US bans Hungarian officials for alleged corruption

By bne IntelliNews October 20, 2014

Kester Eddy in Budapest -

Washington has banned a group of Hungarian officials from entering the US because of suspicions of corruption,  worsening what is already a strained bilateral relationship.

Andre Goodfriend, charge d'affaires at the US embassy in Budapest, confirmed at a press conference on Friday that the US was refusing entry to “fewer than 10” Hungarian individuals “in the Hungarian government or in government-affiliated organisations” for engaging in or benefiting from corrupt activities, in contravention of US law.

Goodfriend declined to provide any names, citing privacy laws, or evidence of the alleged corruption. He had called the press conference after an article that day in Napi Gazdasag, a pro-government business daily, had broken news of the US ban, saying the US move was in retaliation for tax audits at US-owned companies in Hungary. Goodfriend said the embassy had been “unaware” of any tax audits. “We did not want this erroneous story to become the public narrative,” he told bne.

The Hungarian government responded by saying it had requested names and evidence of the supposed corrupt officials, but this had been denied. Peter Szijjarto, the newly appointed Hungarian foreign minister, said this could create suspicion that the US “wants to exert influence on certain issues”.

Without citing sources, Hungarian media soon reported that the persons affected include Arpad Habony, senior adviser to Hungarian prime minister Viktor Orban, Ildiko Vida, head of the tax office, Andras Giro-Szasz, a former government spokesperson, and Peter Heim, head of communications at Szazadveg, the political think tank which now owns Napi Gazdasag. Habony and Heim have already denied any involvement.

At a press conference on Saturday, Szijjarto stressed that Hungary believed in openness and transparency, and lacking any evidence against individuals cited by media speculation, there were no grounds for launching any investigations. The minister said he had briefed all political parties on the affair.

However, opposition groups have been quick to denounce the government over the affair, the Socialists demanding a fast track enquiry, as, lacking this, the “stigma of corruption” will hang over the entire cabinet, Tamas Harangozo, deputy caucus leader said.

Further, the government was being disingenuous as it was “fully aware” that the US would not identify the persons involved, nor reveal its evidence, so the statement by foreign minister Szijjarto requesting this was simply “bogus” he said.

“It is unprecedented for the US government to apply presidential proclamation 7750 [the legal basis for the ban] on a Nato ally,” Szabolcs Kerek-Barczy, a leading member of the Democratic Coalition, told bne.

“This news is beyond shocking: it proves what the democratic opposition has been saying for a long time: [prime minister] Orban has built a system in which the essence of the operation of the state is corruption,” he said

Peter Kreko, of Political Capital, a Budapest-based think tank, argued that the US has taken this strong stand on Hungarian corruption because of Orban's pro-Russian policy and his recent pronouncements on his 'illiberal" vision for Hungary's political future.

“I think what has made the US response especially urgent is Hungary's very spectacular gravitation towards Russia. The move towards having a pro-Putinist, anti-liberal, anti-western regime in the course of the [Russian – Ukraine] conflict is alarming [to the US],” he told bne.

Andras Simonyi, a former Hungarian ambassador to the US, says the ban is a clear sign of Washington losing patience with quiet diplomacy, most particularly after warnings by both former US president Bill Clinton and current White House incumbent Barack Obama.

“This step is the strongest signal yet that the US has had enough of the Hungarian government repeatedly ignoring the warnings about the lack of democratic control, transparency and checks and balances. A move like this is very unusual among allies,” he told bne.

The US action also signifies a broader caution to both the European Union and to any other less-than-democratic  political leaders in  Central and South-East Europe.

“I guess is is also a message to others 'don't go down the road of Putinism'. Perhaps also a message to the EU that it, too, has failed to deal with the problem of its own,” Simonyi says, adding that the measure would not have been taken lightly, nor indiscriminately.

“The Americans surely chose their targets in Hungary with care, it's part of the message,” he said.

Szijjarto is due in Washington on Tuesday for a pre-arranged official visit. Asked if the Hungarian foreign minister would be allowed entry, US charge d'affaires Goodfriend told bne: “Yes. We are looking forward to discussing this [ban] and other aspects of our strong bilateral relationship when he visits the US.”



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