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EU Grills Hungary over Misspent Funds

Hungary-watchers have been saying for years that EU funds are being spent enriching Orban’s inner circle.

14 February 2018

The miraculous speed with which the family and friends of Hungarian Prime Minister Viktor Orban have found wealth and success since he took power in 2010 has been tracked by local and international media. Now, the European Union is looking into the matter.


The EU anti-fraud agency, OLAF, has called on the European Commission to recover more than 40 million euros ($50 million) in funds granted to Hungary for public lighting projects between 2011 and 2015 after it found “serious irregularities” during an investigation that spanned more than two years, the Guardian reports.


“OLAF’s investigation revealed not only serious irregularities in most of the projects, but also evidence of conflict of interest,” the agency told The Wall Street Journal in January.


Now, Hungarian authorities have launched an investigation into the tenders, Reuters reports.


In 2015, OLAF began investigating 35 EU-funded public lighting tenders that were awarded by various municipalities throughout Hungary to Elios Innovativ, which was at the time co-owned by Viktor Orban’s son-in-law, Istvan Tiborcz.


Direkt36, an investigative outfit in Hungary, says that the public tenders to find contractors for the lighting projects were directly overseen by the prime minister’s office when Elios was awarded 12 of the biggest projects and received 72 percent of the grant money. In many cases Elios was the sole bidder.   


EU eyeballs are also on other bloc-funded projects won by people close to Orban.


In September 2017, the European Parliament’s budgetary control committee embarked on a fact-finding mission to ensure EU taxpayer money has been properly spent on EU-funded projects in Hungary.


One of the places the delegation visited was Felcsut, Orban’s hometown, located about 50 kilometers (31 miles) from Budapest. Although Felcsut has a population of less than 2,000, it has been a major beneficiary of public infrastructure projects since Orban took office in 2010.


It is now home to a 4,000-seat football stadium and a narrow-gauge railway meant to take tourists from Felcsut to the next village, Alcsutdobo, where Orban’s relatives live.


The miniature train in Orban's hometown, Felcsut, has previously been at the center of questions about how Hungary is spending EU funds. Image : Christo / Wikimedia Commons


A government feasibility study estimated that 2,500 passengers would use the 5.7 kilometer line daily, but the actual figure is a “few dozen” passengers a day, the Budapest Beacon writes.


The major of Felcsut, and the owner of the construction company that was awarded the public tender to build the stadium, is Viktor Orban’s old friend, Lorinc Meszaros.


Companies he and family members own are major beneficiaries of EU funds and public tenders. The Hungarian investigative organization Atlatszo estimates that 83 percent of the companies’ earnings – over 1.5 billion – has come from EU sources in the seven years since Orban’s Fidesz party was elected.


A former gasfitter, Meszaros is now worth somewhere from tens to hundreds of millions of dollars, according to Deutsche Welle.


Once, when asked about this good fortune, Meszaros famously said it was down to "God, luck and Viktor Orban."



  • Tiborcz and Meszaros have acquired several hotels and resorts in the Lake Balaton area, and have been awarded construction contracts under a government-led initiative to fund tourism projects in the area, Magyar Narancs reported this week, cited by the Budapest Beacon.


  • Meszaros is also a major player in the Hungarian media. Most of Hungary's regional newspapers are now under his control, according to HVG

Compiled by Kate Syme-Lamont

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