IN ORDER TO PREVENT BANK FRAUDS Blănculescu: "The guarantee funds should be included in the Supervisory Authority"

Guarantee funds should also be included in the Financial Oversight Authority (ASF), which, if created, would bring together the Insurance Oversight Commission (CSA), the Commission for the Oversight of the Private Pension System (CSSPP) and the National Securities Commission (CNVM), considers Ionel Blănculescu, the executive secretary of the Consulting Council for the Business Sector (CCMA).

According to him, the Romanian guarantee funds need to be carefully watched by a competent authority, to prevent bank frauds like the ones currently investigated by the Department for the Investigation of Crimes, Organized Crime and Terrorism (DIICOT).

Ionel Blănculescu said: "In Romania, we have two types of corruption: public corruption and private corruption. The signs of the private corruption are already visible, and what is happening now in the banking system is a component of this type of corruption, where we find precisely the same ingredients as in public sector corruption. Yesterday's event (ed. note: the bank fraud of 85 million Euros), which comes as a follow up to the one which happened nine months ago, are a reflection of greed and profit seeking regardless of the costs. Under normal circumstances, in the absence of a guarantee fund, our bank architecture could not afford such a slip-up of 85 million Euros.

This is impossible, because the foreign shareholders of the banks have introduced in Romania a risk analysis system which is used on a European level, which basically makes it impossible to defraud such a large bank (ed. note: such as BRD) with that kind of amounts. The only logical possibility for anything like that to happen is for the amount of the loan to be guaranteed by the state, in which case we can accept the idea that the bank «may turn a blind eye ». There is some information, I hope that it doesn't get confirmed, that the Guarantee Fund is involved in this incident as well. In this context, following what has repeatedly happened on our banking market, we would also propose that the Financial Oversight Authority also incorporate the myriad of guarantee funds which exist in Romania. If it's already the second time a major bank gets defrauded, it will definitely happen again. That is why, besides the CSA, the CSSPP and the CNVM, the guarantee funds should also become part of the ASF. They have been created to support the companies and it would be a good thing if they were supervised in an organized manner. It is clear that the guarantee fund is a turntable in these frauds".

According to Mr. Blănculescu, our country is affected in three areas - in the area of public funds, in the European grants sector and on the banking market, "which also means public money when they are recouped from the guarantee fund", therefore such a supervisory authority would be welcome.

Ionel Blănculescu also says: "If the construction of the Financial Supervisory Authority will be done like everything that's been done so far, in typical Romanian style, then it will definitely become the haven of politically appointed cronies instead of industry professionals. This will certainly lead to the "pre-suspension" of the activity of the ASF by the European Financial Oversight Authority until corrections are made. We should avoid having the Romanian Financial Oversight Authority catch the attention of its European peer. Let's consider this scenario an early warning sign, to prevent instead of correct, like we will have to do with the reorganization of the system for absorbing the European funds based on the Polish model, after seven years of ineffectiveness of the domestic system".