One can always count on a good friend (or an alter ego): Lőrinc Mészáros and Viktor Orbán

I have the feeling that as long as Hungary has the misfortune of having Viktor Orbán as its prime minister there will be no end to the scandalous affairs surrounding Lőrinc Mészáros, the pipefitter from the village of Felcsút whose brilliant business acumen is the marvel not just of Hungary but perhaps the whole world. Since 2010 he has become one of the wealthiest men in the country thanks to, as he himself admitted, God, hard work, and, last but not least, his friendship with Viktor Orbán. Every time one turns around the miracle pipefitter has made a new acquisition. By now he himself is confused about the businesses and properties he owns. Occasionally he has to be reminded by others that he is the owner of this or that property or business. It could be amusing if it weren’t so sad.

I don’t think you would find too many Hungarians who think that Mészáros’s businesses are actually his own. The information made public today only reinforces this skepticism. One of Mészáros’s companies paid a 3 billion forint debt of Cider Alma [Apple] Kft., a company in part owned by Viktor Orbán’s brother-in-law and nephew. No, this figure is not a mistake; we are talking about 3 billion forints or $10.3 million.

To understand this transaction, let’s go back a little in time to the establishment of a number of centers, representing the Hungarian National Trading House (MNKH), under the aegis of the newly reorganized ministry of foreign affairs and trade. An incredible amount of money was poured into these trading centers in far-flung places across the globe. They were supposed to promote Hungarian business abroad. Unfortunately, in the last two years the foreign ministry’s business venture has lost something like 6 billion forints without bringing in an appreciable amount of money as a result of international trade.

At the end of September 2016 444.hu found out that a certain Cider Alma Kft. owes MNKH 3.2 billion forints and that the trading house now has in its possession 5 million packages of 425 ml vacuum-packed corn and 1.5 million 720 ml packets of pitted sour cherries. 444.hu’s investigative team was a bit puzzled and at first couldn’t see the connection between the corn and sour cherries on the one hand and Cider Alma Kft. on the other. But then they found an item from 2015 which revealed that MNKH had lent 3.2 billion forints to Cider Alma to produce apple sauce (not, as its name would indicate, apple cider). A year went by and only 280 million forints were paid back. Obviously something went wrong and Cider Alma was broke. Or, using a slang expression, the whole thing went “alma,” in this sense meaning “went bust.” 444.hu couldn’t resist a good line: “Would you like to have some apple sauce? Call the foreign ministry.”

Close friends with lots of secrets

It didn’t take more than a couple of days for 444.hu to learn that “Orbán’s relatives are dropping from the spaces between the packets of corn and sour cherries.” It turned out that Gizella Lévai, sister-in-law of Viktor Orbán, and her partner, Imre Ökrös, are business partners in three different subsidiaries of Cider Alma Kft. The relationship between the owners of Cider Alma and the Orbán relatives is so close that Ökrös’s two companies, Érvölgye Konzerv Kft. and Kelet Konzerv Kft., became the guarantors of the loan MNKH extended to Cider Alma. There are other Orbán relatives in this particular business venture as well. Most notably, Ádám Szeghalmi, Gizella Lévai’s son, cousin of the Orbán children, is the CEO of Drogida Hungaro, also a subsidiary of Cider Alma.

Hír TV immediately went after the story and asked for details of the deal. Specifically, they launched an inquiry into the fate of that loan. Ordinary citizens are entitled to get such information because MNKH is a state company and therefore the sum in question is public money. Five months later, Hír TV learned that the debt had been sold to Hórusz Faktorház Zrt., which happens to be a business venture in which Lőrinc Mészáros is involved. Factoring is a financial transaction and a type of debtor finance in which a business sells its accounts receivable to a third party at a discount. It is hard to find out much about this factoring company, except the name of its CEO.

Factoring is a common tool of finance, so Jobbik’s spokesman, Ádám Mirkóczki, was uninformed when he said: “I have never heard of a case where one company pays another company’s debt.” Admittedly, this arrangement is atypical. Cider Alma, it seems, had no accounts receivable, only some inventory to sell. Perhaps Mészáros and his business partners thought that the corn and sour cherries could be sold for more than they paid to settle Cider Alma’s debt. Of course, it is also possible, perhaps even likely, that Hórusz Faktorház took over the debt knowing full well that the firm will never see a penny. It was simply an arrangement among relatives. Whether we will learn more about this case I very much doubt. I agree with Ágnes Vadai of Demokratikus Koalíció that Fidesz corruption cases are simply dropped by the prosecutor’s office and this is especially so when the prime minister’s relatives are involved.

The funniest piece on the case was written by Bálint Molnár in Kolozsvári Szalonna (Bacon à la Kolozsvár). It bears the title “Is it surprising that with such stupid relatives the prime minister is flat broke?” The reference is to Viktor Orbán’s latest financial statement in which he went a bit too far in trying to make himself an average Joe financially. He was already quite poor in 2015 according to that year’s financial statement, but by the end of 2016 he was outright poverty-stricken. He does have one and a half pieces of real estate. He is half owner of the family’s Budapest home and sole owner of the house in Felcsút, right next to the stadium. But he and his wife have only 743,000 forints ($2,551) in their checking account, and they owe 5,999,694 forints ($20,600). He still has four dependent children, and his monthly pay as prime minister is 1,558,333 forints ($5,350). Let me add that an average Hungarian family has over 2,500,000 forints ($8,580) in its checking account. Anikó Lévai must be a very frugal housewife. On the other hand, Mészáros is busily buying one piece of property after the other. According to the latest account he is building a football stadium in Osijek, Croatia, where he wants to establish Europe’s best football academy. Oh my, and what will happen to Felcsút?

February 14, 2017
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Ferenc
Guest

“Oh my, and what will happen to Felcsút?”
They can use the setting there to create an updated version of the 70s sitcom “All in the Family”, anybody has a suggestion for who has to play the role similar to Archie Bunker?

pappp
Guest

Nobody can seriously believe that in the corrupt Hungarian system in which even from a HUF 5m (USD 15,000) state or municipal contract the contractor must pay kickbacks to designated fideszniks somebody can just become one of the country’s richest billionaire overnight. Even oligarchs aren’t that lucky.

Mészáros, Garancsi et al are a separate category and even more normal oligarchs (who by the way also have to do some fronting besides paying the kickbacks) know that when they are dealing with Mészáros or Garancsi they are dealing with the boss himself.

Observer
Guest

“Close friends with lots of secrets..” No, no.
Meszaros is Orban’s underling, not a friend, let alone close. Orban has none such. From what was written/said about him: he was insolent, arrogant, sneaky and absolutely self centered even in youth.

Observer
Guest

We are talking again about the Orban mafia with its front men. Remember the Sicilian one, where large tracts of valuable land came to be nominally owned by illiterate goat herders.

The current Orban shams are just as shallow and reeking of fraud. These corruption schemes would easily be exposed if tested in a proper court of law. A big if.

In the mean time this mafia siphons/embezzles more billions every month.

wrfree
Guest

Re: Things going ‘alma’

Haha.. well you can tell those guys don’t read their Bible. They just keep biting into forbidden fruit.

And that Academy in Croatia. Wouldn’t be surprised if VO has his hands out on that. But if his experience in ‘man-management’ is any example I’m not too sure their player development scheme will work out too well.

Observer
Guest

In fact all these counter selected “businessmen” grow and thrive only on state orders, i.e. on stolen money. E.g. once cut off Vegyépszer and Közgép shriveled dramatically, old names like Ikarus and Videoton are doing nothing.
The new fidesznik “business elite” is an oxymoron, no investment, new businesses or ideas have spring from these black holes where billions of tax dollars disappeared.
The regime’s media outlets are gorging themselves with state “advertising” while making no headway in ratings or quality.
The mafia state.

webber
Guest
Istvan
Guest

The sandwich composed of micron of butter, an unknown meat product, one fragment of carrot was particularly appealing. I think the unknown meat product is canned luncheon meat most likely made by Pontifical Meat Kft which was bought by an unknown group of Hong Kong investors using the name Famous Yield Enterprises recently. It is similar to the American product “spam” and equally as bad for you. I recall having it given to me by an older relative who spread it on White Bread seasoned with anise and fennel. The bread was outstanding, the Hungarian spam, not so good.

Its always a good idea to get the young ones started out right with a healthy diet of high cholesterol foods in order to keep the members of the Hungarian Society of Cardiology of the future working.

webber
Guest

I heartily agree, and this is why I am urging local authorities to immediately install cigarette vending machines in kindergarten bathrooms.

webber
Guest

“micron of butter” – That ain’t butter. It’s something like margarine. Something like it, but a Hungarian version which is more like yellow colored lard with artificial butter flavor.

bimbi
Guest

This is a very disturbing post. It is clear now that there is nothing to get in the way of the ruling Fidesz clique enriching themselves (under the direction of the Great Leader, of course), because there are no (were there ever?) ‘checks and balances’ left in the system. The investigative/prosecutorial system simple does not function when it comes to dealing with official theft and manipulation. Single bidding and the use of insider knowledge appear to be par for the course and certainly steps are taken to attempt to cover tracks. Alas the theft of public money is covered by lies (“Hungary is Strengthenng”) and as we can see from the acknowledged enrichment of Lorinc Meszaros alone has reached damaging proportions for the public purse.

Hungary can take a lesson from Romania in the matter of official government corruption.

wrfree
Guest

You know the country is like a battleship that has been unsuccessful in making the turns to make itself fit for the 21st and beyond. Curious how far the selfishness will go.

History has shown indubitably that empires don’t last. It looks as if we may have to wait for those historians perhaps not yet living in some far future to uncover where it was where Hungary finally learned to manage ‘the turns’. Until then the present shows all the facts of tumbling decline when the post mortem begins.

webber
Guest

OT – the faint scent of impeachment wafts on the breeze. Trump’s people are in major trouble, and the administration has barely begun.
https://www.nytimes.com/2017/02/15/opinion/on-the-road-to-another-watergate.html?action=click&contentCollection=Opinion&module=Trending&version=Full&region=Marginalia&pgtype=article

webber
Guest

And don’t tell me Pence didn’t know. The President was informed of the investigation by the Attorney General, and the VP didn’t know???? Puhlease.

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