The banking snake

A BRD – Societe Generale deputy general manager is investigated by the organized crime prosecutors. He was one of the shareholders of company administered by the former head of the Romanian Intelligence Service – SRI, Virgil Măgureanu and a trusted friend of convicted businessman Sorin Ovidiu Vântu. Măgureanu is accused of getting illegal loans from BRD – Societe Generale.

On March 14th 2016, a sharp-dressed lady comes into the office of the National Anticorruption Directorate to speak up about her troubles. Domestic violence determined her to ask for the prosecutors’ help. What does anticorruption have to do with domestic violence? The lady who knocked dispassionately on the door was Alina Ioana Măgureanu (Petre), none other than the former daughter-in-law of Virgil Măgureanu, the founder of the Romanian Intelligence Service – SRI. After passing the mandatory check of the DNA police force, Alina Măgureanu started to search her purse for a pen and paper to write up her complaints about her former father-in-law. Dubbed the „Monocle Cobra”, he was the head of the SRI in 1990 – 1997.

Perhaps Alina Măgureanu liked Tudor Vladimirescu’s Proclamation from Padeș: „No law can prevent man from meeting evil with evil! When faced with the serpent, you strike it down with your cudgel to defend your life, which is often endangered by its bite”. The woman told the prosecutors that Virgil Măgureanu, his given name being Imre Asztalos, allegedly was the beneficiary of several bank loans obtained based on false documents.

Moreover, she also disclosed the numerous phone calls and visits paid to Mugur Isărescu, the Governor of the National Bank of Romania. He was supposed to intervene with banking institutions in favor of Măgureanu. According to Alina Măgureanu, one of these loans was contracted from BRD Groupe Société Générale. Thus, 2.800.000 euro was allegedly obtained by influence peddling for constructing a building on Zăgazului Street, near the Bordei Park in Bucharest. Allegedly, the key-figure in obtaining this loan was Mugur Isărescu.

One of these apartments is now owned by Senator Crin Antonescu and his wife, Adina Vălean, a member of the European Parliament. They gave a 20.000 euro down payment in December 2010 and another 120.000 euro in June 2011, money from by a loan granted by Unicredit. In her statement, Alina Măgureanu claims that the price was undervalued and that the difference to the real value was supposed to be covered by Romprest. The owner of the company, Walter Florian, was captured in the beginning of the month in the United Arab Emirates, after fleeing the country, as warrant for his arrest had been issued for money laundering and tax evasion.

BRD has been for years involved in huge scandals related to loan granting, several politicians and bank managers being investigated by the DIICOT. It’s not by accident that Virgil Măgureanu turned to BRD. One of the heads of BRD who is investigated by the prosecutors is Alexandru Cercel Duca, the deputy general manager. In 2007, Cercel Duca held 5% of the shares in Amrom Automotive 2006 SA from Câmpulung, a company currently deregistered.

Two of the administrators were Virgil Măgureanu and Vladimir Soare, the latter also being a shareholder. Soare was Sorin Ovidiu Vântu’s trusted man. In March 2007, Virgil Măgureanu and his wife had 200.000 euro in one of their many accounts opened at BRD in lei and foreign currencies. In April 2008, the Măgureanu family: Virgil and his wife; his son Marian and his daughter-in-law Alina contracted a loan from BRD – Primăverii Agency, which was subsequently modified by addendums.

BRD, seduced by the spooks

In November 2012, Cercel Duca was almost arrested for his involvement in an organized crime network, according to DIICOT’s press release. The group was accused of obtaining illegal loans using forged or false documents, the damages amounting to 22 million euro. This case involved several businessmen, including PSD senator Damian and former Minister during the Ceauşescu regime, Sava Tipa.

This group also included Florian Dragoș Diaconescu, arrested at that time for 29 days, a retired superior officer of the Foreign Intelligence Service, the descendant of the Foreign Intelligence Department – DIE, the secret services during the communist regime. Diaconescu’s relationship with BRD was also a special one. His accounts held 8.000.000 lei, according to DIICOT.

Another interesting thing was the statement given by Cercel Duca’s attorney, who said that his client is an old friend of former Securitate officer Diaconescu. Cercel Duca was arrested when he was 22 during the events in December 1989 and imprisoned at Jilava, but he was released from prison by the DIE officer. While Diaconescu released Cercel Duca from Jilava, Măgureanu was busy shooting the Ceaușescu spouses as representative of the people.

Cercel Duca, dressed to the nines, haled in for hearings

In a 2006 interview, published by the central press, the former three star general in Securitate, Ion Pacepa said that: „If Magureanu lived in the USA or in another true state of law, he would still be in jail for false statement under oath. In March 1990, when he was appointed head of the SRI, he stated under oath before the parliament that he didn’t have any ties with Securitate. In truth, he became a collaborator of domestic Securitate in February 1972 and then he was employed by the DIE under the rank of captain and the cover name “Mihăilă Mihai”. The original documents attesting his status as a Securitate officer can be found in DIE archives”. Pacepa was the deputy chief of the DIE and the personal advisor to Nicolae Ceaușescu until 1978, when he requested political asylum in the United States.

BRD, also seduced by a blonde

While the first case was being tried, Cercel Duca was involved in a new scandal, started in the spring of 2015. Also related to BRD. DIICOT prosecutors are investigating Cercel Duca and other persons for their involvement in an organized crime network. According to the prosecutors, in late 2007, an organized crime group was created within BRD executive management, group which dealt in granting huge loans without complying with the regulations imposed by the bank and by the National Bank of Romania.

Criminal charges were brought against 27 persons, among which businessman Remus Truică, the former chief of staff to Prime Minister Adrian Năstase; the former senator and journalist Sorin Roșca Stănescu, recently released from prison; Sorin Popa, the former vice-president of BRD; Adrian Sârbu, the former Mediapro mogul. One of the beneficiaries of these non-performing loans is Tal Silbersten, an Israeli businessman and international political consultant, in Romania having been an electoral campaign consultant for Traian Băsescu, Adrian Năstase, Călin Popescu Tăriceanu and the PNL.

Elena Udrea is also the beneficiary of a preferential loan from BRD, amounting to 3.3 million euros, granted in 2007 and guaranteed with a plot of land. The maturity of the loan was in 2009, but Udrea obtained a postponement from the bank and then assigned the loan to a third party. The prosecutors detailed Elena Udrea’s relation with BRD in the Gala Bute case: ”The case contains dates and evidence that Udrea Elena used her influence derived from her position as minister and vice-president of the governing party on the B.R.D. – Société Générale decision makers to get them to exercise their attributions in a manner which would allow Banca Română de Dezvoltare to grant a loan to S.C. Europlus Computers S.R.L.”

BNR performed inspections at BRD, but didn’t find it appropriate to take any measures. In this last scandal, the damages amount to 43.5 million euro. Both individuals and especially companies contracted state-guaranteed loans from BRD. It was known that these loans will never be paid. One of the agencies granting these loans was the one in Primăverii, where Măgureanu also contracted his loan in 2008. Some sources claim that BNR didn’t make the BRD situation public to avoid panic in the market and population.

BRD was involved in a huge scandal right after its privatization. Former Deputy Gabriel Bivolaru, a close friend to the Năstase family, was accused of conspiring with a BRD account officer to defraud the bank of the equivalent of 50 million euros by crimes committed in 1992-1995. In 2004, Bivolaru was sentenced to 5 years in prison, but BRD still hasn’t entirely recovered its damages.

No business, loads of loans

The former head of the SRI, Virgil Măgureanu didn’t stop at the loans granted by BRD. The National Bank and the prosecutors should check the conditions of the loans granted by Intesa Sanpaolo and CR Firenze to his company. Afinul SRL was founded in July 2007 in Măgureanu’s home village and its initial object of activity was: cultivation of fruits, walnuts and plants for drinks and spices. Subsequently, it was modified to processing and preserving of fruit and vegetables.

In 2009, it had 85,170 lei net turnover and 5,510 lei in losses. In 2010 and 2011 it didn’t submit its turnover, according to the information provided by the Ministry of Finances, but Afinul continued to register increasingly larger losses: 132,641 lei in 2010 and 685,557 in 2011. In 2012, the company had a 20,000 turnover, but the losses doubled compared to the previous year, amounting to 1,253,755.  In 2013, the turnover increased to 124,874, but the losses continued to rise, amounting to 2,488,264. In 2014, the company registered 1,090,021 in losses to a 78,310 lei turnover.

Virgil Măgureanu, a credible farmer

Although Afinul only registered losses and had extremely low turnovers, in November 2011 Banca C.R. Firenze România – Satu Mare Branch, granted a 4,539,333 lei – 1,000,000 euro loan to Afinul. This loan, which included Virgil Măgureanu and his wife, was guaranteed with a 2nd lien mortgage over several plots of land in the native commune of the former head of SRI. These were unincorporated, agricultural lands and had an aggregated area little over 5 hectares.

Also in November 2011, Măgureanu had guaranteed a 1,171,059.66 euro loan granted to Afinul by Intesa Sanpaolo. In 2012, the two banks merged.  In august 2014, Intesa Sanpaolo granted another 1,350,000 lei loan to Afinul SRL. Both involved the Rural Credit Guarantee Fund – IFN.

The Rural Credit Guarantee Fund is a company facilitating access to funding in the agrifood sector and contributing to the achievement of projects conceived by farmers in Romania. The shareholders of the Rural Credit Guarantee Fund are: BCR, Raiffeisen Bank and BRD, each holding 33.331% of the shares and the Ministry of Agriculture with 0.007%.