Today and tomorrow I will look at three recent corruption cases in Hungary, all of which involve money received from the European Union.
Two Hungarian politicians are currently spending a lot of energy uncovering corruption cases. One, Benedek Jávor (PM-Együtt), is a member of the European Parliament who sits with the Greens. The other is Ákos Hadházy, a veterinarian from Szekszárd who began his political career as a Fidesz member of the city council. Once the corruption of the Fidesz members of the council became apparent, he resigned his post and quit the party as well. He is now a member of LMP.
Both men are doing a splendid job. Jávor is in an infinitely better position than Hadházy because he receives information from the EU and its anti-corruption arm, OLAF. Jávor has made a real impact, especially concerning the Paks II nuclear power plant and its most likely illegal financing. Hadházy, on the other hand, is at the mercy of the Hungarian authorities or the police who simply ignore his inquiries and/or criminal complaints. Although he has been working tirelessly on dozens of cases, he is unable to show any results. Hadházy is now hoping that if he and his fellow LMP politicians regularly make corruption cases public, they will be more difficult to ignore. Thus, every Thursday he will reveal one case. He claims that he has enough cases to keep “Corruption Info” going for at least a year.
Today I’ll focus on Hadházy’s first case, presented at the launch of “Corruption Info.” I will devote tomorrow’s post to Benedek Jávor’s successful efforts in Brussels.
Ákos Hadházy arrived at the press conference with a recording of a conversation between Rezső Ács, the mayor of Szekszárd, and Péter Máté, a Fidesz member of the city council. The conversation took place in 2012. It was about the decision of the city council to entrust a particular job to a company that charged considerably more than its competitors. Here is a portion of the conversation:
-Eighty-five percent support!
-Yes, yes, but this is a good offer. The price is high, but it can be done in such a way that the person who does it will finance the whole thing and therefore it will not cost us anything.
-Is it overpriced?
-Yes. This is how the tendering procedure works today in Hungary. He comes and tells me that he will do everything. He will win the tender, but he will bring everything. And if not, then he will go to the city next door. Because he has a quota which he can divide. This is how it is behind closed doors.
I’m sure that we all need an explanation of this cryptic description of the process. First of all, the ministry responsible for the tender has a certain number of businesses that have a chance of receiving these EU jobs. Each of them is allotted a quota, so if Szekszárd doesn’t grab the opportunity, the owner of the company will go to the next town. And if Szekszárd makes the mistake of awarding the tender to someone else, they most likely will either get no funding or they will have to put down 15% before the work begins. But one of the privileged companies will promise “to do everything”: the application as well as the work itself. Only large, well-off companies are able to participate in this game because they have enough capital to wait for payment until the very end of the project, when the money from Brussels arrives. In the case of the project discussed on the tape, the company who did the project charged 115 million forints as opposed to 60 million, which would have been the price without the ruse devised by the Hungarian ministry officials and their corrupt business associates. By the end, with overruns, the cost turned out to be 130 million, paid in full by the European Union.
According to Hadházy, what’s going on are criminal acts of a mafia-like network that reaches and is perhaps even orchestrated by the ministries. He mentioned the prime minister’s office and the ministry of human resources as the main sources of this criminal activity. Apparently, 12 trillion forints worth of tenders subsidized by the European Union are offered by these two ministries.
The reaction of the prime minister’s office was typical. The real culprit is Ákos Hadházy, who sat through this discussion and kept the recording secret instead of going to the police immediately after the discussion took place. Thus, Hadházy is an accessory to a criminal act. According to the spokesman of the prime minister’s office, LMP, instead of holding weekly press conferences, should go to the police immediately and report all suspicious cases they know about.
The prime minister’s office underestimated András Schiffer, co-chair of LMP, who although not my favorite is a very good lawyer. Naturally LMP made sure that everything was professionally prepared. First of all, as soon as the project was finished and paid for, Hadházy filed a criminal complaint concerning the case. That was two months ago. Since then he received a letter from the police saying that they could not find any reason to investigate the Szekszárd case because they found nothing that would indicate abuse of office or misappropriation. However, the police sent the case over to the National Office of Taxation and Customs (NAV). The case bounced back from NAV, which stated that the case has nothing to do with budgetary fraud. It is a case for the police.
Rezső Ács, the Szekszárd mayor, went further. He blamed the socialist-liberal administration for the city council’s decision to offer the job to a company in 2012, two years after Viktor Orbán’s Fidesz won the election.
Tomorrow I will relate stories of criminal activities committed by the Hungarian government in its direct dealings with the European Union.
To be continued