Former head of PM's office arrested in corruption case, linked to murder plot

12-10-2006

Three officials were arrested by the police's anti-corruption squad on Wednesday, charged with attempting to siphon off large amounts of money from EU structural funds. Two of the three are closely associated with the Social Democrats, and the scandal could damage the party at the forthcoming local and Senate elections.

Zdenek Dolezel, photo: CTKZdenek Dolezel, photo: CTK The most influential of the three is Zdenek Dolezel, who served as head of the prime minister's office under former Social Democrat prime minister Jiri Paroubek. Ladislav Peta, the Social Democrat mayor of Budisov in Moravia, and an Agriculture Ministry official named as Miloslav Rehulka were also arrested.

They are accused of blackmail, extortion and corruption in the handling of EU structural funds channelled via the Local Development Ministry. According to media reports, the plan centred round the renovation of the state-owned Budisov chateau. The cost of renovation was to be pumped up to almost 70 million crowns, over 3 million dollars, around 30 million higher than the true figure. That money was to be divided between the three men.

The three men never obtained the money. Regional Development minister Petr Gandalovic - a member of the right-wing Civic Democrats - says the scam was unveiled in the early stages, before any money changed hands. But more seriously, detectives quoted by the media say wiretapping reports suggest there was also a plot to murder Jan Kubice, head of the Czech police's criminal investigations department, and that Mr Dolezel might have been involved.

Jan Kubice is known as the man who drew up a report into links between organised crime and the Social Democrats. The report was leaked to the public days before June's elections, and included all sorts of accusations. Prime Minister Jiri Paroubek was even accused of paedophilia. The Social Democrats subsequently lost the elections, and Mr Paroubek claims the Kubice report was part of a deliberate smear campaign orchestrated by the Civic Democrats.

The Social Democrats have dropped Mr Dolezel like a hot potato. Mr Paroubek said if the allegations against the former head of his office were true, Mr Dolezel belonged either in prison or in a mental hospital. Mr Dolezel's lawyer, meanwhile, has insisted his client is innocent. In the meantime the Regional Development Ministry has frozen all projects financed by EU structural funds.

Czechs go to the polls in less than two weeks, and this latest scandal could damage the Social Democrats' chances. But overall, it will simply reinforce the popular perception that (a) many Czech politicians enter politics to line their pockets, and (b) getting into government is a great opportunity to dish the dirt on your political opponents. That might not be true, but that's certainly the public perception.

12-10-2006