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Politics

Czech PM Andrej Babis fraud probe halted

September 2, 2019

A Czech state attorney has reportedly stopped proceedings over suspected fraud by the prime minister. The scandal that intertwines his government and former business empire has hampered Babis' political career.

Czech Republic Prime Minister Andrej Babis
Image: picture-alliance/dpa/S. Kubes

A Czech state attorney on Monday halted a probe of suspected fraud by the country's prime minister, Andrej Babis, according to regional daily Denik N.

Babis, a 64-year-old multibillionaire, was accused of having cashed in just under €2 million ($2.2 million) in EU funding for a recreation and conference center called "Stork's Nest" a decade ago. The subsidies were intended to support small and medium-sized businesses, however the resort was bought in 2006 by Inoba, a subsidiary of Babis' business empire Agrofert. 

The attorney's office said its opinion of the case had been "changed" but declined to provide further details.

"The state attorney submitted his final decision in the case, in which he changed his legal opinion," spokesman Ales Cimbala said in a statement.

"A senior state attorney will now revise the decision to determine whether the change is legal and justified."

Read more: Prague crowds demand PM Andrej Babis step down

The Agrofert-owned 'Stork's Nest' was built using EU subsidy fundsImage: picture-alliance/dpa/V. Simanek

'Politically motivated' 

Agrofert, which started in the early 1990s, grew to become the Czech Republic's biggest private employer, encompassing over 250 companies. Babis became the second-richest man in the Czech Republic, with the US magazine Forbes estimating his assets at $3.5 billion (€3.18 billion).

It was not until 2016 that Babis admitted the complex belonged to his two adult children and his partner's brother at the time the EU disbursed the funds. Czech police have been investigating Babis, while he in turn has called the probe "politically motivated" and all accusations against him "lies."

Read more: Billionaire Czech prime minister's business ties fuel corruption scandal

Enterprise to politics

Babis entered politics in 2011 by founding the ANO (YES) party on an anti-corruption platform, becoming finance minister and deputy prime minister in 2014. He was forced out of the Cabinet in 2017 over allegations of tax fraud and suspicious business dealings.

However, the crisis brought down the government and triggered a parliamentary election, which Babis' ANO won convincingly.

kw/rt (Reuters)

Aureliusz M. Pedziwol contributed to this report

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