Let it never be said that Hungarian billionaire real estate developer and banker Sandor Demjan is not a man of his word.

In July 2013 Demjan warned that the National Association of Credit Unions (OTSZ), which he chairs, would sue the government for effectively nationalizing Hungary’s credit unions.

The Law on Credit Union Integration passed in June 2013 enabled the state to take over the running of the Takarekbank and to impose a new governing structure. Any member opposing this was stripped of its rights.  Takarekbank managing director Peter Csicsaky immediately resigned in protest, as did the president of the Zirc credit union, Antal Varga, calling the government’s actions “a primitive appropriation and violation of ownership rights”.

At the time of the quasi-nationalization,  Demjan warned its members would sue the state for forcing them to sell a majority interest in Takarekbank for one-fifth the value of the shares in question and that “the fire is going to be a lot bigger than this”.

Yesterday it was announced that a lawsuit had been filed by Sandor Demjan on behalf of OTSZ against the Hungarian Post Office, the Hungarian Development Bank, the Takarekbank, the Hungarian Central Bank, and the Hungarian State, and that the first trial was scheduled to take place on 24 January.

Origo.hu reports that in addition to OTSZ one other individual has filed suit against the four  state-owned entities as well, and that six individuals have petitioned the constitutional court for relief claiming that the government’s actions violated the constitution.

In December the government announced plans to sell its shares in Takarekbank in March, that is, before national parliamentary elections scheduled for April.  It is not know what impact, if any, the lawsuits will have on the government’s ability to find a buyer for its ill-gotten shares.

Referenced in this article:

Demján Sándorék beperelték az államot, origo.hu; 23 January 2014