Ex-CEO Becomes Key Witness in Investigation Into Austria’s Kurz

(Bloomberg) -- Austrian anti-corruption prosecutors accepted a plea bargain from former state holding company executive Thomas Schmid in a setback to ex-Chancellor Sebastian Kurz.

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Investigators will stop their prosecution of Schmid and give him key witness status, subject to the former head of Austria’s state holding company OeBAG paying €260,000 ($274,000) in legal fees and damages, the prosecution agency WKStA said in a statement on Thursday.

Schmid is providing information on several lines of investigation, including the wide-ranging corruption probe that grew out of Austria’s 2019 Ibiza video scandal, prosecutors said.

The decision is a blow to Kurz, who resigned as chancellor in 2021 following allegations he used taxpayer money to plant fabricated opinion polls in a tabloid newspaper, helping his rise to power.

In a parallel probe, Kurz was handed a suspended jail sentence earlier this year for false testimony related to his involvement in appointments at OeBAG, with Schmid acting as key witness. Kurz, who’s now working as a global strategist for billionaire investor Peter Thiel, has appealed the verdict and denies wrongdoing.

In 2022, prosecutors started investigations against insolvent property tycoon Rene Benko’s companies for suspected bribery after offering Schmid a lucrative job while he was working at Austria’s Finance Ministry. Benko has denied wrongdoing.

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