a document from late December 1993 where they were
9 discussing the financing of all three armies, and then the question would
10 be whether the amounts mentioned in that document, whether that would be
11 the same source of finance that we have in front of us here. That I
12 would not know. I can only state that they were planning to finance the
13 army, the VRS, also in 1994 by the VJ. That's what is listed in that
14 document.
15 Q. All right. But from this document, you can see certain budgetary
16 resources allocated for the army. Now, what I'm asking you is can you
17 see that there were other funds which were used to finance the army of
18 RS, from this document, just on the basis of this document?
19 A. No. It is listed here that the original income is very small out
20 of the total budget.
21 Q. Yes, I agree. Now let me follow on from that. Did you hear
22 about the commodities reserve directorate or directives for commodity
23 reserves? Does that mean anything to you?
24 A. At least I can't remember that now.
25 Q. Do you know that in Republika Srpska at the municipal level,
Page 1584
1 considerable financial assistance was given, or any financial assistance
2 was given to the Army of Republika Srpska separate from the budget? Do
3 you know anything about that?
4 A. No.
5 Q. Do you know that in 1992 the Government of Republika Srpska
6 brought in a provision about war booty stored as commodity reserves? I
7 think that war booty is mentioned somewhere as a special area.
8 A. I have seen the reference to "war booty" in one of the military
9 documents, yes.
10 MR. LUKIC: [Interpretation] Now may we call up document 6549,
11 please.
12 Q. It's a short document, just a one-page document, and you referred
13 to it in your report. It is the letter of Republika Srpska Krajina,
14 their government, dated the 20th of June, 1992, and sent to the Belgrade
15 bank, Beogradska Banka, in Belgrade
16 that Beogradska Banka was a commercial bank of the FRY at the time.
17 A. Yes.
18 Q. Just briefly, this document speaks for itself, but would you
19 agree with me that the document says that certain funds of the RSK were
20 transferred to an account in Belgrade
21 asking for their money back; right?
22 A. Yes. It doesn't state anything about the source of the money,
23 but yes.
24 MR. LUKIC: [Interpretation] May we have a number for this
25 document.
Page 1585
1 JUDGE MOLOTO: The document is admitted into evidence. May it
2 please be given an exhibit number.
3 THE REGISTRAR: That will be Exhibit D12, Your Honours.
4 JUDGE MOLOTO: Thank you very much.
5 MR. LUKIC: [Interpretation]
6 Q. Now I'd like us to look at another document that you referred to
7 earlier. It's 65 ter 6551. You mentioned it in your report in paragraph
8 68. Would you agree with me that from this document, we don't see the
9 source of the money that is mention in the document, or, rather, who is
10 selling -- sending what money to whom.
11 A. The letter here is addressed to the MUP of the Republic of
12 Serbia
13 MUP.
14 Q. Yes, I'm not challenging that at all. My question was: In the
15 first sentence is about money following -- to escort the transport of
16 money from Belgrade
17 That's my question.
18 A. Well, it's going to the RSK, and it's being -- basically, they
19 are asking for assistance in having this transferred, and they're making
20 a request to the MUP of the Republic of Serbia
21 Q. Look at the last paragraph. I understand the document to read
22 quite differently, quite the opposite. It is just sent to the border
23 service of the police for the possible transfer or, rather, travelling of
24 vehicles.
25 But I ask just you this: From the document, can we see who is
Page 1586
1 sending the money from whom? Because you refer to this document in the
2 report. So can that be seen on the basis of this document? Who is
3 sending the money, and who is the money going to?
4 A. Well, I can't see where the money actually originates from,
5 whether it's from a primary issue or whether it's something else. I can
6 only see that it's being -- the money is being requested by the RSK and
7 the transportation of this money is being facilitated by -- by the MUP of
8 the Republic of Serbia
9 Q. So do I understand you correctly? On the basis of this document,
10 you see that RSK is asking for money; right?
11 A. Yes.
12 Q. Is that what you said?
13 A. Yes.
14 Q. Thank you.
15 MR. LUKIC: [Interpretation] I'd like to tender this document,
16 please.
17 JUDGE MOLOTO: The document is admitted into evidence. May it
18 please be given an exhibit number.
19 THE REGISTRAR: That will be Exhibit D13, Your Honours.
20 JUDGE MOLOTO: Thank you so much.
21 MR. LUKIC: [Interpretation]
22 Q. I'd like to go on to another area now regarding financial
23 assistance by the Army of Yugoslavia to the Army of RSK.
24 JUDGE MOLOTO: I'm sorry to do this to you. Can we have that
25 exhibit back on the screen, please. I have a small question to ask. I'm
Page 1587
1 sorry, Mr. Lukic.
2 Mr. Torkildsen, are you able to show -- tell us, on the left --
3 the document on the left side of the screen, whether what is written by
4 hand on the right side is also shown on the left side? And if so, what
5 it is? "Predato, 05.11.1996," do we see it on the other side? And the
6 author of this document doesn't seem to be mentioned on this side.
7 THE WITNESS: Your Honour, the way that I read this, I think it's
8 a date, the 5th of November, 1993.
9 JUDGE MOLOTO: Thank you very much. The next page of the English
10 version was shown. Okay. It might go. Thank you.
11 Sorry, Mr. Lukic.
12 MR. LUKIC: [Interpretation]
13 Q. I'm now going to move on to another area that you address in
14 paragraph 121 about this assistance to the Army -- rather, from the Army
15 of Yugoslavia
16 to paraphrase what you say, but anyway, you say that financial assistance
17 of the Army of Yugoslavia was sent to the Army of Republika Srpska in
18 such a way as to -- regarding the payment of salaries to VRS members,
19 financed by the FRY. That's the substance of your claims there; right.
20 A. Yes.
21 MR. LUKIC: [Interpretation] May we call up P149. The B/C/S page
22 is 111. It is English page 127. 127 of the English and 111 of the
23 B/C/S.
24 Q. You testified about that on Thursday; 1476 is the transcript
25 page. But, first of all, let's set the time period. This document
Page 1588
1 relates to the situation and analyses the situation in the Army of
2 Republika Srpska in 1992, and that's what the document says in its title;
3 right?
4 A. It actually analyses the situation until the 20th of February,
5 1993.
6 Q. Did you have an opportunity of seeing analyses of this kind of
7 the Army of Republika Srpska for 1993, 1994, and 1995?
8 A. A similar analysis like this, no, I don't recollect that. No.
9 Q. In your work you did not analyse the resources from primary
10 issue, as you claim, during that period. What resources, what funds,
11 were used to help out the budget of Republika Srpska? And that includes
12 the military budget by the same token because you didn't analyse the
13 budget of Republika Srpska for 1992, so you don't have figures which the
14 FRY allegedly helped the VRS.
15 A. I have seen a budget or, actually, the annual accounts of
16 Republika Srpska for 1992, and that should also be referred to somewhere
17 in my report. But just to clarify that, that specific budget or annual
18 accounts do not itemize on a detailed level what the use of the money was
19 for. It states that the revenue side of the budget originates from
20 credits or primary emissions, but it doesn't detail out what it was spent
21 for.
22 Q. You said last Thursday, it was your theory that the financing of
23 the officers and the other categories of personnel listed here came
24 directly from the FRY, non-commissioned officers, and so on, and then you
25 said that all the other members of the VRS were practically financed by
Page 1589
1 the FRY as well, because the budget of Republika Srpska received monies
2 in such large amounts from the budget of the FRY. But that was just your
3 assumption. You did not show us any evidence that the VRS was financed
4 from the budget to that extent, the budget of the FRY.
5 A. Well, in 1993 the budget that we just looked at, or the rebalance
6 of the budget, that was exactly the situation, so -- but when it comes to
7 1994 and 1995, I haven't seen the RS budget so I can't comment on that.
8 MR. LUKIC: [Interpretation] I think this is the time for the
9 break, Your Honour.
10 JUDGE MOLOTO: Very well. Is that a convenient time for you?
11 We'll take a break and come back at a quarter to 6.00. Court adjourned.
12 --- Recess taken at 5.16 p.m.
13 --- On resuming at 5.47 p.m.
14 JUDGE MOLOTO: Yes, Mr. Lukic.
15 MR. LUKIC: [Interpretation]
16 Q. Mr. Torkildsen, I will try to ask questions that warrant brief
17 answers.
18 MR. LUKIC: [Interpretation] May I call up P149. We need B/C/S
19 page 112 and, in English, 127. In fact, we already have them.
20 Q. Do you know, Mr. Torkildsen, and now I'm talking about these
21 salaries received by the officers of the VRS and SVK, do you know how
22 much in absolute numbers the Federal Republic of Yugoslavia paid in any
23 specific year for the salaries of these officers in the VRS and the Army
24 of the Serbian Krajina?
25 A. No.
Page 1590
1 Q. I put up this document because in the B/C/S version, and we see
2 it in the English version, too, "Accounting Centre, JNA." Do you know
3 what this accounting centre is?
4 A. The Accounting Centre of the JNA, no, I don't, if you're not
5 referring to the establishment of the 30th and 40th Personnel Centres,
6 but that should be in 1993. So at this point in time I don't know.
7 Q. My question is this: Do you know that there was a Military
8 Accounting Centre of the JNA with the Ministry of Defence? Do you know
9 about this institution and what its job was?
10 A. I heard about the institution, but I don't know any details about
11 how it operated and what was its job. But I would, again, assume that it
12 was their job to make track of the bookkeeping of basically who received
13 what in salary, what were their entitlements in terms of pension and
14 other allowances, and so on.
15 Q. You have heard about the 30th and 40th Personnel Centres, and you
16 mentioned them in your report. But I'm asking you about the Military
17 Accounting Centre, and I believe these are two different institutions. I
18 just asked you if you knew that the Military Accounting Centre existed
19 within the framework of the Ministry of Defence. That was my question.
20 Nothing more.
21 A. I have seen reference to that accounting centre in the report
22 that I have in front of me and most likely in other documents, but I
23 don't know any details about it.
24 Q. Do you agree with me that the Ministry of Defence is an organ, an
25 agency of the government, in every state?
Page 1591
1 A. Yes, I do.
2 Q. But let us speak only of the Ministry of Defence of the FRY. The
3 next questions will refer specifically to the FRY. Do you agree that the
4 Ministry of Defence, as an organ of the government, was answerable to the
5 Assembly, the parliament?
6 A. Yes.
7 Q. Would you agree that the Ministry of Defence is completely -- let
8 me put it this way: Do you agree that in terms of financing of the VJ,
9 the Army of Yugoslavia, the Ministry of Defence is superior to the
10 General Staff?
11 A. When it comes to financing, that sounds reasonable, yes.
12 Q. Have you looked at the budgets of the FRY for 1993, 1994, and
13 1995?
14 A. I have looked at budgets of the FRY, but I can't remember now for
15 which years.
16 Q. Would it refresh your memory if I said there was a special rubric
17 for defence within the budget and within that rubric for defence a
18 special item was -- a separate item was the army? Would that help?
19 A. Well, it doesn't refresh my memory, but what you're stating
20 sounds -- sounds natural, that that would be itemized in the budget, yes.
21 Q. In the part of the budget relating to the army, is it the case
22 that the amount for salaries has to be indicated separately?
23 A. That depends on the detail level of the budget or the annual
24 accounts, whether it's specifically itemized in that respect.
25 Q. Do you know who made the decision on the financing of the
Page 1592
1 officers of the VRS and the SVK by the Federal Republic of Yugoslavia?
2 A. From what I remember, since these documents were not part of my
3 report, so then I have to base this on my recollection of all the
4 documents I have seen, and from what I remember, the 30th Personnel
5 Centre, meaning concerning the officers of the VRS, and the 40th
6 Personnel Centre, concerning the officers of the SRK army, those two
7 personnel centres were established by the then-President of the FRY,
8 Mr. Zoran Lilic.
9 Q. Is it the case that the financing of officers of the VRS and SVK
10 came from the FRY even before the establishment of the 30th and 40th
11 Personnel Centres, as far as their salaries are concerned? Or let me be
12 more precise. Maybe you don't know when these personnel centres were
13 established, but it was in the autumn of 1993.
14 A. Yes. I think, actually, it was in November 1993, and before that
15 the salaries of the officers of the VRS and the Army of the RSK were
16 directly under the -- falling under the obligation of the VJ.
17 Q. And who made the decision before that time that these finances
18 should be released, that these funds should be released? Do you know?
19 A. No, I don't.
20 Q. The financing of salaries of the officers of the VRS and SVK in
21 1993, 1994, and 1995, was it continuous?
22 A. Well, at least that's -- that is my understanding. I haven't
23 seen any documents regarding they not being -- this financing not being
24 continuous.
25 Q. Do you know, perhaps, what was the base level for those salaries?
Page 1593
1 Was it the same as for the salaries of the Army of Yugoslavia, or was it
2 different? Did you see any document that would specify the base for
3 calculating these salaries?
4 A. I might have seen documents. I can't remember anything regarding
5 the base level of those salaries. What I do remember is that the
6 officers serving in the VRS and the SVK, they got some additional pension
7 contributions and, if I remember correctly, also some additional
8 allowances. But regarding the salaries, I can't remember whether the
9 basis there was the same or not.
10 Q. Salaries are paid from the part of the budget designated for the
11 army, "the military budget," let's say, although the term does not exist
12 legally.
13 JUDGE MOLOTO: Is that a question?
14 MR. LUKIC: [Interpretation] Yes. Possibly, yes. That was the
15 question, indeed.
16 Q. Is it the case that salaries are paid from the military part of
17 the budget, the part of the budget intended for the army? Is that the
18 source for salaries?
19 A. Well, that sounds reasonable that the salaries for the officers
20 were paid from the budget, except in this case, we have seen that that
21 was not actually what happened, since -- and that's what we have referred
22 to -- I have referred to previously.
23 Q. If I understood correctly what you said earlier, I'm now talking
24 about the salaries of the officers of the Army of Republika Srpska and
25 the Army of Serbian Krajina. Are you claiming that their salaries were
Page 1594
1 not financed from the part of the budget intended for the Army of
2 Yugoslavia
3 A. No, no. The officers were, of course, paid by the -- what must
4 have been the budget of the VJ. I would assume at least it must have
5 been -- if it was not like that, it must have been paid from some other
6 funds controlled by the VJ, but that I wouldn't know about.
7 Q. But you have not seen evidence of that?
8 A. Regarding other funds controlled by the VJ? No.
9 Q. Would you agree that the control over the way funds from the
10 budget were used, specifically the military funds, was exerted by the
11 Ministry of Defence and the Ministry of Finance. It was their job to
12 verify that the funds were used as intended.
13 A. At least that should be the case, yes.
14 Q. In your analysis in your report, did you come across any document
15 establishing that the General Staff or the Chief of the General Staff was
16 disposing of certain funds without the consent of the Ministry of Finance
17 and the Ministry of Defence?
18 A. No.
19 Q. Again, in preparing this report, you did not refer to any
20 documents emanating from the 30th and the 40th Personnel Centres, did
21 you?
22 A. That is correct. That was dealt with by other personnel at the
23 OTP.
24 Q. Mr. Torkildsen, when you speak about the financing of the VRS and
25 the SVK by the Federal Republic of Yugoslavia, in your evidence on
Page 1595
1 Thursday you made conclusions that this financing was granted in 1994 and
2 1995 exclusively on the basis of documents showing requests addressed to
3 the FRY, but you did not produce a single document showing that the FRY
4 effectively sent some funds to the SVK and the VRS.
5 To be more precise, on page 1491, let me read this verbatim:
6 "[In English] There is a lack of documents compared to the
7 previous period in order for me to conclude how it -- this was done. I
8 can see that the VRS and the institutions of Republika Srpska are
9 requesting money, but I can't really see how this is done in practice."
10 A. That is correct, yes.
11 MR. LUKIC: [Interpretation] I would now like to call up P317,
12 page 1. When I looked at the Thursday transcript, I believe it was the
13 position of Mr. Saxon - that's how it was recorded in his question - that
14 this is a document issued by the Army of Yugoslavia, whereas my theory is
15 quite the opposite, so let us look at this.
16 Q. It's page 1492, in fact, of the official transcript, line 19.
17 It's Mr. Saxon's question.
18 JUDGE MOLOTO: Yes, Mr. Saxon.
19 MR. LUKIC: [Interpretation] Sorry, it's line 8.
20 Q. Mr. Saxon says concerning this document:
21 [In English]: "... from the General Staff of the Yugoslav Army
22 to the Office of the Chief of the General Staff."
23 JUDGE MOLOTO: Yes, Mr. Saxon.
24 MR. SAXON: I'm very sorry to interrupt. Maybe this will save
25 some time. I believe I misspoke at that time. If I can clarify the
Page 1596
1 record and save some time, I should not have used the word "from" before
2 the General Staff of the Yugoslav Army.
3 MR. LUKIC: [Interpretation] Right. Well, if that is so, because
4 my theory is that this document was sent by the head of the office of the
5 commander of the Serbian army of Krajina. It's a ten-page document, and
6 I believe it's clear from the entire document who the author is.
7 Then I'll ask a different question.
8 But we will need page -- the one you looked at when you testified
9 in direct examination, that is, the last page but one. Page 13 in
10 English. Last page but one. That's one page before this. And 10 in
11 B/C/S.
12 Q. The part below that you analyzed, I'll read again. So the author
13 of this document, which comes from the Army of Serbian Krajina, says:
14 "Unofficially we learned that the federal government would, out
15 of the total balance of requirements demonstrated in 1994, will be able
16 to provide for all three armies. Instead of 93 billion, only
17 80-something billion."
18 Now, I want to ask the following: The document before, as you
19 saw, was made in December 1993. That is before the adoption of the
20 Avramovic programme and above the thorough overhauling of the monetary
21 system in the FRY; correct?
22 A. Yes.
23 Q. And this document was written at a time when primary issue was
24 still used as a source of finance.
25 A. Yes.
Page 1597
1 MR. LUKIC: [Interpretation] Let us turn to the next page.
2 Q. Speaking of the reserves of fuel expended and the problems
3 experienced by the Serbian Army of Krajina with fuel, and then it says:
4 "To alleviate the consequences of this measure, please lift the
5 ban of issuing diesel fuel in Bubanj Potok because we have repaid the
6 debt, and we will repay the value of the fuel according to the
7 timetable."
8 From this I can conclude that certain payments were made to
9 Federal Republic of Yugoslavia by the Serbian Army of Krajina for
10 purchases of fuel; correct?
11 A. Well, I don't know the details about the payment here, but what
12 you are stating here makes reason.
13 MR. LUKIC: [Interpretation] Now I would like to move on to P322,
14 page 1 in B/C/S and the English as well. That's the appeal of
15 Mr. Milosevic of the decision to remand him in custody.
16 Q. You referred to it both in your report and in direct examination.
17 I had a look at that paper of yours that you made for the Prosecution
18 that was not admitted regarding offshore companies and financial
19 transactions from the year 1994 through to the year 2000, so I suppose
20 you are familiar, if not from that analysis then from this appeal,
21 namely, the second paragraph, you know why proceedings were instituted
22 against Mr. Milosevic before the District Court in Belgrade. Can you
23 tell us something about the facts, if you know of this?
24 A. I can't remember the details, but from what I remember, there
25 were some kind of fraud charges against him and some other persons as
Page 1598
1 well.
2 Q. As he says in the explanation of his appeal, he was charged with
3 instigating certain civil servants on the federal level to gain benefit
4 for others in the period from 1994 to 5 October 2000. You have been to
5 Cyprus
6 A. Yes.
7 Q. In the documents that you analysed, did you come across any
8 document showing the financing of the VRS and the Army of Serbian Krajina
9 in 1994 and 1995 with funds outside of the budget of the FRY?
10 A. Yes. There were funds diverted from the budget of the FRY that
11 actually ended up in Cyprus
12 again were used to purchase various commodities. It was hospital
13 equipment, it was food, but there were also some sort of military
14 equipment.
15 Q. I read that in your report, but did you find that this equipment
16 bought in this way was sent to the Army of Republika Srpska or the Army
17 of Serbian Krajina? Because you spoke of financing of groups and the
18 Army of Yugoslavia
19 A. Today, I can't remember actually what groupings were the
20 beneficiary of this, but at least I can state that I can't remember that
21 to any large extent that the RS army or the SVK was financed from these
22 funds, no.
23 Q. I'll now move to my final questions.
24 In paragraph 9 of your report, and that's the summary and
25 introduction - page 3 in English and page 3 in B/C/S of P310 - you say --
Page 1599
1 I'll be reading in Serbian, and I'll wait for it to come up on the
2 screen.
3 "The documents strongly indicate that funding for the Army of
4 Republika Srpska and the Army of the Republic of Serbian Krajina
5 from a single financing plan for all three Serb armies - the Yugoslav
6 People's Army," that is, the JNA, "the VRS and the SVK."
7 That is part of your summary of conclusions.
8 On page 1493, last Thursday, you said:
9 [In English] "As we can see here, it is the FRY government who's
10 actually planning to fund all three armies in -- also in 1994, but
11 they're getting less than they originally had planned for. As I
12 mentioned previously, even if the financing through primary emissions
13 stopped, at least they were still planning to continue the financing in
14 1994, by then a different method. But then again, as I pointed out, when
15 it comes to 1994, there has been a lack of documents for me to review."
16 [Interpretation] Aren't these two things contradictory? I'm
17 interested in the period of 1994 and 1995. Do you still maintain what
18 you said in paragraph 9? Because your report applied to a much broader
19 period, and we are here discussing a narrower issue.
20 In this part regarding 1994 and 1995, can you confirm that there
21 are indeed no documents confirming the financing of these two armies by
22 the FRY?
23 MR. SAXON: Your Honour, before the witness answers --
24 JUDGE MOLOTO: Yes, Mr. Saxon.
25 MR. SAXON: -- there are at least two questions in that last
Page 1600
1 question, if I may, of my learned colleague. It starts off with "Aren't
2 these two things contradictory?" and then later on, "Do you still
3 maintain what you said in paragraph 9?" I'm wondering whether the
4 witness could deal with each question one at a time.
5 JUDGE MOLOTO: Mr. Lukic.
6 MR. LUKIC: [Interpretation] All right.
7 Q. You heard my first question. Do you think what you said in
8 paragraph 9 and what I read from your testimony on Thursday are in
9 conflict?
10 A. Well, just to repeat, it's that, as we have seen from that
11 December 1993 document originating from the command of the SVK, it
12 clearly states that they were planning for financial funds also in 1994.
13 And I would also like that -- it's not very reasonable that they keep
14 requesting cash in 1994 and 1995 if they did not think that they would
15 get any financial funding. But, as you have pointed out, I haven't seen
16 that they actually got a positive reply to their requests. That is
17 correct, yes.
18 Q. You just mentioned this document we analysed a moment ago where
19 the Army of Republika Srpska mentions that they had heard officially that
20 there will be financing -- there would be financing from the FRY for all
21 the three armies. That's the only reference I saw in your work, that
22 quotation where you mentioned these three armies were funded from a
23 single source.
24 A. Well, also the budgets that we have gone through previously
25 regarding 1992 and 1993, they point in the same direction when it comes
Page 1601
1 to the financing of all three armies.
2 Q. You are talking about 1992 and 1993, in fact 1993, about
3 financing from primary issue.
4 A. Yes.
5 Q. But you cannot say the same about 1994 and 1995.
6 A. No, I have not seen any other documents, other than the one we
7 have now just discussed. Yes.
8 Q. Briefly, a comment on your paragraph 8.
9 "This support was provided from 1991 until 1995, although the
10 nature and degree of this support varied throughout that period."
11 Let us go to the final conclusion based on all the answers I got
12 from you. You did not review the budget of the Republika Srpska and the
13 Republic of Serbian Krajina for 1994 and 1995; correct?
14 A. Correct, yes.
15 Q. Therefore, you are not able to tell us whether these budgets in
16 1994 and 1995 were financed from direct, real sources.
17 A. No. Since I haven't seen them, no.
18 Q. Nor can you say here before the Court how much compared to the
19 budget allocation for the Army of Republika Srpska and the Army of
20 Serbian Krajina from their own entities is accounted for by the salaries
21 of the officers of the VRS and SVK that came from the FRY.
22 A. I don't know the amounts, no.
23 Q. Paragraph 124 of your paper, the final conclusion.
24 Let me be more precise with the previous question. I'm looking
25 at it as a lawyer, and I'm trying to understand. There is, let's say,
Page 1602
1 the budget of Republika Srpska consisting of 100 units of something. You
2 did not establish how many units intended for the salaries of the
3 officers of the Army of Republika Srpska came from the budget of the FRY.
4 You cannot tell us that, can you?
5 A. I thought that the whole -- that the salaries of the VRS were in
6 total paid by the FRY. I never heard anything about the salaries of the
7 officers of the VRS coming from the budgets of the RS. The budget of the
8 RS covered the salaries of the ordinary soldiers and not the salaries of
9 the officers.
10 Q. That much is clear, but I wanted to do something that I think is
11 important for us in this courtroom. It's important for us to establish
12 that if an army receives a total amount of something in one year, what
13 part of that total is accounted for by what they received from the
14 Federal Republic of Yugoslavia? Do you have that parameter? Were you
15 able to establish that?
16 A. No.
17 Q. And now, in conclusion, let me just not forget this: When I
18 asked you about your CV on the first day, I asked you whether you had
19 ever appeared as an expert witness before the International Court of
20 Justice and you told me yes, in the proceedings instituted by Bosnia
21 Herzegovina
22 in what capacity you appeared, and you said "legal consultant,"
23 "consultant lawyer," for Bosnia-Herzegovina.
24 A. What I -- I did not --
25 JUDGE MOLOTO: Mr. Saxon.
Page 1603
1 MR. SAXON: There may have been a translation problem. Can we
2 have the citation to the transcript, please?
3 MR. LUKIC: [Interpretation] I probably put the question in that
4 way because I read the witness's testimony before the ICJ, and I asked
5 whether his expertise -- his expert report was used. But my question was
6 only in what capacity.
7 JUDGE MOLOTO: Can you refer us to the citation of the
8 transcript, Mr. Lukic, please. That is what your learned friend is
9 asking for.
10 MR. LUKIC: [Interpretation] Just a moment. That was at the
11 beginning of my cross-examination.
12 JUDGE MOLOTO: What page? What line?
13 MR. LUKIC: [Interpretation] Yes, yes, Your Honour. I understand.
14 Page 1504 -- sorry, 16 -- no, 1506, the transcript from Thursday.
15 JUDGE MOLOTO: Line?
16 MR. LUKIC: [Interpretation] Line 1. Let me see if this is the
17 correct page.
18 THE WITNESS: Your Honour, I don't mind answering the question,
19 if possible.
20 JUDGE MOLOTO: Just a second. There's an objection on the floor,
21 sir.
22 Mr. Saxon.
23 MR. SAXON: It's just that no where on page 1506 do I see the
24 witness saying he was a legal consultant.
25 MR. LUKIC: [Interpretation] Perhaps my question was
Page 1604
1 misinterpreted. That's what I wanted to ask.
2 JUDGE MOLOTO: [Previous translation continues] ... on line 1,
3 page 1506, Mr. Lukic, please.
4 MR. LUKIC: [Interpretation] My question.
5 [In English] "The report of yours with certain additional
6 amendments in the fact represented, if I can put in this way, the
7 substance of your expert finding before the International Court of
8 Justice, pursuant to the complaint made by Bosnia-Herzegovina and the
9 lawsuit against the state community of Serbia and Montenegro
10 conducted two years ago," and the answer was yes.
11 [Interpretation] I just wanted to ask the witness an additional
12 question on the same topic, in what capacity he was acting at the time.
13 That is the question I wanted to ask now.
14 JUDGE MOLOTO: Yes, because he didn't give the capacity in which
15 he acted in that statement that you are referring us to, so he didn't say
16 he was a legal assistant -- legal expert.
17 Are you able to answer that, sir?
18 THE WITNESS: Yes, Your Honour. I was part of the team pleading
19 the case for Bosnia and Herzegovina. What I did was that I gave a
20 90-minute presentation on the financial issues.
21 JUDGE MOLOTO: Thank you.
22 Yes, Mr. Lukic.
23 MR. LUKIC: Okay.
24 [Interpretation] Just a moment. All right, thank you.
25 Q. Paragraph 124 of your report, the final conclusions.
Page 1605
1 Let me put it this way: In your work, in your research, you did
2 not refer to a single document passed by General Perisic and the General
3 Staff of the Army of Yugoslavia during the period that he was chief?
4 A. I can confirm that I did not point to any documents with the name
5 of General Perisic. That is correct.
6 Q. He wasn't one of the people that you referred to in paragraph 124
7 of your report.
8 A. At least I do not remember his name being on any of the
9 documents. In order to look at that -- address that specifically, then I
10 would have to look at all the documents again and see actually which
11 organs of the FRY the -- these documents dealt with, who did the requests
12 and who actually replied to these documents. But I can confirm that I've
13 never seen his name on any of the documents; that is correct.
14 MR. LUKIC: [Interpretation] That completes my cross-examination,
15 Your Honours.
16 Thank you, Mr. Torkildsen.
17 JUDGE MOLOTO: Thank you, Mr. Lukic.
18 Mr. Saxon, any re-examination?
19 MR. SAXON: Please, Your Honour.
20 Re-examination by Mr. Saxon:
21 Q. Mr. Torkildsen, earlier today Mr. Lukic -- this was at page 51 of
22 today 's transcript, line 17 to 21, where you said: "Most of the Army of
23 the RSK --" excuse me, "Most of the Army of the RSK, as well as the
24 Republika Srpska, were financed from the budget." So can you recall who
25 financed the officers serving in the VRS and the SVK? Who paid their
Page 1606
1 salaries?
2 A. That was the FRY or the VJ.
3 Q. Okay. Page 24 of today's transcript, my colleague asked you
4 about the date 1 March 1994
5 MR. SAXON: Can we see Exhibit P323, please.
6 Q. My colleague asked you where you came up with that date.
7 A. Yes, and I actually think that we saw that date on one of the --
8 yeah, exactly the document that is in front of me now.
9 Q. Just wait for the English, please.
10 MR. SAXON: Can we go to the next page in the English, please,
11 and if we focus on the first full paragraph, please.
12 Q. The first full paragraph says:
13 "Based on these documents the Programme for Reconstructing the
14 Monetary System is being implemented in the territory of Republika Srpska
15 and the Republic of Serbian
16 Can you recall now --
17 JUDGE MOLOTO: Yes, Mr. Lukic.
18 Yes, Mr. Saxon, you may proceed.
19 MR. SAXON:
20 Q. Can you recall now where you located the date that you referred
21 to in paragraph 45 of your report?
22 A. That must have been from this document, the second paragraph in
23 the translation on this page.
24 MR. SAXON: Can we please turn to the next page in both versions,
25 please, and if we can -- no. Can we please focus on paragraph 7 in the
Page 1607
1 English and in the B/C/S, please.
2 Q. If you look at paragraph 7, Mr. Torkildsen, it says: "The
3 Governor of the National Bank of Republika Srpska and the Governor of the
4 National Bank of the Republic of Serbian Krajina are required to attend
5 the sessions of the Council of the Yugoslav National Bank without a
6 voting right."
7 What, if anything, of significance do you take from subparagraph
8 7?
9 A. That was the issue of subordination that I was trying to address
10 earlier today.
11 Q. And who was being subordinated to whom?
12 A. It was the governor of the Yugoslav National Bank in Belgrade
13 being in charge and the governors of the National Bank of the RS and the
14 National Bank of the RSK being subordinated to the governor of the NBY.
15 Q. Moving to another topic, on Thursday at page 1519 of the
16 transcript, lines 10 through 13, Mr. Lukic asked you:
17 "In this report when you prepared this paper, you worked
18 exclusively on the basis of what was provided to you by the OTP, am I
19 right?" And you answered: "Almost exclusively."
20 Earlier in your direct testimony, at page 1446, lines 5 to 20,
21 you described how, with the assistance of language personnel, you did
22 searchs on the electronic evidence system of the OTP.
23 JUDGE MOLOTO: Yes, Mr. Lukic.
24 MR. LUKIC: [Interpretation] I think that my learned friend is now
25 trying to lead the witness, asking the question in that way by extracting
Page 1608
1 this portion.
2 MR. SAXON: Your Honour, I haven't asked a question yet. I'm
3 just describing the witness's testimony on Thursday. I have not asked a
4 single question. I'm just saying what he said on page 1446.
5 JUDGE MOLOTO: Okay. Objection overruled.
6 MR. SAXON:
7 Q. At that time, when you were making these electronic searches,
8 Mr. Torkildsen, did the OTP's electronic collection of evidence contain a
9 lot of material?
10 A. Yes. We are talking about thousands and thousands of documents.
11 Q. And can you recall whether the number of pages of material
12 electronically searchable from the OTP's electronic collection of
13 evidence was in the tens, hundreds, thousands, or more?
14 A. More. I don't know the exact number, but it was a huge
15 collection.
16 Q. Did this electronic collection of evidence contain materials
17 relevant to different topics or just to financial materials?
18 A. Different topics, most not of -- not regarding financial issues.
19 Q. So can you describe briefly, then, how did you conduct your
20 searches on the electronic evidence system?
21 A. I conducted searches by typing in different search criteria, like
22 "bank," "finance," "dinars," "budget," "accounts," et cetera.
23 Q. During these searches -- let me step back for a moment. And did
24 you devise these search terms?
25 A. Yes, I did.
Page 1609
1 Q. During these searches did you personally select the documents
2 that you believed were relevant to your task?
3 A. Yes, I did, and of course I had to use language personnel in
4 order to assist me, since I don't read or understand the language.
5 Q. Did anyone in the Office of the Prosecutor limit your ability to
6 search this electronic collection of evidence?
7 A. No.
8 MR. SAXON: I have nothing further, Your Honour.
9 JUDGE MOLOTO: Thank you very much.
10 Questioned by the Court:
11 JUDGE DAVID: Mr. Torkildsen, in page 31 and 32 of your report,
12 you discuss the circumvention of UN Security Council Resolution 757. In
13 paragraph 31 you talk about the restructure work in industry was, in
14 part, allowed to circumvent this resolution and also the creation of a
15 new federated system of national banks is discussed in paragraph 32.
16 These indications will also apply to the primary issues, which is the
17 printing of money, and also to the grey issues that you discussed later
18 on in various paragraphs, especially number 79 and others. Would that
19 apply also, this circumvention of UN Security Council resolutions?
20 A. Yes, Your Honour.
21 JUDGE DAVID: Last question. You said on Thursday that the
22 methodology of your report here is based on the same principles that --
23 in pursuing the money trail, and of course I am aware that in Norway
24 also through the European Community, you have enormity with structure,
25 both at the macro and micro level. The Strasbourg Convention of 1990
Page 1610
1 first; and second, the financial task force of resolutions, the first 40
2 and then last 40 -- the last 9 after 11 September, et cetera, et cetera.
3 Are both methodologies similar?
4 A. Yes, Your Honour. It would be -- it will also be like trying to
5 follow the money trail. But, again, it will -- the limitation is that
6 the -- you can only analyse the documents that you have in hand.
7 JUDGE DAVID: Thank you very much. That's all.
8 JUDGE MOLOTO: Thank you.
9 Any questions arising from the Judges? I beg your pardon.
10 Judge? Any questions arising from questions by the Bench?
11 MR. SAXON: No, thank you.
12 JUDGE MOLOTO: Mr. Lukic? Thank you very much.
13 Mr. Torkildsen, thank you very much. This brings us to the end
14 of your testimony here. May I thank you for coming to testify, and may
15 you travel well back home. Thank you so much. You are now excused. You
16 may stand down.
17 THE WITNESS: Thank you, Your Honours.
18 JUDGE MOLOTO: Thank you.
19 [The witness withdrew]
20 JUDGE MOLOTO: Yes, Mr. Saxon.
21 MR. SAXON: First, may Ms. McKenna be excused so she can bid
22 farewell to the Mr. Torkildsen.
23 JUDGE MOLOTO: She is excused.
24 MR. SAXON: Your Honour, at this time the Prosecution would
25 tender for admission Mr. Torkildsen's expert report. The Prosecution, as
Page 1611
1 it said before, will not rely on the third sentence of paragraph 19,
2 paragraph 23, nor paragraphs 79 to 83.
3 MR. LUKIC: [Interpretation] Your Honours, on behalf of the
4 Defence of Mr. Perisic, I object to having the expert report of
5 Mr. Torkildsen admitted into evidence.
6 Firstly, I tried to follow what you said in your ruling when you
7 said that Mr. Torkildsen would come in for testimony and examination -
8 that was your ruling of the 30th of October this year - as to what the
9 expert should assist in, should be of assistance to us and especially to
10 you. And that is, as layman, in certain matters that he is an expert, he
11 should assist us to find our way more easily in the exhibits and the
12 material and thus make the proper decision, and that you should make the
13 proper decision -- actually, that was my attempt at paraphrasing what the
14 Trial Chamber said it expects of an expert witness. And I think that the
15 Prosecution and Mr. Torkildsen, with their findings, have not provided an
16 answer to what you were expecting.
17 And there are a number of reasons why I consider that this expert
18 report is in no way suited to the trial we are engaged in here.
19 First of all, I would like to say in respect of his CV the
20 following: On the basis of what I saw and what he confirmed, I see that
21 he is -- well, I don't want to use any pejorative terms, but I think that
22 it is a classic police inspector, a professional police inspector, that
23 is investigating a case. He has not written any work. He did not deal
24 with any theoretical aspects of macro-economic relations or anything like
25 that. On the other hand, he is a real investigator and he's highly
Page 1612
1 professionally qualified in that respect.
2 But what he was asked to do here, that is to say, the analysis of
3 certain documents, and you were able to see from his testimony and
4 examination-in-chief and the cross-examination what documents he used and
5 what documents he didn't use, and the cross-examination what documents he
6 used and what documents he didn't use. And of the documents he didn't
7 use, he considers to be important and significant in order to be able to
8 answer the question that looms before us. That's as far as his
9 methodology goes.
10 So I consider that in the case of Mr. Torkildsen, that in the
11 true sense of the word, he's a summary witness; that is to say, a man who
12 came here before us and collected certain documents which are just
13 one-sided, in my opinion. They did not provide an answer to the key
14 questions which were raised, which we might have been able to get from
15 expert witnesses of this type had we had other documents.
16 And I think that the results of his methodological approach are
17 that we had a witness as a summary witness who just introduced certain
18 documents that are important but did not provide a professional opinion.
19 Nothing further and more than what we as lawyers can see for ourselves in
20 these documents. And as a lawyer myself, I don't consider that I'm well
21 educated in the economics sphere, but I think it was easy for me to
22 establish what was crucial for us here, the crucial points that we did
23 not receive from this witness; that is to say, we did not receive the
24 right answers to what we wanted to elucidate. He said that something was
25 logical but, in fact, didn't provide us with answers, the answers to our
Page 1613
1 questions. And I think that he would be the right witness for quite a
2 different area.
3 But what we're interested in, first and foremost, and where we
4 need key answers to key questions to be able to understand the
5 Prosecution case, we did not get those from this witness. We did receive
6 a number of answers to the period from 1991 to 1992 and sometimes 1993,
7 and you said in your decision that this is important in order to
8 understand the genesis of financial relationships, but we did not, in
9 fact, get what was important to us in this trial.
10 So I think that the documents that were tendered through this
11 witness speak for themselves, and that in that sense his expert report
12 cannot help us. It cannot be of assistance. As I can see, his answers
13 and his analysis of certain documents can best be seen in his responses
14 on Thursday to certain questions posed to him by the Prosecutor, his
15 analysis of P321, 319 and 322. He just said what he read in the document
16 and all he could tell the Prosecutor was when the document came into
17 being. But he gave no expert assistance to us for us to be able to
18 analyse and weigh up the situation and the questions that we're
19 interested in. And that is why I don't feel that his expert report can
20 be admitted.
21 JUDGE MOLOTO: Mr. Saxon.
22 MR. SAXON: Your Honour, the Trial Chamber itself has already
23 found this report relevant in its decision of 30 October 2008.
24 With regard to Mr. Torkildsen's expertise, Mr. Torkildsen has
25 been a forensic financial investigator for more than 15 years. You heard
Page 1614
1 in his testimony he's carried out complex investigations nationally in
2 Norway
3 inspector investigating a typical case. Clearly, he is much more than a
4 summary witness. Without Mr. Morten's -- Mr. Torkildsen's expertise,
5 neither the Chamber nor, I submit, the other parties present in this
6 room, would be able to understand the exhibits shown to him during the
7 last two days of testimony and understood their relevance and probative
8 value to issues that are important to this case.
9 Mr. Lukic says that Mr. Torkildsen's evidence is one-sided.
10 Well, I would respectfully direct the Chamber to paragraph 55 of his
11 expert report where Mr. Torkildsen talks about the subject of "grey
12 issues," that is money, printed money, that was used for the budget of
13 the Republika Srpska or the Republic of Srpska Krajina
14 from the National Bank of Yugoslavia
15 example of the objectivity of Mr. Torkildsen.
16 It may be that Mr. Torkildsen was unable to review certain
17 documents related to the financing of these two Serb-controlled entities
18 during 1994 and 1995. Having said that, the Chamber has heard and
19 received important, albeit not conclusive, evidence regarding the
20 financing of the VRS and the RSK during 1994 and 1995. Exhibit P317, I
21 believe, is the document where a member of the RSK is complaining or
22 worrying that neither the RSK nor the VRS will receive sufficient
23 financing from the FRY during 1994. You've also admitted into evidence a
24 number of requests made during 1994 and 1995 to the authorities in the
25 Federal Republic of Yugoslavia by either members of the VRS or the RSK or
Page 1615
1 government officials of the Republika Srpska or the Republic of Serbian
2 Krajina.
3 Finally, Your Honour, this particular report and the evidence
4 contained in it is important for another reason, and that is, this is an
5 issue that has been taken up not only by the Prosecution but also by the
6 Defence.
7 If you take a look at paragraph 3 of the Defence pre-trial brief,
8 there's a reference to a recent decision by the International Court of
9 Justice in a lawsuit brought by Bosnia and Herzegovina against the
10 Republic of Serbia
11 "The Defence has attached Annex A to this brief which outlines
12 those portions of the ICJ decision it believes should be followed by this
13 Chamber."
14 If you then turn to the factual findings relied upon by the
15 Defence and listed in Annex A, fact number 5 reads:
16 "There is no doubt that the FRY was providing substantial support
17 inter alia financial support to the Republika Srpska and that one of the
18 forms that support took was payment of salaries and other benefits to
19 some officers of the VRS, but this did not automatically make them organs
20 of the FRY."
21 So, Your Honours, even the Defence have highlighted the
22 importance of this kind of evidence. And by reviewing the report and by
23 observing the demeanour of Mr. Torkildsen, listening to the expertise as
24 he's provided to you, the Prosecution has demonstrated this evidence is
25 both relative -- relevant, I'm sorry, and probative and therefore
Page 1616
1 admissible.
2 JUDGE MOLOTO: Yes, Mr. Lukic.
3 MR. LUKIC: [Interpretation] To make my position quite clear, I do
4 not think at all that this topic is irrelevant for this trial. I think
5 this subject of financial support is exceptionally important and
6 significant for establishing the facts before this Trial Chamber, and the
7 documents introduced through Mr. Torkildsen I consider to be highly
8 relevant. However, precisely what Mr. Saxon just said, this just goes to
9 confirm my position that he was here describing documents to us, which we
10 consider to be significant indeed, but he did not give an expert
11 professional opinion in matters which we are -- in the realm in which we
12 are unable to understand the documents, because as lawyers, and the Trial
13 Chamber especially which will come to weigh up the probative value of
14 exhibits. In reading these documents, they could have gained a complete
15 picture. But his report doesn't help us in that respect at all. It is
16 not of assistance.
17 In his responses and answers today and on Thursday, on several
18 occasions when asked significant questions, he based his answers on
19 speculation, assumption, and logics. So we can't accept that because
20 economics reports are very exact. It's an exact science. And they show
21 substantive and even mathematical relationships, and we can't expect an
22 expert to give us -- it would not be expected of an expert to give
23 answers on the basis of logic, speculation, and so forth.
24 So I think, based on your decision as the Trial Chamber that you
25 accept the witness coming in here and hearing him, is important for our
Page 1617
1 trial, but his expert report cannot be of assistance to us in any way.
2 Just one more sentence. I stand by what I said at the beginning
3 with respect to his professionalism and expert qualities that he -- look
4 at his biography, his CV, before he did his report and, as I say, he was
5 engaged in investigation, corruption, bribery, and so on and so forth, as
6 a police inspector. Not more than that. Thank you.
7 [Trial Chamber confers]
8 JUDGE MOLOTO: The expert report of Mr. Morten Torkildsen is
9 admitted into evidence. May it please be given an exhibit number.
10 THE REGISTRAR: Your Honours, the expert report, it will be
11 Exhibit P310.
12 JUDGE MOLOTO: Thank you so much.
13 I'm mindful of the time. There is an exhibit that was marked for
14 identification during this witness's testimony which we need to decide
15 upon. We can do so now, but if there is going to be lots of arguments,
16 we can do that at the next session, and that's P314, MFI.
17 MR. SAXON: Your Honour, if I understood you correctly when this
18 document was being discussed, your final ruling was that the P314 would
19 stay MFIed until and unless the Prosecution -- the Prosecution could
20 produce a final decision -- a final published decision indicating that
21 this proposal had been formally approved.
22 JUDGE MOLOTO: So do you want us to stay at that point? We'll
23 stay on that.
24 MR. SAXON: Yes, Your Honour.
25 JUDGE MOLOTO: Okay. Thank you very much.
Page 1618
1 Once again, it is late. Other housekeeping matters, we'll deal
2 with at the next session.
3 We'll adjourn to tomorrow. We start in the morning tomorrow,
4 again in Courtroom I, 9.00. Court adjourned.
5 --- Whereupon the hearing adjourned at 7.02 p.m.
6 to be reconvened on Tuesday, the 18th day of
7 November, 2008, at 9.00 a.m.
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