Goulash: Hungary fronting for China; neo-Nazi networks busted; Slovak spyware scare

FRESH FROM VSQUARE

ONLINE NEO-NAZI STORE AND CUSTOMERS FROM CENTRAL EUROPE EXPOSED

This international investigation, spearheaded by Sweden’s Expressen and conducted in collaboration with VSquare and its Central European partners, has uncovered a disturbing network centered around the Swedish Nazi store Midgård. This online outlet has been supplying far-right merchandise to a range of individuals, including Czech sentenced for violent crimes, a Slovak soldier, a Hungarian pro-government journalist, and even Polish politicians and far-right activists. Midgård has deep connections with the Nordic Resistance Movement (NMR), a group classified as a terrorist organization by the US State Department. For the full impact of this chilling exposé, we recommend reading the story on a desktop using Chrome browser as the investigation is presented through immersive visual storytelling: check out the story here.

TERRORGRAM COLLECTIVE HEADS LINKED TO SLOVAK LGBTQ BAR SHOOTING ARRESTED

The story about international far-right networks gets even grimmer. Our Slovak partners at the Investigative Center of Ján Kuciak (ICJK.sk) previously revealed that the Zámocká Street terrorist, who targeted an LGBTQ bar in Bratislava in 2022, was radicalized by the Terrorgram Collective. US authorities recently arrested and charged the group’s American leaders, confirming ICJK.sk’s earlier findings. The shooter, labeled a “saint” by the neo-Nazi group, had direct ties to the Terrorgram Collective, which actively recruits and incites terrorist acts globally. Their network’s reach is chillingly wide and insidious. Read the story here.

SPICY SCOOPS

There is always a lot of information that we hear and find interesting and newsworthy but don’t publish as part of our investigative reporting — and share instead in this newsletter. 

MORE DETAILS ON SLOVAKIA’S ALLEGED SPYWARE ACQUISITION

Last week, Denník N revealed that Prime Minister Robert Fico’s government possesses a spyware with capabilities comparable to Pegasus, allowing them to hack into and gain full access to smartphones (here’s a round-up of what happened after Hungary’s Pegasus spyware revelations). The report cited opposition MP Juraj Krúpa, a security and defense expert from the Freedom and Solidarity (SaS) party, who raised concerns about the implications of such powerful surveillance tools in Slovakia. When I asked him for more details about what he knows and how he knows it regarding the spyware, Krúpa told me that his information came from three independent sources. “Every time I received information from them, it proved to be valuable,” he said. These sources provided consistent details, informing Krúpa that the Slovak Information Service (SIS) had long sought access to highly sophisticated spyware. After extended negotiations, an agreement was finally reached. The spyware in question was described to the MP as the “latest version” of a tool similar to Pegasus, capable of breaching all security measures and gaining full access to smartphones. He added that Denník N reporters also managed to confirm this information from their own sources. Krúpa does not know the name of the company or the specific technology, but his sources identified it as being from an Israeli firm. He is also uncertain whether the negotiations and purchase were carried out directly or conducted through an intermediary, as was the case with Pegasus in Hungary (read my earlier piece on how the spyware was brought to Hungary). 

According to Krúpa’s sources, the spyware system underwent testing over the summer and was deployed in September. Krúpa also believes that the spyware is intended solely for SIS use. But the SIS does not own the system outright. Instead, they pay the Israeli company for each phone that is hacked and surveilled on their behalf. While Krúpa lacked precise information on costs, he estimates that the price could amount to millions of euros. The purchase of such spyware does not require approval from the Slovak parliament or the parliamentary committee responsible for overseeing the SIS and national security matters. Krúpa noted that the opposition chairperson of this committee was removed over the summer, raising concerns that the replacement could be a member of the ruling party, further weakening the committee’s already limited capacity to oversee and scrutinize the SIS’s surveillance activities. “I’m aware that some opposition politicians and journalists are being targeted, and they are attempting to dig up compromising information on them,” he told me. Fico and his government deny and downplay allegations of purchasing Pegasus spyware, suggesting that the tool may operate under a different name. Since the Slovak government recently purchased the BARAK MX Israeli air defense system for a hefty €554 million, there is now speculation that it might have come as part of a package deal along with Israeli spyware.

TUSK SHOWS NO LOVE FOR THE V4 – DUDA DOES

The Polish presidency of the Visegrád Group has been so invisible so far that even the previous, relatively passive Czech presidency appears hyperactive by comparison. According to well-connected foreign policy experts I’ve talked to, no prime ministerial-level meetings are expected this year. Long-standing divisions, driven primarily by Viktor Orbán’s pro-Kremlin stance and now bolstered by Fico’s Slovakia, are a key factor in the Visegrád Group’s stagnation. Hungarian foreign minister Péter Szijjártó’s reputation in Poland as a Kremlin pawn combined with Orbán’s recent anti-Polish rhetoric has further strained political cooperation, making high-level meetings even more unlikely for the duration of Poland’s V4 presidency, which will conclude next July. However, Polish President Andrzej Duda, closely aligned with the ruling Law and Justice (PiS) party, may provide a glimmer of diplomatic activity: My expert sources indicate that he is expected to host a V4 presidential meeting in December, either in Kraków or at his winter residence in Wisła, in an effort to bring Hungary and Slovakia — or at least their mostly irrelevant presidents — in from the cold. And, of course, to irritate Donald Tusk’s government.

HUNGARY’S CHINESE LOAN HUNT WITH A BALKANS TWIST

This July, Hungary announced a €500 million loan for North Macedonia, a country once again led by the nationalist VMRO-DPMNE party and thus seen as a close ally of Viktor Orbán. Soon after, data from the Hungarian state’s debt agency revealed that Hungary itself took a €1 billion loan from China earlier in 2024, a fact Orbán’s government didn’t advertise to the public. Multiple diplomatic sources told me that the two loans are linked, suggesting Hungary is using Chinese funds to support North Macedonia – essentially acting as China’s intermediary. According to a North Macedonian expert source, when Hristijan Mickoski, the VMRO-DPMNE leader, announced a €1 billion loan for strategic projects on the day he was elected, he immediately denied it would come from Russia or China, claiming a European country would provide it. However, this source soon heard unconfirmed reports that the money would indeed be Chinese, but funneled through Serbia or Hungary. Later, Mickoski said €500 million would be enough. My sources remain baffled by Hungary’s involvement, especially as Orbán’s government faces its own financial struggles. What makes the story even more mysterious is that, according to an internationally connected business source, Hungary originally hoped to secure a much bigger loan during Xi Jinping’s visit to Budapest as a substitute for the country’s frozen EU funds (here’s my earlier piece on Xi’s Hungarian visit in case you missed it). I, for one, have so many questions – Why is Hungary fronting for China? Why give away even that little €500 million? – but the Orbán government, once again, did not respond to my request for comment.

ORBÁN’S WRATH THREATENS HUNGARIAN PRO-GOVERNMENT PROPAGANDISTS

Meanwhile, those who are not asking real questions – that is, propagandists working for the Orbán government – may be in trouble. “Orbán believes that they were unable to successfully reach voters during the campaign for the European Parliament (EP) election, and there needs to be a change,” a well-informed source connected to the government revealed to me. This change – a potentially big shake-up – could even reach the leadership of the most important Hungarian government-controlled propaganda operations. Specifically mentioned to me were MTVA (a public media conglomerate); Magyar Nemzet (the main print daily mouthpiece); Origo (the largest online propaganda site); and Megafon (Facebook propaganda video content). Two other government-connected sources added that, at a recent annual gathering of Orbán’s close circle near lake Balaton, the prime minister not only talked about the threat posed by opposition leader Péter Magyar but also expressed the need to improve how media is handled by the government. Orbán seems to be blaming his ineffective propagandists for being unsuccessful in stopping the rise of Magyar’s Respect and Freedom (TISZA) party. According to a fresh bombshell survey by Medián, Hungary’s most trusted pollster, TISZA is already polling at 39 percent against PM Orbán’s ruling Fidesz-KDNP coalition’s 43 percent. 

SECOND HELPINGS

We’d already reported but the story went on… here’s a second bite of our previous stories and scoops.

Orbán’s most trusted guards protect Geert Wilders. Two weeks ago, I reported on how frequent visits by the Dutch far-right leader to Hungary are made possible because Wilders receives the red carpet treatment with full security protection (Wilders often receives death threats). It was only after I sent out the previous edition of Goulash that Hungary’s interior ministry sent an official explanation, revealing that the same counter-terrorism special forces that protect Orbán also look after Wilders. “According to current legislation, certain personal protection tasks can be temporarily assigned to the Counter Terrorism Centre (TEK) by the Minister responsible for law enforcement on a case-by-case basis. This was the case with Geert Wilders,” the ministry wrote, refusing to disclose further details for security reasons. Knowing how TEK operates and how close they are to Orbán – plus their involvement in surveillance scandals here and here – it is certain that Wilders’s every movement in Hungary is extremely closely watched.

Ex-Orlen CEO Daniel Obajtek is suddenly followed by Orbán’s daughter. VSquare, FRONTSTORY.PL and Radio Zet’s joint investigation into the secret Budapest luxury hideout of the former Polish oil company executive (linked to the Orbán government) was the third biggest story on the Polish internet in June. It was quoted in 212 articles, which, taken together, generated 25.6 million views. A few weeks later, after being elected as an MEP, Obajtek filed his asset declaration with the European Parliament, suddenly revealing that he also receives €15 thousand per month from a Hungarian company with ties to Viktor Orbán’s son-in-law – the same company that is behind the penthouse apartment he stayed in Budapest. Obajtek’s proximity to the Orbán family is now also shown on social media: the Hungarian Prime Minister’s daughter, Ráhel Orbán, recently made her Instagram account public – revealing that she actually follows Obajtek’s account, too.

Chinese EV company’s Hungarian plans are in jeopardy. Back in April, I wrote in this newsletter on how the Orbán administration made pro-government news sites take down articles about how Great Wall Motors (GWM), a Chinese EV company, is building a new factory in the Hungarian city of Pécs. These news pieces were premature as the government was still in negotiations with the company. According to diplomatic sources and a well-connected foreign policy expert, due to the company’s ailing business, GWM has actually postponed a decision on its Hungarian investment to this autumn. That on its own is not a good sign – but it’s even worse that, at the end of August, GWM closed its European headquarters in Munich, laying off 100 employees.

US polls worry Budapest. Just a few weeks ago, I reported on the Orbán government’s excitement over JD Vance, a fan of the Hungarian prime minister, becoming Donald Trump’s running mate. What a summer it has been since! Kamala Harris replaced Biden and is currently managing a small lead over Trump in many polls, meaning Hungary’s leadership is growing increasingly anxious. Two government-connected sources confirmed to me that they are closely tracking the polling results, and becoming slightly worried. Orbán’s all-in gamble on Trump looked even riskier this week, as Trump used his September 10 debate with Harris to praise Orbán for endorsing him. This brought renewed scrutiny on Hungary’s authoritarian direction, drawing sharp criticism from top Democrats like VP nominee Tim Walz and Hillary Clinton. Meanwhile, Radio Free Europe’s Hungarian broadcast backed up another previous Goulash scoop by reporting that Viktor Orbán’s long-time spin doctor, Árpád Habony, is playing a role in Trump’s campaign, making occasional trips to Florida.

MORE FROM OUR PARTNERS

ICJK AND RSF SUSPEND PARTICIPATION IN SLOVAKIA’S PRESS FREEDOM ADVISORY BOARD. Our Slovak partner ICJK.sk and Reporters Without Borders (RSF) suspended their participation in sessions with Slovakia’s state-run Platform for the Promotion of Press Freedom and the Protection of Journalists in response to Robert Fico’s government’s nomination of someone totally unqualified as a new member. (Text in Slovak and English.)

“A STATE AGENCY HAS BEEN SET UP FOR WITCH-HUNTS”. Ten years ago, Hungarian police raided the offices of organizations managing the Norwegian NGO Fund supporting Hungarian independent civil society groups. To mark the anniversary, a commemorative event was held where Atlatszo.hu’s Tamás Bodoky delivered a speech. (Text in Hungarian and English.)

OUTSTANDING SALARIES, INCONSISTENT PERFORMANCE AMONG TEACHERS – NEW INTERNAL DATA LEAKED ON MCC SPENDINGS. Direkt36.hu obtained internal documents regarding the expenses of the Orbán government-affiliated educational (and propaganda) institution, Mathias Corvinus Collegium (MCC). The documents reveal how certain teachers, despite rarely showing up at their workplace, receive exceptionally high salaries compared to the standards of Hungarian higher education. (Text in Hungarian and English.)

PATRIOTISM WITH A MUSTACHE. FRONTSTORY.PL’s investigation into the Polish customers of the Swedish neo-Nazi store Midgård found, among others, a close associate of the main organizer of the country’s infamous November 11 nationalist march buying Fascist-praising music. (Text in Polish.)

CZECHS ORDERING FROM SCANDINAVIAN SHOP FOR NEO-NAZIS. And here’s Investigace.cz’s own national story, which focuses  on the criminal record of some of the Czech Midgård customers and explains what happened to the local neo-Nazi scene. (Text in Czech.)

This was VSquare’s 26th Goulash newsletter. I hope you gobbled it up. Come back soon for another serving. 

Still hungry? Check the previous newsletter issues here! 

SZABOLCS PANYI & THE VSQUARE TEAM