Minister of Economic Development Márton Nagy’s brother remains suspiciously close to his former law office stuffed with public funds

• On the day Nagy Márton was sworn in as a minister in May 2022, his brother, Szilárd Nagy, quit his law office that had been raking in hundreds of millions in public money
• The office was taken over by lawyer Judit Pete, and the company has continued to secure nine-figure contracts with state-owned firms belonging under the supervision of Minister Márton Nagy.
• The lawyer had previously received 35 million forints for consulting services provided to the scandalous “Bridge to the World of Work” program of the National Roma Self-Government (ORÖ).
• Márton Nagy, while serving as Minister of Economic Development, nominated Judit Pete to the Public Procurement Council.
• A suspicion of a close relationship between the lawyer and the minister’s brother is supported by the fact that on a recent morning our team witnessed Judit Pete leave in a Porsche from the District II property registered as Szilárd Nagy’s address within the company register.

May 24 2022 was an important day in the life of Márton Nagy and his family, as it marked the politician’s swearing-in as a minister of the fifth Orbán government. On the very same day, his brother Szilárd Nagy signed an agreement to quit his law office that had been cashing in on public funds until then. However, each and every one of the previously existing state contracts remained with the law office, which simply changed its name.

These two events are unlikely to be a coincidence. For Nagy Márton, the state contracts of his brother’s law firm had been causing trouble even before his term as a minister. While Nagy was still the Prime Minister’s chief economic advisor, in 2021, Momentum politician Márton Tompos released a list of contracts, revealing that Nagy Szilárd’s law office had been signing billion-forint deals with the state. Primarily, the Nagy and Kiss Law Office received commissions from companies under the supervision of Andrea Mager, the then-minister without portfolio responsible for managing national assets (currently CEO of the Hungarian Lottery). According to the list, the office had contracts with several of the state’s largest privately listed companies, including the national long-range bus company Volánbusz, the chief electricity provider MVM, the postal administration Magyar Posta, as well as public road manager Magyar Közút. The contracts primarily entailed legal or procurement advisory services.

As a result of our investigation, we found that after Szilárd Nagy’s departure, the law office – now operating under the name “Pete and Kiss Law Office” – has remained still rather closely connected to the minister’s brother and continues to receive state commissions of the same magnitude.

The public money tap opens

The Nagy and Kiss Law Office first appeared in public procurement procedures in 2016, winning state contracts for legal and procurement advisory services, sometimes amounting up to several billion HUF. The law firm initially operated in these deals as a consortium with other companies, and would later go on to secure numerous similar contracts with state-owned companies independently.

According to our research, between 2016 and 2021, the consortiums including the law office were awarded public contracts exceeding 10 billion forints in total value. The most significant of these was a 2016 contract with the Prime Minister’s Office, led by János Lázár. The members of the consortium receiving the 4.8 billion HUF contract included the Nagy and Kiss Law Office, Ész-Ker Plc., and SBGK, the law office of the late István Bajkai, a founding member of Fidesz.

The companies were tasked with overseeing the legality of the procurement processes related to Hungarian EU-funded projects. However – as we have reported earlier – the results were devastating: the exceedingly high number of legal breaches allowed to pass ultimately led to Hungary being penalised with a flat fine of one billion euros.

The responsibility of the participants was seemingly not questioned, as they were also successful in securing (https://24.hu/kozelet/2020/02/24/bajkai-istvan-rogan-antal-tanacsadas-buntetes/) contracts from the Digital Government Agency Plc.’s procurement in 2020. The Nagy and Kiss Law Office secured a contract for procurement quality assurance and monitoring tasks with a net hourly rate of 14 900 forints. Additionally, the firm of Márton Nagy’s brother was successful as a consortium member in several other contracts:

• a procurement from the Hungarian State Treasury, amounting up to nearly 1,8 billion forints,
• contracts worth 800 million and 1,2 billion forints from the Public Roads Nonprofit Plc.,
• as well as tenders worth 530 million and 500 million forints from the National Infrastructure Development Ltd.

New owner, unrelenting success

It was after such precedents that Szilárd Nagy decided to quit Nagy and Kiss Law Office on the day of his brother’s ministerial swearing-in. His 99 percent ownership was acquired by lawyer Judit Pete, who had previously appeared as a subcontractor alongside Nagy’s firm. We have no information regarding whether the ownership stake changed hands in exchange for money, but nonetheless, the law firm continues to operate under the new name Pete and Kiss Law Office. The company also continues its operations related to the previously signed state contracts.

The firm’s new owner did not come from afar: Nagy and Kiss Law Office and Judit Pete had their headquarters on the sixth floor of the Bankcenter office building on Budapest’s Liberty Square, where the newly established office of Pete and Kiss is also located. Szilárd Nagy founded a new firm under the name Nagy and Hollós Law Office, which also began its operations on the sixth floor of the Bankcenter building.

Much like its predecessor, Pete and Kiss Law Office continues to thrive on state commissions.

Already under the leadership of Judit Pete as the majority owner, the law office has secured contracts worth more than 362 million forints with MNV Plc., a state company under the supervision of Minister Márton Nagy, as well as a 262 million HUF deal with Eximbank.

Pete and Kiss was hired for legal consultancy by other state-owned entities under Márton Nagy’s supervision, including:

• Corvinus International Investment Ltd. for 35,000 to 50,000 forints per hour, or 50 million forints annually,
• The Hungarian Development Bank for two contracts worth 7.5 million forints each,
• IFKA Industrial Development Nonprofit Ltd. for a net 19.5 million forints,
• ATEV Plc. for 20 million forints,
• Mining Property Utilization Nonprofit Public Ltd. (BVH) for 4 million forints.
• Residual Asset Utilization Plc. (MVH) for 35,000 forints per hour and up to 90 million forints per year, and as per another contract also for 35,000 forints per hour and up to 630,000 forints per month. A third contract was also signed with the hourly rate of 35,000 HUF, up to 60 million annually.

The latter three companies not only commissioned the law firm led by Pete, but also BPP Best Practice Procurement Plc., also owned by the lawyer. Her other company receives an annual 3 million HUF from ATEV, 15 Million from BVH, and up to 30 million from MVH. The same company was also commissioned for consulting services by Garantiqa Creditguarantee Plc., also under the supervision of the Minister of Economic Development.

Confidential relationship

Moreover, shortly after Szilárd Nagy had entrusted his law firm to Pete, Minister Márton Nagy also assigned an important task to the lawyer.

As the minister also responsible for the supervision of state assets, one of his first decisions was to nominate Judit Pete as a member of the Public Procurement Council.

Pete already participated in the council’s very first meeting under the fifth Orbán government, roughly two weeks after the swearing-in of the ministers.

So, while performing public procurement and legal advisory tasks for numerous state-owned companies, the lawyer is also a member of the Public Procurement Council. Among other responsibilities, the organisation appoints or dismisses the President and Vice-President of the Public Procurement Decision Committee, as well as the public Procurement Commissioners, and also adjudicates conflicts of interest related to these positions.

Inquiring about Pete Judit’s appointment, we contacted the Ministry of Economic Development led by Márton Nagy. In their reply, the Ministry stated that Pete complies with the statutory regulations regarding conflicts of interest, and based on her long-standing expertise and practical experience,

she is suitable for performing her duties as a member of the Public Procurement Council. They added that she fully complies with her reporting obligation to the minister.

It is noteworthy how Pete gained experience as a lawyer, as she had worked with taxpayer-funded assignments well before taking over Szilárd Nagy’s law firm. Our team obtained the closing report of the National Roma Self-Government (ORÖ) scandalously ill-fated “Bridge to the World of Work” employment assistance program. Within the framework of the 1,6 billion HUF project, the organization was primarily supposed to create a nationwide employment bureau network financed by European Union funds, aimed at providing continuous and predictable work for disadvantaged individuals, primarily Roma. A functioning office network was never established, and the ORÖ spent the received funds on cars, unusable offices, furniture, a villa in Budapest’s fancy Gellért Hill area, as well as several other items of questionable explicability. The utterly failed program has become almost synonymous with the name of ORÖ’s then-president, Flórián Farkas. Despite investigating the case for seven years, authorities have not managed to pinpoint a culprit, even though most of the contracts were signed by Fidesz politician Farkas as the head of ORÖ. The money provided for Roma integration was also enough to procure legal counselling: according to the closing report,

Pete Judit received 35 million forints for legal services within one year.

The lawyer drove off from Szilárd Nagy’s address

It can be assumed that Judit Pete and Szilárd Nagy are connected by more than the aforementioned law firms and their headquarters.

Little before 7 AM September 7th, we personally witnessed Judit Pete leave a District II building in a Porsche. The address she drove off from is the registered residence of Szilárd Nagy according to the company register,

as well as the property of Vincent Properties Ltd., an interest of Szilárd Nagy.

The lawyer drove out of the villa’s garage and left through the gate. Nagy and Kiss Law Office began leasing a Porsche of the same type in December 2021, while, based on the Hungarian Chamber of Notaries’ collateral register, the firm continued the lease under the new name as well.

We contacted Judit Pete by phone. She told our team that she is only willing to answer any questions in writing. However, she would not reply from the provided address, and our mobile text messages seemed to remain ignored as well. Among others things, we would inquire about the circumstances of the ownership change of the law firm and her relationship with Szilárd Nagy. The latter is an important issue, as

if the lawyer is Szilárd Nagy’s life partner sharing a common household with him, then Nagy’s departure from his law firm would have been important only to maintain an appearance. After all, in this case, the state-owned companies under the supervision of Minister Márton Nagy are, formally speaking, not shovelling public money into a law firm owned by the minister’s brother.

Machine translation revised by Frigyes Harmath.