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Has Poland’s Government Become a Threat to Business?

Has Poland’s Government Become a Threat to Business?

An accusation had been made against Przemyslaw Krych, and, at about 9 on the morning of Dec. 19, 2017, he was arrested at his home in Warsaw. The financier was sure there had been a misunderstanding, and, as armed agents of the Polish government took him away in handcuffs, he confidently told his wife he’d be back later in the afternoon.

How could it not be a mistake? Krych was the founder and co-managing director of Griffin Real Estate, which had more than $5.6 billion in assets under management and was a partner in huge local projects with global investment luminaries Pacific Investment Management Co. and Oaktree Capital Group LLC. He carried his success with a swagger, typically explaining his business this way: “Griffin doesn’t develop real estate. We buy real estate developers and become the biggest player in the markets we enter.” He hobnobbed with powerful politicians and knew what made the government tick. This arrest, he was certain, would be cleared up quickly.

But Krych wouldn’t be back in the afternoon to see his wife as he promised. In fact, he wouldn’t be home for months. He was told the charge involved what appeared to be a 1 million zloty ($251,000) bribe to Stanislaw Kogut, the chairman of the infrastructure committee in Poland’s Senate. Krych denied it, saying the sum was part of the total of $550,000 he’d given to the senator’s multiple sclerosis charity for more than a decade. This latest amount was earmarked for a new building for kids with autism.

The prosecutors didn’t charge Krych with wrongdoing, but they argued he might tamper with evidence if released and demanded the businessman be kept behind bars until he told them what they wanted to know—as Polish law allows. Krych insisted there was nothing to tell. The judge agreed with the government and remanded Krych to a prison in Sosnowiec in southern Poland.

And prison was where Krych says his story, already Kafkaesque, took on the creepy shadings of a horror movie. His ordeal, he says, is a parable of contemporary Poland: how the disruptive behavior and feudal organization of the populist government have corroded the judiciary and are endangering not just civil rights in general but also the stability that businesses need to prosper. “The notion that the authorities respect laws is pure fiction,” Krych says.

In Sosnowiec, around February 2018, after weeks in what was effectively solitary confinement, Krych was allowed to take walks around a barbed wire enclosure about the size of a tennis court. One day he was joined by two strangers who kept several steps behind him in the exercise yard but were close enough that he could hear what they were telling him. He said they offered a proposition and a number of threats: Give us dirt on opposition politicians or we will destroy you. The destruction could come in many ways, Krych recalls: Child pornography would be planted in his computer; his 16-year-old daughter would be sent to a treatment facility for victims of molestation; his wife would be arrested for embezzlement. Krych demurred. He said he had no information to trade.

But the two men continued to hound him at the exercise court and beyond. They’d walk into the showers as Krych was bathing, disrobe, and talk among themselves as if he weren’t there, discussing details of Krych’s life few people would have known. The duo weren’t the only people who seemed familiar with Krych’s private life. At night, he says, a person nearby would yell out to someone beyond the prison fence, a woman who stood on a hill listening like a bereft lover in a melodrama. But Krych recognized the script of their romance: snippets from letters he was allowed to send his wife from jail, as well as pre-prison family correspondence from his computer and messages from his phone’s WhatsApp account.