SCANDAL IN THE MINISTRY OF INTERNAL AFFAIRS: Cătălin Chelu, arrested for attempting to bribe a government official

Who is Cătălin Chelu

Most of the businesses that Cătălin Chelu is involved in remain shrouded in secrecy, even though the press spent a lot of time poring over them, along the years.

Few are those who can claim they know their way through the maze of dozens of companies that the businessman of Galaţi adeptly crafted over the last 20 years.

Cătălin Chelu started doing business in 1993, when he created the cable TV company "Cony Sat" in Galaţi.

A portion of his earnings was invested in the stock market, and the rest was spent on buying companies put up for privatization by the State Property Fund (FPS). In 2003, sub-commissioner Daniel Mergeanu, the head of the Economic-Financial Police Department of Galaţi, said that businessman Cătălin Chelu had been accused of committing a serious fraud to the tune of 4.3 billion ROL, as well as using the assets of a company which he managed in ill faith.

Meanwhile, Chelu succeeded in increasing his fortune, and in 2005, was featured in the Top 300 of the richest Romanians, with an estimated fortune of 70 million dollars, which some say came from his stock exchange operations.

On the stock market, Chelu was notorious for his holdings in the SIFs and the scandals caused by the fact that he had exceeded the 1% threshold per individual s shareholder of the five SIFs. Chelu was one of the most vocal opponents of the amendment to the capital market law, introduced in 2006. The amendment provided that investors whose holdings in the SIFs exceeded 1% would see any votes pertaining to holdings above that threshold cancelled, as well as be forced to sell any holdings above that limit.

The draft bill for amending the capital market law came a few months after a statement made by Traian Băsescu in February 2006, in which he mentioned the existence of certain interest groups who were looking to acquire as much as possible of the five SIFs.

Chelu opposed the amendment of the law, claiming it represented an interference of the state in the private sector, and his point of view was also backed by Graţiela Iordache, who at the time was the vice-president of the Budget, Finance and Banking Commission of the Chamber of Deputies. Due to his extreme interest in the five SIFs, Chelu did everything he could to be seize their control. In 2004, he successfully became a member of the Board of Directors of SIF Moldova, and in 2008, he took the market by surprise, after being elected as CEO of SIF Moldova, following a surprise resignation of former CEO Sorin Mihail Turtoescu. His victory was short lived, as the Romanian National Securities Commission refused to validate him.

Also in 2008, Chelu came into open conflict with Dinel Staicu, the chairman of SIF Oltenia, who is also a very controversial player on the Romanian stock market. Staicu accused Chelu of having tried to seize control of SIF Oltenia at the General Shareholder Meeting which was held in August, when several shareholders saw their voting rights suspended, under the claim that their combined holdings in the SIF exceeded 1% and they were acting in concert with Chelu. At the time, Staicu claimed that the businessman of Galaţi tried to remove him from his position as chairman of SIF Oltenia, and that the DIICOT had asked him to provide information on some trades which involved companies owned by Chelu.

The CNVM later fined Chelu with 5,000 lei and demanded that he sell any shares above the 1% limit that he held in SIF "Oltenia".

In November 2008, Chelu was removed by the shareholders of SIF2 from his chairman position.

Chelu recently came to the attention of the Romanian National Securities Commission again for failing to perform mandatory takeover bids for companies in which he had reached the threshold at which he would be required to do so.

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The hearings lasted 12 hours

After the sting, businessman Cătălin Chelu, Gabriel Constantinescu and Antonel Bunu were transported by the prosecutors at the headquarters of the National Anticorruption Department, where they were heard for more than 12 hours.

Dan Fătuloiu was also present at the hearings, and he claimed that the person that wanted to bribe him came to his office in person, but did not provide a name. According to Mediafax, Ioana Ionescu, the lawyer of Cătălin Chelu, claimed that the attempt to buy influence (one of the two charges brought by the prosecutors of the DNA), did not occur, as the money wasn"t handed over.

Lawyer: "Cătălin Chelu considers that the whole probe is a setup"

The attorney also said that the businessman told prosecutors that he did not pay Fătuloiu any money and that he was not concerned over the cases that involved him. According to Ioana Ionescu, Chelu also said that such files are prepared against every major Romanian businessman, and that in his opinion, the entire case is a setup intended to "decapitate" Alprom, a company in which he is a majority shareholders, and in which he is associated with the other two defendants.

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Fătuloiu accuses his subordinates of betrayal

The lawyer of Cătălin Chelu, Ioana Ionescu, has also said that, in this case, Alexandru Fătuloiu, who is also a businessman, and the son of Dan Fătuloiu, has also submitted a denounce. Dan Fătuloiu claims his son has no connection to this affair and that the entire situation is the result of having been betrayed by his colleagues in the Economic Police Department. Some voices claim that businessman Cătălin Chelu had actually asked Alexandru Fătuloiu to help him get in touch with Dan Fătuloiu, through Ştefan Badea Niţache. Alexandru Fătuloiu is allegedly a witness in the current case.

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Another bribery attempt in 2006

Another businessman attempted to bribe Dan Fătuloiu in 2006.

At the time, the administrator of an agricultural-oindustrial company of Vâlcea accused Fătuloiu of demanding a 5,000 Euros payout to help him with a lawsuit in which the businessman was involved. At the time, the press wrote about a supposed sting operation directed against Fătuloiu, who was a questor (head of a police department) at the time.

In a communiqué of February 2007, the prosecutors of the DNA stated that, following a tip, they succeeded in arresting an individual who was carrying the amount of 5,500 Euros received from the denouncer.

At the time, the prosecutors of the DNA said that "the evidence submitted, did not in any way suggest that chief questor Fătuloiu Dan Valentin was guilty (...)".

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Igaş: "Ve will present a new report on Tuesday"

On Saturday, the Minister of Administration and Internal Affairs, Traian Igaş, claimed that the attempt to bribe secretary of state Dan Fătuloiu concerns the DNA (National Anticorruption Department), not the Ministry of Internal Affairs.

Traian Igaş also said that lately, the Ministry"s image has taken a serious blow, alluding to the controversial case of Piatra Neamţ, where one person died in what looked like a settling of old scores. When asked by journalists whether the Ministry has launched a probe on the possible connections between Dan Fătuloiu and Aurelian Şoric, the chief of the Neamţ County Police, the minister did not outright deny such a case, and said that a report on the matter would be presented on Tuesday.

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The case of Piatra Neamţ; the statements made by Traian Băsescu on the matter

The scandal around the arrest of Cătălin Chelu comes just as, a few days ago, another case shocked the entire country: the settling of scores in Piatra Neamţ, which ended with the death of one person.

Official sources claim that president Traian Băsescu has asked the Executive, during last week"s meeting, to begin the reorganization of the Police right away. The quoted sources also said that the President stated that the Police no longer protects public order and has instead become a source of unruliness and a protector of mob factions. The head of state also said during his appearance on a TV show, that it has asked the Minister of Internal Affairs, Traian Igaş, to hold off relieving the chief police inspector of the county of Neamţ until after the Investigative Body of the Prime-Minister will have performed its own investigation.