Fall of Trump ally in Hungary turns spotlight on multi-billion ringgit ventilator deal linked to Malaysian man

The stunning electoral defeat of Hungarian strongman Viktor Orban is likely to turn the spotlight on a multi-billion ringgit government contract for ventilators awarded by his regime involving a Malaysian businessman MalaysiaNow - among the first to reveal details of the controversial purchase six years ago - has learnt.

Orban, an anti-Muslim hardliner and admirer of President Donald Trump, was defeated by the centre-right opposition party Tisza following an election campaign focused on allegations of systemic corruption and abuse of power throughout his 16-year rule.

Just hours before voting day, Trump dispatched Vice-President JD Vance to personally campaign for Orban, in a desperate bid by Washington to salvage an ally after European countries abandoned the US in the wake of its aggression against Iran, intimidation of Nato, and threats to annex Greenland.

However, Trump's support proved to be a kiss of death for Orban, who had been prime minister for the last 16 years, as voters overwhelmingly embraced opposition leader Peter Magyar, giving him a landslide two-thirds majority.

Magyar, Hungary's incoming prime minister, has largely campaigned on fighting corruption and steering Hungary towards Europe.

At the centre of his manifesto is a promise of "total transparency" on government contracts, and a pledge to recover "stolen" money under Orban's rule.

"That anti-corruption pledge may inevitably lead the new government to launch an investigation into the ventilator scandal during the Covid-19 pandemic," a source close to the incoming government told MalaysiaNow, referring to the Orban government's purchase of ventilators and other medical equipment in 2020, touted as the single biggest purchase of medical equipment by a European Union member state.

The procurement of the ventilators caused a storm in Hungary, with opposition politicians calling out the deals for being opaque and resulting in an oversupply.

The RM2.4 billion Covid windfall

In June 2021, MalaysiaNow reported that several of the purchases were linked to Vinod Sekhar, a controversial businessman who operates a chain of companies and organisations under the Petra Group.

Vinod, who has often described himself as a friend and staunch supporter of Prime Minister Anwar Ibrahim, secured more than RM2 billion million worth of contracts to supply ventilators to the Hungarian government, making up the lion’s share of the deal.

Documents viewed by MalaysiaNow showed that the Orban government had agreed to pay a total of US$559,600,000, which at the time of the contract in May 2020 was equivalent to about RM2.43 billion, to GR Technologies, a company Vinod represented.

The 57-year-old is the son of the late BC Sekhar, who was credited with modernising Malaysia’s rubber industry.

But unlike his father, Vinod has found himself embroiled in several financial controversies.

In 2005, he was declared bankrupt over debts to several companies totalling RM12.38 million. The bankruptcy status was removed in 2020, the same year the ventilator contracts were signed.

The following year, the Malaysian Anti-Corruption Commission raided his office as part of a money laundering investigation. Five years later, the status of the probe remains unclear.

Vinod was also in the news due to heavily publicised announcements of huge donations by his company for charitable works around the world, from a football club in Singapore to a pledge to construct a medical faculty building for one of Scotland’s oldest universities.

In 2010, Scottish daily The Scotsman reported that Vinod had yet to “hand over a penny” to the University of St Andrews for its new medical school despite his pledge to donate £8 million.

During the 2020 Sabah election campaign, critics questioned Anwar for his association with businessmen, including Vinod,  after a photograph showed the PKR leader arriving at Kota Kinabalu in a private jet bearing the word “PetraTara”. Petra and Tara are the names of Vinod’s children.

His ties with Anwar resurfaced last year during the hearing of a suit by 12 individuals who accused Vinod of fraud, misrepresentation, and breach of contract regarding investments they made in his Petra Group.

'Strange contracts'

The Hungary contracts, numbering in the dozens, raised questions not only over the sheer volume and how the payments were made, but also because the procurement was handled through the Hungarian foreign ministry, instead of the health ministry.

The Hungarian chapter of Transparency International (TI-Hungary) described the purchase as a "hotbed of abuse", stating the ventilators were “incredibly overpriced”, and suppliers were “selected arbitrarily in a non-transparent and no-bid process”.

In 2022, TI-Hungary was unsuccessful in a suit to compel the government to reveal details of the deals with GR Technologies, citing suspicious transactions involving bank accounts in Singapore and Hong Kong.

Now, the watchdog is pinning its hopes on the incoming Magyar government.

"Hopefully the new government will dig out the details of the ventilator business, which is positively one of the promises made by the new prime minister-elect," Miklos Legati, TI-Hungary's legal head, told MalaysiaNow.

"There is a great chance that there will be an investigation and the responsible person, such as Hungary's outgoing foreign minister, will be questioned and held accountable, or, potentially, thrown to justice."

Márton Tompos, an opposition activist who is not part of the incoming government, is cautiously optimistic about whether the new government will investigate the ventilator deal.

"I cannot be certain that they will actually fulfil the promise," he told MalaysiaNow. "If they do, the ventilator business will definitely be investigated. If I have a say in it, then 100%."

Price gap

There were concerns that the ventilators sold to Hungary were overpriced.

“For example, the Ministry of Foreign Affairs and Trade bought one ventilator unit for an average price of 19.8 million forints (RM270,000), while the National Healthcare Service Centre bought one unit for an average price of 10.8 million forints (RM147,000). And there is no explanation for such a price difference from the government," opposition politician Vadai Agnes told MalaysiaNow in 2021.

When it was first reported in Malaysia, Vinod defended the deals.

"Everything was above board. The contract has been completed. The Chinese side delivered, although there were some logistical issues. Will we make money? It is the normal percentage. People gave their time and energy to secure it, and they should be paid," he reportedly said.

Health fears

Apart from transparency, there were also questions over the quality of the ventilators.

During the Covid-19 pandemic, British experts warned that the China-made ventilator models “Shangrila 510S” and “SH300”, among 6,258 units sold by Vinod to Hungary, were faulty and could cause harm or even death. This led to the withdrawal of hundreds of these ventilators from government hospitals.

"The ventilator deal is definitely among the top ten on this list, as public health was put at risk."

“The fact that a single ventilator’s average cost was US$89,500 is outrageous on its own, but if we add the information from the UK and Colombia... the issue becomes a health and security risk for our country,” Tompos told MalaysiaNow in 2021.

The ventilator deal is only one of many opaque purchases which critics say were rife with mismanagement, irregularities, and kickbacks.

They include Paks II, a Russian-backed nuclear project in Hungary which came under fire over its €12.5 billion price tag, opaque finances, geopolitical impact, lack of transparency, delays and environmental harm.

There are also calls to investigate Hungarian private equity funds, accused of being used to conceal the wealth of pro-Orban oligarchs; the Budapest-Belgrade railway project, which has raised allegations of cronyism and quality issues; and Orban's purchase of a luxurious private estate using public funds, among countless other land deals and government procurements.

"The ventilator deal is definitely among the top ten on this list, as public health was put at risk," a Tisza party source, speaking on condition of anonymity, told MalaysiaNow, adding that the new government was expected to announce further details on how the investigations would be conducted.