* Suspects accused of selling Schengen visas
* Alleged ringleader is son of late Kosovo leader
* Visas sold for thousands of euros
By Fatos Bytyci
PRISTINA, Feb 7 (Reuters) - Italy's embassy in Kosovo faced a growing scandal on Friday over sales of Schengen visas for thousands of euros, with prosecutors and defence lawyers saying at least two embassy employees were implicated in a scam allegedly led by the son of Kosovo's late independence leader, Ibrahim Rugova.
Uke Rugova, a member of parliament from the ruling coalition, was among 10 people arrested by European Union police on Wednesday on suspicion of organised crime in the sale of much-coveted visas to Europe's borderless Schengen zone.
Three suspects were remanded in custody late on Thursday for 30 days. Six others were placed under house arrest and another was freed.
Lawyers for the defendants said those arrested included a local staff member of the Italian embassy in the capital, Pristina. Another staffer was implicated in prosecution documents seen by Reuters, but defence lawyers said he had diplomatic immunity.
"Only one embassy worker is here, the other suspect has diplomatic immunity and is not here among the other suspects," defence lawyer Tome Gashi told reporters during the court session.
The Italian embassy said it was cooperating on the case with the EU police and justice mission in Kosovo, known as EULEX. EULEX was set up in 2008 to handle cases of war crimes, organised crime and high-level corruption.
"We continue to be in close contact with the EULEX mission in full transparent collaboration," Italian ambassador Andreas Ferrarese told Reuters on Friday. He declined to comment on the details of the case.
According to the prosecution, police found hundreds of passport photocopies, visa applications, copies of IDs, photos and other documents at Uke Rugova's home, formerly the residence of his father, who led the Kosovo Albanian struggle to break away from Serbia through the 1990s.
"The group was producing fake documents to support the applications for Schengen visas to apply at the Italian embassy for their clients," prosecutors alleged. "They were using their influence inside the Italian embassy to make sure that fraudulent applications were approved."
Weapons were also found at Rugova's home, and police confiscated a letter from January this year addressed to an official at the embassy asking to accept 300 visa applications.
"In writing this letter, Uke Rugova shows he considers himself above the law," the prosecution said.
It said the group's "clients" were charged 2,700 to 3,500 euros for a visa that should otherwise have cost 60 euros. Rugova's lawyer said his client was innocent.
The requirements to obtain a Schengen visa are often beyond the means of many in Kosovo, an impoverished, landlocked country of 1.7 million people that declared independence from Serbia in 2008.
To some, a Schengen visa is a foot in the door to a longer-term stay in western Europe and the chance to work and send money home. More than 30,000 young people enter the job market in Kosovo every year, but few find work. (Editing by Matt Robinson/Larry King)