Text of Prague Post article

Salespeople taken for a ride

Police investigate World Cup scam that left many in the lurch

By Brandon Swanson
Staff Writer, The Prague Post
May 03, 2006

When O'Hsin Technology employees came to work April 3, all legal evidence was gone.

The Interior Ministry is investigating a scam that ended with the midnight flight of nearly a dozen Canadians who were selling World Cup advertising illegally from an office in Prague.

If caught, the managers of the Toronto-based O'Hsin Technology Limited — which operated here as O'Hsin Technology Works, s.r.o. — may face up to three years in jail for theft, tax evasion and withholding employee benefits. Czech Police spokesman Ladislav Bernášek said the ministry has reason to believe the company was operating illegally here.

"Right now, we are in the investigation phase — verifying the information," he said.

O'Hsin Technology hired more than 30 employees in late January to call companies around Europe and sell them World Cup advertising packages worth 35,000 euros each. But on the weekend of April 1, the company's managers stripped the office and fled the country and without paying employees, workers say.

The managers had told employees that the company had exclusive rights from FIFA, soccer's governing body, to sell ads that would run throughout the World Cup in June. The ads would appear on daily World Cup highlight shows that would air on giant LED screens in several major cities in Sweden, Portugal, the Netherlands and elsewhere.

O'Hsin Technology "have no such rights to the event nor have ever had any such rights," said Niclas Ericson, FIFA's head of broadcast and media rights.

O'Hsin at a glance

Who: Prague managers of the Toronto-based O'Hsin Technology, who claimed they had the rights to sell World Cup advertising
What: Alleged theft, tax evasion and withholding employee benefits
When: Managers fled the country the weekend of April 1, allegedly with evidence that they hired employees and left them without full pay
Stakes: Up to three years in prison in the Czech Republic

O'Hsin employees don't know exactly how much money they made for the company in false advertising, but former employee Michal Rezanka said a bulletin board in the office showed company sales at 350,000 euros to Portugal alone.

The attention O'Hsin Technology has received in the Czech Republic is unfair, said Manny Rubos, one of the company's managers who fled Prague, via telephone from Toronto April 27. When asked to elaborate, he said all comment must come from company attorneys in Prague.

The attorneys for O'Hsin Technology, Martin Mládek and Ondřej Peterka, said that the company had not given them consent to speak to The Prague Post at press time.

When O'Hsin employees came into work on the morning of April 3, they found the managers gone and the office free of most of the evidence that the company had done business there.

Quite a suprise

"We came to work on Monday and the telephones were missing, the hard drives were missing from computers," Rezanka said.

The employees say they also found personal documents, such as O'Hsin employment contracts, missing from their desk drawers.

They now say the managers fled the country without paying them.

There were many things that should have rung alarm bells, said one employee who asked to be identified only by her first name, Dana.

"Here was this high-tech company that has all of these LED screens all over the world, but they pay their employees in cash?" she said.

Employment contracts show that O'Hsin Technology promised a gross monthly salary of 25,000 Kč plus 10 percent commission on any sale an employee made. O'Hsin employees say that they did not receive full pay during their tenure, and were not paid at all for their last month of work.

But only 19 of them have copies of their work contract, which will make it hard for the others to prove that O'Hsin employed them.

Some of the employees were non-EU citizens, and did not have work visas. It is unlikely that they will be able to receive any additional pay.

Petr Hanyk, an attorney representing the employees, said there is a question whether they signed their contracts with the Canadian company or its Czech counterpart.

"We are trying to go after both," he said.

O'Hsin employees asked the Canadian Embassy in Prague to pressure the company to pay them for the hours they worked, but embassy officials do not plan to do anything about the issue.

"We are informed about the matter, but as far as we are concerned it is in the hands in the Czech authorities," spokeswoman Lucie Čermaková said.

The Czech-Moravian Confederation of Trade Unions (ČMKOS) is helping some of the O'Hsin employees who could not get new jobs because they were still technically working for the company.

ČMKOS spokesman Vít Zvanovec said cases like this are all too common in the Czech Republic.

"It is because of our legal system," he said. "It doesn't uphold the rules, so when the employer breaks them no punishment follows."

But O'Hsin employees are less concerned about any criminal punishment the managers may face. They have vowed to get compensation for their work at any cost, and will be pressuring the Canadian company to follow through.

"I want O'Hsin Technology in Canada to pay me every single crown they owe me," Dana said. "If they don't, they will have trouble."

— Sylvie Dejmková contributed to this report.

Brandon Swanson can be reached at bswanson@praguepost.com