Austria The Strache Recordings - The Whole Story

In a secret recording from 2017 obtained by DER SPIEGEL, Austrian Vice Chancellor Heinz-Christian Strache of the far-right Freedom Party is heard discussing a deal with a purported Russian millionaire to trade state contracts for campaign support. By DER SPIEGEL Staff
FPÖ leader Heinz-Christian Strache in Ibiza in 2017

FPÖ leader Heinz-Christian Strache in Ibiza in 2017

A snow-white vacation house on a hill, a few kilometers from Ibiza Town. Three bedrooms, four bathrooms, an outdoor pool and a separate guest house with around 500 square meters (5,382 square feet) of living space for 1,000 euros a night.

The group mingling on the terrace on the evening of July 24, 2017, drinking champagne, eating tuna tartare and sushi, was discussing delicate topics: How could they make sure that a Russian investor was awarded contracts from Austrian businesses and the government?

They were thinking big. Nothing seemed impossible. They discussed casino licenses, the sale of an old luxury hotel, contracts for highway construction -- all of it for the Russian investor. They even discussed a takeover of the Kronen Zeitung, one of Austria's most widely circulated newspapers.

The group included a woman who was supposedly from Russia, an Austrian woman with Serbian roots and a master's degree, and three Austrians in leisure attire.

At that moment, two of them were already on their way to the center of political power: Heinz-Christian Strache, head of the far-right Freedom Party of Austria (FPÖ), and Johann Gudenus, a member of the federal board of the FPÖ and a former deputy mayor of Vienna who was also the husband of the Serbian-born woman.

Nearly three months after the meeting in the villa, Austrians would go to the polls to elect a new National Council, the country's lower house of parliament. Another two months after that, Strache would be sworn in as vice chancellor of Austria. Gudenus was promoted to head of their party's parliamentary group.

In Ibiza, as the two talked merrily about million-euro deals, they seemed like drinking buddies on vacation. But since December 2017, they have helped chart the course of the federal government in Vienna. The FPÖ is part of Austria's governing coalition, having emerged from the last election as a kingmaker for Chancellor Sebastian Kurz and his conservative Austrian People's Party (ÖVP).

The two men had been sitting together for six hours on that warm evening by the time a dark suspicion crept over Strache: "Trap, trap, it's a trap," he whispered to his neighbor, Gudenus. But soon enough, his worries seemed to disappear. "It's not a trap," Gudenus assured him.

But the FPÖ leader was right. The meeting was a trap. The villa was bugged and outfitted with several hidden cameras.

The purported Russian woman, Alyona Makarova, who claimed to have Latvian citizenship as well, was pretending to be the investment-hungry niece of a rich oligarch. Her story: She wanted to invest over 250 million euros in Austria, as capital that "cannot be deposited at a bank" because it is "in fact, not entirely legal," the woman's companion candidly explained.

The videos from that evening in Ibiza were made available to DER SPIEGEL and Germany's Süddeutsche Zeitung newspaper.

Potentially Criminal?

The recordings are politically explosive. They reveal highly questionable views of Austrian politicians currently in office. They show that these politicians were willing to boost the FPÖ's election results with the help of Russian money. The promises made that evening and the practices they revealed could potentially be criminal for someone in political office.

Due to the political significance and the public interest, DER SPIEGEL and Süddeutsche Zeitung have decided to publish the contents of these conversations.

The source is known to editors at both media outlets, but insists on remaining anonymous. It is unclear at whose behest the FPÖ politicians were tricked and what their motivations were.

The visual and audio documents were forensically examined by two external experts and deemed to be authentic. They found no indications that the recordings had been manipulated after the fact. A certified interpreter also translated central parts of the Russian dialogue. DER SPIEGEL has seen a photo of the bill for the villa in Ibiza. It was rented from July 22-25 of 2017 at a cost of 2,936 euros. The images on the website of the rental agency show the same spaces visible in the video. Ultimately, the politicians involved were approached for comment.

The videos from Ibiza seem like a workshop report from a banana republic: Two leading Austrian politicians cavalierly spoke to a woman they barely knew about their vision for controlling the levers of power and how they could compensate her if she helped them to the very top.

After a couple of hours, the group began talking about the Kronen Zeitung, or the "Krone," as the tabloid is known, and its influence in the coming election. The group eventually decided to move the conversation inside.

The suggestion was made to the young Russian from Latvia that she should discreetly acquire half of the Kronen Zeitung. Strache said that if the newspaper "were to push us" before the election, "then we won't get 27, we will get 34 percent" of the vote. Any article that "helps us, enrages red and black." He was referring to the Social Democratic Party of Austria (SPÖ) and the ÖVP, which have been governing the country since the end of the war, mostly together.

'Always Be Legal'

The Kronen Zeitung reaches more than a quarter of all Austrians. Strache, who has been head of his party since 2005, was fully aware that support from the paper would provide a significant boost to his efforts to move into the Chancellery in Vienna.

And that was precisely Strache's goal in the summer of 2017. At the time, though, the young ÖVP candidate Sebastian Kurz had just passed the FPÖ in the polls.

At first, Strache seemed wary of the false claim by the purported Latvian-Russian that she was considering buying half of the Kronen Zeitung shares and that she was already in contact with two of the four heirs of the deceased Kronen Zeitung publisher, Hans Dichand. "I didn't expect that," he said. Gradually, though, his doubts seemed to disappear and his appetite for a deal that could potentially bring him closer to the Chancellery won out. Any deal, however, must "always be legal," he kept emphasizing.

With the newspaper, Strache said, she would be "in league with the 10 most powerful people in Austria." There were still outliers on the Kronen Zeitung editorial staff, Strache said, "three, four people who needed to be shown the door," but he added that "we'll quickly bring in five new ones." Are things really that simple? "Journalists are the biggest whores on the planet," he said.

The young woman asked what the investment would bring her, personally. "You have a weapon in your hand that allows you to do whatever you want in Austria," Strache answered. Anyone who owns the "Krone," he said, is not only an opinion leader but has "a monopoly on power that allows them to open up other business paths." Later, Strache brought up the prospect of public contracts for highway construction, which had generally been awarded to the company STRABAG in the past.

Strache claimed he could provide the "missing link" to the Funke Media Group. At the time, the German publishing group, formerly known as WAZ, owned half of the Kronen Zeitung, while the heirs of longtime publisher Hans Dichand owned the rest.

Strache said he also knew the right man to help plot a new direction for the tabloid: Heinrich Pecina. The investor, whom Strache described as a "big player," had "bought up all Hungarian media for Orbán over the past 15 years and primed them for him."

A Media Landscape Like Orbán's

Pecina, a businessman who puts on aristocratic airs, organized the consolidation of the Hungarian press landscape for Hungarian Prime Minister Victor Orbán. Népszabadság and other newspapers that were critical of the government were bought and were either discontinued overnight or sold on to people with friendly views of Orbán. One could learn from Hungary, Strache said: "We want to build a media landscape like Orbán did."

In response to a request for comment, Heinrich Pecina said he had never had anything to do with the Kronen Zeitung. "In any case, I never had and do not have any possibility of controlling or influencing the Kronen Zeitung in any way. Nor have I ever claimed such a thing."

Beyond the Kronen Zeitung, Strache continued in the video, ORF, the Austrian public broadcaster, was also very important. He said it was conceivable that it be partly privatized, with a large share sold to media entrepreneur Dietrich Mateschitz, the head of Red Bull and the media company that belongs to it. "We could imagine a complete restructuring of ORF." Strache described himself as the "Red Bull brother from Austria."

Again, and again, the supposed Russian asked what was in it for her. If she took over the Kronen Zeitung before the election and helped the party "to the number one position," the FPÖ chief said, "then we can talk about anything."

This would be Strache's grandest promise of the evening: They could talk about anything. Anything at all.

What was wishful thinking in Ibiza has gradually become reality in the coalition government of the ÖVP and the FPÖ. The current chairman of ORF's board of trustees is Norbert Steger, the former head of the FPÖ. Three weeks ago, Steger made headlines when he attacked one of ORF's best-known journalists. After Armin Wolf, the host of the network's main news show, conducted an interview that was critical of the FPÖ, Steger sarcastically said: "I would take a sabbatical, travel around the world on fee-payers' dime and reinvent myself."

It is not as if politically motivated interventions are anything new at ORF. In fact, they have been the rule for decades. But since the FPÖ has been part of the government, the broadcaster's editorial independence has been massively challenged. Vice Chancellor Strache had promised on Facebook that he would work "like a lion" to eliminate the "mandatory ORF fees."

The FPÖ doesn't just have power over the public broadcast media, but also over many other aspects of the country. The party, for example, holds key ministries, including the foreign, interior, defense and social affairs portfolios.

The 'Homosexual Lobby'

All three Austrian intelligence services are overseen by ministries under leadership of the FPÖ, a party that has been affiliated with United Russia, which currently controls the Kremlin, since the signing of a cooperation agreement in 2016. Concerns that Moscow may have access to Austrian intelligence has led Western intelligence agencies to limit what they share with Vienna.

The party's affinity for Russia also played a decisive role in the Ibiza meeting. Johann "Joschi" Gudenus, who translated for the purported Russian, has taken courses at a university in Moscow. The son of a former FPÖ politician and a convicted Holocaust denier, he has been part of the right-wing camp since his youth. Indeed, Gudenus is considered one of the most important intermediaries between the FPÖ and Russia. He even accepted an invitation to visit Grozny from the violent Chechen leader Ramzan Kadyrov, as well as one from the Russian occupiers of Crimea. In Moscow's Cathedral of Christ the Savior, he railed against the EU, describing it as a refuge for the "homosexual lobby."

Strache sees "Joschi" as something of a right-hand man. The men have been close for years: In Vandalia, a Viennese student fraternity, Strache was Gudenus' pledge father. Now Strache views Gudenus as his man for Russia and he's the one who engineered the meeting with Strache in the villa.

The young FPÖ official had been hearing good things about the purported Russian for quite some time. She was supposedly interested in buying property in Austria and Gudenus' family owns farmland in Lower Austria. So they met in Vienna. In the Ibiza video, Gudenus could be heard saying that the woman had offered to pay five times what the property is worth. But it was during the conversation in Vienna that the plan for a bigger scheme apparently emerged.

In one of the videos, Strache said that Austria should orient itself toward the Visegrád Group in the future, referring to the informal alliance of Eastern European EU members, a group comprised of Poland, the Czech Republic, Slovakia and Hungary. He said the country needs to "open itself very strongly towards the East," towards Russia. "We have decadence in the West," said Strache, "but in the East people are normal."

The FPÖ head said he had been in Moscow on many occasions, noting that he had met with Putin advisors over 10 years ago and made plans for "how we can work together strategically." He also said that Serbia is a fantastic country and that several of his friends had invested heavily there, and that he was almost as beloved in the polls there as Putin.

Beyond Strache's self-aggrandizing proclamations, the central topic of the meeting was money -- and how the FPÖ could be financially supported. Strache told the purported Russian how she could bypass legal hurdles to donate money to the FPÖ. If the model that Strache described actually exists, it would be a clear-cut case of illegal party financing.

Large Donors

"There are a couple of very rich people, they pay between 500,000 and 1.5 to 2 million," Strache claimed. At another point, he said that the money hadn't yet been transferred, but that it had been pledged. And for such large sums, there was a non-profit association that has nothing to do with the party. "Because of that, you're not required to report it to the Court of Audit," Strache said, spreading his arms wide in a shrug, the omnipresent cigarette in his hand. Gudenus added in Russian that nobody knew of the association's existence. Strache said that it was headed up by three lawyers.

Austria's rules pertaining to political donations are similar to the ones on the books in Germany: If a contribution is in excess of 50,000 euros, it must be reported to the Court of Audit. Donations made by foreigners may not exceed 2,641 euros.

Strache claimed there were 10 potential large FPÖ donors and he intended to visit each of them personally. Gaston Glock, for instance. As he spoke, Gudenus stood and formed a gun with his hands to make clear to Alyona how the weapon's maker from the southeastern Austria region of Kärnten makes his money. There was also mention of Heidi Horton, a billionaire department-store heiress. Strache said that there were supporters who had made, or planned to make, donations to Chancellor Sebastian Kurz "and to us," allegedly including the billionaire and real-estate magnate René Benko. And "a couple of big players," like the gambling company Novomatic, one of Austria's biggest taxpayers: "They pay all three," claimed Strache, meaning the ÖVP, SPÖ and FPÖ.

When contacted, all the companies and individuals named by Strache claimed they have never donated money to the FPÖ, either directly or indirectly. When asked about the supposed donors, Strache and Gudenus confirmed in writing that "no donations to the FPÖ" had been received "from the named people and companies."

In Ibiza, though, Strache said that Alyona was welcome to "at any time make donations to us via the association," if she "was so inclined." Strache said that the party's donors tended to be idealists. Turning to his friend Gudenus, Strache asked "Joschi" to explain to the Russian woman that FPÖ supporters "don't want Austria to be Islamisized; they don't want their children and grandchildren to be destroyed."

The FPÖ views itself as a "social homeland-party," a slogan that is also used by the neo-Nazi NPD party in Germany. In the last election, the party drew significant support from the working class, in part because of his ability to simplify even the most complicated of issues and play the common man, even in his role as vice chancellor. All of which makes the video of his comments in Ibiza even more shocking.

Strache spoke about spending evenings eating caviar and oysters for 1,600 euros per table -- "not so expensive," he said. He spoke of a friend who had bought a diamond mine in Africa and of a businessman in Tel Aviv who, he claimed, stored diamonds worth 400 million euros in his heavily secured office.

'Tons of Money'

In public, Strache likes to portray himself as an anti-establishment fighter. In the villa, he made it sound as though he has been on close terms with Austria's billionaires for quite some time. He said that he was "on good speaking terms" with the perennially left-leaning Vienna businessman Martin Schlaff, and that he supposedly met real-estate mogul and Karstadt owner René Benko in Ibiza, because the latter had been there on board the 62-meter (200-foot) yacht Roma. Strache also has connections to Mateschitz, the Red Bull head who also runs Servus TV. Strache said he is "nice" but doesn't understand the media business. Strache also spoke of Ukrainian and Russian friends with lots of money, of contacts to a group of billionaires in China. "Those dogs," the man who is now Austria's vice chancellor said in the video, "have tons of money."

Strache's own path to the top was rocky. His mother, a pharmacist, raised him alone and through a violent student association, he came in contact with right-wing extremists. Photos show him later taking part in military exercises with neo-Nazis. A trained dental technician, he distanced himself from the far-right fringe of the political spectrum in the early 1990s. In 2005, he then became head of the FPÖ, a party which had been hollowed out by Jörg Haider when he left to form a splinter party, and which stood at just 4 percent in the polls. Over the next 12 years, Strache managed increase support for the party six-fold.

It is something Strache is quite proud of, and he made no effort to hide it. He kept coming back to the principle of honesty and his repeated avowals on the subject that evening in Ibiza began to sound like an incantation. "This is sacred to me: I don't do anything illegal," he said multiple times, perched between Red Bull drinks and ashtrays on the sofa. "This is who I am, and it's my strength." He said he always rejected attempts at bribery, because "I don't need that shit" and said he wants to "get up in the morning and say, I'm clean." He claimed this was always his way and "in truth, it brought me to where I am today. Now the big players say: We need to take this guy seriously."

While Strache considered himself unassailable, he relished in the vulnerability of other "Schneebrunzer," literally: people who piss in the snow, i.e. idiots. The FPÖ chief claimed to be privy to incriminating material exposing the alleged escapades of two politicians from the former governing coalition of the Social Democrats and Christian Democrats. The politicians knew they were exposed, so they forged a non-aggression pact of sorts, he claimed.

If the corresponding photos were to be published by some foreign country, the center-left and center-right parties would be in deep trouble, Strache said, adding that it would result in political "nuclear war."

Illicit Russian Money

The man who, until moments ago, had been praising his own incorruptibility, remained seated while the conversation in the villa shifted to patently un-kosher business prospects. The group began discussing a possible privatization of state-owned properties into which the illicit Russian money could flow.

Strache categorically refused some of the suggestions proposed by the decoys. There are "areas that we don't privatize," he said. He responded to other suggestions by remaining quiet and taking a long drag on his cigarette or chewing his fingernails. Again and again, he insisted that any deal must take place within the realm of legality.

But he did provide his thoughts on other ideas. When the confidant of the purported oligarch's niece unashamedly pointed out that, for her, it's not about securing public contracts, but rather about getting paid a "hefty price" -- a markup that would come at the expense of taxpayers -- Strache reacted dismissively at first. But then he said, "Jaaa. Ja. Ja." When the confidant then spoke of a mark-up that would "be guaranteed," the FPÖ chief responded: "Again, you'll get that with the public contracts."

They also spoke about the purported Russian getting involved in state-controlled casinos. Strache agreed that these deserve to finally be deprived of their power, saying: "We want to break up this monopoly." But he admitted this would be "damn hard." Strache knew this firsthand. Legal proceedings against former Austrian Finance Minister Karl-Heinz Grasser on the suspicion of bribery -- which Grasser denies -- in connection with the planned loosening of the gambling monopoly were only just recently shelved.

But when the conversation shifted to highway and road construction, the FPÖ chief perked up. "The first thing that I can promise from a government involvement is that Haselsteiner will not get any more contracts!" Strache said, referring to Hans Peter Haselsteiner, an Austrian industrialist and philanthropist who is the current chairman of STRABAG, Austria's largest construction company. In 2018, STRABAG had more than 15 billion euros ($16.8 billion) in revenue. To this day, Haselsteiner and his family hold more than a quarter of company shares.

In the 1990s, Haselsteiner was elected to Austria's lower house of parliament, the Nationalrat, as part of the Liberal Forum party. More recently, the businessman supported NEOS, a neoliberal political party, with a donation of 1.7 million euros. The fact that "the oligarch Haselsteiner and other Social Democratic and Christian Democratic minions of the system only care about public and state contracts" upset Strache, the former opposition leader, so much that a few days before leaving for Ibiza, he took to Facebook to publicly vent his ire.

'Joschi, Take Care of It!'

Given that, the question from the purported Latvian-Russian and her male confidant about highway construction contracts was music to Strache's ears. If she were to decisively help the FPÖ before the election, "then it wouldn't even be up for debate, excuse me, excuse me. Tell her she should found a company like STRABAG and all public tenders that STRABAG now receives would then be hers."

For a vice chancellor, it would likely be criminal to make such promises about government contracts. But at the time of the recordings, in 2017, Strache did not occupy an office that would have allowed him to award construction contracts, so they probably weren't criminal -- but they were certainly ethically questionable. Dangling the prospect of public contracts in return for support in an election campaign at the very least smacks of corruption.

When asked about the meeting in the villa, Heinz-Christian Strache recalled that a "purported Latvian citizen" and her confidant invited him to dinner. It was a "purely private" meeting in a "relaxed, informal and boozy atmosphere," Strache wrote via WhatsApp. "I repeatedly pointed out the relevant legal provisions and the need to comply with the Austrian legal system for every issue we discussed." He wrote that this also applies to "prospective party donations or donations to non-profit associations in accordance with the relevant statutes." Strache and the FPÖ neither received nor were they promised "any benefits" from these people, he claimed.

"In addition," the Austrian vice chancellor wrote, "apart from the fact that a lot of alcohol was consumed as the evening progressed, there was also a high language barrier and no professional interpreter to translate from Russian, English into German."

Johann Gudenus, who says he has known the Latvian citizen for some time, offered a similar response. The woman was interested in a hunting ground he owns, Gudenus claimed. He argued she told him that she and her daughter were planning to move to Vienna and to establish themselves there and invest in Austria. Both politicians claim to have had no contact with the woman since their meeting.

The questionable statements of the Austrian vice chancellor and his close confidant will likely put considerable pressure on Austrian Chancellor Sebastian Kurz. The coalition between the ÖVP and the FPÖ has been strained recently, even without these new revelations. The Freedom Party's connections to far-right extremist groups, such as the "Identitarian Movement," as well as racist statements and publications by people associated with the party, and the party's handling of critical reporters with Austria's public broadcaster ORF -- all of this has been the subject of intense debate in the country.

People close to Kurz say that the governing coalition in Vienna is not in danger of collapsing. A different coalition partner would be desirable, they say, but the FPÖ is so devoid of policy that the ÖVP can more or less govern as it sees fit. It remains to be seen whether Kurz can stand by this position now that his vice chancellor has shown himself to be open, at least in the past, to the idea of carrying out deals with dirty money.

The meeting in the villa lasted more than six hours. Toward the end, Strache became suspicious. Alyona had dirty toenails, the FPÖ leader noticed suddenly. "That doesn't fit the overall picture," he mumbled. Earlier, he had complained that his up-and-coming far-right populist party had to be constantly vigilant. "We know that we're being watched 24 hours a day, that people would be happy to destroy us over any little thing." But Gudenus appeased him, and Strache continued to drink and chat, seemingly unbothered.

Long after midnight, the visitors said they had to leave. They wanted to go to a club, the Hï Ibiza, located a few kilometers away in Platja d'en Bossa.

On their way out, Strache spoke to the Russian's confidant and to Gudenus one last time. He argued that she should do the "right and smart" thing and buy the Kronen Zeitung. Alyona's confidant warned him: "She's leaving tomorrow. If you want to do it, you have to do it before she's gone."

Before they got in the car, Strache sent Gudenus back to the villa. "Take care of it Joschi!" he said.

Gudenus and Alyona retreated to the kitchen. A camera filmed them there, too.

The FPÖ man whispered to the woman in slightly broken Russian: "We are 100 percent prepared to help, no matter what."

By Maik Baumgärtner, Vera Deleja-Hotko, Martin Knobbe, Walter Mayr, Alexandra Rojkov and Wolf Wiedmann-Schmidt

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