ProMoPro: Who is behind the offshores?

Methods used to trace the beneficial owners of offshore trusts around Škoda Plzeň could be employed in the murky ProMoPro case

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The High Prosecuting Attorney’s Office in Prague has reportedly asked British authorities for help in tracing companies and payments related to a high-profile case of alleged fraud around the company ProMoPro that occurred when the Czechs were at the helm of the rotating EU Presidency, under the watch of then Minister for European Affairs, Alexandr Vondra, (Civic Democrats, ODS), the current Defense Minister 

Enquiries began when details emerged of the Kč 550 million bill charged to the government for audiovisual and translation services by the privately-owned company ProMoPro at the start of 2009. The struggling company won the contract after a non-competitive tender; without a proper audit, Vondra and the Finance Ministry signed off on the final bill, Kč 371 million higher than initially agreed.

In January 2011, the Finance Ministry’s anti-financial crime and money laundering watchdog, the FAÚ, announced that it had received a report from an unnamed financial institution about suspicious flows of money to and from the accounts of the firm ProMoPro and its owners. According to the FAÚ, over Kč 135 million of the money paid to ProMoPro ended on the Austrian account of the UK-registered company Deeside Service Solutions. At Finance Minister Miroslav Kalousek’s (TOP 09) request, the Austrian account was blocked, but no further developments have been made public and the ministry is refusing to comment.

A spokesman for the High Prosecuting Attorney’s Office has refused to comment on the information request, telling Czech Position to rather ask the British authorities, but in all likelihood it relates to Deeside Service Solutions, which last year changed its name to Inteprod Ltd. ProMoPro’s owner and director, Jaroslav Veselý, confirmed he paid Kč 340 million to the Prague-registered company NWDC, which then transferred Kč 135 million to Deeside Services Solutions and the Prague-registered firm Kom-Forest CZ, which according to the commercial register is involved in the forestry sector.

Who is behind Inteprod?

Deeside Services Solutions, renamed Inteprod Ltd., is a classic offshore company, in that it is not possible to directly ascertain from the UK Commercial Register the final shareholder (beneficial owner). According to available data, however, Czech Position this March found that Inteprod has made taxable transactions. It has a registered capital of £100 and no employees. Leaving aside how such a company could provide Kč 135 million worth of services during the Czech EU Presidency in the first half of 2009, the more interesting question is how it could show no turnover, according available to UK data.

Some British offshores work in a simplified regime, whereby the basically do not have to keep accounts and pay only the minimum flat-tax rate. But such conditions can hardly be accorded to a company with hundreds of millions of crowns in turnover, if the company had such status to begin with, it would be revoked. Despite enquiries to numerous Czech firms that were involved in realizing the EU Presidency, no information could be gleaned about Inteprod, who acted on its behalf, signed invoices or anything of the kind.

Questions for E.R. Christopher

The only individual we managed to trace to Inteprod, was its director, Erickson Raymond Christopher (who is listed as heading three dozen other companies), appointed on Dec. 20, 2007, who has residency on the Caribbean island of Dominica. Czech Position sent a letter to the corporate and private addresses of Christopher with a number of questions related to the ProMoPro case, but received no reply:

  • Are you familiar with the business transactions of Inteprod with the Czech company NWDC?
  • Can you explain why Inteprod shows no turnover in 2009?
  • What services does Inteprod provide, when it has no employees?
  • Why did you not send the money (Kč 135 million) from NWDC to Austria?

Despite Christopher’s silence, there is a way to obtain information (though not in some neatly organized package) about the beneficial owner that was probably used in tracking down the people around Škoda Plzeň, although the newspaper that broke the story, Mláda fronta Dnes (MfD), did not reveal its sources.

The daily said documents in its possession showed that the recently resigned CEO of state-controlled power giant ČEZ, Martin Roman, benefitted from payments from Škoda Plzeň, his former employer, via offshore trusts — which would have been a clear conflict of interest as the engineering giant continued to win lucrative ČEZ contracts.

MfD reported that Roman was founder of a Cayman Islands trust, The California Trust, which in turn owned the British Virgin Islands-based company Artwick Investments Limited. Roman figured both as a “beneficiary” and manager of both offshore trusts, along with three other former Škoda Plzeň managers, from a Dutch unit of Škoda Plzeň’s owner, Appian Group.

The daily said it drew on documents stemming from the ongoing investigation by the Swiss public prosecutor into Appian Group’s purchase of the Czech mining company Mostecká uhelná společnost (MUS) in 1998, followed five years later by the acquisition of Škoda Plzeň.

It is possible MfD got the Škoda Plzeň documentation via people listed as having long-term business connections to the firm. The costs for obtaining such reports can run into tens of thousands of euros, but when public contracts amount to tens of millions of euros, it’s a worthwhile investment. Kalousek and the FAÚ have long had access to or the ability to uncover information producing a similar paper trail regarding the ProMoPro case, but the finance minister’s promises of quickly informing the public about new developments have rung hollow.

Počet příspěvků: 2, poslední 12.12.2011 12:52 Zobrazuji posledních 2 příspěvků.