Another Fidesz scandal: Hunguard and Antal Rogán, the inventor

Scandal after scandal in Fidesz circles. Following on the heels of the revelations about the alleged bribery case involving Roland Mengyi, here is a new one. This time a much more important person is being implicated: the #3 man in the Fidesz hierarchy, Antal Rogán. The propaganda minister’s “financial affairs” are far too numerous and, although he is currently being shielded by his benefactor and boss, Prime Minister Viktor Orbán, and Chief Prosecutor Péter Polt, I wonder how long he can remain in his post without inflicting serious political damage on the Orbán government.

I have often complained about the incomprehensibility of Hungarian investigative journalism when the case under scrutiny has something to do with business. This latest scandal, Antal Rogán’s involvement with Hunguard, is a case in point. Admittedly, the corporate structures some Hungarian entrepreneurs come up with are byzantine by design.

Hunguard Kft., an information technology company, is not new. It was established in 1990 by four mathematicians. It was in the news a lot during the summer of 2014 in connection with the infamous utility rate reduction program. In conjunction with this program, the invoices of every utility company had to be audited by a professional auditor to ascertain that the bills the customers received were calculated accurately. That requirement was suspect from the first, but further amendments raised the suspicion that certain people in the government wanted to guarantee that only Hunguard Kft. could have the job. For some bizarre reason the company entrusted with this task had to have national security clearance. Behold, among the three or four companies that could have been in contention for the contract only Hunguard had the requisite clearance.

A year later Népszabadság reported that Hunguard most likely did exceedingly well with its auditing of 67 different utility companies with an estimated combined earnings of one billion forints. Interestingly enough, all the utility companies passed with flying colors, which only strengthened the suspicion that the audit was superfluous in the first place. It was also more than suspicious that while in the original bill auditors had to rotate yearly, Szilárd Németh, the politician in charge of the propaganda campaign, took this provision out of the final version of the bill.

So, from the very beginning it was clear that Hunguard’s fortunes were closely tied to certain leading members of Fidesz. They even included János Lázár, who when one of Hunguard’s competitors managed to get national security clearance eliminated that particular requirement and introduced something called “telephely-biztonsági engedély,” which I believe is a permit the company gives to those who can safely enter its premises. This was a simple solution to keep Hunguard as the only auditor of state utility companies. They would give permission to Hunguard, not to its competitors. Easy.

This was all we knew about Hunguard Kft. until yesterday when Népszabadság, after doing some further research, returned to the topic. Their research led them to Cyprus where, after paying a fee, they received details about the business activities of Hunguard. And here things become complicated, but I will cut to the chase. The owners of Hunguard Kft. wanted to be certain that their ownership was well hidden, so they engaged the services of the Kinanis Fiduciaries Ltd. in Malta, described by a Hungarian lawyer specializing in international business activities as a well-known “bizalmi vagyonkezelő” or a kind of trustee who for a certain fee becomes the owner of the company on paper. Behind the deal is a secret legal agreement which allows only the true owners to make business decisions. The graph below shows the more complicated structure of the arrangement.

Hunguard

Népszabadság notes that only the bank handling the two owners’ finances and the lawyer who represents them vis-à-vis the “trustee” in Malta know the identity of the real owners. And here is the clue. The lawyer in this case is Katalin Karafiát’s law firm, which has for years been in a close business relation with Antal Rogán. Népszabadság was told by people familiar with the business activities of Hunguard that the man behind the whole complicated business structure “is none other than the Fidesz leader who has been much attacked lately for shady business activities.” He is described by the paper as “a master at operating such company networks.” Well, I guess it is not terribly difficult to figure out whom the paper’s informers have in mind.

At this point a commenter to Népszabadság’s August 9th article came to the paper’s help with another clue. The commenter, who wittily called himself “nokiás kamion” (Nokia truck), called attention to something he found on the internet: a patent was registered for “the method of digitally signing an electronic file, and authenticating method.” The inventors were listed as “Balázs Csík, Csaba Lengyel, and Antal Rogán.”

There are several oddities regarding this patent. The original, which was registered at the World Intellectual Property Organization with headquarters in Geneva, listed the three men as the inventors. But when it came to the registration in the Hungarian patent office (Szellemi Tulajdon Nemzeti Hivatala) the trio didn’t want to be called “inventors” (feltalálók) but only “jogosultak,” i.e. someone who holds the rights. Népszabadság correctly points out that inventors are normally proud of their invention and rarely hide their role in creating a new product. Perhaps Rogán’s presence among the inventors had something to do with their modesty.

In February the three owners of the patent sold their rights to MobilSign Kft., which now markets the product “MobilSign” as “a system capable of recording the dynamics of a handwritten signature, it produces the advanced electronic signature and assigns it to PDF documents.” Until December MobilSign Kft. was owned by Balázs Csík and Csaba Lengyel. Now the owner is someone called Petra Pozsgai.

Once discovered, Rogán with a straight face claimed that he had an active role in the invention of this electronic signature which, let’s face it, is most unlikely. Rogán has a degree in economics and has no information technology experience. Moreover, he is one of the busiest Fidesz politicians around. He couldn’t possibly have spent three years developing a software program, as he claims, even if he knew something about programming.

The most plausible conclusion one can draw is that Csík and Lengyel paid off Rogán for his good offices over the years by forking over a third of the profits from their invention.

August 10, 2016
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LwiiH
Guest
First, the company structure isn’t that complex. It obviously funnels off commissions to certain individuals leaving the largest chunk to the silent partner. These structure may work in Hungary but they offer little if no protection in most western countries. I know of a least one similarity structured company in Canada, built by a Hungarian as it would happen, that was sued where the “silent partne” was held 100% responsible even though the “Hunguard” in that case did the work. Second I suspect that Rogan had little more to do with the handwriting analytic than his being involved in the company where most likely the most valuable thing they own is this IP. I am not what the novel feature is in their digital signing so I’m not sure how they managed to get a patent for it but that is another question. If Rogan has a proper degree in Economics then he would certainly have the mathematical background to contribute the the project. Maths are the language of economics. That said, I suspect his involvement is more like those doctors who manage to pad their list of papers by getting thie names on papers by lending the project a… Read more »
dos929
Guest

There isn’t much to discuss about this or any other shady business of the circles close to or part of the government that came to light. This is simply a mafia regime, and this is not just a figure of speech. The whole FIDESZ party and their government is simply a mafia organisation. And as a ‘government’ they do not govern at all, as what they doing has no resemblance to governance. They are common criminals of the highest degree.

Furthermore, they think, and perhaps justifiably so, that they are untouchable, so there is no longer a need for pretences; as all their acts are out in the open. At most, sometimes they have to explain some of their doings in the public, which comes down to denial upon denial and turning the table on the opposition with fabricated lies and accusations. We shouldn’t waste any of our energy on them, but simply admit defeat in the face of this tyranny…

Guest

I agree with dos929. the only organisiton which could do something about the Hungarian mafia regime is the EU, and as we have seen over the years, they do nothing, other than keep financing it.

It is EU funds which have created this monstrosity here, which is now extending its criminal activities and influence even as far as the USA.

PALIKA
Guest

This is another popular but fallacious analysis. Reducing or refusing EU funding to Hungary could have unforeseen and unintended consequences. Mass poverty and consequent migration to the West. Even closer relations with Moscow. Where is the guarantee that the next regime will be any better. All previous post communist governments were corrupt.
The approach towards Hungary has to be much more subtle if it is to achieve any result. Probably there was a time in 2010 when a more interventionist approach would have made Orban change course. He would not take any threat made now at all seriously.
The EU has currently other problems which need careful handling such as the underlying Euro uncertainties, migration, Brexit, nationalist movements in member states, the Russian threat just to mention a few. Micro management of the Hungariian political and economic system might be a task too much. Please let us stop dreaming that there is a magic wand. I wish there was

Guest

Things we’d like to see:

The Magyar Parliament after breakfast going into the hallowed halls and voting for RICO. That is the ‘Racketeer and Corrupt Organizations Act’. I realize this could be like seeing cockroaches in the dark acting like the Flash hunting for crevices as the room lights go on. But it’s probably the minimum to halt the pilfering, robbing and hidden as well as brazen criminal activities going on by those in the state, of the state and out of the state.

Outsiders looking on at the corruption could help ameliorate it but ultimately when a nation’s judiciary at all levels is compromised massive change with regard to corrupt activities can only come from the ‘inside’. From experience here in the US, it appears a mob’s slide begins from that part of the bag.

But all the above is a possibly a dream. The country has not come to a certain consciousness necessary for action to destroy corruption.

Guest

Yes, wrfree, change has to come from the inside …

Hungary is different from Nazi Germany or the USSR – everything bad happens inside to its own people and as long as the people don’t react the EU can not do much – it has to follow its own democratic rules.

And PALIKA, you’re also right: Hungary’s problems are rather irrelevant on the International scene …

Of course nobody knows how long this can go on and how it will end …

Guest

Re: ‘Of course nobody knows how long this can go on and how it will end’

You know sometimes I think Magyarorszag’s political issues revolve around ‘occupational’ selection in the population. Is political life beckoning only for a particular type?

Politics because of its great import in the well-being and operation of a nation arguably needs the best and talented to channel those efforts for the public good.

If indeed the best are going there well something gets short-circuited somewhere. Ideals must perhaps get switched off to ‘practicalities’. And if the worst are going there selection criteria is out of whack. Points to ponder for the future of the country.

dos929
Guest

Hungary already has mass poverty and migration to the West. One has to be naive believing that the Hungarian citizens with or without the opposition parties can achieve any change from the outside. Since the EU is a ‘paper tiger’ and cannot be relied on, if change would happen it can only be from within the FIDESZ, but I wouldn’t hold my breath waiting for it as such an internal revolution to happen may take many years to come…

Member

Fatalist Defeatism and Self-Fulfilling Prophecy: Pascal Meets Thumper
This entire thread, from top to bottom, strikes me as an exercise in fatalist defeatism.
If it were true, then there would be no point saying it — or saying anything at all.
If it were not true, it would just play into into a self-fulfilling prophecy.
The truth is, no one can know. But a Pascalian variant of the Thumper Principle from Bambi is a better bet: “If you can’t say somethin’ that will help, don’t say nothin’ at all.”
comment image

Guest

Stevan, just look here:
http://kepeslajoska.tumblr.com/

Gallows humour at its best …

Guest

Re: ‘Fatalist defeatism’

You know I’m sure a few of us have had and perhaps still have the ‘glory days’. Personally I can remember pulling ‘rabbits out of hat’ when a game looked pretty bleak to win. We accomplished something when all looked lost. It is with me to this day as well as with the ‘team’. The feeling it engenders is one of accomplishment against great odds. Indeed I wish I could push a button and transfer the feeling to make change for the better. I’m sure others having the same experience and mind set would like to do the same.

And watching Joe Namath lift that ‘number one finger ‘ after beating the Colts in the Super Bowl after pundits said he and his team had no chance says it all. Odds can be defied. I love to watch that win.

Guest

Another hysterical shot across the bow by the chief laptop bombardier of the wishful thinking brigade.

On my part, however, I think that convincing factual rebuttals are a lot more to the point and a lot more useful than childish name calling or hysterical calls to either say something nice or to shut up.

If however you really are unable to advance any convincing factual rebuttals, then – irony of ironies – you are in fact conceding the ground to those that you are hysterically protesting against.

Anyway, the call to say nothing if you can’t say something nice is usually said in reference to some dead reprobate (De mortuis nihil nisi bonum), so your call to do so in any case implies that liberal democracy in Hungary is a lost cause and that you are making an appeal to all and sundry to cease and desist flogging a miserable dead horse.

So it would appear that actually, the message of the wishful thinking brigade implies exactly what the fatalist defeatism brigade is explicitly articulating. So once again we are back to Peanut and his immortal saying that we have met the enemy and the enemy is us.

tappanch
Guest

Rogan is also involved in another scam, which started in March of this year:
“nemzeti otthonteremtési közösségek ”

See the last paragraph of the following article:

http://mno.hu/belfold/a-telekom-szamara-fejleszt-rogan-antal-1356194

tappanch
Guest
tappanch
Guest

More evidence surfaced today about the scandal involving Fidesz MP Roland “Voldemort” Mengyi and the “Ministry of Human Resources” led by Z Balog.

http://www.168ora.hu/itthon/mengyi-roland-voldemort-holbok-sandor-public-sector-consulting-kft-147956.html

FreeWheeling
Guest

One can’t help but wonder what is the reason behind the recent flow of corruption revelations about Rogan. An internecine feud with a peer in the PMO?

apparatchik
Guest

Good point. It might actually be Kövér instead of Lázár. Surely not Pintér and there are no further people who would dare to do so.

bursa ikinci el eşya
Guest

Another difference btw PL & HU: PiS has leftist values solidarity w the poor. For Fidesz, solidarity is reserved for the middle class. + İlave olarak – Scandal-ridden #MNB foundations to spent HUF 15 billion on yet another luxury office building. #fidesz #corruption

tappanch
Guest

Unterfuehrer Lezsak’s kurultay – Hungarian Tribal Assembly will start tomorrow !

http://kurultaj.hu/tag/lezsak-sandor/

On its webpage, look at the runic script popularized during SS times.

Let us look at the flags. Turkish Cypriot, all right.

Between the Kazakh and the Hungarian flag, is it an imaginary Arpad flag or a well-documented Nyilas flag ?

Guest

Hungarian myth-making at its finest . . .

Medieval reenactments in Western and Northern Europe are based in historical fact. The same in Hungary are purely imaginary constructs. Talk about wishful thinking . . . And talk about believing your own BS . . .

Geez, am I glad not having to put up with this kind of inane Hungarist crap among the peoples and the places I chose to live in since 1956.

Guest

Re: ‘history as ‘imaginary construct’

‘Who controls the past controls the future.
Who controls the present controls the past’

George Orwell

Mr. Orwell had the current Magyar history teachers pegged very well.

Guest

Another “nice” example of corruption in Fidesz:
“The first piece showed that, in his wealth declarations, he failed to declare millions of state agricultural subsidies and concealed some of his lands for years. These lands are located in a planned industrial development zone. In the case of some other lands, he listed a smaller share than he actually had in them,” she said.

According to the second piece, when Tasó was mayor of Nyíradony, he led a civic organization that was granted HUF 38.3 million in state money to transform an old “castle” into a hotel. “The restoration project finished at the end of 2013. A month later, the town of Nyíradony sold the castle to Tasó’s NGO (its members being mostly his family members and former employees or colleagues). The price was significantly lower than the cost of restoration,” the article said.
http://bbj.hu/politics/politician-lodges-harassment-complaint-after-critical-articles_120552
The police are investigating – no, not the guy who falsified his wealth statements of course, but the people who are “harassing” him – that’s Fidesztan!

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