AFTER THE FRAUD INVESTIGATED BY THE DIICOT "Carpatica Invest" may shut down permanently

It would seem that brokerage firm "Carpatica Invest", involved in a scandal which concerns the making of trades which were not authorized by its customers, which was also investigated by the prosecutors of the DIICOT, will not recover from the decision to suspend its activity for three-months made by Financial Oversight Authority (ASF) on May 16th, 2014.

The management of the intermediary has summoned the shareholders to approve the early dissolution and the voluntary liquidation of the company, according to an announcement published in the Official Gazette.

In May, the ASF had asked "Carpatica Invest" to improve the state of its finances and to raise new capital. Market sources told us that the company was affected by the attachment of its accounts, following the accusations of its customer that a broker had executed trades without their authorization.

At the end of April, the prosecutors of the DIICOT have announced that they have executed an operation to dismantle an organized specializing in the manipulation of the stock market.

This related to the case reported by BURSA, in October 2012, when investor Andrei Anghel, accused his broker of Carpatica Invest, Ştefan Terziu, of fraud, after conducting unauthorized trades in his account, using forged documents.

The criminal prosecution was subsequently begun against five suspects, including Ştefan Terziu. According to the press release of the DIICOT of April 30, the investigators have seized from the suspects' homes documents, computers, deeds concerning the ownership rights under litigation, which were recorded by National Authority for the Restitution of Properties (ANRP), but which were instead found in one of the suspects' homes.

In 2012, the National Securities Commission (CNVM), currently ASF, has levied fines of approximately 150,000 lei.

After the suspension of the operations, Carpatica Invest was allowed to deposit and withdraw cash to and from the customers' accounts and to transfer securities to the 1st section of the Central Depository or to other accounts indicated by the customers.

On August 18th, the shareholders of the SSIF are called to approve the nomination of Fiducia, as liquidator of Carpatica Invest, as well as its compensation.

The Board of Directors is proposing for Fiducia to receive 4,000 Euros without VAT, 8% of the amounts collected and distributed following the sale of the tangible assets, 4% of the amounts collected from the recovery of the receivables and 2% of the amounts resulting from the sale of the financial assets and the liquidation of the existing amounts found in bank accounts, according to the quoted document.

The liquidator would also be empowered to review whether the management of Carpatica Invest is responsible for the losses incurred by the company, which have resulted in its equity reaching 1.57 million lei at the end of 2013, as well as to hire an expert or consultant to conduct this analysis.

Any proceeds from the liquidation would be distributed to the shareholders, according to their contribution to the share capital of the broker, according to the notice to attend.

Last year, Carpatica Invest was ranked 17th in the brokerage firms chart, with a market share of 0.94%, with a turnover of 255.7 million lei on the BSE.

At the end of last year, the ASF has fined Carpatica Invest almost 22,000 lei, which represented 1% of its turnover in the year 2012,because the brokerage firm did not fill out the structure of the Board of Directors from two to three persons.

Brokerage firm Carpatica Invest is part of the Carpatica financial group, controlled by businessman Ilie Carabulea, who is currently on house arrest in the "Carpatica Asig" case.

On April 24th, the anti-corruption prosecutors have indicted former ASF president Dan Radu Ruşanu, businessman Ilie Carabulea and Marian Mârzac, former member of the Board of the ASF.

Ilie Carabulea, owner of SC Atlassib SRL and SC Transcar SRL, companies through which he owned and indirectly controlled insurer Carpatica Asig SA, was indicted for the creation of an organized criminal faction, buying influence, offering bribes, using information not intended for public use in order to obtain undue benefits, in an continued form, abetting forgery of privately signed deeds and abetting the use of forgeries, according to the National Anti-corruption Department, according to the DNA.