Why would DatAdat keep its accounting files in a small, remote village?

Hungary's National Tax and Customs Administration (NAV) has located DatAdat's bookkeeping accounts in a small, remote village. The investigators arrived at the rural settlement as they found no records of the activities of the company linked to socialist ex-PM Gordon Bajnai and his associates either at the firm's official headquarters, or at its registered accountancy office, according to information obtained by the Magyar Nemzet newspaper. The company is embroiled in a scandal that erupted in connection with Hungary's general elections. The question of how and why the documents of DatAdat Professional Kft ended up in Borsod county remains a mystery.

POLITICS OCTOBER 24. 2022 13:19

Investigators of Hungary’s tax authority (NAV) found the accounting documents of DatAdat Professional Kft in Szegi, a small village with a population of 300, in Borsod-Abauj-Zemplen county in north-east Hungary, daily Magyar Nemzet writes.

The company group – linked to ex-PM Gordon Bajnai and his former secret services minister, Adam Ficsor – has recently denied, falsely, that Magyar Nemzet’s information regarding a recent house search carried out by NAV at the firm were correct. The tax authority was forced to respond in a statement confirming that there was indeed a house search on 27 September. The statement also revealed that DatAdat violated legal requirements as the company did not operate at its registered headquarters – which happens to be an apartment owned by Adam Ficsor, former socialist secret services minister. Even when contacted on the phone, the company’s executives refused to disclose where the company actually operated, and NAV could not look into documents at DatAdat’s official accountant, as there was no accountant’s office at the address given.

“Eventually, the investigators managed to seize a significant part of the necessary documents from the solopreneur’s undeclared office, who was in charge of the accounting,” the tax authority’s statement said.

According to information obtained by the Magyar Nemzet newspaper, the remote village in Hungary’s Borsod-Abauj-Zemplen (BAZ) county is where the office, undeclared by DatAdat, is located and where another search was held by the tax authority last week. This is rather surprising in light of a statement issued by DatAdat in the run-up to this year’s election campaign, which says

“we are proud that over the last 6 years we have managed to build up a business that is successful on the international level too; the company has turned from a small Hungarian enterprise into one of Europe’s leading campaign technology companies in a short period of time.”

If DatAdat can be considered a truly significant international enterprise, it is rather intriguing why they conceal their accounting records, instead of hiring a serious, well-known auditing company to manage their accounting documents.

This peculiar move could be explained by the tax authority’s suspicion that DatAdat Professional Kft may have reduced its tax dues in 2020 in violation of law, potentially causing a budgetary loss by filing a false statement in its tax return.

As is known, the DatAdat scandal erupted after it was revealed that during Hungary’s general election campaign in 2022, DatAdat was able to reach approximately one million voters with phone calls and text messages, raising the suspicion that stolen databases were used, because supporters of the government, who certainly did not knowingly give away their contact information, also received calls from the united Left. Suspicion fell on DatAdat after the case, as the left-wing prime ministerial candidate himself admitted that Bajnai’s company worked on his campaign. DatAdat vehemently denied involvement in the case, which is being investigated, among others, by the National Bureau of Investigation (NNI).

Since then, it has also been revealed that the Left’s campaign was financed from unknown US sources through Action for Democracy, an organisation whose president and executive director is David Koranyi, the former chief advisor of Gordon Bajnai and then state secretary for foreign and security policy in Mr Bajnai’s government. Most recently, Mr Koranyi has served as diplomacy advisor to left-wing Budapest Mayor Gergely Karacsony, until Mr Karacsony rescinded his mandate as it became embarrassing that Mr Koranyi – living a life of luxury in New York – was working “remotely.”

We already know that some 1.86 billion Hungarian forints (approx 4.4 million euros) were funnelled into the Left’s 2022 campaign. A part of these donations was used by Peter Marki-Zay to settle the bill with Bajnai’s DatAdat company. This raises suspicion of forbidden campaign funding and constitutes a serious national security risk.

It is also clear that this may not have been the first campaign staged by the Left from US funding in Hungary. Mr Koranyi may have also raised funds during the 2019 local government elections for Gergely Karacsony’s so-called 99 Movement, which operates with money of dubious origins. DatAdat also appeared behind the Left’s campaign at that time. According to a previous article published by the Index news portal, one-time secret services minister Adam Ficsor said: “We worked in 12 campaigns during that election, and all 12 mayors won. It was a big victory.”

Another news related to the DatAdat case is that Gyula Budai, a ruling party MP, has recently filed a supplementary denunciation with NAV in connection with the latest developments in the DatAdat scandal, as well as the US funds channelled to the opposition. Mr Budai has turned to the authority again because DatAdat had pocketed two billion forints in the twelve months before the election but, according to the company’s own accounts, almost all of their revenue quickly disappeared, as they spent about 1.8 billion forints on so-called “brokered” services.

POLITICS

Tags:

datadat, election campaign, Hungary