Hungarian Initiatives Foundation and Friends of Hungary no longer in a relationship

October 25, 2013


Hungarian Initiatives Foundation director Tamas Fellegi speaking at the US-Central Europe Strategy Forum held on 3 October 2013

“Lobbying . . not only benefits the civil and corporate sectors, but, if utilized properly, it can also be a serious foreign policy tool and weapon for a national government in achieving its goals. Whether it is the European Union, the United States, or any other country or international organization, a country with a well-functioning and efficacious lobbying system through its diplomats, politicians, representatives, NGOs or civil society organizations, as well as corporations and professional lobbyists – multiplies its chances of success.“

— Viktoria Zoltan in “The Role and Importance of Lobbying in Contemporary Hungarian Domestic and Foreign Policy”.  Hungarian American Coalition intern 2009

On 28 November 2012 Prime Minister Viktor Orban instructed his ministers to make all necessary arrangements for the incorporation of a foundation in the United States to be named “Friends of Hungary”.  The goal of the foundation was to “strengthen and support the bonds that unite the Hungarian diaspora’s nationalist identity with the Hungarian nation”.

In the midst of student protests over the defunding of education, Orban directed then Minister of National Economics, Gyorgy Matolcsy, to make approximately HUF 3.9 billion (USD 18 million) available to the “Friends”.  The hefty endowment did not go unnoticed by the political opposition which accused the government of plotting to buy the votes of American-Hungarians in next year’s election.  Nor did it go unnoticed by the Hungarian press which observed that the government had formally allocated nearly HUF 4 billion to an organization that had yet to be established.  Not reported at the time was the fact that any funds not used to set up the foundation were to be remitted to the office of the Prime Minister.

“Friends of Hungary” was incorporated in Delaware later that month under the name “Hungarian Initiatives Foundation”.  The foundation is presently registered in Washington, D.C. as a “grantmaking and giving services company”.  The foundation’s website lists its official place of business as 1110 H street NW Suite 915, Washington DC.  However, according to the foundation’s original place of business was 1120 Connecticut Ave. NW, Suite 280, which also happens to be the address of the Hungarian American Coalition.

A “credible, dependable voice for the interests of Hungarians in the United States and around the world” the Hungarian American Coalition’s press statements made no mention of the fact that the government of Hungary had decided to follow its recommendation that it set up a government financed lobby group in Washington, D.C.

On 10 January 2013 PM Orban directed the Ministry of National Development to assign all the ownership rights and responsibilities associated with the foundation to the Prime Minister’s office until 2062. With the foundation’s incorporation process complete a remaining HUF 3.1 billion (USD 14.5 million) was transferred to the office of the Prime Minister according to the Hungarian official gazette.  This means a total of USD 3.5 million was spent by the Hungarian government on the Hungarian Initiatives Foundation at the beginning of January.

Former National Development Minister Tamas Fellegi was appointed head of the Hungarian Initiatives Foundation and given an annual salary of USD 155,085 according to his H1B Visa application.  Prior to that Dr. Fellegi acted as Minister without portfolio responsible for “negotiations” with the International Monetary Fund. (Government claims and government media reports notwithstanding the IMF denied any formal negotiations were taking place).

The only Jewish member of Orban’s original cabinet, Dr. Fellegi evidently succeeded in recruiting a number of prominent Jewish Americans, including several of Hungarian heritage, to serve on the board of trustees including Eva Laudner, Edith K. Lauer, Michael J Horowitz, and John P. Lipsky, former First Deputy Managing Director of the IMF.

The willingness of prominent Jewish Americans to serve on the board is surprising given the current Hungarian government’s toleration of anti-Jewish remarks on the part of certain Fidesz publicists and government efforts to resuscitate such pro-Nazi figures as Albert Wass and Jozsef Nyiro (whose writings are now required reading for secondary students according to the new national curriculum).

Since then the Hungarian Initiatives Foundation has sponsored a number of events, including this year’s Center for European Policy Analysis’ US-Central Europe Strategy Forum held on 3-4 October.  Dr. Fellegi himself participated in a panel discussion about the state of democracies in Central Europe. According to the Foundation’s website:

In his opening remarks, Dr. Fellegi fundamentally questioned the existence of a crisis of the democratic institutions in the region. . . . He described the current super majority and the actions of the government as the result of eight catastrophic years of socialist governance followed by a very strong sense of mission to rebuild Hungary by the new governing force. He stated that there are always at least two narratives of one political story, the government’s and the opposition’s, and this fact has to be taken into account every time when one forms an opinion about a country and its government’s actions.

It seems one of the Hungarian Initiatives Foundation’s missions is to ensure that it is the  Hungarian government’s narrative that is heard in Washington, D.C., and not that of its many critics at home and abroad.

So who are the Friends of Hungary?

In January 2013 a “Friends of Hungary” Facebook page appeared alongside a blog with the same name. Both pages were run by Fidesz politician David Bencsik, head of Budapest’s delegation to the European Union. With 10,000 “likes” on Facebook, a Twitter account, and a blog, “Friends of Hungary” quickly developed a strong following.

At the end of January the “Friends of Hungary” posted a photograph on its Facebook page of the Dachau concentration camp with the caption “Commemorating Hungarian Victims of Tito’s Genocide in Vojvodina 1944-1945”. In the wake of the controversy which ensued Bencsik denied having any affiliation with Hungary’s US-based foundation.

The Friends of Hungary social media campaign continued until late September when the Facebook page was inexplicably removed.  Since then Friends of Hungary has been dormant.  The final entry on its blog dated 26 September offered this:

Friends of Hungary removed from Facebook

Friendly Fire

We’ve been told, that solution is on the way. We will wait a little longer hoping that our beloved page returns or else you will hear the full story.  Thank you for your kind support. We will be back soon. We still hope

David Bencsik

In order to learn the “the full story” the Budapest Beacon contacted the International Communication’s office last week.  It responded that “the Hungarian government has no affiliation with a ‘Friends of Hungary’ organization and therefore cannot provide any information”.

On Monday we asked Dr. Fellegi to help us make sense of the situation.  He responded within a few hours with the following statement:

“The Hungary Initiatives Foundation and Friends of Hungary are not the same organization.  The source of confusion is that the government resolution establishing our foundation used the working name “Friends of Hungary” (as it is a common practice to name these kinds of organizations friends of . . . ).  However, it became known that there was already a Hungarian organization with this name, thus our organization was registered with our current name.  The Hungary Initiatives Foundation.  We have our own website and you can find us on Facebook with our name.  We have no affiliation with the other organization, nor with its Facebook page.”

On Tuesday we asked Dr. Fellegi to explain why the Foundation was registered at two different addresses in the District of Colombia and to send us a description of the  Hungarian Initiatives Foundation’s activities this year to date, including a list of US companies and persons to which the Foundation made grants or gave gifts. We received the following response:

The Foundation’s office is at 1110 H street NW Suite 915, Washington DC 20005 (this is the contact information on our website). At the time of incorporation, another office was used, the Foundation has just moved.

Our mission is to build lasting value by reviving and strengthening the cultural, educational, and emotional bonds between the United States and Hungary as well as the large and diverse Hungarian American community and its mother nation. We support educational and knowledge exchange programs between the two nations, art and cultural exchange programs, as well as community building programs inside the Hungarian American Community.

All of our activities are detailed on our website, all of the programs and projects supported have a detailed narrative report on them (Smithsonian Festival, ReConnect Hungary, Art as Ambassador etc.)

The Foundation is a nonpolitical organization. I would like to refer you to our mission statement and funding policy on our website. We do not participate in any ways in political activities, political or election campaigns and do not fund lobbying, electioneering, or political activities.

Grants and program directions are decided by the Board of Trustees. The Foundation is governed and overseen by an independent Board of Trustees, comprised of highly respected, prestigious public figures and businessmen who have achieved significant results in their own areas of expertise and are committed to strengthening the diaspora and improving American-Hungarian relations. They are personally and financially independent of the Hungarian Government; however, they support and identify with the mission of the Foundation.

Nobody else is involved in the decisions. The Hungarian government was the donor of the Foundation’s first endowment and grant support. As the donor, it determined program directions – art and culture, exchange programs, community building. The Foundation will make the full report to the donor of the money in 2015. Besides this, the Hungarian government, the ministries, or any officials do not have a say in the grant making activity or the Foundation’s daily operations. The independence of the Foundation is assured by its independent Board of Trustees – it is a non paid position.

Also, the IRS request for public charity status is currently in progress, this will facilitate the fundraising activity, which is critical for the long-term sustainability of the foundation, and the IRS will also frequently monitor the organization.