How EU Fraud Schemes Work in Orban’s Hungary

Yet even such popularity couldn't save him. Last year, before he ultimately lost the mayoralty election, he was removed from office by the Kengyel Council after a court in Szolnok sentenced him to a year in prison, suspended for three years, for signing during his time as mayor a contract with a lawyer who was then accused of embezzling some 10 million forints (about 280,000 euros) of Kengyel public funds.

What helped Nagy to win a conditional suspension of that sentence was his cooperation with the prosecutor's offices in Kecskemet and Budapest on a matter of much greater importance: how a fraudulent scheme involving EU money works in today's Hungary.

Now, living under police protection, Nagy agreed to explain to BIRN how this scheme operates.

Demonstrators gather on the Kossuth Square in front of the parliament during an anti-corruption demonstration called 'Our country! Our money!', in Budapest, 04 December 2014. Placards read: 'System Error' (L) and 'Unity! Freedom!' (R). EPA/ZOLTAN MATHE If you lie with Boldogs, you get fleas

The Jasz-Nagykun-Szolnok county, in which Nagy's village is located, was for many years informally controlled by Istvan Boldog, Nagy claims.

A mechanic by education, a former mayor of one of the neighbouring villages and a Fidesz member of parliament since 2010, Boldog had his parliamentary immunity removed in April at the request of the Office of the Prosecutor General, which accused him in a statement of "abusing his official position and influence, and illegally influencing the results of the assessment of applications [for EU funds], for which he received an unjustified advantage from entrepreneurs." He has been questioned by the Office of the Prosecutor General over the...