On last Tuesday morning, the Budapest Metropolitan Court held a preparatory hearing for the criminal case of one of Hungary’s wealthiest individuals. We reported in October last year that Dániel Jellinek was being held accountable in one of the largest invoice factory scandals in recent years, as the businessman took responsibility for the fraud for which his father and a colleague had been accused.
Two companies of the Indotek Group, owned by Jellinek, accepted fictitious invoices from the invoice factory causing a total budgetary damage of 4.5 billion HUF. According to the charges, Jellinek’s companies caused damages of 52 and 53 million forints. At the time of accepting the fictitious invoices, the two companies (Mall Management Ltd. and In-Management Ltd.) were managed by Jellinek’s father and one of his colleagues. Initially, they were the ones charged with budgetary fraud causing significant financial harm and the misuse of forged private documents. However, the charges against them were dropped after Jellinek had testified in the case.
Speaking about the accusations, Jellinek previously told 24.hu: “I did what can be expected from any company leader, owner, and person responsible for their parents in such a situation. I took responsibility for the case to prevent my elderly father and my colleague from being punished wrongfully.” He later told Telex that he would have to pay a fine amounting to 250 million forints in the wake of the events.
The hearing began with the businessman refusing to allow photo or audio recordings of himself.
After the charges were presented, Dániel Jellinek fully admitted to the accusations and waived his right to a trial.
Concerning his personal circumstances, the businessman said he had a monthly income of one to two million forints, but annually he withdraws dividends exceeding one billion forints from his business interests.
The court then sentenced the entrepreneur to a 250 million forint fine, in line with the prosecutor’s motion, consistent with Jellinek’s earlier statements.
Following the hearing, Dániel Jellinek read a statement to journalists. He stated: “Seeing the significant media interest surrounding today’s hearing only strengthened my belief that I had made the right decision by taking responsibility in this unpleasant matter instead of my father and colleague, along with the burdens of the proceedings. It is important to emphasise that the anomalies related to the software procurement were detected through an internal investigation months before NAV’s (Hungarian Tax Authority) inquiry. We corrected these within the framework of self-revision and fully paid the amount due, with interest, in accordance with the law, ensuring that neither the state nor the budget suffered any damage. Furthermore, we continuously cooperated with the authorities during the procedure and were committed to resolving the matter as soon as possible. By paying the financial penalty imposed in today’s court ruling, we consider the case closed.”
The invoice factory case involving Jellinek has practically become synonymous with the name of Zsolt F., whose organisation was raided by authorities in the summer of 2021 at eighty locations simultaneously. According to the charges, the criminal organisation operated a multi-level network of companies providing cleaning and IT services, functioning as an invoice factory. According to investigators, billing data revealed that with the issued fictitious invoices, the group’s clients unlawfully reduced their payable VAT, while the invoicing companies did not engage in any real activity.
It is noteworthy that Jellinek had already been convicted by the Kecskemét Court for aiding and abetting budgetary fraud in another case related to an EU tender. Although he disagreed with the “legal interpretation differing from business practices”, he admitted his mistake and waived his right to further trial during the preparatory hearing, accepting the conviction. This spared him from further legal consequences and potentially years of court proceedings.
The billionaire’s role in this case is particularly interesting because, as G7 uncovered, he has close ties with Prime Minister Viktor Orbán’s son-in-law, István Tiborcz. The economic news portal concluded that 27 billion forints in profits from one of Jellinek’s companies could have been channelled into Tiborcz’s interests through an intermediary real estate business.
The reasony why it’s interesting that Jellinek’s case began at the Budapest Metropolitan Court is that at the end of last year, Zsolt F.’s criminal trial could not commence at the Győr Court due to the indictment against Jellinek being filed in Budapest, while the plan was to merge Jellinek’s trial with the Győr case, which was also scheduled for continuation this Tuesday.
As we previously reported, the invoice factory case has political dimensions as well. For example, a company involved in the case received a transfer of 288 million forints from the Ministry of Foreign Affairs led by Péter Szijjártó. Based on investigative documents from the case, 444.hu reported that the links extend as far as the circles of Minister of Interior Sándor Pintér, as one day before authorities raided the criminal organisation, the company operating BKV’s IT system had been acquired by a firm owned by Pintér’s confidant, László Tasnádi. Despite these connections, the scandal gained media attention mainly in connection with left-wing politicians, primarily during the 2022 parliamentary election campaign. In a plea deal, Zsolt F. implicated several politicians from the Hungarian Socialist Party (MSZP), claiming to have bribed them in connection with various business deals.
Based on Zsolt F.’s testimony, former District 14 (Zugló) mayor Csaba Horváth (MSZP) and former District 14 MP Csaba Tóth were both suspected and later charged. Tóth allegedly accepted 280 million forints in bribes. Both were questioned over abuses linked to Zugló’s paid parking system, which, although separate from the invoice factory, showed overlaps in individuals and companies involved. Charges were also brought against MSZP politician Ferenc Baja and Zsolt Molnár, who then resigned from his position as the Socialist Party’s director. They stand accused of also accepting tens of millions in bribes, allegations they both deny. The criminal trial against the left-wing politicians has begun just recently, also in Budapest. The prosecution is seeking six years of imprisonment and a 50 million forint fine for Csaba Horváth and Csaba Tóth, four years and a 15 million forint fine for Ferenc Baja, and two years of imprisonment with a 25 million forint fine for Zsolt Molnár.
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