Although I’m aware that regular commenters on Hungarian Spectrum seem to be interested only in the aftermath of Donald Trump’s victory, I have to return to Hungarian affairs. After all, the blog’s stated purpose is to acquaint people with the politics, economy, culture, and history of Hungary.
I think that by now readers of Hungarian Spectrum are fully aware that the Orbán government is exceedingly pleased with the result and is looking forward to a close friendship between the two countries. I’m certain that Hungarian foreign ministry officials already envisage Viktor Orbán paying an early visit to the Trump White House. Maybe even a state dinner. Wouldn’t that be splendid?
But let’s get back to Hungarian reality, which is not without its troubles for Viktor Orbán and his closest entourage. The Hungarian prime minister might act high and mighty in parliament when asked about one of his closest associates, Antal Rogán, whose luxurious life style reeks of ill-gotten gains. But Rogán’s activities are symptomatic of wider problems. For instance, the “business activities” of the president of Hungary’s central bank, György Matolcsy, funneled through phony “foundations,” and his “generosity” toward his friends and family, from public funds, haven’t helped the reputation of the Orbán government. By now the majority of the population considers it rotten to the core.
Hardly a day goes by without one of the few remaining independent internet news sites unearthing a new scandal. Just today 444.hu published an excellent piece of investigative journalism showing that the Pénzügyi Szervezetek Állami Felügyelete (PSZÁF), the Hungarian equivalent of the U.S. Securities and Exchange Commission, and the Hungarian National Bank, which incorporated it in September 2013, must have had knowledge of Quaestor’s Ponzi scheme for at least 15 years before the brokerage firm collapsed in March 2015. I provided details of the scandal earlier.
Another story that doesn’t want to die concerns Ghaith Pharaon, a wealthy Saudi businessman who has been a fugitive from justice for the last 15 years at least. I covered the story about three weeks ago, but since then an awful lot of new information has come to light, which I will try to summarize briefly.
First of all, the confusion in government circles about the status of Pharaon is indescribable. Yesterday Index devoted a lengthy article to recounting the range of explanations coming from various government offices about why a fugitive from justice had received a Hungarian visa. The same confusion exists when officials try to explain Pharaon’s exact relationship to Viktor Orbán and his family. These explanations more often than not contradict one another. Some most likely have nothing to do with reality. János Lázár is especially prone to inventing stories for his weekly press conferences. I will not bore readers with these attempts to mislead the public.
On the other hand, I think it is important to note that Pharaon’s business activities were not confined to buying expensive real estate in Hungary from a firm connected to Viktor Orbán’s son-in-law, István Tiborcz. MOL, the Hungarian oil company, also had business dealings with Ghaith Pharaon through Pakistan Oil Fields Ltd. The deal was sealed only in April 2016. And a couple of days ago RTL Klub learned that the ministry of foreign affairs and trade, which owns Magyar Nemzeti Kereskedőház/MNK (Hungarian National Trading House), which is designed to encourage and smooth the way for ventures of Hungarian businessmen in different parts of the world, broke its contract with one of Pharaon’s Hungarian companies, Pharaon Gamma Kft. MNK naturally denied that the move had anything to do with the cloud over Pharaon.
The Artemy used by Lőrinc Mészáros
Meanwhile, back in August Magyar Narancs learned about a 35m luxury yacht docked in the Zadar harbor in Croatia, most likely rented by Lőrinc Mészáros. Of course, it was a juicy story that the former pipefitter, Orbán’s front man, not only has a luxury villa on the Adriatic coast but also enjoys the good life on a yacht with a four-member crew on deck. But the story became truly interesting in November when the same reporters discovered that on August 4 Mészáros’s yacht was anchored in the harbor of Split. And behold, Ghaith Pharaon’s famous Le Pharaon luxury yacht, on which he spends most of his days, just happened to be docked right next to it. This was a most unlikely coincidence because, as the reporters found out, Le Pharaon had not visited Split in the three years prior.
Ghaith Pharaon’s famous Le Pharaon
But this is not the end of the story. At the beginning of August Viktor Orbán disappeared for at least a week. The assumption was that he was on vacation. Zsolt Gréczy, the spokesman for DK, inquired from the prime minister’s office about the whereabouts of Viktor Orbán. He was told by Bertalan Havasi, director of the prime minister’s press office, that he was unable to provide any information regarding the prime minister’s holiday plans. Now that Magyar Narancs discovered the strange “coincidence” of the two yachts next to each other, DK suspects that it wasn’t so much a rendezvous between the pipefitter and the “professor,” as Orbán called Pharaon, but a high-level business meeting between the Hungarian prime minister and the wanted man. Today, although the prime minister’s office still hasn’t revealed where Viktor Orbán was on August 4, it claimed that “Viktor Orbán hasn’t even gotten near Split this year.” I doubt that this denial will satisfy the increasingly suspicious public.
And now let’s move on to a slightly different aspect of the Orbán-Pharaon relationship. Orbán in parliament admitted that he had met “Professor Pharaon” at a dinner party given by the Budapest representative of Jordan where Pharaon was the guest of honor. And now comes Mátyás Eörsi, former chair of the foreign affairs committee of the Hungarian parliament and undersecretary in the ministry of foreign affairs between 1994 and 1998. After hearing the story of Orbán’s meeting with the “professor,” he became suspicious. First of all, it is extremely rare for a prime minister to accept a dinner invitation from a representative of a foreign country. It is even less likely that he would accept such an invitation from the honorary consul of a country that doesn’t even have an embassy in Budapest. Economic relations between the two countries are practically nonexistent. Jordanian exports to Hungary amount to 0.04%, while Hungarian goods going to Jordan are only 0.15% of total trade. Surely, Eörsi argues, the prime minister’s acceptance of this dinner invitation had nothing to do with affairs of state.
Eörsi became even more suspicious when he tried to find out details of direct Jordanian investment in Hungary and discovered that, in the case of Jordan, this is “confidential information.” Normally such investment figures are readily available to the public. On the basis of his research Eörsi suspects, first, that the dinner was organized for the sole purpose of giving Orbán an opportunity to meet Pharaon in person without arousing suspicion and, second, that the subject of their meeting was of a private nature. As for the confidentiality of Jordanian investments the answer is simple enough. Pharaon’s front man is a Jordanian lawyer who is behind the nine Hungarian real estate purchases that have been sealed so far. Surely, the Jordanian partner doesn’t want to reveal details of Pharaon’s purchases, which were most likely acquired on the cheap in exchange for some benefits to the Hungarian partners. I find Eörsi’s hypotheses convincing.