Former Hungarian central bank chief Matolcsy detained in foundations probe

Ex-Hungarian Central Bank Chief Matolcsy Detained in Foundations Investigation

Investigation into Central Bank Foundations and Detention of Matolcsy

Background of the Investigation

BUDAPEST, Oct 21 (Reuters) - Former Hungarian central bank governor Gyorgy Matolcsy was detained on Wednesday as part of an investigation into foundations set up by the central bank during his tenure, news website Telex reported.

Since early 2025, prosecutors and police have been investigating a foundation established by the National Bank of Hungary (NBH) under its previous management after a State Audit Office report raised concerns about investments made by the foundation and its asset management company.

Matolcsy's Response

Matolcsy said in April that the bank had no legal mandate to interfere in the foundations' operations because they "were acting independently".

Details of the Detention

Telex, citing Matolcsy's lawyer Pal Batki, reported that Matolcsy was detained on Wednesday morning along with others linked to the probe.

Allegations and Legal Proceedings

Telex said Matolcsy would be questioned later in the day over suspected fraud causing significant financial losses and the use of a forged private document. Batki was not immediately reachable by phone or email for comment.

Prosecutors' Statement

"The Central Investigative Chief Prosecutor's Office is carrying out coordinated investigative actions today in the ongoing investigation into the crime of mismanagement of funds causing a particularly significant financial loss," prosecutors said in a statement.

They declined further comment, saying only that the actions were related to the so-called NBH case and were being conducted at several locations.

Political and Financial Implications

Prime Minister Peter Magyar, who ousted Viktor Orban in an election in April, has said the central bank's past operations must be investigated, and his ruling party has set up a parliamentary committee for that purpose.

Seizure of Assets

In May, Hungarian prosecutors and police seized some 92 billion forints ($300 million) in funds and securities as part of a money-laundering investigation involving foundations set up by the central bank years ago.

(Reporting by Krisztina Than and Anita Komuves. Editing by Hugh Lawson and Mark Potter)