Hungarian IDV company acquisition attracts suspicion over alleged government ties

FaceKom, the identity verification company used by the Hungarian national digital identity program, has been acquired by major local IT and telecom group, 4iG Informatikai (4iG IT). The deal is now attracting attention among media outlets and political watchers due to the companies’ relationship with Prime Minister Viktor Orbán.

The acquisition was announced on Tuesday, with 4iG IT signing an agreement to purchase 100 percent of FaceKom pending regulatory approvals.

FaceKom is known for its facial biometrics-based identity verification, video-based customer identification (eID) and kiosk software. The company was commissioned to identify citizens as part of the government’s Digital Citizenship Program (DÁP).

4iG IT says that the acquisition would help integrate digital identification and authentication solutions into its products, allowing Know Your Customer (KYC) compliance for remote customer identification. The company is currently planning expansion in the Western Balkans and in Central and Eastern Europe.

“Our aim is to introduce FaceKom’s innovative technological solutions to new markets by leveraging 4iG Group’s international presence, and to further strengthen our position in high-value-added, software-based services,” says Gábor Radó, CEO of 4iG Informatikai Zrt.

Recent 4iG’s purchases, however, have been raising questions over the company’s reported links to the Hungarian government, which has been accused by critics of enriching political allies, family, and loyalists through state resources and public contracts.

In June, the Hungarian government announced it was selling a large stake in its defence industry to 4iG in a deal that could be worth up to 212 million euros (US$248.7 million). Lawmakers and legal experts have highlighted that the deal represents yet another sale of state assets to allies of Prime Minister Orbán. The deal could also potentially breach several EU rules, including state aid regulations, according to investigative outlet Follow the Money.

4iG chairman and majority investor Gellért Jászai is known for his ties to Orbán and was invited as part of his entourage to Donald Trump’s Mar-a-Lago resort after the 2024 U.S. presidential election.

FaceKom itself may have undisclosed connections with Hungarian leadership.

The company’s previous owner is Equilor Fund Management, owned by the Central European Opportunity Private Equity Fund (CEOM), which is managed by financial services company Equilor. While CEOM has no direct links with Orbán, local media investigations have discovered links with companies owned by the Prime Minister’s son-in-law, István Tiborcz.

One of Hungary’s richest men, Tiborcz was probed for fraud by EU authorities in 2017 after a company he co-owned was awarded tens of millions of euros to upgrade street lights across Hungary.

Article Topics

4iG Informatikai  |  acquisitions  |  FaceKom  |  facial recognition  |  Hungary  |  identity verification