INTELLIGENCE ISSN 1245-2122 N. 51 New Series, 13 January 1997 Publishing since 1980 Editor Olivier Schmidt (email intelligence-adi@wanadoo.fr; web http://www.blythe.org/Intelligence) TABLE OF CONTENTS, N. 51, 13 January 1997 FRONTPAGE -SPECIAL REPORT SLOVAKIA - REACHING WEST WHILE SLIDING EAST p.1 INTELLIGENCE AROUND THE WORLD INTELLIGENCE - COMPLETE KEYWORD, NAME & TITLE INDEX FOR 1996 p.2 --------------------------------------------- FRONTPAGE - SPECIAL REPORT Intelligence, n. 51, 13 January 1997, p. 1 SLOVAKIA REACHING WEST WHILE SLIDING EAST In Slovakia's brief and increasingly authoritarian existence as a nation, Prime Minister Vladimir Meciar and his ruling Movement for a Democratic Slovakia (HZDS) have used what was intended to be the country's intelligence service, Slovenska Informacna Sluzba (SIS, the Slovak Information Service), to consolidate their power and as an instrument of internal repression. Indeed, the SIS's only discernible external function has been a formal alliance with Russia, forged at the expense of proffered links with Western agencies. For over a year now, news of the SIS has most frequently concerned a grotesque series of events that began with the kidnapping -- allegedly by the SIS -- of the son of President Michal Kovac, Meciar's arch-rival and a man whose democratic inclinations have won Western plaudits. The fingerprints of Meciar's hand-picked SIS chief, Ivan Lexa, are all over the affair, which has become a veritable bloody circus, although attempts to pin legal responsibility on the SIS and its masters have so far been unsuccessful. On 31 August 1995, President Kovac's son, also named Michal, was delivered, handcuffed in the trunk of his own Mercedes, to the front of an Austrian police station in the border town of Hainburg. Beside Kovac, Jr., was a copy of an international warrant for his arrest issued by Interpol. The police in Hainburg picked up their "package" after they got a telephone call telling them where to look; the caller spoke German with a Slovak accent. Kovac, Jr., then 34, was reportedly dragged from his car in Bratislava by about eight unidentified men. He was hooded, handcuffed, beaten, given electric shocks and forced to drink half a liter of whiskey at gunpoint. The Interpol warrant had been issued in November 1994, when a Munich court asked that Kovac, Jr., be arrested for fraud and illegal business dealings between German companies and the Slovak firm Technopol. The Austrian police arrested him and took him to a Vienna clinic for treatment of his injuries. There he awaited extradition to Munich at the request of public prosecutor Manfred Wick (INT, n.21 18). Eventually, Germany would lose interest in having Kovac, Jr., extradited. But by then the affair would be claiming its victims among those who investigated it. The kidnapping followed months of bitter battle between Meciar and President Kovac over control of the SIS -- not to mention Kovac's very tenure in office, which, at one point, Meciar had vowed to end (INT, n. 15 47). Meciar launched the hostilities when he began pushing to place his political ally, Ivan Lexa, at the head of the SIS. Lexa and Meciar shared a pronounced pro-Russian attitude, which was in obvious conflict with the policy of then SIS Director, Vladimir Mitro, SIS intelligence chief, Igor Cibula, and chief SIS counterspy, Stefan Straka. These three believed in keeping an eye on both the East and the West. President Kovac backed them, as did the parliamentary opposition. In late February 1995, all three SIS officials resigned under strong pressure from Meciar (INT, n. 12 56). Then, on 6 April, parliament passed a law taking away the president's power to appoint the SIS director and giving it to the prime minister. Kovac had vetoed an earlier version of the law. This time, the parliament rejected an opposition motion to require the SIS parliamentary oversight body, the OKO, to have a member from each parliamentary party. The fight then heated up, with Meciar claiming an SIS agent had been dismissed for refusing to spy on him. Kovac countered by accusing Meciar of forming his own parallel and illegal intelligence service, an accusation that was backed by Vladimir Mitro, who also denied Meciar's claim that the SIS was spying on him. Mitro further denied allegations that the SIS had infiltrated Meciar's Movement for a Democratic Slovakia (HZDS). Then Arpad Matejka, deputy chairman of the HZDS, claimed a bomb blast outside his house on 14 April had destroyed a car he had borrowed. Matejka, a strong political ally of Meciar, told the press, "This warning was addressed to the Movement [HZDS] in which they know I carry great influence." On 18 April, Prime Minister Meciar named Ivan Lexa director of the SIS. President Kovac expressed his disagreement with the decision (INT, n. 14 56). Meciar then rammed through legislation cutting Kovac's staff budget in half (INT, n. 18 21). On 23 June 1995, Meciar's coalition also pushed a law through parliament ending the president's right to appoint the armed forces' chief of staff (INT, n. 18 21). This was subsequently struck down by the Constitutional Court. But the court's 7 November 1996 ruling did not strike down the law granting Meciar power to appoint the SIS director by himself (INT, n. 49 38). Meciar vowed to get rid of President Kovac and, for a time, it appeared he might succeed (INT, n. 15 47). Kovac took his campaign against Meciar to the U.S. where he received Washington's backing for "developing democracy" in Slovakia (INT, n. 21 18). But he did say he was not planning to run for office in 1998 (INT, n. 18 21). Meciar too was weakened; his authoritarian "system" and pro-Russian sympathies were isolating him and his government, "Intelligence" sources warned (INT, n. 15 47). But Meciar, as our sources noted, is a former boxer with the astute tactical ability to "roll with the punches" and get in a good position to return them (INT, n. 21 18). Both men clung to their offices while the focal point of their struggle shifted to the kidnapping. By November of 1995, "Intelligence" was reporting that leaked police information indicated that Ivan Lexa's SIS had carried out the kidnapping of Michal Kovac, Jr. Meciar responded by having the two first chief police investigators, Major Jaroslav Simunic, then Peter Vacok, taken off the inquiry, and opening an investigation of the police itself. The third chief investigator of the kidnapping, Major Jozef Ciz, was a staunch Meciar fan club member. Lexa wrote Kovac accusing him of trying "to criminalize the SIS and its representatives." Some Meciar supporters chimed in, accusing the president of treason. On 25 October 1995, representatives of the European Union, Spain, France, Italy and the U.S. formally expressed their concern for the future of democracy in Slovakia to Meciar who promptly used the reprimand against President Kovac (INT, n. 25 72). Police investigator Vacok, it soon emerged, had heard the confession of one of the SIS agents involved in the kidnapping, 26-year-old Oskar Fegyveres, at the time identified only as "Oscar F." In hiding for fear of his life, Fegyveres gave a series of interviews to "Sme," describing the operation and accusing Ivan Lexa of running the entire operation directly by radio. On 1 December, President Kovac pardoned Fegyveres because of his "spontaneous and full confession" (INT, n. 27 22). Fegyveres soon became an international celebrity -- and a hunted man. On 13 February 1996, he told his story to Austrian investigators and, on the same day, Slovakia's nemesis, the Czech Republic, broadcast the story on television along with details of a secret meeting between Fegyveres and the Slovak media. According to the Czechs, Fegyveres' family was being harassed and had decided to seek asylum in a "democratic country" -- the Czech Republic, for instance (INT, n. 31 24). At the time, all contacts between Fegyveres and the media were arranged through Fegyveres' friend, Robert Remias, a former policeman. Two days later President Kovac publicly accused the SIS of his son's kidnapping. Ivan Lexa responded by taking the president to trial for libel. As "Intelligence" noted at the time, Lexa would lose a fair trial since several former SIS officials have already given Pres. Kovac intelligence on the case and would probably back him in court against their former boss (INT, n. 32 60). Indeed, it seemed for a time that Lexa might be "sacrificed" on the political chopping block by his dearest friend and political ally, Meciar. Since the Germans have let Meciar know that his long-awaited invitation for an official visit to Germany would have to wait until the resolution of the Kovac, Jr., case, it seemed, we said at the time, that the only "honorable" exit for Lexa would be to "fall on his sword" or be "pushed on his sword" by losing a "fair trial" against Kovac, Senior and Junior (INT, n. 33 48). Meanwhile, the pretext for action against Kovac, Jr., was dissolving. On 18 January 1996, Slovak Prosecutor General, Michal Valo, announced that he would not seek to extradite Kovac, Jr., from Austria (INT, n. 30 21). On 20 February, a Vienna court rejected a German request for Kovac Jr.'s extradition saying that he was brought illegally to Austria with possible involvement of the SIS (INT, n. 32 60). Meciar, Lexa and the SIS battled doggedly to prove that Kovac Jr. "staged his own kidnapping." Jozef Ciz, the police investigator, who had remained on the case after the Meciar forces removed his two colleagues because they'd found SIS involvement, declared on 21 March that he had found three witnesses who could prove the kidnapping was staged by Kovac Jr. Ciz was given extensive time on Slovak TV (STV), but he never produced anything resembling "proof" of his accusations. That same day, a high-level independent investigative commission issued preliminary results indicating that the SIS had kidnapped Kovac Jr. -- and that the service had officers with criminal records in its ranks. The commission was headed by former Interior Minister, Ladislav Pittner, member of the opposition Christian Democrats. STV also stated that Ciz's predecessors, according to the independent investigative commission, had falsified testimony. The commission immediately declared that statement "absolutely false." Then the trans-Karpath spy circus got bloody. On 30 April 1996, Robert Remias, the former policeman who had backed Kovac Jr.'s claims and was Fegyveres' only contact with the outside world, died when his car exploded. The Interior Ministry quickly declared that Remias died because his propane-fueled engine has blown up. But Jaroslave Simunic, the former police investigator in charge of the Kovac Jr. case, stated that Remias and he had been followed for several days by the SIS and that Remias had been murdered. On 10 May, Meciar's political opponents said that Remias' car had several bullet holes in it. An official police investigation would later confirm that Remias had been murdered. Meciar wasn't happy. An amendment he was pushing to curtail presidential powers had been rejected on 2 May by the Constitutional Court, the same day the U.S.-based Committee to Protect Journalists (CPJ) put him on the list of "the ten worst enemies of the press" along with political leaders of China, Turkey, Cuba and Tajikistan. Things got worse for him on 13 May when independent Radio Twist aired a recording of a telephone conversation between Interior Minister Ludovit Hudek and SIS chief Lexa; they were heard discussing falsifying evidence in the Kovac, Jr. case and "doing away with an investigator" working on the case. Hudek, who called his police officers "idiots" on the tape, was removed from office during the following cabinet change. On 20 May, good cop Ciz closed his investigation of possible SIS involvement in the kidnapping of Kovac, Jr., citing a "lack of evidence." On 22 May, when Lexa delivered his report on the SIS to parliament, he spent his whole time attacking Pres. Kovac and denying SIS involvement in the kidnapping, entirely forgetting to tell the deputies how he spends his sizable budget (INT, n. 38 48). Then, on 18 June, Germany dropped a bomb by rescinding the request for the extradition of Kovac, Jr., who soon returned to Slovakia to fight against Meciar with his father (INT, n. 40 47). Meciar and Lexa responded by having the president's son's passport suspended, preventing him from going to Germany, as he wished, to publicly defend himself (INT, n. 43 48). In mid-July, President Kovac pardoned two of his son's associates so they could go to Germany to testify and clear up accusations against his son, but Prosecutor General Michal Valo blocked the measure and asked the Constitutional Court not to nullify the President's pardons, but to decide whether the President had the right to issue pardons "arbitrarily"; in short, questioning the President's constitutional right to pardon. On 22 July, the police abandoned opening an investigation of Lexa and their own chief, Interior Minister Ludovit Hudek, for involvement in the kidnapping of Kovac, Jr., and the murder of Remias. There was "no suspicion of criminal activity," according to the cops. Police investigator, Jozef Ciz got rapped on the knuckles by a prosecutor, who obliged him to reopen the investigation. However, on 5 August, the Justice Ministry adjourned indefinitely a case brought by President Kovac against Meciar, accusing the prime minister of misuse of power, slander and defamation. On 27 August, Ladislav Pittner, a former interior minister who headed the investigative commission whose report whitewashed the government in the kidnapping scandal, refused to go before the parliamentary immunity commission which was considering removing Pittner's parliamentary immunity. Then, on 30 August, the new Interior Minister, Gustav Krajci, who had "other, more important tasks" than the kidnapping affair, had the investigation adjourned for a second time. The Constitutional Court responded, on 4 September, by deciding that Kovac, Jr.'s constitutional rights had been violated by the Foreign Ministry in the kidnapping affair (INT, n. 43 48). Also in the autumn of 1996, the Meciar government conceded that Remias had been killed by a bomb. The acknowledgment followed reports quoting Oskar Fegyveres saying that his other two contacts were being followed by the SIS. Fegyveres said he expected to be given asylum in a foreign country soon. He said that once Meciar and Lexa were "toppled and punished for their actions" and "democracy wins in Slovakia", he would be willing to give evidence in a Slovak court (INT, n. 43 25). In November, Milan Knazko, a deputy of the opposition Democratic Union, said he would withhold information from authorities concerning the whereabouts of Oskar Fegyveres, because he feared for the former SIS man's life (INT, n. 48 21). However, in October, an investigation into a possible case against Lexa, and then Interior Minister, Ludovit Hudek in association with Remias' death was dismissed for the inevitable "lack of evidence" on orders from Meciar's cabinet, via the Justice Ministry. This resulted in a U.S. request for "clarification" of why the investigation was dropped. At the same time, however, the newspaper, "Sme", wrote that SIS agent "Martin K." was following Remias and was near his car when it supposedly "exploded" (INT, n. 46 45). The worm turned yet again on 18 November 1996, when a Bratislava court ordered Slovak TV to apologize and pay 250,000 crowns ($8,000) to Michal Kovac, Jr., for broadcasting false information about him in 1995 (INT, n. 49 38). Slovakia's intelligence juggernaut has not been so taxed by its battle with the Kovacs that it did not have attention to spare for Meciar's less exalted domestic opponents. Democratic Union Deputy Milan Knazko recently charged that Lexa has used the SIS against internal enemies. Knazko said the SIS has shadowed journalists, opposition deputies, as well as Jaroslav Simunic, the first investigator of the kidnapping case. He confirmed previous information in "Intelligence" that the SIS now employs many Moscow-trained Communist era agents. As if on cue, on 11 November parliamentary deputy Frantisek Gaulieder, who had recently left the parliamentary caucus of the ruling HZDS, stated that he had received threats that his children would be kidnapped. Gaulieder also accused the SIS of spying on him and charged Meciar with wanting to put "an end to democracy" (INT, n.48 21). Gaulieder's case has been cited by the European Union and the U.S. as proof that democracy is in danger in Slovakia. Meciar's government responded on 12 November by asking parliament to give the SIS more than 990 million crowns ($33 million) for 1997, one of the few government agencies to get an increase. On 18 November, Jozef Majsky, head of Sipox Holding and known as Slovakia's richest man, helped the anti-Meciar opposition by telling the press that he was aware of plans to "physically liquidate" him because he is now "politically suspicious". He formerly backed Meciar, but is now allied with the opposition. On 20 November, the Slovak Syndicate of Journalists (SSN) protested the barring of four reporters from cabinet press conferences after they refuted Meciar's accusations that President Kovac told them at a May meeting that Meciar was dying of a brain tumor. It is true that Meciar is sick and was out of the office for several weeks earlier in the year (INT, n.49 38). The prime minister's ruling coalition finished off 1996 by ramming a controversial "anti-subversion" law through Parliament. Passed on 17 December, the legislation features punishments for such deeds as organizing anti-government demonstrations. Jan Slota, chairman of the right-wing Slovak National Party (SNS), one of two junior coalition partners, told Reuters: "This law will guarantee that the people dismembering the republic will be put where they belong." He said that the law was aimed at some of the activities of the leaders of Slovakia's 600,000 ethnic Hungarians, such as support for cultural autonomy for Hungarian minorities abroad. Slota said the law could be used against other groups, as well, but he didn't single any out. It might be argued, however, that Slovakia's rulers have neglected building the kind of society and intelligence agencies that would really defend the fledgling nation against dismemberment. Their preoccupation with internal suppression and the alliance Meciar chose for the SIS to establish with Russia has precluded such tangible undertakings. Meciar has refused to confirm or deny he named former Deputy Interior Ministry Jaroslav Svechota head of SIS counter- espionage, but he made no bones about calling for the creation of a state "language police" to enforce a new state language law (INT, n. 21 57). According to specialists, the SIS, which has a foreign intelligence branch and a counter-espionage branch, is incompetent outside Slovakia (INT, n. 15 47). According to our information, over half the SIS personnel can't speak any other language than Slovak and the major proportion of those who can speak another language can only manage Russian (INT, n. 15 47). Last July Moscow's "Nezavisimaia Gazeta" noted that the SIS has only one official foreign representative -- and he is in Moscow (INT, n. 43 48). But Colonel Yurii Nikolayevitch Yermolayev, Russia's resident intelligence official in Bulgaria (his official title is representative of the Russian Ministry of Internal Affairs), neglected to mention this relationship when he told the Bulgarian daily "Standart" (on 2 December 1996) that Russia has bilateral intelligence agreements with Poland and Finland, as well as Bulgaria (INT, n. 50 16). The relationship with Russia became known by the spring of 1995, when it was reported that Bratislava and Moscow had signed a "friendship agreement" permitting the Russian air force to use Slovak airports in times of crisis. Specialists, "Intelligence" reported, are beginning to believe that Slovakia is "on the other side" of the new East-West divide, those beliefs buttressed by the resignation of SIS's top three officials and the installation of Ivan Lexa (INT, n. 12 56). That appointment confirmed the worst fears of NATO intelligence specialists and Western political observers (INT, n. 13 12). Slovakia belongs to the Middle European Conference of Security Services (MEC), which has held annual meetings since 1994; the other members are Austria, the Benelux countries, the Czech Republic, Denmark, Hungary, Poland, and Slovenia (INT, n. 38 43). Slovakia is also a member of the Council of Europe and, at least nominally, a member of the Visegrad Group, comprised of the Czech Republic, Poland and Hungary. In early 1995, the group accepted a U.S. proposal to set up a unified radar system to be used for both civilian air traffic control and as an air defense system, but it is not known whether the system is actually being set up in Slovakia while Russia is setting up another unified radar system to the East. What is known, however, is that Slovakia's sole source of cryptographic hardware and software is Russia. However, in the spring of 1995, in the wake of Bratislava's pact with Moscow, Hungary and Poland decided to cut off all intelligence exchanges with the SIS (INT, n. 15 47). Similarly, it appears that cooperation with the West is out of the question. FBI Director, Louis Freeh, visited Bratislava in June 1994 and, as a result, in late November and early December of that year, an FBI team taught a two-week course for Slovak law enforcement officers. When the Slovak Interior Ministry announced the training, it explained the purpose was to help curb international organized crime (INT, n. 4 40). But the exchange has not been repeated. The Dutch intelligence service, Binnenlandse Veiligheidsdienst (BVD) said in a report issued in late 1994 that it intended to establish structural relations with Slovakia. The BVD noted it had already established contacts with its Czech and Hungarian counterparts (INT, n. 6 43). Recent news reports on Slovakia unfailingly note that, as long as Meciar pursues his authoritarian ways, his government is unlikely to gain entrance to NATO or the European Union. In December, Reuters quoted Jan Slota, chairman of the ultra-right Slovak National Party (SNS), a junior partner in Meciar's governing coalition, scorning membership in NATO: "What difference will it make whether Russian or American nuclear missiles point at us?" It did not seem to make that much difference to Western governments either -- that is, until the Reiffaisen Bank affair in late 1995, when SIS boss Lexa apparently concocted Reiffaisen account slips showing that his enemy, President Michael Kovac, Sr., had a secret "stash". The operation fell apart because of a wrong date on a slip, but everything else on the documents, including internal bank codes, was correct. This set off alarm bells and brought an immediate visit by Canadian and American specialists. "Intelligence" reported that either the SIS had access to a clandestine counterfeit press of unheard-of high quality, or the SIS had agents in the Reiffaisen Bank. Both represent a strategic Western intelligence problem. In the first case, the SIS could print undetectable false documents. In the second case, the SIS could follow and play with money flowing from the U.S. into Eastern Europe for all major American projects in the region for which Reiffaisen Bank is the central manager (INT, n. 26 73). Despite the bank affair, it is unclear whether Western experts really understand the problems in Eastern Europe. FBI officials had hoped the course they taught for Slovakian law enforcement officers in 1994 would give them an opportunity to learn more about Eastern European law enforcement problems from their Slovak counterparts, local legal experts and banking officials. During his visit to the country, FBI Director Freeh cited the narcotics trade, terrorist groups and money laundering as potentially the most alarming forms of organized crime in Slovakia (INT, n. 4 40) -- a notion at odds with the conclusions of Eastern European specialists, who consider "extorted" or "embezzled" state funds to be the major source of money for organized crime in their region. The specialists -- and, in particular, the highly regarded Bulgarian delegate Valentin Dobrev -- advanced that contention during a three-day conference on money-laundering at the Council of Europe's Strasbourg headquarters held in November 1994. Dobrev ranked profits from drug sales fifth among economic crimes in the East, well below money "extorted" or "embezzled" from state funds, especially during the privatization of former state enterprises. This was the first international conference to focus entirely on money-laundering in the East, where it has burgeoned since the collapse of Communism and involves a large portion of what the UN estimates to be the $300 billion annual proceeds from narcotics sales and other criminal enterprises that is laundered throughout the world (INT, n. 3 29 & 4 29). In its first quarter 1996 Country Forecast, "Economics in Transition - Eastern Europe and the Former Soviet Union" the Economist Intelligence Unit (EIU) noted "the disjuncture between good economic performance and problematic politics" which has "never been greater" in Slovakia where the "old structures" have made a full-fledged comeback. This was a notable distinction at a time when the "old structures" of Communist society were reemerging in many countries (INT, n. 35 64). A subsequent study by the semi-official French Fondation pour les Etudes de Defense, entitled, "Les Defis de Securite en Europe Mediane" similarly noted that Slovakia, the most "Eastern" of the five Central European countries (the others are Poland, Hungary, the Czech Republic and Slovenia) is doing better, after separation from the Czech Republic, than anyone anticipated. Nevertheless, its future stability and security will depend on internal developments and the maintaining of democratic government, the study concluded, even though it failed to mention that Slovakia has a "friendship and defense" agreement with Russia that includes several military clauses, and that Slovakia's only intelligence exchange is with Russia (INT, n. 45 51). But for the time being, it's "business as usual" and, according to the Paris newsletter specializing in the private security industry, "En Toute Securite," Wackenhut, the U.S.-based private security corporation (which has recently become a leading force in prison privatization) is expanding into Slovakia and will open an office in Slovakia (INT, n. 46 43). While it is too soon to say that Slovakia's current anti- democratic course will hold, the nation's current situation on the old side of the east-west divide is poignantly highlighted by the fact that it is a target of the new incarnation of Radio Free Europe/Radio Liberty (RFE/RL). Moved from its cold-war seat of Munich to "cheaper" and fairly well-equipped Prague, the radio no longer broadcasts to the democratic Czech Republic. But, to the contentment of Prague, it continues with a Slovak service. Bratislava is not happy about that at all (INT, n. 13 60). Moreover, the appointment of Madeleine Albright, 59, a naturalized American citizen of Czech origin, as U.S. Secretary of State has supposedly shaken Bratislava to its foundations and resulted in setting up special offices under the Prime Minister and in the SIS to analyze every act and statement by Ms. Albright. Some specialists talk of "rats deserting the sinking ship" and "cracks in the stone wall" as Western opposition to Meciar's anti-demoncratic policies mounts and stiffens. The Prime Minister's health is a major trump card in this game and a dangerous wild card has just been played: Meciar's personal secretary and private advisor, Ms. Anna Nagy, surprizingly, of Hungarian descent -- the "person who knew what Meciar was supposed to know" -- quit her job just a few weeks ago. She apparently had "interesting offers from the private sector." ---------------------------------------------