Who gains from saving nature
Ledger 1 : 33 — For each dollar financing nature-based solutions in 2023, about $33 financed activities harmful to nature. (UNEP)
Cases / Mining / tailings dam · Hungary · 2010–2019

Kolontár red mud spill (Hungary)

Nature's voice · report
No measurement of the harm done to me here is on record.
Did nature suffer? Not measured.
People
  • 10 people died.
    10 dead; nine at the time of the NBC/AP report.
What the record lacks: 4 none on record · 1 not measured · 2 disputed · 2 unclear See the gaps

A red mud reservoir failed on 4 October 2010, killing 10 people. The operator's liability cover was HUF 10m (or HUF 20m by the chairman's early account), against damage reported at about HUF 35bn.

HUF 10m vs about HUF 35bnOperator's third-party liability cover vs reported damage
Cover: official figure per Világgazdaság (7 October 2010); the chairman early on said HUF 20m. Damage figure as reported by Világgazdaság.

Status As of 2019–2020 (latest court stage recorded): managers convicted, including MAL's chief executive, and the sentences upheld by the Kúria; no record found of collection of the HUF 135bn fine.

What?
A red mud reservoir failed at Kolontár; the operator's liability cover was far below the reported damage, and the state paid for recovery. Világgazdaság (vg.hu)
Where?
Kolontár and Ajka, Hungary. NBC News (AP)
When?
4 October 2010; fine 2011–2012; liquidation 2013; convictions 2019. NBC News (AP)
Who?
Gained
None on record
Lost
Harmed
  • Communities and people at Kolontár — 10 people died; about 184 million gallons of red mud released NBC News (AP)
Why?
Not established in the sources beyond the criminal convictions of managers.
How?
The reservoir failed and released red mud; MAL's liability cover of HUF 10m was far below the damage reported at about HUF 35bn. Világgazdaság (vg.hu)
6 of 6 questions answered from the record

What happened

The record, in order.

On 4 October 2010 a red mud reservoir operated by MAL Zrt failed at Kolontár, Hungary. About 184 million gallons of red mud were released and 10 people died (nine at the time of the NBC/AP report).

MAL's third-party liability cover was HUF 10m (the official figure; the chairman said early on it was HUF 20m, about $102,000, as NBC/AP reported), against damage of about HUF 35bn. Világgazdaság wrote that MAL's insurance would not pay ("nem fizet") for the red sludge damage. No exclusion was cited; the gap was the limit. Asset cover was HUF 8.5bn. The insurer was not named.

A fine of HUF 135bn was set in 2011 and suspended by a court in 2012. The state spent HUF 38bn on recovery. MAL Zrt entered liquidation in 2013, and no record of collection of the environmental fine was found.

In 2016 a first-instance court acquitted fifteen defendants. In 2019 the Győr court found ten people guilty, including MAL Zrt chief executive Zoltán Bakonyi, who received two and a half years in prison. His deputy received two years. The Kúria, Hungary's supreme court, upheld the sentences, and the sentence was served.

  1. 20104 October: MAL Zrt red mud reservoir fails at Kolontár; about 184 million gallons released; 10 dead. 7 October: Világgazdaság reports third-party cover of HUF 10m against damage of about HUF 35bn
  2. 2011Fine of HUF 135bn
  3. 2012Court suspends the HUF 135bn fine
  4. 2013MAL Zrt enters liquidation
  5. 2016First-instance court acquits fifteen defendants
  6. 2019Győr court finds ten people guilty; Zoltán Bakonyi receives two and a half years; Kúria later upholds the sentences

What was said

Claims, in the words of those who made them.

“MAL's third-party liability insurance was worth 20 million forints”

NBC News/AP report (about $102,000) · October 2010 · NBC News (AP)

“does not pay”

Világgazdaság, on MAL's insurance for the red sludge damage · 7 October 2010 · translated from Hungarian · Világgazdaság (vg.hu)

Where accounts differ

Each party's account, side by side, with its source. The record does not settle these points; it shows them.

How large was MAL's liability cover compared with the damage?
Press and investigations
Világgazdaság

Third-party liability cover was HUF 10m (official figure) against damage of about HUF 35bn; MAL's insurance "does not pay" for red sludge damage; no exclusion cited, the gap was the limit.

Világgazdaság (vg.hu)
Company or project
MAL Zrt chairman

Said early on that cover was HUF 20m.

Világgazdaság (vg.hu)
Press and investigations
NBC News/AP

MAL's third-party liability insurance was worth 20 million forints (about $102,000).

NBC News (AP)
Company or project
Insurer (not named)

No statement in the sources; the insurer was not identified.

How it looked

What was shown, beside what was recorded.

Shown

    Recorded

    • Third-party liability cover was HUF 10m (official figure) against damage of about HUF 35bn; asset cover was HUF 8.5bn; the insurer was not named.
    • Fine of HUF 135bn (2011), suspended by a court in 2012; the state spent HUF 38bn on recovery.
    • Managers were convicted and Hungary's supreme court (the Kúria) upheld the sentences.
    • MAL Zrt was liquidated in 2013; no record of collection of the environmental fine was found.

    Who gained

    Money that reached nature, beside money that stayed elsewhere.

    Reached nature or the ground

    Not published
    No figure published.

    Gained elsewhere

    Not totalled
    Currency: HUF · Window: . All figures cover the same period. * Estimate built from cited figures.

    Responses on record

    • MAL Zrt (chairman) (October 2010): Said early on that third-party liability cover was HUF 20m (the official figure was HUF 10m). · Világgazdaság (vg.hu)
    • Hungarian state (2010–2011): Paid HUF 38bn for recovery. · NBC News (AP)

    In court and with insurers

    Every proceeding and every insurer decision on record.

    Lawsuits and rulings

    1. 2019Claimant won
      Criminal case against MAL Zrt managers (Ajka red mud)
      Hungarian first-instance court (2016); Győr court (2019); Kúria · Criminal · State (prosecuting authority not named in the sources) → Fifteen defendants at first instance, including MAL Zrt chief executive Zoltán Bakonyi

      A first-instance court acquitted fifteen defendants in 2016. In 2019 the Győr court found ten people guilty; Zoltán Bakonyi received two and a half years in prison and his deputy two years. The Kúria upheld the sentences and they were served.

    2. 2011Outcome not on recordHUF 135000000bn Fine (2011), suspended by a court in 2012
      HUF 135bn environmental fine against MAL Zrt
      Hungary (authority not named in the sources) · Administrative · Hungarian authorities (not named in the sources) → MAL Zrt

      A court suspended the fine in 2012. MAL Zrt entered liquidation in 2013, and no record of collection of the fine was found. NBC News (AP)

    Insurers

    1. 2010No policy foundHUF 10000bn Third-party liability cover (official figure); the chairman said HUF 20m early on
      Not named → MAL Zrt
      Stated reason: No exclusion cited; the gap was the limit.

      Third-party liability cover was HUF 10m against damage of about HUF 35bn; Világgazdaság wrote that MAL's insurance "does not pay" for red sludge damage. Asset cover was HUF 8.5bn. Világgazdaság (vg.hu)

    What nature saw

    Outcomes measured on the ground, and nature's note.

    Nature's report opens this page. Below: further outcomes measured on the ground.

    Red mud released
    About 184 million gallons
    NBC/AP report, October 2010
    Environmental fine
    HUF 135bn, suspended
    Set 2011; suspended by a court in 2012; company liquidated 2013
    State recovery spending
    HUF 38bn
    Hungarian state

    What we don't know

    Undisclosed, unproven, untried: recorded as data.

    Nature

    • Not measured Harm to nature: The record holds no measurement of harm to nature.

    Court

    • Unclear HUF 135bn environmental fine against MAL Zrt: outcome not on record.

    Insurers

    • Unclear Not named: no decision on record.

    Accounts

    • Disputed How large was MAL's liability cover compared with the damage?
    • None on record Insurer (not named): No statement in the sources; the insurer was not identified.

    Record

    • None on record The insurer was not named in the sources.
    • Disputed Conflicting figures for the operator's third-party liability cover: HUF 10m (official figure, per Világgazdaság) and HUF 20m (the chairman early on; reported by NBC/AP as about $102,000).
    • None on record No insurer refusal on the grounds of an exclusion was documented; the gap was the policy limit.
    • None on record No record of collection of the HUF 135bn environmental fine in the company's liquidation was found.

    Did the harm stop?

    Not recorded in the sources reviewed.

    Who paid?

    The Hungarian state spent HUF 38bn on recovery. MAL's third-party liability cover was HUF 10m against damage of about HUF 35bn; the HUF 135bn fine was suspended and the company was liquidated in 2013, with no record found of the fine being collected.

    Sources

    Voices on record: — Company or project— Government and regulators— Courts✓ Press and investigations— Communities and civil society— Researchers

    Connected cases

    Related matters, and cases linked to this one through the same organisations, with the role each played in both.

    Bonds and banking

    Liquidation, insolvency, bankruptcy
    Legal processes that apply when a company cannot pay its debts; its assets are sold and claims against it may go unpaid.