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POLITICAL RIVALS SAY FORMER PM'S SUGGESTION IS PRE-ELECTION "POPULISM"

Mečiar: Next cabinet will have to compensate deposit fund victims

FORMER PM Vladimír Mečiar has suggested that if his HZDS opposition party entered government following September 20-21 elections, the state would compensate hundreds of thousands of Slovaks who lost their savings in the crashes of several pyramid funds this past spring.
Speaking to journalists in the north Slovakia town of Žilina September 9, Mečiar said the current Dzurinda government was responsible for allowing funds such as Horizont, BMG Invest, Bonifikačný Drukos Výnos (BDV) and AGW to collect deposits from people without a license from 1999 to 2002.
The next government, he said, had only two choices. "The first is that people sue the state, and I know they'll win their cases. The second option is a compromise between the government and the representatives of depositors. A certain level of compensation will be approved."


BMG head Fruni was arrested in Croatia this spring.
photo: TASR

FORMER PM Vladimír Mečiar has suggested that if his HZDS opposition party entered government following September 20-21 elections, the state would compensate hundreds of thousands of Slovaks who lost their savings in the crashes of several pyramid funds this past spring.

Speaking to journalists in the north Slovakia town of Žilina September 9, Mečiar said the current Dzurinda government was responsible for allowing funds such as Horizont, BMG Invest, Bonifikačný Drukos Výnos (BDV) and AGW to collect deposits from people without a license from 1999 to 2002.

The next government, he said, had only two choices. "The first is that people sue the state, and I know they'll win their cases. The second option is a compromise between the government and the representatives of depositors. A certain level of compensation will be approved."

Horizont and BMG Invest shut their doors in early February, while BDV and AGW followed suit later that month as panicked depositors rushed to try and withdraw savings. The damages have been estimated at Sk22 billion in lost savings and over 200,000 people directly affected, about four per cent of the country's population.

The crashes have been a hot political issue as well, with two political parties being formed to prosecute the aims of former depositors before and after September elections. While the Dzurinda government has said depositors have only themselves to blame for being lured by the funds' promises of up to 39.7 per cent interest, opposition parties such as the HZDS have long blamed the cabinet for inaction.

"It's as if a policeman helped a thief," said Mečiar. "Despite the fact the scandal affects 600,000 people, it is surrounded by silence, and we are not told... how it is connected to the current government elite."

Horizont and BMG Invest are now in bankruptcy, with owners Vladimír Fruni and Marián Sebeščák in jail awaiting trial for fraud, unauthorised business and violating business principles.

AGW boss Matúš Grega is charged with fraud, but is not in pre-trial custody, while the firm's accounts have been blocked and it is under forced administration. BDV owner František Mojžiš has not been charged, and is free to continue business.

Július Brocka of the ruling coalition Christian Democrats dismissed Mečiar's suggestion as "a populist bubble".

Given that Slovakia's 2002 state budget deficit is already expected to run Sk10-11 billion over its Sk37 billion target, and that the nation has been warned to tighten its fiscal policy by some international financial groups, the burden of compensation is seen as unbearable.

On the other hand, Ano party deputy head Ľubomír Lintner said he thought Mečiar's move might win him votes, given the desperation of depositors.

"People are desperate, but if someone gets votes that way I think it's unfair," he said.

Other politicians noted a possible connection between Mečiar and financier Jozef Majský, whose wife, MP Diana Dubovská, was installed at number 33 on the HZDS list of candidates for elections in a snap move last month.

Majský is alleged to have played a major role in the Horizont crash, and a taped phone conversation, allegedly between him and Fruni, published in the Sme paper this spring contains the statement that an unknown politician would step forward and declare state aid for depositors.

"When the guy I was telling you about announces that [the lost money] is to be repaid, the [public and police] view [of the fund crashes] will be different," said Majský.

"I think it's now clear to everyone how Diana Dubovská got on the [HZDS] candidates list," said Smer party vice chair Monika Beňová.

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