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Public Film Foundation accumulated huge debts
Hungarian police started an investigation because of the fraudulent misuse of state funds at the Motion Picture Public Foundation of Hungary (Magyar Mozgókép Közalapítvány, MMKA). The public foundation once responsible for the distribution of state funds in the film industry was dissolved in March, 2012. Atlatszo.hu found that MMKA—with the promise of generous state funds which were never wired—has accumulated a huge debt. The foundation took a mortgage loan on one of its expensive real estates as well. According to the Government Monitoring Office (Kormányzati Ellenőrzési Hivatal, KEHI) the former Minister of Culture, István Hiller is also responsible for the situation because right before the elections in 2010 he reiterated a government committal several billion Hungarian Forints worth for funding MMKA.
Since 2002 MMKA was the patron of the Hungarian film industry, according to the State Audit Office (Állami Számvevőszék, ÁSZ) the public foundation received a 15.6 billion HUF (ca. 53.6 million EUR) worth funding between 2002 and 2005. Between 2006 and 2010 an additional 18 billion HUF (ca. 61.8 million EUR) funding was also sent to MMKA. Despite the public funding MMKA accumulated a huge debt by 2010, therefore the new Fidesz-KDNP government decided to dissolve it. In April 2012, following an investigation by the Government Monitoring Office a police investigation started under the suspicion of repeated fraudulent misuse of funds and attempts for fraudulent misuse of funds that caused the loss of a total of 6.2 billion Hungarian forints (ca. 22 million Euros). Most of MMKA’s debt was accumulated when the eventually received amounts of funding decreased but the foundation continued to provide grants to filmmakers. Based on the promised generous funding, from 2002 on MMKA distributed more grants than it would have been able to in reality. Between 2004 and 2010 the foundation’s own companies took out a total of 801 million HUF (ca. 2.75 million EUR) loan as well.