Manhattan Court Indicts Czech Financier for Fraud on Azerbaijan Privatization

On October 2, 2003, Czech financier Viktor Kozeny was indicted by the Manhattan District Attorney on counts of grand larceny amounting to $182 million from clients at the hedge fund he works for, Omega Advisors, Inc. After a lengthy investigation which began a grand jury in January 2002, the indictment alleges that Kozeny persuaded investment managers at Omega to invest in vouchers which anticipated the privatization of the State Oil Company of the Azerbaijani Republic. The investment would have enabled Omega to buyout the company, but which also bought out Mr. Kozeny?s position. He claimed to own 300,000 options whereas the indictment alleges possessed 10 million, thereby obtaining a profit of $93 million on an investment of close to $2 million. He then stole $14 million in company money which he used on personal expenses, and may have stolen $73 million more. Mr. Kozeny currently resides in the Bahamas and has escaped extradition up to this point. The Czech Republic has also issued an international warrant for his arrest, though Mr. Kozeny currently holds an Irish passport.