Austria ‘grand corruption’ probe widens across media

Austrian prosecutors are investigating whether former chancellor Sebastian Kurz bribed the owners of the country’s biggest newspaper for positive political coverage.

Police raided premises across Vienna on Thursday, including those of the publisher of the mass-market tabloid Kronen Zeitung and the free sheet Heute.

The state prosecutor for economic crimes and corruption said that its continuing high-profile investigation into “grand corruption” in Austria — which has so far snared 45 individuals at the pinnacle of Austrian business and politics — had expanded to encompass potential charges of embezzlement and bribery in the media industry.

Investigators said they were exploring fresh evidence over whether Austrian officials and politicians, including Kurz, conspired to use public funds to take out adverts in the widely-read newspapers in exchange for positive political coverage.

The prosecutor’s office is also probing if politicians agreed to amend laws concerning corporate foundations — a special holding structure favoured by rich Austrians — to suit the controlling owners of the Kronen Zeitung and Heute, the super-wealthy Dichand family.

Kurz was forced to resign in October 2021 as the first details of a criminal investigation against him emerged.

The initial probe concerned allegations that a key confident, Thomas Schmid — a former senior official in the ministry of finance — had directed ministry funds to pay for adverts in the online news portal “Österreich” in exchange for positive coverage of Kurz as he rose to the chancellorship.

In an explosive development to the case, Schmid turned crown witness last October. His phone, which contained thousands of sensitive communications between government officials, had initially triggered the investigation when it was confiscated as part of a separate probe.

Schmid subsequently provided investigators with hours of witness testimony against Kurz and other senior politicians and officials in the conservative People’s party.

A spokesperson for Kurz said that the prosecutor “has been continuously making new, false accusations against numerous individuals, including Sebastian Kurz” for several years. “All cases that have been heard in court so far have ended in acquittal. This case will be no different.”

Allies of the former chancellor have long contended that the investigation is political and have sharply criticised the prosecutors’ office for sensationally publicising information on its case before any charges have been brought. Kurz has also himself cast doubt on the reliability of Schmid as a witness and denied he played a key role in his political team.

The Dichand family could not be reached for comment. Eva Dichand, the editor of Heute, wrote on Twitter that there was no substance to the allegations.

“Thomas Schmitt’s [sp] statement that I would have agreed positive reporting in Heute and Kronen Zeitung in exchange for adverts is simply WRONG,” she wrote. She argued that a former ally of the ex-chancellor was trying to play up allegations to justify his “star witness status” in exchange for leniency over existing charges made against him.

The investigation into corruption in the Austrian media establishment has so-far snared ten individuals and three companies. But it is only one leg of a sprawling nexus of cases known as the “Causa CASAG” that began as an inquiry into political favours in the gambling industry.

The prosecutor’s office has 45 open dossiers which include figures such as the property billionaire René Benko, the owner of London’s Selfridges department store. Prosecutors have conducted 40 raids on companies and private properties in the past two years.