BSE CHAIRMAN STERE FARMACHE: "I do not have access to the accounts"

The president of the Bucharest Stock Exchange (BSE) Stere Farmache denied that the press release of the BSE which omitted to mention that Daniel Ţepeş had effectively resigned from the Council of the Exchange.

In a conversation on the phone which took place yesterday morning, Mr. Farmache said he could see no difference between "he informed the Council of his intention to renounce his position as administrator" (the phrasing used in the press release) and the expression "he resigned" (which is what the press release should have announced - see note at the end).

Mr. Farrmache yesterday explained that the protection of confidential data of the Exchange is an accomplished fact.

For accuracy"s sake, the president of the BSE sent us an explanatory note, which includes the statement of the Monitoring Department of the Stock Exchange, which is presented below.

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"According to the requirements of the Regulation 2/2006 of the CNVM concerning the security of the trading platform of the BSE, it must be said that its systems are reviewed by specialized companies- which are CISA auditors, including risk reviews and IT verifications according to the COBIT and ISO17799 standards.

The access to the specific infrastructure and the data exchanged between the systems of the BSE are secured using specific hardware and software encryption mechanisms. Even the data exchanged between its own subsystems is encrypted, thus ensuring maximum protection of data and of the overall informational traffic.

The BSE has a communication and IT system which ensures continuity and disaster continuity in a remote physical location. That location, which specializes in collocation, features all the technical facilities needed for the continuous functioning of the equipment which makes up the systems of the BSE, at international standards of security. The backup location of the BSE is constantly monitored, through a security system controlled and monitored remotely.

The interactions of the staff of the BSE, of the agents and of the systems of the brokerage firms with the trading system of the BSE are continuously audited through a full tracking log, and the history of these accesses is stored according to security standards.

The number of people on the BSE staff which have access rights to confidential information is kept minimal through the decision of the Council of the Stock Exchange, and is limited strictly to the activities in their job description, and their actions on the trading system is continuously monitored by specialized mechanisms.

I personally stress that, neither as CEO nor as chairman of the BSE, did I have nor do I currently have access to the trading, settlement and clearing systems of the BSE and/or of the Central Depository."

• EDITORS" NOTE

We still maintain that a press release which uses the phrase "a member of the Council of the Exchange has decided to announce his intention to resign" instead of disclosing the fact that the resignation actually took place, focuses on the lesser issue of the discussions and notifications which took place between the members of the Council, instead of on the main issue, which is the resignation itself. We maintain that the Press Release intended to conceal the fact that Daniel Ţepeş went back on his resignation, an action which is arguably illegal, and therefore, the press release lies to the public by omission and does so in a deliberate manner.

• SIMINEL ANDREI, MEMBER ON THE COUNCIL OF THE BSE:

• The organization of the internal audit is missing two steps

Mr. Siminel Andrei is the member of the Council of the Stock Exchange who raised the issue of securing access to the data in the accounts of the brokerage firms, which are viewable by the Surveillance Department of the BSE. He initially brought up the issue six years ago, but recently brought it up again and revealed that is has not been completed yet.

Presented below is the answer he provided to the question on how an internal audit system should operate, that BURSA asked:

"Given your question on the organization of an internal audit system, it needs to include the following:

(a) a log which mentions every access (this log exists)";

(b) people who access it must provide a reason for doing so (I am not aware of whether this exists);

(c) am expert answering to the Board of Directors exclusively which would signal whether any of the reasons provided as justification for accessing the system raise any questions (there isn"t one). The aforementioned expert would not have access to the database, only to the list of reasons provided by those who have access.

What"s more, after being implemented, this system needs to be audited by a specialized independent company (in order to avoid any potential agreements between the people involved)."

An obvious rift exists between the visions of Mr. Siminel Andrei and of Mr. Stere Farmache on how an internal audit system should work (the conception of the latter seems incomplete).

Siminel Andrei

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• DAN PAUL, THE CHAIRMAN OF THE ASSOCIATION OF BROKERS:

• "Stere Farmache accessed the secret information"

In a statement he made for us yesterday, Mr. Dan Paul, the president of the Association of Brokers, claims that Mr. Stere Farmache had access to the information which was visible to the Monitoring Department of the BSE, a thing which he now denies.

"There were numerous moments, both in the Council of the Exchange, as well as in the discussions at the headquarters of the CNVM, when, Stere Farmache said was asked if he had access to the confidential information, and he explicitly said that he did", said Dan Paul, who added: "At the time, Farmache was also a CEO and I do not know whether he kept his passwords after that, when he was remained just the president of the BSE ".

"What"s more, when asked if he also accessed the confidential information, Farmache confirmed that he did, but said that he did not abuse this right".

Dan Paul even remembers that the Council of the Exchange subsequently discussed whether it would be possible that someone else could access the information available on his computer.