Andrej Babis, the frontrunner to become Czech prime minister in the general election now less than two weeks away, said on October 9 he has been charged with fraud in the Capi hnizdo (Stork Nest) case centred on a €2.3mn EU subsidy obtained a decade ago.
The Slovak-born billionaire turned populist politician, whose ANO party has a double-digit lead in the opinion polls, has repeatedly insisted he is innocent of any wrongdoing, claiming the investigation, and particularly its timing, amount to a plot by rivals who want to thwart his political ambitions. A big part of his manifesto is tackling the web of corrupt links between influential politicians and business figures in Czechia.
“I have received a decision on the commencement of criminal prosecution in the pseudo-case... I immediately appealed this decision,” Babis stated in a text message relayed via his spokeswoman.
The charges were anticipated after parliament in August agreed to a police request that the parliamentary immunity from prosecution enjoyed by Babis and ANO deputy chief Jaroslav Faltynek be lifted. Since parliament made the move, Ano's lead in the polls has only narrowed very slightly, emboldening Babis in his fight to depict the investigation into the EU subsidy as politically driven.
Faltynek, a former top executive at companies that are part of Babis' agrochemicals, foodstuffs and media empire - largely grouped in the Agrofert holding - has also been charged with fraud. He also denies committing any crimes.
Both Babis and Faltynek could face prison sentences if they are convicted. Asides from the Czech police, the European Union’s anti-fraud unit OLAF has been looking into the case.
If Babis wins a new parliamentary mandate in the October 20-21 election - which is almost certain - his immunity would be restored and parliament would have to vote once more to lift it to clear the way for the prosecution to proceed further.
Most analysts expect ANO to top the polls in the election but to not achieve an overall majority in parliament. In such a case, the party would have a problem in that several potential coalition parties have said they will not join a government led by a man charged with criminal offences. However, Czech President Milos Zeman, a fellow populist, has said that, working to the presumption of innocence until a crime is proven at trial, criminal charges will not stop him from asking the billionaire to form a cabinet if ANO wins the elections.
Babis, whose personal fortune is estimated at €4bn, is facing the allegation that he disguised ownership of the Stork Nest farm and conference centre so that it would qualify for a European Union subsidy. The subsidy was only meant for small businesses and Stork Nest would not have qualified to receive the money if it had been registered as part of Babis’s Agrofert. Babis claimed it was owned by family members when the subsidy was awarded. It apparently became part of Agrofert later.