The European Public Prosecutor’s Office (EPPO) in Zagreb has filed an indictment against former HDZ Agriculture Minister Tomislav Tolusic and an advisor at the Agriculture Ministry's office in Virovitica, Zeljko Ferenc, for subsidy fraud and abuse of office and authority.

The indictment was issued following an investigation into projects for building a winery and planting a vineyard, co-funded by the EU, the EPPO office said without revealing the defendants’ identity.

The prosecutors suspect that Tolusic, who owns a family farm, applied in May 2020 to Croatia’s Paying Agency for Agriculture, Fisheries and Rural Development for a wine sector subsidy, namely the project “Construction and Equipping of a Winery”, valued at approximately €620,000, with the EU contribution amounting to 70%.

It is alleged that, in that application, the defendant falsely stated that his own financial contribution to the project would be secured by a bank loan, by submitting a letter of intent issued by a financial institution. The defendant did not, however, apply for a loan, as the bank had previously informed him that he did not qualify for one. According to the investigation, he financed the project with money whose legal origin, in part (approximately €135,000), could not be determined. For this project, he received a subsidy of €396,500, the EPPO said.

Tolusic also applied for another project, published by the Agency on 2 June 2021, for planting new vineyards.

It is alleged that, in this second application, Tolusic falsely stated that his farm had the required economic size, and that there were no planted vines on the farm’s plots. To this effect, he submitted a report to the other defendant in the case, public official Zeljko Ferenec, who stated that the project was intended for starting a vineyard. This was despite the fact that he had already planted vines on those plots and was aware that, for this reason, he did not meet the eligibility criteria. Ferenc is accused of evaluating the report positively, despite knowing of the existence of the vineyard, in breach of his obligation to lawfully perform his duties.

Due to the fact that his intent became known to the Croatian authorities, Tolusic removed the previously planted vines and submitted a new application to receive a subsidy of €200,000, of which 85% was financed by the EU. However, due to procedural reasons, the Agency did not grant the funds.

In order to compensate the damage to the EU budget, Tolusic’s winery has been subjected to a freezing order, the EPPO said.