Controversial food and chemicals magnate shot dead in Prague

The Czech papers carry reports this morning of last night's mafia-style killing of a controversial businessman linked to the multi-million-crown food and chemicals conglomerate Setuza. Frantisek Mrazek, partner of another highly controversial entrepreneur, Tomas Pitr, was shot dead as he left his office in Prague.

Frantisek Mrazek, photo: CTK

Some in the Czech media describe Mr Mrazek as a "controversial businessman", while others claim he was the head of a substantial criminal operation and one of the wealthiest men in the country.

His business career began in the 1970s in socialist Czechoslovakia, when he began selling electronic devices to Russia. After the fall of communism 1989, he bought a brewery and became involved in the food industry. The controversy began in 2000, when he and his partners gained control of Setuza under suspicious circumstances, after the collapse of the troubled IPB bank.

Mr Mrazek was also known to be close to a number of discredited politicians, including the disgraced former Finance Minister Ivo Svoboda, who is currently serving a prison sentence for fraud. Mr Mrazek was also believed to be involved in large-scale credit fraud, and was friends with Israeli businessman Shlomo Alon, father of Barak Alon, who cheated Komercni banka out of more than eight billion crowns. Police were also investigating Mr Mrazek in connection with a number of high-profile kidnappings and murders.

However he was never convicted in connection with any of the charges. He was only convicted once - in 1986 - when he received a suspended sentence for smuggling antiques.

Frantisek Mrazek was believed to be the brains and probably one of the owners of Cesky Olej, the group which controls Setuza. Setuza owes 4.1 billion crowns to the state-run bailout agency, the CKA. The leading private equity agency PPF wants to buy this debt claim, but the state wants to transfer it to the Farming and Forestry Support and Guarantee Fund and therefore gain a stake in Setuza.

Setuza, photo: CTK

Media reports say at the time of Mr Mrazek's death, he and Tomas Pitr, widely assumed to be the chief owner of Cesky Olej and recently convicted for tax fraud, disagreed over what to do with Cesky Olej's debt.

So far there are no clues as to who killed him or ordered his killing. Reports in the media speak of a professional hit job - he was killed with a single shot by a gunman apparently using a telescopic sight. But while details are still scarce, it is safe to say that his killing will only reinforce the popular opinion that Czech business environment can be a very dangerous place when tens of billions of crowns are involved.