Former Hungarian central bank chief arrested amid foundation investment probe
- Gyorgy Matolcsy faces questioning over suspected fraud and use of forged document as prosecutors investigate management of public funds
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- Gyorgy Matolcsy faces questioning over suspected fraud and use of forged document as prosecutors investigate management of public funds
By Timo Kirez
GENEVA (AA) - Former Hungarian central bank chief Gyorgy Matolcsy was arrested Wednesday in connection with an investigation into foundations established by the bank during his tenure, his lawyer said.
Attorney Pal Batki confirmed the arrest to local media, according to Hungarian news outlet Telex.
The investigation centers on the Pallas Athene Domus Meriti Foundation, established under the former management of the Hungarian National Bank.
Hungarian prosecutors have been investigating the foundation since early 2025 over concerns about its investments and management of public funds.
The central bank originally established six Pallas Athene foundations in 2014, which were consolidated into the Pallas Athene Domus Meriti Foundation in 2019.
A report released by the State Audit Office on March 20 raised concerns about the foundation's investments and its asset management company.
According to the audit, the company managed nearly 500 billion forints ($1.53 billion) through complex private equity and corporate networks, with a substantial portion consisting of public funds.
Authorities subsequently launched extensive investigations and froze or seized assets worth several hundred million dollars over concerns about opaque investments and regulatory violations.
The foundation suspended its operations as legal and political scrutiny of the central bank's previous fund management intensified.
Batki said other individuals connected to the investigation were also arrested Wednesday.
According to Telex, Matolcsy was scheduled to be questioned later Wednesday on suspicion of fraud involving significant financial losses and the use of a forged private document.
"The Central Investigative Prosecutor's Office is today conducting coordinated investigative measures as part of the ongoing investigation into the offense of embezzlement, which has caused a particularly significant financial loss," the prosecutor's office said in a statement.