Hungary’s Fidesz: Corruption on a grand scale

When I read about Canada’s corruption scandals of the day — such as Senator Mike Duffy’s trial, where the disgraced politician is accused of claiming just under $100,000 in bogus expenses — I can’t help but think how incredibly petty all of this is, in comparison to the systemic and absolutely brazen corruption surrounding Hungary’s ruling Fidesz party. Today’s news sheds some light on what in any other country would be a major scandal, but what in Hungary is everyday ho-hum politics and political favours.

György Matolcsy, the current governor of the Central Bank of Hungary and former Minister of National Economy, has a son called Ádám, whose company — Glamorous Kft.– purchased a furniture factory in the western Hungarian town of Győr, called the Balaton Bútorgyár. Ádám Matolcsy’s company is registered as having 16 million forints ($77,000) in cash assets and employs 10 people. The company distributes equipment for barbers and hairdressers. The Fidesz politician’s son has a second company, Magyar Stratégiai Zrt., which owns an 80% share in Glamorous Kft.

While Glamorous Kft is a small business, the Balaton Bútorgyár is actually a major firm, with cash assets amounting to 338 million forints ($1.6 million) and employs over a 100 people. Ádám Matolcsy’s small company managed to buy Balaton Bútorgyár, but did so through a loan provided by a financial institution called the Növekedési Hitelbank (NHB Bank). It so happens that this bank’s CEO is György Matolcsy’s cousin, Tamás Szemerey. This isn’t the only  time that a member of the Matolcsy family, which seemes to be remarkably well-placed at the head of Hungarian financial institutions and government agencies, received major loans from the NHB Bank. A company called New Wave Productions, owned by Matolcsy-relative István Száraz, also managed to obtain a loan from György Matolcsy’s cousin.

György Matolcsy. Photo: AFP.

György Matolcsy. Photo: AFP.

The liberal 444.hu website broke the story today, but Ádám Matolcsy would not disclose the size or the terms of his loan. He just said that the reason his company needed to buy a factory is because there has been a massive increase in foreign orders for Hungarian-built furniture.

But this all-in-the-family story doesn’t stop there. György Matolcsy has another son – Máté Huba Matolcsy – who was given a high-level job at MKB Bank, the financial institution that was nationalized late last year and which is currently being supervised by Matolcsy senior’s Central Bank of Hungary. Furthermore, Mr. Matolcsy’s wife – Gyöngyi – is the mayor of the town of Balatonakarattya.

Welcome to Hungary at the dawn of 2016. To get ahead, you know what you have to do and who you have to be.

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