Gusztav Kosztolanyi

An "apartment mafia" is running the Budapest housing market. Countless numbers of citizens have been scammed out of the roof over their heads and are now in the streets of Hungary's capital city. The term mafia is not entirely inaccurate, with all its connotations of secrecy, conspiracy against the forces of law and order, its flavour of a tightly-organised, mutually loyal and dedicated gang of ruthless individuals who would balk at nothing to attain their aim of maximum financial gain, and who pervert the course of justice by allying themselves with unscrupulous lawyers only to happy to aid and abet in fraud for a consideration.

I can never forget the experience of strolling towards the gleaming station building in another great capital, London, from whence I was to catch a state-of-the-art train back to the Continent through the bowels of a dingy, unlit concrete bunker, a god-forsaken place if ever there was one. From the shadowy depths, a group of ragged figures loomed, and I noticed a bonfire, surrounded by makeshift shelters and it dawned on me that I had strayed into symbolic territory, an area that had become emblematic of the problems and gnawed at the consciousness of an entire nation: this was the infamous cardboard city. I had read about it so many times, yet the columns of print made it unreal, it was a nightmare vision, somewhere in the twilight between fact and fiction: like a weird anti-Camelot, with flimsy corrugated towers disappearing into a putrid mist of squalor. Even if it were a mere legend, it had to be written about, because its moral purpose was so clear. I had expected its denizens to be violent, to mug me, yet they stood peacefully, warming themselves, and my intrusion did not register with them, as if they were somehow not in this world after all.

Contrast this scene, hushed away from the public eye, with the harsh neon exposure, the glaring orange moulded plastic benches of the Budapest underground, where, in the last few months, the homeless of the capital have moved in en masse. These men are no longer content to wait at the foot of the escalator (the favoured intercept position of the ticket inspectors with their red armbands of office) with outstretched hand in abject silence and heads bowed in shame. They now beg in packs along the platforms. It is difficult to avoid them as you alight, particularly if you disembark at the front of the train where they lie slumped in slumber, or chatting whilst their mediator with the respectable world frenetically rattles a few pitiful coins in a mineral water bottle, obstructing the passage of as many commuters as he can. The reasoning is clear: if someone is in a big enough hurry, he might drop in an offering just to speed up his progress. The Metro beggars are loud, brash and intimidating compared to their London counterparts, who lounge in shop doorways wrapped in filthy sleeping bags and cry plaintively "Can you spare some change please?" The Londoners only have to make themselves heard above the roar of traffic, whereas there is more serious competition for the bearded, ruddy-cheeked stalwarts of the Metro in the shape of buskers whose seductive gypsy lilts and winning smiles often tempt donations, hawkers, selling goods of dubious provenance and elderly women proffering half-wilted spring flowers, wrapped up in their faded finery.

Homelessness is a relatively recent phenomenon in Hungary and the informed public is acutely aware of it, not simply because of the more enterprising down and outs who, like their fellows in other major European cities, try to make an honest living by selling newspapers about their plight (the Hungarian version is called "Flaszter"), but because of the activities of gangs of criminals who use sophisticated scams to deprive their victims of a roof over their heads and most often without the slightest means of redress. They have been dubbed the "apartment mafia" (lakásmaffia) and condemned as "hyenas" in the recent spate of publicity exposing their underhand dealings in an attempt to afford some protection against them.

The term mafia is not entirely inaccurate, with all its connotations of secrecy, conspiracy against the forces of law and order, its flavour of a tightly-organised, mutually loyal and dedicated gang of ruthless individuals who would balk at nothing to attain their aim of maximum financial gain, and who pervert the course of justice by allying themselves with unscrupulous lawyers only to happy to aid and abet in fraud for a consideration.

The phenomenon had its roots in the capital (where the property market is at its most lucrative) and spread like a contagion to the provinces. In seven counties (Vas, Zala, Tolna, Nograd, Jasz-Kiskun, Hajdu-Bihar and Szabolcs-Szatmar), no criminal investigations have been launched, no charges preferred and no court judgements pronounced, but in the rest 25 criminal investigations are taking place, 26 sets of charges have been preferred and 6 sentences passed. The modest figures involved may be ascribable to the sad reality that the apartment mafia targets its victims carefully, usually picking out vulnerable or socially marginal figures who are not in a position to defend their own interests effectively, subjecting them to a campaign of intimidation often accompanied by violence and leaving them completely destitute, mentally and physically broken. It may be safely supposed that in many cases the authorities never hear about what has happened to them, and even when they do, it is only once they have gone to rack and ruin and lack the financial resources to fund legal proceedings (a problem exacerbated by a change in law that entered into force in 1994 which prevents the prosecutors' office from launching court action in the interest of a private individual or in their stead, due to a ruling from the Constitutional Court that decreed that each individual must decide on his own behalf how he wants to assert and defend his rights).

According to an article in Magyar Nemzet (by Csilla Halasz, whose series of articles on the apartment mafia has provided an invaluable source of information and was published on 27/2, 6/3 and 13/2 1999 respectively), there are three principle categories of crime committed by the apartment mafia, the first of which usually comes to light by sheer coincidence and is perpetrated behind the property owners' back, with a forged contract of sale being signed on the basis of data compiled about the owner using official documents (in Hungary, title deeds lodged at the registry are freely available to all: anyone may consult any document lodged at the Registry Office at any time and may obtain certified true copies, although since very recently anyone who requests a copy of a document containing information about any property other than that they themselves own must allow a photocopy of their identity card to be made).

The second group of cases consists of those where the injured party has in some way co-operated with the criminals in allowing them to acquire the flat. Here the victim typically needs to borrow money and is persuaded to sign a contract of sale in exchange for a loan, mollified by repeated assurances that the risk of losing the flat is minimal and will only ensue if the victim cannot pay back the loan. However, the perpetrators, virtually without exception, hand in the contract immediately at the Title Deeds Registry Office, where the change in ownership is officially recorded (and henceforth practically impossible to revoke). Once the repayment deadline has expired, no mercy is shown: hired thugs visit the victim at home, informing him that he has to move out, using threats to family members as an incentive to comply.

A common trick is to slip the deed of sale between the sheets of paper the victim is expected to sign to take out the loan. The victim may be relieved or flustered or, since everything seems to be entirely above board, may trust the lender implicitly, all states of mind that do not exactly promote vigilance. It is precisely this carelessness that the swindlers reckon with. Once his signature has been appended, it becomes difficult for the former owner to demonstrate that he was hoodwinked: the burden of proof is incumbent upon him and stands alone in his assertion that he was not aware of what he was signing. If the lawyer, who is usually in cahoots with the criminals, is given a summons to appear as a witness, he will claim that he provided a detailed explanation of what had to be signed, but stepped momentarily out of the room when the actual signing took place, or that he is not at fault if the victim failed to understand the explanation he gave.

The third type of organised property theft is based on meticulous selection of vulnerable people, often social outcasts, whom the criminals befriend with a view to fleecing them, making sure that they were invited to the earmarked flats so that they could form a clearer idea of exactly how much their prey was worth. One example of this virulent strain of the infection led to a successful prosecution in Gyongyos in April 1998. The victim count totalled 15, and all were subjected to violence until they gave in and signed contracts of sale: some were beaten and kicked, one was partially strangled by having a trouser belt tied round the throat and one was held prisoner until the transfer of ownership was officially registered.

A variation on the third theme has proliferated in the suburbs of Budapest to the extent that local authorities have been compelled to tighten up their procedures and have drawn up a blacklist of property agents and lawyers implicated in shady dealings, though to little effect (See article in Nepszabadsag, 20/2/99). The Budapest apartment mafia rarely resort to brute force these days, depending instead on the collusion of representatives of the above-mentioned professions. Sadly, the level of desperation and deprivation amongst their targeted victims is often so high that they are grateful for the "help" they have received. The method employed is as follows: the criminals seek out tenants living in accommodation which is laden with debt, but still purchasable, offering generously to take on the burden of arrears in electricity and gas payments and offering a low-rent swap for the existing flat (hence the label given to this particular variety of fraud: "apartment swap"). The crooked property agent promises to carry out all the necessary paperwork, "sparing" the hapless victim the cumbersome formalities, so that they do not actually have to lift a finger. The contract is presented as a solution to all the victim's woes and is signed officially in the presence of a lawyer. To whet the victim's appetite (and speed up the signing process), a wad of cash may be produced (it also diverts attention from the contents of the document signed), though some are so glad to escape the overwhelming weight of accumulated debt that they will settle for far less, even for a few litres of cheap wine, to extricate themselves from it.

Once signing is complete, the victim is sent on his way with a list of addresses, usually privately owned properties, from which to choose the exchange flat. Once the victim has found something suitable, he is told that he may move in once the paperwork has been dealt with, though he is forced to move out from the old flat straight away. On arriving back at the new address, the victim is confronted by the landlord, a burly, muscle-bound figure who blocks the doorway, refusing to budge to let either the tenant or so much as a stick of his furniture in. It is this form of abuse that local authorities have attempted to combat by refusing to give the go-ahead to flat swaps unless the new landlord has submitted a declaration of acceptance. The apartment mafia does not allow itself to be unduly troubled by such minor inconveniences, however, as the landlord is fully entitled to withdraw his declaration after 30 days has elapsed, so the tenant only has to be tolerated for a month.

There is little that can be done to break the unholy alliance of property agents, lawyers and their mafia cronies, since even where licences to practice have been revoked, the dishonest go about their business undeterred. Meanwhile, for the victims of corruption and wilful misrepresentation, there is precious little redress or solace. The spectre of homelessness haunts the minds of property owners who have acted rashly or in desperation. The tarmac, soup-kitchens, hostels and concourses of the Metro beckon, the frenetic rattling of coins in bottles rings in the ears.

Gusztav Kosztolanyi, 22 March 1999