Matolcsy faces pre-trial detention over alleged PADME foundation transfer
Hungarian prosecutors say a sham share-lending deal signed on one of his last days in office moved control of foundation assets beyond public reach.
By
Adam Kovács
In brief
- Prosecutors want György Matolcsy held in pre-trial detention; a judge is expected to rule on Friday.
- He is suspected of economic fraud causing significant damage and of using a forged private document.
- Two other people were detained and international warrants were sought for two more.
- The case grows out of State Audit Office findings on the central bank foundations, published in March 2025.
After questioning him as a suspect on Wednesday, 21 October, Hungarian prosecutors asked a court to order the pre-trial detention of György Matolcsy, the former governor of the National Bank of Hungary, Daily News Hungary reported.
The request, the suspicions and the defence
Matolcsy is suspected of economic fraud causing significant financial damage, as well as the misdemeanour of using a forged private document. His questioning ended shortly before 3.30 PM. According to his lawyer, Pál Bátki, he made no statement on the allegations and spoke only about his personal circumstances.
Bátki said the prosecutors had set out the grounds for their suspicion in a document. “It was very difficult to process this five-page document containing a great deal of information. Until we see what evidence forms the basis of it, we cannot respond to it,” the lawyer said.
The defence lodged a complaint against the detention. It argues that pre-trial detention would be unjustified, citing Matolcsy’s age, stable living conditions and close family ties. After questioning, he was moved from the Central Investigative Prosecutor’s Office to a police detention facility. A judge is expected to decide on Friday. The court could order detention or opt for a less restrictive measure such as criminal supervision. Under Hungarian procedure, detention following an arrest can last up to 72 hours before a decision on further measures must be made.
The alleged scheme around the PADME foundation
Prosecutors allege that Matolcsy and associates used a sham securities-lending agreement, signed on 28 February 2025, one of his final working days as governor, to transfer control of PADME Foundation assets to people he could still influence. These are allegations, not established facts.
PADME grew out of the Pallas Athéné foundations, set up by the central bank in 2014. According to prosecutors, they received more than HUF 266 billion (about EUR 700 million) from exchange-rate gains. They merged in 2019 as PADME, and Optima Befektetési Zrt. managed their assets.
The transaction moved shares of Optima Befektetési Alapkezelő Zrt. to the Central European III Private Equity Fund, shifting control over assets worth nearly HUF 200 billion. Prosecutors allege the aim was to let Matolcsy and his son Ádám invest for personal gain. They said the exact financial damage is not yet established but substantially exceeds the HUF 500 million threshold.
The Budapest Business Journal reports that the ownership transfer of Optima dates from February 2025 and that the fund is managed by Quartz, majority-owned by István Száraz, a longtime friend of Ádám Matolcsy. Governor Mihály Varga ordered an investigation and referred it to the State Audit Office.
Others caught up in the case
- Two other people were detained besides Matolcsy, and prosecutors sought international arrest warrants for two further individuals.
- Searches were conducted at several locations and evidence was seized.
- Reported detainees include a lawyer who regularly represents companies of Ádám Matolcsy and an executive of the company formally owning a Mykonos villa linked to him.
How the case built up
- The State Audit Office published reports on PADME, a John von Neumann University foundation and MNB operations, including its headquarters renovation, identifying serious shortcomings and major losses.
- The central bank filed a criminal complaint over impairments on five properties it owns. Varga then said a further 30,000 pages of documents had gone to the parliamentary investigative committee.
- The committee questioned former Fidesz MPs Lajos Kósa and Erik Bánki. According to Telex, both said they had not previously suspected wrongdoing involving the foundations.
- Matolcsy was questioned as a suspect.
Telex has also reported that about HUF 200 billion was lost through property deals involving foundation assets. That is a media report, not a proven total. A video from the prison on Gyorskocsi Street in Budapest shows the police car carrying Matolcsy arriving at the gate, which was not yet open.
Photo: Tibor Szabo / Pexels
