"I can only say that this is an entirely trumped-up case, there were no jewels and that was not how the Defence Ministry bought weapons," Zagorec said when asked if he had embezzled jewels received by the Defence Ministry as collateral for five million US dollars intended for the purchase of weapons for Croatia's defence.
"I also can't understand the accusation that the arms dealer gave us jewels as a guarantee that he will deliver weapons. That is not logical," the former defence ministry official said in the interview carried by the Croatian Nova TV network.
Zagorec said that one of the main reasons for attacks against him might be the ongoing trial in Croatia in which arms dealer Zvonko Zubak is suing the state and claiming USD 200 million in damages, alleging that he did not receive payment for the purchase of an S-300 rocket system.
Zagorec said that he could confirm that the rockets had been delivered but never paid for.
He dismissed accusations that he received commission from arms purchase. Asked how he acquired the capital he later invested in Austria, he said that he did not invest his own money, but had found investors and banks willing to support them.
The ORF broadcast depicted Zagorec as a man who purchased weapons during Croatia's war of independence. Despite an international arms embargo, Croatia managed to expand its military equipment from kalashnikovs and hunting rifles to fighter planes.
"Friendly countries helped us obtain weapons. The Croatian state leadership knew about it, as did the leaders of those countries," Zagorec said.
The retired general, arrested on March 14 on an international arrest warrant, is suspected of abuse of office, namely that in 2000 he took from a Defence Ministry safe jewels he had received from a German arms dealer in 1993 as collateral for five million US dollars from the Croatian Defence Ministry intended for the purchase of weapons for Croatia's defence.
Zagorec, who has lived in Vienna for the past seven years, was released on bail last week.
He opposes extradition to Croatia and his Austrian lawyers have said they will sue Croatia with the European Court of Human Rights, because they believe that his prosecution is motivated by the upcoming parliamentary elections in Croatia.