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Russian elite involved in controversial Hungarian residency bond scheme
IntelliNews Pro
Influential Russian citizens, including politicians and the heads of state companies, were granted permanent residence status in Hungary under the now defunct residential bond scheme, according to an investigative report by 444.hu and Russian site Novaya Gazeta released on September 11.
Hungarian opposition parties called for the parliament's national security committee to be convened in connection with the recent reports. The names were leaked to reporters earlier this year.
In January, non-profit investigative journalism centre Direkt 36 and 444 received an envelope containing the names of citizens of Russia and several other countries, who, according to the anonymous sender, had received the permits.
The list includes four relatives of Sergey Naryshkin, the head of Russia’s foreign intelligence service (SVR). A successor
of the Soviet-era KGB, the agency is tasked with gathering intelligence and conducting espionage activities outside of Russia.
Vladimir Blotskiy, a member of the Russian Duma, confirmed that he and his family members had received permits through the bond programme.
Evgenii Evstratov, the former deputy head of Rosatom, which is in charge of the €12.5bn expansion of Hungary’s Paks nuclear power plant, also appeared on the list. He was arrested on charges of embezzling 110mn rubles (€2.7mn).
Under Hungary’s residency bond scheme, running from the summer of 2013 until March 2017, foreign nationals who bought securities from a licensed agent backed by the residen- cy bonds could apply for fast-tracked permanent residency in Hungary. The threshold for the residency bond purchase was set at €250,000 early in the scheme and raised to €300,000 later on.
In the four years of the scheme, the state issued nearly 20,000 resident permits to buyers and their family members. While most of the customers were Chinese nationals, permits were also issued to hundreds of Russians and dozens of immigrants from the Middle East and Africa. The Hungarian authorities had previously refused to name the buyers.
The most heavily criticised aspect of the bond programme was that foreigners did not invest in the bonds directly, but did
so through designated intermediary companies with opaque ownership structures.
The former head of the parliament’s budgetary committee Antal Rogan, who is now in charge of overseeing government communications, personally selected the companies in charge of selling the bonds. Seven of the eight companies are registered in places considered as tax havens. As the interest on the bonds was higher than market levels, the state lost some HUF20bn (€61.3mn) on the scheme, while the eight intermediaries received more than HU156bn in revenues.
Green opposition party LMP called for the parliament's defence and law enforcement committees to be convened to hear officials from the national security services, the immigration office, and the government. The spokesperson for Parbeszed, a close ally of the Socialists, demanded that bondholders residing in Hungary should be banned from the country.
The leader of the Democratic Coalition (DK) party’s parliamentary group said the government had allowed terrorists, criminals, and spies to enter Hungary and the EU. "The Fidesz government's scheme benefited the chief of Russian intelligence and his family members and a key Russian mafia figure," he added.
Relatives of Sergey Naryshkin also received residency permits in Hungary.
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