FBI seizes "Pirate of Prague" Kozeny in Bahamas paradise

Viktor Kozeny, the so-called Pirate of Prague, is currently sitting in a police cell in his adopted home of the Bahamas, after being arrested by the FBI. On Thursday US federal prosecutors charged him and two other men with participating in a scheme to bribe senior government officials in Azerbaijan over lucrative oil privatisation deals. He now faces extradition to the U.S. But as Rob Cameron reports, Czech investors who say they were defrauded by Mr Kozeny have little hope of seeing their money again.

Viktor Kozeny, photo: CTK

Viktor Kozeny, chubby messiah of the early 1990s privatisation process and darling of right-wing post-Communist governments. Viktor Kozeny, wanted fugitive with an Irish passport and a luxury villa in the Bahamas, who once - allegedly - spent 3,000 pounds on lunch in a London restaurant. And now Viktor Kozeny, detainee in a Bahamas prison cell, awaiting extradition to America.

Mr Kozeny made his name in the no-holds-barred free market free-for-all that followed the fall of Communism. In the early 1990s, the right-wing government of Vaclav Klaus sold off shares in large state-owned companies, giving ordinary Czechs the chance to acquire them as a good investment for the future. Forty years of Communist rule, however, meant most people were unacquainted with ins and outs of share deals. Many, therefore, decided to allow the promising Harvard Investment Funds, founded by Viktor Kozeny, to manage their assets. Economist Jan Schiesser.

"He actually played a very important role at the very beginning when he promised a 'tenfold value' through his investment funds and this marketing campaign actually triggered people to buy the vouchers and put the shares into investment funds. Unfortunately, at the end of the privatisation process, he turned out to be a very bad example by siphoning the money out of companies or investment funds. So, I do think that what Viktor Kozeny and others did was the biggest mistake."

FBI press conference, photo: CTK

Instead of investing their money, Mr Kozeny allegedly absconded with it. A lot of it. After buying an Irish passport in 1995 he settled in the Bahamas, posing on his yacht and sipping cocktails by the pool. He ignored feeble attempts by the Czech authorities to bring him to justice - he wasn't even charged until 2003. But there was no extradition treaty between the Bahamas and the Czech Republic, so Mr Kozeny had little to fear. That's not the case with the United States, and Mr Kozeny is likely to face trial over his business dealings in Azerbaijan.

But those Czech shareholders who unwittingly subsidised Mr Kozeny's island paradise have little hope of seeing their money again. By the time American lawyers are through with him, he may well be left penniless. All they can do is wonder at the might of American justice and the impotence of their own.