It was on that certain day of October 9th, 2008 that some strange rumours came to light. News started to be spread via email among players in the financial market that because of the situation caused by the financial crisis, OTP would be nationalised and that a big Russian shareholder was forced to sell his negotiable securities. By spreading such rumours the scaremongers sought to imply that Russian capital abroad had placed OTP in its sights. A statement also appeared that OTP had taken out large loans from  Icelandic banks that had brought about state bankruptcy. At the time Reuters news agency identified London as the source of the rumours. In the meantime, OTP shares lost 22 percent of their value on the Budapest stock exchange. A few minutes before the end of trading an unusually large-scale commission to sell several hundred thousand shares flooded the stock exchange, thus the stock exchange price which that morning had been in a 4,500-4,900 Forint band closed the day at 3,855 Forints.

 The Forint started to plummet in tandem with OTP share prices. Hungary's currency reached a two-year low: from the level of 249 the price of a Euro climbed to 262 Forints by the evening, and during the afternoon the Euro/Forint had even exceeded 270. The following day the chairman-CEO of OTP Sándor Csányi, the Minister of Finance János Veres, and the Governor of the Hungarian central bank András Simor held a joint press conference to attempt to calm the financial market by declaring that the Hungarian banking system was well provided with capital and that the government was doing everything it could in order to sustain stability. In the afternoon, Prime Minister Ferenc Gyurcsány informed the leaders of the parliamentary faction that on the previous day the government had turned to the EU for help, while the central bank had enlisted the help of the International Monetary Fund because of the Forint's weakening.

In the case of OTP almost everybody at the time was sure that speculation was in the background. Flooding the market with hundreds of thousands of shares for sale was intended to send the message that OTP shares must be sold off whatever the price. However, opinions in regard to the plummeting Forint were already inconsistent. Some people saw a direct connection between the fate of OTP and the Hungarian currency, while others traced the reason back to the slump that had developed in state bonds.

After this, the idea began to spread in the market that the Australian fund manager Greg Coffey was behind the attack. This suspicion was strengthened by Csányi's statement. Csányi announced that OTP had reported an unidentified perpetrator to the Hungarian police and that it would be doing the same to the British authorities. He did not actually name anybody because, as he said, "That would be a major legal risk". The 37-year-old Australian, one of GLG Partners Inc's best fund managers, who had formally worked on a fund management linked to György Soros, categorically refuted the accusation.

The veil was raised from the mysterious rumours divulged in October on 26 March, but not completely. A financial supervisory process had to be launched from the office of the Hungarian Financial Supervisory Authority (PSZÁF) to establish whether or not the law on the capital market that prohibits influencing the market had been breached during the OTP transactions in October. PSZÁF concluded that the company of György Soros, the dollar billionaire of Hungarian origin, was behind the dealings that went on in October. What happened was that Soros Fund Management LLC sold short OTP shares, i.e. acted with the intent of later purchasing them at a lower price. However, this was not the problem.  It was rather that the fund manager timed his flooding the market with OTP bonds to coincide with the stock market's end of trading, and by doing this misled investors who make their decisions in regard to the closing price. PSZÁF verified that the profit made on the deal was 675 thousand dollars and set the fine at 400 percent of this, i.e. 489 million Forints. This is the biggest such fine PSZÁF has set, and the most successful since the period of the Kulcsár affair.

In his communiqué Soros tried to distance himself from this "regrettable affair". As he wrote, he would not have concluded a deal reckoning with the fall of the value of OTP shares; and that he no longer managed the everyday affairs of the company since he retired from this last year. (At the same time, the fund has remained in the family, since he handed operational management to his son Jonathan.) He did not mention whether he would be paying the fine imposed by PSZÁF within thirty days of its resolution being delivered or whether or not he would be appealing against the ruling.

PSZÁF also left some questions unanswered. What was the link between the transaction targeted against OTP and the speculation against the Forint? Did those who formulated the attacks exploit the opportunities that ensued from the crisis of the bank and the Forint at the same time? Which London and Budapest financial service providers played a role in the affair? Which of the financial service providers did Soros receive the necessary shares on loan for the selling short? Did Soros' fund manager do the transaction with the intention of causing the fall of OTP or did he just prepare the ground to buy up the bank if the opportunity presented itself? Soros had already tried to get his hands on the bank on another occasion: for example, during the mid-nineties Lajos Bokros in his role as finance minister had worked to ensure that the controlling share of OTP, which was about to be nationalised, would fall into Soros' hands. Sándor Csány on the other hand, was interested in floating the financial institution on the stock exchange; in the end, Prime Minister Gyula Horn ruled out the Soros scenario, and this led to the deterioration of Bokros and Csányi's relationship. The current action by Soros throws a different light on the background of a number of political events in Hungary - including the appearance of Bokros as number one on MDF's MEP election list.

NOBODY IS SAFE

Just which one of George Soros' multifarious roles - investment banker, philanthropist, philosopher or political activist - comes to the fore in America is something that varies. These days Soros has often embroiled himself in self-contradiction. The economic philosopher supporting stricter regulations exploited the laxness of deregulation as an investment banker. The generous philanthropist ruined banks and whole countries without batting an eyelid as a "merciless capitalist". The liberal leaning Soros, who in 2004 regarded bringing about the downfall of George Bush as the objective of his life, enjoyed the fruits of the Republicans' economic philosophy.

According to Alpha magazine, during the economic crash of last year Soros made the fourth largest profit as a risk capitalist, increasing his fortune by 1.1 billion dollars. When everybody else was still talking about the stability of the economy, he was already making economic forecasts - a summary of which appeared in his book entitled The New Paradigm for Financial Markets - according to which the "superballoon" economy that had been pumped up for 25 years would burst and that a recession would become unavoidable. The billionaire sees the secret of his success as his ability to meet changes head on: he invests or withdraws his money on the basis of realities and not on having hunches. However, according to his critics, his success demonstrates something else. "First he stirs up a financial crisis.  Then he buys up the bankrupt companies for a pittance," writes the American Thinker. Of course, to do this one needs to know the loopholes, and good connections are needed. Soros sacrificed at least 40 million dollars to help the Democratic Party come to power.

There were some who returned his favours. Included among these people was Charles Schumer, the Democratic senator for New York State. IndyMac Federal Bank in Los Angeles, which operated as a "bridging bank" to mortgage lending institutions, was the biggest savings and mortgage lending institution in Southern California with 32 billion dollars of capital. In May 2008 Schumer used internal banking information to throw light on IndyMac's problems in order to protect investors from the financial institution. The result of the information being revealed was investors withdrawing their money and the acceleration of one of the biggest bankruptcies in the nation's history. Schumer's course of action was criticized by economists and politicians alike, while IndyMac came under state supervision. According to the announcement published in March 2009, a new financial consortium signed a 1.3 billion dollar deal to buy up IndyMac. György Soros was among the buyers.

How can a country be attacked and "wiped out"? Soros is one of the most competent experts in this area since, at the head of his financial funds, it was he who led the biggest known speculation assault of all time against the British Pound in 1992. The events that led up to this took place in 1979 when the EU member states created the European Monetary System, the precursor of the Euro zone, one tool of which was the European Exchange Rate Currency Mechanism (ERM). The participants wanted to achieve stabilisation in their currencies through fixed currency exchange rates, but with exchange rates remaining variable within a narrow margin. The British Pound entered the system at an overvalued level compared to the economic performance of the country, and opportunities inherent in this situation were not lost on Soros or Stanley Druckenmiller, the managing director of Quantum Fund, of which Soros was the president. They realised that the system was unsustainable and that everybody would invest in German Marks, which were believed to be strong, thus it was worth playing around with the further weakening of the Pound. Soros and his associates changed loans taken out in Pounds into Marks and in a deadline currency market they built up the so-called short position against the Pound.

The speculation was successful: the efforts of the British government to protect its currency by using up the several billion pounds of the Bank of England's foreign currency reserves were to no avail, and raising base interest rates from 10 to 15 percent was of no help either, since investors still responded to the situation by selling Pounds. September 16th 1992 became known as Black Wednesday in the annals of British financial history: the speculation knocked the Pound out of the ERM, the British currency had to be devalued, the country was left out of the Euro's introduction, while the population was left to pick up the tab amounting to tens of billions of dollars. Soros, on the other hand, actually made one billion pounds. Ever since this time, the stock market guru has been following events in Britain and only recently he again launched transactions aimed at the weakening of the pound.

Five years after this, the opinion Soros chanced to make on the Thai currency set off the East-Asian financial crisis. In Thailand they have held Soros responsible for the Thai economic collapse ever since. The businessman did not even dare travel to Bangkok for years afterwards, even though he was only invited to give a presentation. Protestors put a ransom on his head and said, "Inviting Soros is like somebody inviting a burglar into their house again and showing him what there is to steal."