Minister of the Prime Minister’s Office János Lázár has announced that 97% of Buda-Cash customers will get their deposits back by 31 May, and small investors with the Quaestor Group will each get back up to HUF 6 million from Hungary's Investor Protection Fund. He declared that Quaestor deceived both the people and the state.
At the second government info press conference in Budapest, Minister of the Prime Minister’s Office János Lázár said that the Prime Minister’s Office, the Ministry of Agriculture, the Ministry of Foreign Affairs and Trade and a number of local councils have had financial ties with brokerage firms, through a loan provided by the Hungarian Development Bank to Quaestor under previous socialist governments.
Mr. Lázár sees the biggest problem to be the HUF 17 billion loan provided for the ETO Park project, as it was not actually spent on the project itself.
The Ministry of Agriculture deposited HUF 410 million at Hungária Értékpapír Zrt. – this money has disappeared. He said that the HUF 3.8 billion the Ministry of Foreign Affairs and Trade parked at Quaestor is safe, however. He also spoke about the Ministry of Interior, because a number of municipalities have found themselves in difficulty due to the brokerage scandals.
At the press conference Mr. Lázár said that he will suggest that Fidesz parliamentary group leader Antal Rogán also arranges a hearing with former heads of the Hungarian Financial Supervisory Authority (PSZÁF) Ádám Farkas and Károly Szász. The Minister proposed that they should give an account of the inspections they carried out and the impressions they gained. “We cannot afford to neglect asking supervisory bodies what they knew,” he said.
According to the Minister, the issue of the State Treasury will be on the cabinet meeting agenda for 8 April; there will be discussion of when the Treasury will be able to accept government securities purchased by state bodies.
Mr. Lázár described how compensations resulting from the brokerage scandals are being processed by stressing that in 25 years this is the first time that compensation has been offered to the victims of a financial or brokerage crisis.
He announced that 97% of the 96 301 Buda-Cash customers will get their money back by 31 May. Regarding Quaestor, he said that the Investor Protection Fund will fully compensate the 22 264 investors (of a total of 31 832) who each had investments worth up to HUF 6 million. The Minister declared that the Government has a duty to make compensation possible for the remaining 9 568 customers, and is doing so by cooperating with the authorities and by using the law approved on Tuesday on the freezing of the assets of those responsible for the scandal.
The Minister of the Prime Minister’s Office pointed out, however, that some Quaestor clients had access to unusually high interest rates by taking proportionately higher risks. For this reason, he said, in the long run there is the issue of the extent to which the state and banks should compensate clients.
The Minister concluded that the Quaestor Group – headed by Csaba Tarsoly – had deceived both the people and the state. Quaestor betrayed the trust of others and it must therefore bear the consequences, he said, repeatedly calling the group’s activities a Ponzi scheme. He reiterated that the Government had not even considered the solution which Csaba Tarsoly had proposed.
The timeline of government decisions was also raised during the almost two-hour press conference. In this regard, András Giró-Szász declared that the memo from the cabinet meeting of 25 February clearly shows that it was then that Prime Minister Viktor Orbán instructed ministers, and that the Minister for National Economy Mihály Varga gave an account of the situation.
The Minister of the Prime Minister’s Office said the he was not aware of any members of the Government, ministers of state or Fidesz politicians being affected by the brokerage scandals or losing money.
In reply to a question, Mr. Lázár confirmed his recent statement, by saying that he believes that “A stronger wall should be put up between politics, bankers, brokers and financial experts than the one we have now”, as the Quaestor case has confirmed his belief that “these just want to make money under every government and through every politician.”