Final Word from Tuesday, July 29, 2008
Appian, CE Handling, Viamont and now Mladá fronta are just a few of the prominent Czech companies whose ownership is mysterious. Mladá fronta tried to squelch rumors of a Russian link by stating that its shareholders are U.S., British and Czech citizens. "There is simply no citizen of the former Soviet Union among them," it said. But when asked who the "beneficial owners" of its "U.S.-based" (but Dominican-registered) company are, it gave no response. This is a key distinction. Front companies often use nominees to mask their true owners. Technically, the beneficial owner isn't a shareholder. Private companies, such as Handelsblatt, can simply choose not to do business with fly-by-night operators. In government deals, bidders should be required to list the beneficial owners, under penalty of law. If the government isn't doing this, it's probably because some of those involved in awarding the deals have a vested interest in keeping the information quiet.[Czech Republic United States of American United Kingdom Central European ČSA Economia HN]
Glossary of difficult words
beneficial owner - the actual or economic owner of a company, as distinct from the registered or nominal owner;
Mladá fronta - a publishing house, not related to the publisher of MF Dnes;
to squelch - to forcefully silence or supress;
Dominica - an island nation in the Caribbean, not to be confused with the Dominican Republic;
nominee - a person or company whose name is given as having title to an asset but who is not the actual owner;
fly-by-night - unreliable or untrustworthy;
under penalty of law - subject to legal prosecution;
vested interest - a personal stake in an undertaking or state of affairs, esp. one with an expectation of financial gain.