Corruption derailed

True story accompanying image

Responsible for managing all public transport in the Czech Republic capital, Prague’s municipal transit company has long been dogged with accusations of corruption.

“For many years it was perceived as “a milking cow” for politicians and lobbyists who siphoned off money for their own purposes,” says David Ondracka, of Transparency Czech Republic.

The rumours were persistentlobbyists and politicians were members of, or closely connected to, the company’s board. Meanwhile huge contracts were awarded that left the company crippled with debt. Many felt that certain people were benefitting from artificially inflated prices.

Working together with investigative journalists, Transparency Czech Republic has a history of exposing corruption and mismanagement in public contracts. Back in 2008, they revealed that a tender to clean up environmental waste had been inflated, adding a US$2 billion cost to the taxpayer bill.

When a new city mayor took office in 2010, he contacted the team to ask for their help in rooting out corruption in the transport office.

“He asked us to audit the company - to look into contracts to check they were not rigged or overpriced,” David says.

The team accepted the request and started looking over documents at the office. Issues become apparent very quickly.  

“We discovered an enormous mess,” David says. “The companies weren’t overpricing by 10 per cent, but by 100 or 200 per cent. Some of the contracts were completely useless.”

The story went far beyond Czech Republic. The team found evidence of an international network of companies from Cyprus to Hong Kong and the Virgin Islands that was suspected of moving public money into private pockets.

In some cases, the public seemed to be directly subsidising the money being siphoned off. Since 2013, for example, 17 halers (around one US cent) of every print travel ticket was directed to an anonymous account in the Caribbean.

Compiled and released, the findings of the investigation created big changes in the organisation. The mayor dismissed the management and removed implicated politicians from the board. Charges were filed against a number of people involved and prosecutions continue to this day.

“I hope we managed to save millions for the citizens of Prague, money that can be used for improving public services,” says David.

“We learned a lesson from this – if you are ready and there is a window of opportunity, you have to jump on it. There are risks and it can be dangerous, but at the end of the day Prague’s citizens are just happy that something has changed.” 

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