A Szeged court, in southern Hungary, on Tuesday held the first hearing in a case involving five suspects charged with the abuse of European Union and domestic funds totalling 550 million forints (EUR 1.5m).
According to the indictment, the primary and secondary defendants applied for EU funding to set up a model park exhibiting small replicas of 50 major monuments of pre-WWI Hungary. The 648 million forint project was awarded a 550 million forint grant in 2010, but was plagued by problems from the start.
The primary defendant in the case is one of the former owners and managers of Szeviép Zrt, a construction company that has been since wound up.
According to the charges, the defendants presented false reports of the project’s progress, fully aware that the completed components actually were shoddy and overpriced.
Between 2010 and March 2014, they received a payment of 436 million forints from the total grant amount.
In March 2014, the defendants reported that the project had been completed. However, the park was not suitable to receive visitors. An inspection revealed that several models were damaged, while 20 were missing. The project company was then obliged to repay the grant, but only 50 million forints could be recovered by bailiffs.
In the trial, the prosecutor proposed a sentence of three years imprisonment for both the primary and secondary defendants, as well as a fine of one million forints and 400,000 forints, respectively, should they plead guilty.
Both defendants, however, refused, insisting on the project’s success.