20 hunger strikers try to help Albanian swindler Alimucaj seeks more time to repay his creditors

March 29, 1998|By NEW YORK TIMES NEWS SERVICE

TIRANA, Albania -- In this destitute country where court cases are generally decided by the biggest bribe and where a banking system is a foreign concept, there seems to be no end to the power of the swindler.

Twenty people are staging a hunger strike in support of one of the investment schemes that defrauded Albanians and led to nationwide violence that brought down the government last year.

For the past three weeks the protesters, some of them elderly women, have been lying covered in blankets in two dank rooms of a villa owned by Vehbi Alimucaj, head of the biggest of the failed schemes.

Alimucaj, who a prominent international accounting company says has defrauded at least 92,000 Albanian investors, has invited the protesters to starve on his behalf.

He argues -- and the strikers apparently believe him -- that if he is allowed to continue his bankrupt business for the next two years, he will pay back his creditors.

But the international accounting firm Deloitte & Touche showed this month how unrealistic Alimucaj's assertions are. His scheme, known as Vefa, owed creditors more than $255 million but had assets of only $33 million, the firm said. There were monthly cash losses of $300,000, the auditors said.

In the past few days, a Dutch diplomat, Daan Everts, who heads the Tirana office of the Organization for Security and Cooperation in Europe, has tried to mediate the end of the hunger strike.

"It is incredible that after Alimucaj has already cheated people of millions, he puts up an empty promise and mobilizes the hunger strikers," said Everts after meeting with the strike committee. "I told them that in a capitalist country when you are losing $300,000 a month, you're considered a bad manager and put out of business."

The new government elected last July told Alimucaj that to pay back just a smidgen of what the investors are owed, he must sell the businesses that were part of his investment scheme.

But using the hunger strike, which has become a popular form of protest here, Alimucaj hoped to embarrass the government into allowing him to continue to operate the mine, real estate holdings and chicken farms that gave his pyramid scheme a legitimate front.

Most of the pyramid schemes in Albania promised generous interest payments to investors, but because they paid the interest with money from new investors and had no real assets, the schemes collapsed.

Alimucaj's was able to last longer than some of the other Albanian schemes, Western financial experts said, because Vefa was involved in weapons smuggling, money laundering and other illegitimate businesses.

A former army sergeant, Alimucaj has no known experience as a businessman. But when the government headed by President Sali Berisha allowed the pyramid schemes to flourish in 1996 as an easy way for the mostly unemployed population to get rich, Alimucaj became a symbol of wealth and success.

Pub Date: 3/29/98

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