Fidesz MP fails to disclose extent to which his hand is in the cookie jar

February 23, 2017

Investigative journalism NGO has found yet another MP who failed to meet his asset disclosure obligations. The NGO reports that Fidesz MP Sándor Farkas failed to report nearly EUR 5 million in state and EU subsidies over the past five years. When confronted by Direkt36 about the discrepancies between data provided by the State Treasury and his own asset disclosure, Farkas responded,

“What would happen if I declared another 300 million forints [roughly EUR 1 million]? Nothing.”

According to Direkt36, no other member of the National Assembly received as much in state and EU subsidies last year as Farkas. But his success in being awarded grants goes back to previous years as well.

While not well-known as a national politician, Farkas is quite active in politics and business. He is the head of Fidesz in Csongrád County, works as a government commissioner, and chairs the Hungarian Animals Breeders Association. Since 2012, a company co-owned by Farkas has received more than HUF 2.5 billion (about EUR 8.1 million) in subsidies. However, his asset disclosures only declared HUF 925.5 million (EUR 3 million) of these funds.

“The rest of the money is totally missing from these official documents,” Direkt36 reports.

Farkas explained the discrepancy by saying that some subsidies are not distributed in the same year as they are awarded, and that he only declared the amount that was actually granted and paid. According to Direkt36, “[Farkas] never declared those parts of the subsidies that were transferred later.”

Farkas is not the only MP whose asset declarations Direkt36 has found to be problematic. The NGO, along with corruption watchdogs such as K-Monitor and Transparency International Hungary, has written at length about other such abuses by MPs, and the systemic problems that make this possible.

In Hungary, asset disclosures of MPs and government officials are handwritten and scanned and are not digitally-searchable. The disclosures themselves are not audited by the tax authority, nor are they compared to tax returns.

Sándor Léderer, co-founder and director of K-Monitor, says the Hungarian system of asset declarations remains extremely ineffective due to several deficiencies.

“Asset declarations are not transparent enough, and there is no comprehensive database where you could check MPs’ and their family members’ incomes and assets,” Léderer says. “Furthermore, a lot of important information is not incorporated into the declarations, such as membership or non-paid positions in organizations.”

Léderer also points at the lack of independent asset disclosure oversight. Only a parliamentary committee can investigate the complaints related to asset disclosures.

“The government recently took the tax authority’s right to conduct independent investigations into illicit enrichment,” he adds.

Both K-Monitor and Transparency International Hungary have criticized the lack of effective sanctions for those who do not comply with asset disclosure regulations.

“It is a shame that – despite its supermajority in the parliament – the ruling political elite has done absolutely nothing to reform this corrupt system,” Léderer says.