After he received five million US dollars in the Croatian Defence Ministry in 1993 or 1994 for the purchase of the S-300 anti-aircraft missiles system, arms dealer Josef Rothaichner left two bags of jewels with Zagorec, Siprak said testifying at the trial for the abduction of Zagorec's son.
No record was made about the jewels that Zagorec placed in the safe in his office, nor had the Finance Ministry been informed about the gift, Zagorec's former assistant said.
The witness revealed the story about the arms purchase and the jewels after she was questioned by Hrvoje Petrac's defence attorney.
Petrac, who is on trial on kidnapping charges, several weeks ago had pointed to a number of illegal transaction that Zagorac had carried out while he was assistant defence minister.
Witness Siprak said he negotiated the prices of arms with arms dealers on his own after which he would go to the Privredna Bank to collect the funds with the permission of the Finance Ministry.
According to the witness, Zagorec informed only the then head of the Croatian Intelligence Service, Miroslav Tudjman about the two bags of precious stones and after the death of Defence Minister Gojko Susak in 1998 Zagorac discussed the jewels with Hrvoje Petrac in his own office.
Petrac said earlier that Zagorec had asked him if he could sell the jewels worth 17 million German marks.
Commenting on today's testimony, the attorney for the Zagorec family said those allegations had nothing to do with the case.
Speaking about the kidnapping of Zagorec's underage son in February 2004, Siprak reiterated the majority of her testimony from the first trial, stressing that in her opinion Petrac had had no connections with the crime.
Tomislav Zagorec was kidnapped in front of his family home in Zagreb on 23 February 2004 and was released four days later after his father paid 750,000 euros, half the ransom demanded.
Hrvoje Petrac and his associates and his son were the main suspects. During the first trial most of the indictees were tried in absence. The Zagreb County Court sentenced Hrvoje Petrac to six years in prison for masterminding the abduction. Given that at the time he was on the run and the sentence was handed down in his absence, under Croatian laws he was able to appeal to the Supreme Court for a retrial.
Petrac was arrested in Greece in August last year and was extradited to Croatia this summer.
The retrial commenced at the end of September. The next hearing is scheduled for 6 November.