Why has Andrej Babis surrounded himself with police detectives and Communist spooks?


Sitting in judgement: Andrej Babis in a Slovak court in 2014. This penetrating shot by Jan Koller of CTK shows the arrogance of a man who has never held the law in high regard.

“A young and ambitious worker who has some practical experience with commercial work" is how a Communist counter-intelligence agent described his Petrimex colleague, Andrej Babis, thirty years ago.

Never was a truer word uttered by a professional liar. In the last couple of years, the business conglomerate, political movement and ministerial team of the Czech finance minister have, between them, recruited some two dozen senior police detectives, Communist counter-intelligence officers, and state security agents and their collaborators, according to my reckoning based upon a review of public sources.

If you include Andrej Babis himself, there are now at least twenty five individuals in the Babis team with a skill set that encompasses the covert gathering and control of information, entrapment and the crushing of political dissent.

It is worth asking then, why the likely next prime minister of the Czech Republic (Babis’ ANO 2011 is today way ahead in the opinion polls, at some 35%) has such a pronounced preference for people with these sinister skills.

There are three reasons: personal loyalty, expedience and necessity. But before examining these reasons in turn, here is a quick reminder of how Andrej Babis actually became a billionaire.

In the early 1980s, Babis was employed in state-owned Petrimex, the monopoly importer of oil and chemical products to Slovakia. In 1990 he was appointed deputy managing director of the firm and by 1993, he was on the board.

In that same year, Petrimex established its Agrofert subsidiary. Two years later, an obscure Swiss entity, Ost Finanz & Investment, quietly re-capitalised Agrofert, in this way wresting control of the business from Petrimex. Petrimex sacked Babis, suing him without success for allowing its stake in Agrofert to be diluted behind its back. Soon after, 100% of Agrofert miraculously belonged to Babis. The Swiss company was heard of no more! Where it got hold of the funds to dilute Petrimex's stake in Agrofert remains a mystery to this day. All Babis is willing to reveal is that the money came from 'friends in Geneva'.

Babis used a similar manoeuvre, over and over again, to acquire his conglomerate of over 200 firms: a mysterious third party brought in to dilute Babis’ existing partner out, with Babis then taking full control. This article, in English, by the veteran Babis-watcher, Jaroslav Spurny of Respekt from 2002, sets the scene well.


Cut from the same cloth

Andrej Babis was not a victim of Communism. Far from it. As a manager of a state enterprise specialising in foreign trade, he was one of the very few beneficiaries of a totalitarian system that enslaved and impoverished the majority of his fellow citizens.

It hardly matters that, in the opinion of a Bratislava court (pictured above), Babis did not knowingly serve as an agent of Communist state security. The essential thing is that, 25 years on, his upbringing as a Communist cadre must produce in him feelings of relief and solidarity, not revulsion, when in the presence of other cadres. These people are cut from the same cloth and will never judge Babis.

Today, Andrej Babis is widely regarded as the country’s most determined anti-corruption crusader. It would be more accurate to say that Babis has hi-jacked the anti-corruption movement for himself, just as he seized Agrofert from Petrimex, with the help of his many associates in the country’s Communist and post-Communist intelligence and state security services.

Associates such as Libor Siroky, the chairman of the supervisory board of Agrofert Group. In 1981, Siroky was recruited to that part of the Communist state security services focused on counter-intelligence against internal enemies. This section worked closely with the KGB in eliminating dissent. How many were imprisoned as a result of Siroky’s activities is not known. Siroky also worked in what was called the ‘4th Department of X. Administration’, responsible for ‘ideological diversion and emigration’. The Western peace movement was his special area of interest. See here

After 1989, Siroky went on to work as a lawyer in CKD Services, where he met Dagmar Negrova, who later became the chief financial officer at Agrofert. It was Negrova, apparently, who introduced Siroky to Babis, who was looking for a reliable lawyer. He was hired and within a short time was acting as the front man for the hidden owners of that fateful Swiss firm mentioned earlier by means of which Babis wrested control of Agrofert from Petrimex. See here

Then there is Radmila Kleslova, who runs the Prague chapter of ANO 2011 as well Prague's new mayor, Adrianna Krnacova. From 1988 to 1990, Kleslova served as a Communist counter-intelligence officer responsible for the recruitment and training of spies in the West. See here

Kleslova has held several board positions in Agrofert companies and has been working for years as Babis’ political ‘fixer’, embedded in the Social Democratic party, which, until ANO 2011 appeared on the scene, had held power jointly and continuously with ODS for the last two decades.

Not all Babis’ spooks are Communists. Karel Randak has helped Babis since around 2011, always at one step removed to avoid compromising his mission, which is to legitimise Babis’ acquisition of Czech politics, and above all, his posture as a crusader against political corruption. Randak is the former director of the Czech Republic’s foreign intelligence service. He also served in the Czech Security Information Service, or BIS, specializing in economic affairs and organized crime. See here


Hiring the detectives

The second reason for the preference Andrej Babis shows for police detectives and spies is expedience. Such people are obviously a useful tool for a businessman who does so much business with the state and the bent politicians who run it.

But their role is much more profound than simply helping Babis grow richer. These people are priceless for a politician with an instinct for absolute control and a contempt for collegial habits of behaviour.

They have helped Babis to discredit some of his most prominent political competitors, most notably the country’s former prime minister, Petr Necas, who was forced to resign in 2013 after his chief of staff, Jana Nagyova, who was also his lover, was shown to have been tasking intelligence chiefs to spy on the prime minister’s wife.

Efforts to convince us that these romantic antics were a threat to national security have not been convincing. But the Nagyova scandal paved the way for Babis' political ascent, lending enormous weight to his anti-political stance. One day, when the archives are opened and historians set to work, it will surely be shown that the sting operation was not merely the result of good, old-fashioned police work.

Recruiting senior police detectives and spies is an expedient way for Babis to manage his rise to power. It is also a deeply unprincipled way, in a political system built on liberal democratic principles, including, for example, the principle of the separation of powers.

It is a measure of Babis’ cynicism that, whenever another senior police officer is recruited to his team, he explains that the man was being prevented from investigating crimes properly because of police corruption and interference from party politicians. In his eyes, he is liberating them in hiring them, offering them the chance to realise their potential.

But potential for what? A closer look at the work of these detectives suggests that the value of such people to Babis is their professional skills in gathering compromising information on his business and political competitors.

The most impressive detective on Babis’ payroll is Jiri Vesely, a member of the Agrofert board and its director of internal security. Before joining Agrofert in 2011, Vesely spent 20 years in the police, most recently as deputy director of the unit for combating corruption and financial crime (UOKFK).

Then there is Tibor Levai, head of security at an Agrofert poultry firm ("Chicken Run" fans will understand why a poultry business requires a highly trained police detective to watch over the hens. They will instantly guess who plays Mrs Tweedy). Levai worked at UOKFK and later at the police department for combating organised crime (UOOZ). He was involved in several cases related to Andrej Babis, none of which led anywhere.

Libor Kazda is the new director of the financial analysis unit (FAU) of the Czech finance ministry. Before joining Babis’ team at the ministry in early 2014, he had served for 17 years in the police, leading the Plzen branch of UOKFK since 2008. He was recommended by Vesely, for whom he worked.

Bronislav Schwarz is a member of parliament for ANO 2011. He served as a police officer for 20 years. He chairs the long-running parliamentary inquiry into Opencard, a showcase of municipal corruption that has been used to ruin the careers of many of ANO 2011’s political competitors in Prague.

Schwarz is also vice chairman of the security committee in the lower house of parliament, as well as a member of the parliamentary commission for control of the secret services. Parliament lifted his immunity at the end of 2013 to allow him to face criminal prosecution for breaking into a house without a search warrant and handcuffing the occupants while serving as police chief in Most.

Then there is Oldrich Hlusko, leader of ANO 2011 in Cesky Krumlov. He served for 15 years as an investigator at the Ceske Budejovice branch of UOOZ, working on cases such as Opencard. In March 2013, he filed spurious charges against the then Mayor of Prague, Bohuslav Svoboda, and another member of the municipal government, Tomas Hudecek, who would later become mayor himself, in connection with their alleged role in a scam that was hatched long before either had ever dreamt of going into municipal politics. Both are from ANO 2011’s fiercest party rivals, ODS and TOP 09.


‘The promise given was a necessity of the past: the word broken is a necessity of the present’ Machiavelli

The third reason why Andrej Babis has surrounded himself with former high-ranking detectives and Communist intelligence officers is necessity: he had very little choice.

There is good reason to believe that Babis has employed these detectives and spooks not only because of what they know about his competitors, both in business and in politics (it is very hard to make the distinction in this country) but because of what they know about him.

A number of Babis’ past business transactions, such as the acquisition of Lovochemie and PKN Orlen’s acquisition of Unipetrol (which went so disastrously wrong for Babis), have been the subject of police investigations by detectives whose colleagues he has now employed.

As for the Communist intelligence officers, men like Libor Siroky, who can say for certain that they are not in control? Babis is obviously a boss, but is he the bosses’ boss? No one knows to this day where that Swiss entity got the money to allow Babis to kick Petrimex out of Agrofert and grab it, apparently for himself.


Power before popularity

The popularity of Andrej Babis continues to rise in spite of the sinister company he keeps. And because of this company, so does his power. He is on a trajectory to become the country’s next prime minister.

People seem convinced that Babis’ team of detectives and spooks are actually needed to eliminate the corrupt politicians that have been ruling the country for the past 25 years. And eliminate them he most certainly will: politicians are now his competitors where once they were his business partners.

But the notion that such a man surrounded by such people could ever hope or even wish to restore legitimacy to the country’s failing democratic institutions is absurd. Andrej Babis is building a world in his own image. It is a world in which the covert gathering, control and misuse of information, not popular support garnered at the ballot box, is the true source of power. Today, Babis has both popularity and power at his disposal: he is preparing for the time when he has only power.