Web of ‘coincidences’ widens: Prague transport firm DPP’s deal with Samcor unraveled

The Czech media continue to untangle the web of direct and indirect connections between opaque offshore companies, the law firms that represent them, and the individuals actually benefiting from contracts agreed by Prague’s transport company former CEO, Martin Dvořák — possibly including his mother (a police investigation into the family’s finances is underway).

Czech Position has already reported on the link between the security agency Samcor and businesswoman Jana Lütken; now this publication has unraveled additional threads in the yarn of intrigue around the city-owned company, DPP, involving a small circle of Prague lawyers, lobbyists and entrepreneurs — and specialists in doing business via the Caribbean.

To best understand the extent of the connections, many of which are now being investigated by anti-corruption police due to suspicions of fixed tenders and kickback schemes at the Prague transport company (DPP), let us first review the individual cases known thus far and the companies they involve.

• The case of the “overpriced tickets”: The Virgin Islands-registered company Cokeville Assets Inc. brokered a 2007 contract between DPP and the private Czech printer Neograph toproduce metro, tram and bus tickets; Cokeville collected Kč 0.17 for each. In December 2011, the Endowment Fund Against Corruption (NFPK) in December made public a 2006 contract between Cokeville and Prague lobbyist Ivo Rittig, who was represented by David Michal of the law firm Šachta & Partners. The NFPK concluded that some Kč 73 million was transferred from a Cokeville account to one controlled by Rittig, calling him the beneficiary of the dodgy deal; Transparency International said it smacked of “kickbacks” to DPP management. The head of the organizational seat of Cokeville was another lawyer, Peter Kmeť, while Jana Lütken was director of the offshore company at the time of the 2006 contract.
• The case of the “turnstiles”: The NFPK in December last year also published a contract (from 2009) between DPP and the company ALSEDA — also signed by Peter Kmeť— for advisory services relating to the installation of turnstiles in the Prague metro. ALSEDA is owned by the Swiss company Eurozeta, which was managed by Jana Lütken from 2005 to 2010.
• The case of the “television monitor” patent: City-owned DPP has been paying the company Bitmedia a license fee for a patent on the big screens hung on the walls of the Prague metro stations — although there is no exclusive technology whatsoever involved. The chairman of the board at Bitmedia is Peter Kmeť. Meanwhile, a third of the shares in the Czech company are in the hands of Mavex Group Incorporated, yet another firm registered in the Virgin Islands.
• The case of the “Maderia villa”: Marie Nováková, the mother of ex-DPP chief Martin Dvořák —who was pushed to by Prague mayor Bohuslav Svoboda to resign this autumn, reportedly due to suspicions of widespread corruption during his tenure — bought a villa located on the grounds of a luxurious golf resort on the Portuguese archipelago of Maderia in 2009. On the very same day that Nováková secured a €1.6 million loan of for this purpose from Unitex International Capital, that Hong Kong-registered company entered into a loan agreement with Mavex Group Incorporated — both of these offshore companies were represented by David Michal of the law firm Šachta & Partners. Nováková also bought a “suspiciously cheap” villa in Hanspaulka, a posh area of Prague’s Dejvice district that is home to a number of foreign embassies, from Michal’s company Future Earnings through a firm in which she is co-owner, HK Development.

Samcor’s Caribbean credit

According to Czech Position’s information, also figuring in to the web of connections around the city-owned transport company is the security agency Samcor, owned by Prague businessman Samuel Korbíni. The agency, founded in 1999, has never published an annual report, yet though it has secured contracts from public companies. Samcor’s clients include DPP and TV Prima — a commercial broadcaster also previously headed by Martin Dvořák.

The collection of Samcor documents obtained by this publication show that the agency obtained a Kč 6 million loan in September 2008 from Mavex Group Incorporated and negotiated, once again, by David Michal of Šachta & Partners. Samcor’s clients include DPP and TV Prima — a commercial broadcaster previously headed by Martin Dvořák. TV Prima has refused to disclose details of its contract with Samcor, which ran from 2007 to 2008 (Dvořák became head of DPP in April 2007).

To recap: Samcor borrowed money from the same Caribbean offshore (Mavex Group Incorporated) as did the Hong Kong-registered firm (Unitex International Capital) that lent money to Dvořák’s mother, Marie Nováková, to buy the villa in Madeira. Mavex owns Bitmedia, which collected money from DPP for the “television monitor patent.”