The founder and owner of the firm ProMoPro , Jaroslav Veselý, whose company was was paid hundreds of millions of crowns by the Czech government for providing audio visual equipment and interpreting services, was among individuals connected with the suspected scam who have been arrested and charged by anti-corruption police, according to Czech media reports.
The affair threatens current Defense Minister Alexandr Vondra (Civic Democrat, ODS), the then Minister for European Affairsm who had overall responsibility for EU presidency contracts.
The server E15.cz reported that five people, including Veselý, were arrested late Wednesday. Others included Vlastimil Maxa from the company NWDC, to which over Kč 300 million was transferred by ProMoPro, and Václav Čada, co-owner of the firm Damovo, which rented audiovisual equipment to ProMoPro.
Police spokesman Jaroslav Ibehej on Wednesday said only that arrests had been made in connection with the ProMoPro case, but refused to divulge names or any details about the charges and outcome of the investigation.
The server Euro.cz reported Thursday that in all nine people have been formerly charged in connection with the ProMoPro affair, including Vondra’s former deputy Jana Hendrichová, and former or current Government Office employees Radomír Karlík and David Mlíčko.
The arrests follow a more than year long investigation. Police were initially alerted to suspicious transfers of large amounts money to and from ProMoPro accounts by the Financial Analytic Unit (FAÚ), the Czech Finance Ministry’s anti money laundering and financial crime watchdog. It subsequently emerged that ProMoPro was paid a total of Kč 525 million by the Czech Government Office for conference services during the Czech presidency of the EU in the first six months of 2009.
Later reports said that Kč 378 million was transferred to NWDC, which then supposedly hired the London-registered firm Deeside Service Solutions to provide IT services. Deeside was later renamed Interprod, whose official director is Raymond Christopher Erickson , a resident of Dominica who officially heads another three dozen or so companies.
The money trail eventually led to an anonymous bank account with the Austrian bank Vontobel to which Veselý’s friend and associate Líbor Veverka had access, and Prague-registered firm Kom-Forest CZ, which according to the Czech Company Registered is involved in the forestry sector.
At the beginning of March, the daily Hospodářské noviny (HN) reported that the anticorruption police had completed their investigation and concluded that the services provided by ProMoPro were significantly overpriced and that at least Kč 135 million of public money was embezzled. The daily also said that several employees of the EU affairs department within the Government Office could expect court summons, though it is unclear whether those arrested include any current or former employees of the office.
ProMoPro received the contract o provide audiovisual services without a public tender being held. From Czech media reports of the investigation it emerged that the company effectively had carte blanche to invoice the Government Office for “additional services” above the originally agreed costs for services.
The ProMoPro scandal has almost cost current Minister of Defense Alexandr Vondra (Civic Democrats, ODS) his career. Although, according to sources in the prosecution service, he is not suspected of knowing about the alleged embezzlement scam, Vondra as the deputy prime minister in charge of EU affairs at the time headed the Government Office’s EU affairs department thus was ultimately responsible for its spending. Thus even if not under direct suspicion, Vondra’s abilities as a ministerial manager have and will again be questioned and scrutinized as the case returns to the forefront of media attention.