The court confirmed a 35 million fine and a ban on contracts for Metrostav in the Bohemia hotel case

Prague – The High Court in Prague today confirmed a monetary penalty of 35 million crowns for the company Metrostav in the case of fraud during the modernization of the Hotel Bohemia Chrudim. The court also imposed a three-year ban on Metrostav from fulfilling public contracts and participating in public tenders. Compared to the original ruling of the Hradec Králové court, a three-year ban was also imposed today on the subsidiary Metrostav Infrastructure. Today's decision is final.

"We respect today's ruling and are ready to carry out what has been imposed on us. We consider the case of Hotel Bohemia closed after more than ten years," stated Metrostav spokesperson Radim Mana.

The penalties for Metrostav and Metrostav Infrastructure include previous convictions of the companies. Last year, the High Court imposed a ten-million penalty and bans on participation in public tenders and fulfillment of public contracts for three years in the so-called second branch of the corruption case involving former Central Bohemian Governor David Rath. The same ban was then imposed on Metrostav Infrastructure. Last month, the same court also confirmed the guilt of Metrostav and its subsidiary in the case of manipulating contracts for the repair of the National Stud in Kladruby nad Labem, but in this instance refrained from punishing the companies.

According to today's decision, Metrostav and its subsidiary are also required to publish parts of the rulings relating to the company at their own expense.

During the sentencing, the judge pointed out that Metrostav could not claim to have been exonerated simply because it made every effort to prevent the criminal actions of its employees. "At the time for which we are now imposing penalties on Metrostav, one cannot speak of the excesses of individual employees," she stated, referencing other cases involving the company. However, when imposing the penalty, she took into account that no misconduct was revealed at Metrostav in the following years.

In the case of Hotel Bohemia Chrudim, more people were originally indicted, most of whom have already heard final rulings. In addition to both companies, the High Court also ruled today on Ivan Fišák, reducing his sentence by a year to a two-year probation period with a four-year trial period. He is also to pay a monetary penalty of 196,000 crowns. The court found both companies and Fišák guilty of attempting to damage the financial interests of the European Union and grant fraud. Today, the appellate panel merely changed Fišák's legal qualification from organizing to aiding in a crime.

The indictment claims that in 2012, representatives of the investor, HOMA holding, the technical representative of the investor, Cettus, and the contractor, Metrostav, agreed to unlawfully siphon funds from a project financed by the Regional Operational Programme NUTS II Northeast. The repair of the hotel was supposed to cost 74 million crowns, with a subsidy of 43 million crowns. However, part of the subsidy that the company applied for was not paid, and the work was halted. The company subsequently withdrew from the subsidy agreement. Later, the owner sold the company along with the hotel.

Fišák acted in the case as a representative of HOMA holding and, according to the indictment, participated in agreements regarding changes to the work compared to the approved project documentation and in carrying out and reporting on targeted work, the fictional execution of which was to be confirmed in the construction diary. According to the prosecutor, Metrostav's guilt was derived from the criminal activities of individuals in leading positions within the company. Today, the prosecutor demanded stricter penalties for the defendants in the appeal.

Fišák and both companies once again denied the charges today. Fišák stated today that he did not commit the crime. A representative of Metrostav told the court that the company regretted the excessive actions of former employees and continuously takes measures to prevent similar behavior from its workers.

A representative of Metrostav Infrastructure pointed out that the company did not participate in the actions being sued. It is currently serving a sentence imposed in the Rath case and claims that by the announcement of last year's ruling, the company lost contracts worth two billion crowns. He also mentioned that the company has many highways and roads under construction; if the court were to grant the prosecutor's proposal for a stricter penalty, it would result in significant harm to the budget of the Czech Republic.