Why Bother?


A well respected official recently asked: "Why bother?" "Why does AKRO investiční společnost, a.s. continue to fight against the Czech government on behalf of investors in the former CS fondy?" A very pertinent and direct question. Indeed, since 2014, almost every judicial decision has been against these investors. Why doesn't AKRO investiční společnost, a.s. just quietly walk away?

I can only answer personally, as the Fund Manager responsible since October, 2003, for the former CS fondy, (though I know many of my colleagues share these sentiments). Yes, we have always been aware that if AKRO wins compensation against the Czech government, many, perhaps the majority, of investors will immediately sell their units in the former CS funds. Indeed, I would not blame these long-suffering investors if they decide to 'cash out' their investment should compensation be paid: better to do it now than after they die. However, for AKRO, gaining that compensation has now become a point of principle: a question of Right and Wrong. A question of self-worth not net-worth.

Forget the formal Czech judicial system for a moment. What a mess that is! We were all born with an innate sense of right and wrong. As it stands, the 60,000 investors in the former CS Funds (and their descendants) stand to get no compensation for the multiple acts of malpractice by government officials which facilitated the ''tunneling'' of their funds in 1997. Perversely, previously awarded compensation recently had to be returned to the State, with penalty interest (CZK700m), after a reassessment (two previous judges had ruled in favour of investors) of the Statute of Limitations by a court in Prague 6. As a result, investors not only get no compensation, but actually loose what remaining investments they have. Due to acts by the State, and its judicial system, they stand to lose everything. The relevant Prague 6 court hearing admitting all the evidence from the state while strangely ruling all evidence on behalf of investors ''superfluous''. Even the Supreme Court commented there may have been a ''procedural error'' (though didn't act). The 'bottom-line' being that investors not only get no compensation, the government, through its court system, has rewarded itself to the tune of CZK700m for its own malfeasance, contradictory interpretation of the Statute of Limitations, and slowness In hearing the case.

That is why we bother.

Jeremy Monk
Investment Director
AKRO investiční společnost, a.s.

E-mail: Jeremy.monk@akro.cz