Hungarian State Audit Office fines opposition parties for alleged foreign campaign financing

Hungarian State Audit Office fines opposition parties for alleged foreign campaign financing
The Hungarian opposition ran on a joint list in the 2022 elections led by outsider Peter Marki-Zay.
By Tamas Csonka in Budapest February 21, 2024

Hungary’s State Audit Office (ASZ), led by a former Fidesz MP, has levied a HUF520mn (€1.34mn) fine on opposition parties four months before the local government and European Parliamentary Elections on claims that they received illegal campaign financing in the 2022 elections.

ASZ has ruled that the Democratic Coalition, Jobbik, Momentum, the Socialist Party, and LMP should pay the entire sum shared equally to the central budget within 15 days. There is no possibility to appeal against the decisions of ASZ, but parties said they will still attempt a legal recourse.

Presenting the report on February 20, ASZ head Laszlo Windisch said that the parties had received over HUF261mn illegally from abroad via the Hungary Belongs to Everybody (MMM) movement, set up by Peter Marki-Zay, the joint prime minister candidate of the opposition picked by voters in the historic primaries two years ago.

After the 2022 elections, the government began an all-out attack on opposition parties receiving "illegal" foreign funding, primarily from the US-based NGO Action for Democracy (AD).

In a declassified intelligence report, the Orban regime alleges that AD funnelled over HUF4bn to opposition-linked organisations through MMM.

Opposition parties vehemently deny the accusations, stating the funds in question came from micro donations from Hungarian citizens living abroad, which is legal. 

They highlighted that no legal action had been taken against them, despite the government's claims.

ASZ's investigation found that MMM and the opposition parties had set up a campaign council to coordinate their campaigns. MMM had used funds from abroad to partially finance the parties' billboards, leaflets and other campaign material, and joint events. The parties accepted the support, thereby breaking regulations against illegal party financing.  

Analysts observed that MMM did not break the law by receiving foreign funding per se, but as they ran on a joint campaign, political parties inherently had made use of the financing, which could give legal ground to the findings if the funding was actually foreign.

Hungary's Sovereignty Protection Act, approved late last year, tightens up on foreign funding of political parties. The acceptance of foreign funds for political purposes, or the attempt to conceal them, would be punishable by up to three years in prison.

The Orban government aims to cut off all kinds of funding to its political opponents, while it has an unlimited pool of funding for campaigns. A recent compilation showed that the cabinet had spent a whopping HUF1.4 trillion on communication between 2015 and 2023.

Earlier this month, the European Commission launched an infringement procedure against Hungary over the sovereignty law, which in its view infringes fundamental rights and several EU regulations.

Jobbik - Conservatives said the government had imposed the ASZ fine as "an act of revenge for the clemency scandal" that erupted in recent weeks in order to stymy their rivals in the upcoming elections.

The Socialist Party said they did not acknowledge ASZ's findings and would take legal action, insisting that there were clearly political reasons behind the office's decision.

Their statement added that if the opposition parties contested the elections together, "these kinds of attempts to undermine them could be unsuccessful".

The Democratic Coalition said it would take "all possible legal steps" regarding the fine. The party said it would sue the state treasury if it carried out ASZ's decision.