The Orbán family and corruption, Part I

Looking through the almost 1,500 articles in Hungarian Spectrum I discovered one that mentioned some of Viktor Orbán’s schemes to enrich his father’s company. The title of the piece was “Who is guilty of a breach of fiduciary responsibility?” But the cases mentioned there were only a minute portion of the whole.

Here I’m relying mostly on József Debreczeni’s summary in his newly released book, Slough of Politics, which gives a succinct account of how Viktor Orbán used his political weight to enrich himself. A chapter is devoted to the topic with the title, “Executive power in the service of private property.”

 

Debreczeni published two books about Viktor Orbán earlier. The first one was written while Orbán was still prime minister but it appeared only after the elections in 2002. The second book appeared in 2009 with the whimsical title Arcmás. Why whimsical? Because the word that means “portrait” actually is a compound word: “kép” (picture) and “más” (other). And to make certain that everybody understands the pun there are three portraits of Orbán from three different periods. The last one is anything but flattering.

 

At the time Debreczeni wrote his first book on Viktor Orbán most of the corruption cases associated with the Orbán family were not known. There was only one case that had become public, which happened before Orbán attained high office. I mentioned in an earlier article that each party received former MSZMP properties. Fidesz received an especially valuable building which the party decided to sell immediately and to use some of the proceeds for other purposes. Unfortunately, some of this money ended up in the pocket of Viktor Orbán’s father who needed cash in order to purchase the stone quarry which he used to manage and of which he was party secretary during the Kádár regime. All that came to light in 1999 when Attila Ószabó and Éva Vajda wrote an article in Élet és Irodalom: “The boys in the mine: Business ventures of the Orbán family.” Fidesz sued on three different grounds. The party won in two cases while in the third instance its lawyers withdrew the charge. No one ever questioned the facts. The two cases were decided on technicalities. The whole story can be read in a book published by Élet és Irodalom in 2000.

In 2006 a book appeared written by Krisztina Ferenczi about another questionable affair connected to the Orbán couple entitled Vintage: In pursuit of the Orbán fortune. Why the harvesting of grapes? Because this time it was the acquisition of a vineyard in Tokaj that came under scrutiny. Another court case, another Fidesz victory because of the improper use of a word. The decision turned on whether a business meeting was officially a board meeting or not.

Debreczeni in his latest book only summarizes what he wrote before in Arcmás in much more detail. According to Debreczeni Viktor Orbán and/or his wife owned 5.5 hectares of land in 1998. Four years later they had 63 hectares. In 1998 they owned an apartment in downtown Pest worth 563,000 forints. Four years later they purchased a villa in the elegant Sváb-hegy district of Buda for 75 million forints and they immediately began extensive renovations and the enlargement of the building that included even a wine cellar. Keep in mind that the Hungarian prime minister’s salary is modest and that the Orbáns have five children.

When it comes to the extended family, Győző Orbán’s business also thrived during this period. In 1998 his Dolomit Kft. was worth 98 million; in 2002, 666 million forints. The older Orbán had another company called Gánt-Kő Kft. that also did very well indeed. Its profits grew from 16 million to 167 million forints. The question is whether Orbán used his position to enrich himself and his family. Here Debreczeni brings up the example of the Tokaj vineyards which is well documented.

Luckily for Orbán his illicit transaction came to light years after the actual events. As Debreczeni writes, it was post festa. Élet és Irodalom had full documentation of a board meeting of a group of people, including the prime minister, that revealed how Viktor Orbán and his friends conspired to receive government properties free of charge and government assistance gratis for their newly acquired vineyards in Tokaj. Here are some facts. Attila Szász, a lawyer friend of Anikó Lévai, wife of Viktor Orbán, as a member of the group received 50 million forints in just one year from the government for the improvement of their vineyard. The mayor of Sárazsadány, where the vineyard was located, sold land belonging to the town for two (2!) Fts per m2  to Viktor Orbán’s wife. That’s called a bargain!!! Then they used the 50 million government grant for the planting of vines. During the period between 1998 and 2002 several millions in government assistance went to that particular village in the Tokaj region, including a new road that led to the Orbán vineyard.

One might also mention here that among the businessmen involved in the vineyard affair was Dezső Kékessy, a 56-er from Switzerland, whose son-in-law purchased the Pest apartment of the Orbáns for 65 million forints! Keep in mind that only a couple of years before the apartment was worth 563,000 forints. I clearly recall that Kékessy’s son-in-law was stuck with the apartment for months on end and eventually had to sell it at a loss. However, Kékessy got what he wanted. He became Hungarian ambassador to France!

During one of the “board meetings” the topic was a government grant vineyard owners could apply for. In the transcript that Élet és Irodalom received from Attila Szász’s estranged wife one could read Orbán’s warning to the other board members that they have to be careful: “We mustn’t ask for so much that we would be the ones who win the largest amount.” Indeed, that is exactly what happened. Five hundred and seventy people received government grants. Only two of these received more than forty million forints. Royal Tokaji Borászati Kft. received 44,636,000 forints and behold, the second largest amount went to the company in which the Orbáns were involved. The amount was 44,475,000 forints! But that wasn’t all. The company received government grants twice more to the tune of 64.5 million forints.

The dirty business in Tokaj didn’t end here. I will continue the story tomorrow.

Sort by:   newest | oldest | most voted
Ron
Guest

Well I remember Happy End Kft and the ezusthajo Kft with regard to the campaign finance of Fidesz and the organization of the August 20 fireworks a few billion HUF went there.
I can also remember that the new government could do nothing as the companies were liquidated before the investigation started.
Well under the new law re. MSZP Fidesz can be sued as well. Unless they withdraw the law before loosing the 2/3 majority.

Paul
Guest
As with so many things Orbán and Fidesz related, my poor, long-suffering wife stands in for the Fidesz voting public. After the previous mention of possible Orbán corruption, we had a ‘discussion’ about corruption in Hungarian politics. Her standard reply to all these ‘discussions’ is to blame everything on the Socialists and deny that Fidesz/Orbán could possibly ever do anything wrong. So, after hearing about all the Socialist’s terrible (but entirely unspecified) crimes, I raised the issue of possible Orbán corruption (the Buda villa and the cheap quarry and vineyard sales). Her response? Total denial. Orbán couldn’t possibly be corrupt – not because there was no evidence against him (which of course there wasn’t), but because he was the Saviour*, everything he did was for the betterment of Hungary. And then, as always, the standard Fidesz rider – and anyway, even if there was some small level of corruption in Fidesz (this is Hungary, after all), it would be absolutely NOTHING as compared to what went on under the Socialists, and especially that Spawn of the Devil, Gyurcsany. Did I not understand that the Socialists had stolen the country? They had stolen everything and sold it to their friends (quite… Read more »
Paul
Guest

PS – for those of you feeling for my wife (and my marriage!), we do talk about other things as well!

Wondercat
Guest

Thank you, Prof Balogh. As expected of the “1%”: Legal, “transparent”, and very corrupt indeed.

Paul
Guest

Is there any definite dirt on Kósa?

Paul
Guest

Straying off-topic again, I’ve just been going through the stats for the last election (it’s been a slow Sunday, and I’m not well!), and the list of professions for Hungarian MPs is interesting.
Of the 386 MPs, 214 (55%) are either political party officials or civil servants!
Of the rest, the greatest number are from education (32 – 8%), 29 are from the legal profession and 23 are described as ‘entrepreneurs’. Just 12 are doctors or dentists (which struck me as odd, considering the number of both there are in Hungary!) and a mere 8 represent agriculture.
Strangely (by UK standards, at least) there are only 5 media people (1.3%) and, perhaps most damming of all, just 7 MPs are economists.
So, in summary:
214 – party/government
32 – teachers
29 – lawyers
23 – business
12 – doctors
8 – farmers
7 – economists
5 – journalists
Could this have any connection with the mess this ‘government’ is making of the country?

Member

I don’t think the Orbans case in Hungary and the other politicians on the right for that matter who got richer is the same category as the 1% (in Occupy Wall St terms). They were the ZERO precent before they raised into power. They just recently stole their wealth from the 99% while the 50 some precent is still gladly cheering to them. Our 99% is like: “Good job, Vick! You deserve it!” Do you want my daughter too? I would not be surprised if they introduce Ius primae noctis with the 2/3 majority. Now or never.
This shows that our politicians on the right are even bigger thieves and liars than the ones on the left. Our problem is that we keep electing the same thrash 1% percent since 1990, only the stickers on them are different.
By the way does anybody know a “wealth concentration” chart for Hungary? How much is the 1% in the Land Of The Goulash?

Member

Paul, you didn’t stray too far from the original topic. This shows how many of the MPs are practically career politicians, who do this “politics thing” for a living. Meaning slowly getting closer and closer to pork barrel. They start low, keep waving the parties flag and they get rewarded at the end.
This also suggests that the individual qualities don’t matter much during the elections. People vote for parties. The horde is following another dog every 8 years or so. The election campaign is based on “Vote for X because he’s with the party (the good one)”. We just had elections here in Virginia few weeks ago and I saw almost all the faces personally. Almost all candidates rang my doorbell once, not only the VA senate and the house, but even the candidates for the school board.

Paul
Guest

Writing that made me wonder how the Hungarian situation compared to the UK. I couldn’t find any up-to-date stats, but here’s the situation for 2005:
political/civil service – 19% (Hungary – 55%)
teachers 15% (8%)
lawyers – 12% (7.5%)
business – 19% (6%)
doctors – 1% (3%)
farmers – ? (2%)
economists – ? (2%)
journalist – 7% (1%)
workers:
…white collar – 13% (?)
…manual – 6% (?)
This can only be used as a rough comparison, as things may have changed since 2005 (more Tory and fewer Labour MPs, so more ‘professionals’?) and also the categories probably don’t match exactly. But it does indicate an alarming difference between the proportions of career politicians in the two parliaments and the number of MPs who have actually worked out in the ‘real’ world.