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Brokerage Saga Continues As Parties Debate Quaestor Scandal In Parliament

2015.03.31.

PM Viktor Orbán said the government will inform the public on Thursday about the financial links of state-run agencies to the now-bankrupt Quaestor brokerage. Socialist lawmaker Bertalan Tóth asked Orbán in parliament whether concrete information about ministry funds held at brokerages had been available or had he “relied on his intuition”. Orbán noted he had instructed all ministries to examine whether they had public money “parked” at brokerages and, if so, to withdraw it immediately. Precise information about which agencies are involved and whether the funds are still available will be presented to the public by Thursday morning, the Prime Minister said.

Meanwhile some of the opposition lawmakers have moved to dissolve parliament over the recent scandal at Quaestor brokerage, accusing the prime minister of failing to warn people with savings placed at the brokerage of the disaster to come, of which he had had prior knowledge. Tímea Szabó, a lawmaker for the opposition Dialogue for Hungary (PM), told a press conference on Monday that the Socialist Bertalan Tóth and two independent lawmakers, László Varju(DK) and Zsuzsanna Szelényi (Együtt), have joined her motion. Szabó, who sits as an independent, said Orbán had made a statement earlier revealing he had known everything about the Quaestor case before it became public.

“He had prior knowledge of the whole thing yet he did nothing,” she said, adding that because the prime minister and the government had failed to warn the brokerage’s clients of the impending disaster they were unfit to govern. Szabó noted that several opposition parties last week had called on Orbán to hold a vote of confidence and gave him a deadline of Monday to do so, otherwise the motion for dissolving parliament would be submitted. Orbán must take full responsibility for the Quaestor scandal, Szabó insisted. Szelényi said called for a parliamentary committee to be established to examine where the money has gone and how the financial regulators PSZÁF and the central bank were at fault, allowing Quaestor to issue “fictitious bonds”. The question to be asked is why the government had placed money into risky investments, she said, adding that there should be an investigation to find out who knew what and when in the case.

PM Viktor Orbán said earlier that after the failure of the Buda-Cash brokerage late in February the government had decided to take steps that “could still save folks’ money”. He said the decision was taken right after the scandal broke out to cease the risky practice of keeping taxpayer money at brokerages. Learning that some municipalities were hit by the bankruptcy of Buda-Cash, “we immediately raised the question of whether the central administration might also be affected,” and this prompted the instruction to ministries to withdraw any monies invested with brokerages, Orbán said.

Csaba Tarsoly, owner of brokerage firm Quaestor, reported the problems at his firm to PM Viktor Orbán in a letter on March 9, at the same time he briefed the central bank about the situation, the government spokesman confirmed. Orbán had instructed the ministries to withdraw funds at brokerages fourteen days earlier, on Feb. 25, András Giró-Szász told news channel ATV. He rejected reports, however, that the prime minister had acted on insider information, adding that such “baseless accusations were driven by political motives.”

Foreign Minister Péter Szijjártó said the government had considered Quaestor a “serious firm” before the scandal erupted at the brokerage, and this is why public funds had been entrusted to it. On the prime minister’s instructions, the ministry withdrew funds from the brokerage and “no taxpayer money was lost,” he said. The Foreign Minister said that the affiliated Hungarian National Trading House decided to withdraw funds it held with Quaestor on March 5. According to unconfirmed reports, the withdrawal took place on March 9, when private bond issuer Quaestor Hruria announced it had filed for bankruptcy protection.

Meanwhile ruling Fidesz party said it has proposed setting up a parliamentary sub-committee to investigate a government loan to the Quaestor brokerage made under the Socialist administration of Ferenc Gyurcsány. Antal Rogán, the party’s parliamentary group leader said that an investigation should establish the extent of losses to the central budget due to the 17 billion forint (EUR 56.6m) unsecured loan by Hungarian Development Bank to Quaestor.

via hungarymatters.hu and MTI photo: Gergely Botár – kormany.hu