Anti-Corruption 2021

Last Updated December 08, 2020

Romania

Trends and Developments


Authors



Enache Pirtea & Associates stands for Extraordinary Professionalism Applied to the requirements and needs of the clients and is the main drive and focus of the law firm. This is best encompassed by the firm's motto (“We go the extra mile”), as well as in its mission ("inside the business & outside the box") and vision (to provide businesses with integrated practical solutions for ethically moving forward and shaping the future). EPA was set up in 2018 in Bucharest, after the merger of the specialised law boutique offices of two highly reputed “new wave” business criminal law attorneys, Ms Simona Pirtea and Mr Mădălin Enache, both with extensive experience, mainly in white-collar criminality cases, but also in business crime matters of significant importance. The firm’s focal area of activity, where the main partners have professional experience of over 15 years, is criminal law – white-collar and business crimes, in its two main components: criminal investigation and litigation, as well as business crime consultancy and counselling (business ethics and integrity).

General Outlook

The 2020 fight against anti-corruption appears to be under the same auspices as during 2019, namely, an ongoing commitment to Europeanism and to modernising institutions and overall administrative procedures. However, the Justice, at a declarative level, tries to achieve much, but in fact has accomplished just a few notable things, while shifting most of its focus on to fighting organised and violent criminality. Considering also the great impact caused on all levels of society by the COVID pandemic, the outcome is a general under-achievement when compared to the results expected and assumed by heads of the Justice at a certain point in time.

What can definitely be mentioned is that the time when prosecutors requested the arrest of famous persons (politicians or important business public figures) for perpetrating various corruption or economic crimes has long passed and this year the public was left without (what was thus named in the media) the “handcuffs show”, especially after the relevant jurisprudence from the European Convention on Human Rights (ECHR) condemned Romania for public displays of accusations and of detaining defendants, which was deemed as representing veritable breaches of the presumption of innocence.

Nevertheless, in the context of an election year (locals in September and parliamentary in December), there have been some attempts to discredit some of the competitors, based on accusations of illegal activities formulated through criminal complaints submitted to various legal institutions, mainly the National Anti-corruption Directorate. However, all the allegations have remained at the level of public discussions and this year the prosecutors did not interfere with the elections, no significant official candidate for locals being subject to any such investigation.

Consequently, the fight against corruption has yet to be re-launched, following a frenzy of acquittals since 2019 and which have continued also throughout 2020, doubled by a much more reduced rhythm of investigations, even if public resources remained the same or increased. However, the general opinion and leadership expect more visible results, especially in the context of a multitude of accusations regarding public funds having been misused in relation to infrastructure projects (in the last few years) or the COVID pandemic measures.

The Activity of the Main Authorities Involved in the Fight against Corruption – DNA, SIIJ, OLAF, ANI

The Romanian National Anti-corruption Directorate (DNA), the Directorate for Investigating Organised Crime and Terrorism (DIICOT) and the General Prosecutors’ Office with the High Court of Cassation and Justice (PG) all have newly appointed chiefs starting in February (Mr Crin Bologa), March (although Mrs Giorgiana Hossu resigned in September, after her husband,  a former judicial police officer, was definitively convicted by the Bucharest Court of Appeal for corruption, and currently Mrs Oana Daniela Pâțu is the Deputy Chief Prosecutor) and respectively 20 February 2020 (Mrs Gabriela Scutea) took on their mandates. Furthermore, the Justice Minister was also changed, Mr Catalin Predoiu resuming office on 4 November 2019, after a previous mandate during 2008-2012.

As previously mentioned, during this year the DNA has had rather reduced activity when compared to the media outlets of the last few years, the most notable being the investigation of former Health Ministers, Mrs Sorina Pintea and, more recently, Mr Nicolae Banicioiu, both accused of traffic- or influence-peddling or receiving a bribe in their capacity of ministers in former governments.

Regarding the medicines and medical devices and equipment bought during the COVID pandemic, the DNA is currently investigating the case of the general  manager of Unifarm (the centralised buying structure of the Government), accused of requesting a bribe of EUR760,000 to conclude several contracts for medical products.   

Another noteworthy case is that of the judicial police officer, Mr Marius Fleancu, who requested the amount of EUR1.1 million (receiving only part of it, in an in flagrante operation) from a businessman in order to use his influence among other police officers and a prosecutor, so that the latter would close the criminal investigation against him for charges of tax evasion with a prejudice of EUR3 million.

In terms of solutions delivered by prosecutors, there are many star-investigations that have been closed this year, such as in the case of Mr Marian Vanghelie (an influential politician, former Mayor of Bucharest's 5th District and head of a political party), a case in which the chief prosecutor of DNA subsequently decided to revoke this decision and requested the reopening of the case in court.

Furthermore, the number of acquittals received by the DNA in 2020 has increased even more since 2019, a year in which the acquittal rate of the DNA exceeded a whopping 50%. Thus, it should be noted that the cases brought by the National Authority for Property Restitution (ANRP) commission (with names such as Mr Horia Simu, former deputy Mr Marko Attila or Mr Teodor Nicolescu) all being acquitted (by the first court) for prejudices exceeding EUR70 million; Mr Robert Raduly and Mr Domokos Szoke, the mayor and the vice mayor of Miercurea Ciuc, definitively acquitted by the Targu Mures Court of Appeal; Mr George Scripcaru, the former mayor of Brasov, acquitted by the Brasov Court of Appeal (definitively); Mrs Doina Tudor, former senator (definitively); and Mr Cornel Samartinean, former deputy (definitively). Many of these had been previously arrested as per the request of the DNA after being publicly accused and displayed as important cases of severe crimes of corruption.

However, there are other difficult cases which have been put on hold for years, such as a blackmail case against media-mogul Mr Dan Voiculescu (since 2014), or a case of traffic of influence involving the former PSD deputy, Sebastian Ghita (since 2017). Other old cases - such as the case of "Hidro Prahova" (2014), in which former PM Victor Ponta's brother-in-law was arrested, or even the "Tony Blair" case (from 2016), in which the former PM is accused of traffic or influence-peddling - are dormant.

In the first six months of 2020, DNA prosecutors decided to close the criminal investigation in another 963 cases (another staggering record, which was interpreted by public opinion as representing clear evidence of investigations being launched without minimum evidence by the previous leadership of the Directorate), while 84 Indictment Acts and Plea Bargain Agreements were sent to trial. The DNA also registered 1,423 new criminal cases to a docket of approximately 4,500 at the beginning of 2020 (after some 1,000 investigations had been previously forwarded to the Section for Investigating Justice Crimes because it involved prosecutors or judges).

From the Department for the Investigation of Crimes in Justice (SIIJ) portfolio of corruption crimes involving magistrates, the most notable in 2020 is the case of the DNA Ploiesti former chief prosecutor Mr Onea Lucian, along with DNA prosecutors Mr Negulescu Mircea, Mr Alfred Savu and Mrs Cerasela Raileanu, plus other judicial police officers, all accused of having tampered with or even invented evidence in several investigations previously performed by the DNA Ploiesti Service, in which defendants had been arrested and held for several months or even condemned in the first court. Mr Negulescu was under arrest for three weeks, before being released by the High Court of Cassation and Justice, while some of the defendants illegally investigated or condemned had their sentences reversed. The case was partially sent to the High Court against Mr Onea and Mr Negulescu.

In relation to anti-corruption, the activity of the European Anti-Fraud Office (OLAF) in Romania should also be mentioned as an important component of the mechanism against defrauding EU subsidies. Thus, Romania is the first country in the European Union with respect to corruption investigations and recommendations received concerning European funds to be included in the latest OLAF report, which strengthens the role of DLAF (the Romanian branch) in this area. In 2019, Romania was the subject of the largest number of investigations with respect to management and the spending of European funds - more than 10% of the total number of causes referring to European funding fraud.

The investigations conducted by the OLAF varied from the dismantling of complex fraud networks, such as purchasing equipment with EU funds and manipulated auction procedures, to major customs operations targeting consumer goods and cigarettes. The number of environment-related projects has also grown, in line with the EU’s growing focus on sustainable environmental policies.

According to the report published by the press, the OLAF mentions an investigation classified as complex, in which it collaborated with the National Anti-corruption Directorate (DNA). This investigation was aimed at dismantling a network that specialised in fraud and money laundering, acting in the field of EU funds for projects on water supply and waste-water infrastructure. The project was valued at EUR102 million and had a local public water-supply company as a beneficiary. It was found that during the auction procedures the beneficiary attributed two contracts to an enterprise comprised of a Romanian company and a German construction firm, the latter being the lead in the project, having 70% control over the business, and being the sole beneficiary of all the EU money invested. During the investigation, the OLAF found out that the German company was not informed about its involvement in the project, the auction procedures, the EU funds, nor the fact that the project was taking place in Romania. The reality of the situation was that the Romanian company created a false joint enterprise, using the name, reputation, experience and financial standing of the German company.

The problem of aquaculture farms with no water is a common occurrence in the OLAF’s experience, as environmental projects have been subjected to defrauding for several years. Romania has been on the OLAF’s radar for some time already, as a situation from 2013 highlights - a beneficiary of five EU-funded aquaculture projects in Romania received subsidies for surfaces that were never even covered by water. Undoubtedly, the OLAF has proved the allegations that the projects were fabricated with the sole purpose of obtaining EU funds through fraudulent means - and this is proof that what seems to be impervious, usually is not - even when the fabrication can be at such a discrete level insofar as organisational matters are concerned.

The National Integrity Agency (ANI) is responsible for the investigation of administrative conflicts of interest, of incompatibilities and of unjustified assets, and its operation has shown positive results so far, since the sanctioning of incompatibilities and of conflicts of interests is an important element of combating and preventing corruption. The ANI continues to render good results with respect to its activity, but its effectiveness is being tested by the changing of the legislative framework and the scarcity of its technical and human resources. The ANI has also developed powerful tools for preventing administrative conflicts of interest, especially in the field of public procurement, and has carried out awareness-raising campaigns, including in national and local elections. Previous Co-operation and Verification Mechanism (MCV) reports have highlighted the persistent issues which the legislative framework is facing, in terms of integrity and the need for stability and clarity, as well as the need to establish a robust and stable framework.

The Agency proposed that the Ministry of Justice and stakeholders should work together to review legislation concerning integrity and strive towards developing a coherent, strengthened legislative framework. Even though the Agency has a substantially higher workload during election time, its budget has been reduced.

In 2016, the Romanian Constitutional Court ruled that the Romanian Intelligence Service (SRI) can no longer perform wire-tappings on behalf of the DNA, nor can the DNA use any such evidence or SRI investigators in the criminal investigations performed. Thus, the execution of the technical supervision mandates ordered in the criminal trials is carried out exclusively by the judicial police officers from the DNA Technical Service, a situation in which the DNA has publicly complained of a lack of technical resources and know-how, as well as of sufficient personnel.

Currently, the DNA operates with approximately 150 prosecutors and 310 judicial police officers and specialists, yet these numbers are considered insufficient and a new project to increase the numbers (especially) of prosecutors and police officers in the DNA is being debated publicly.

The Implications of the COVID Pandemic in the Fight against Corruption

Since early March 2020, when the new coronavirus entered the global spotlight, governments across the world were subjected to an extreme challenge and, seeing how perspectives are continuously shifting, it is definitely not far from reasonable to say that this challenge has yet to be over. Governments across the globe have striven to handle this crisis to the best of their capacities, mostly by implementing drastic social distancing measures which obviously come with substantial implications. One of these implications is the possible alteration of the criminal justice system, an alteration which will undoubtedly have a further effect, not solely on corruption, but on crime generally.

The alteration of the criminal justice system, for the purposes of this article, illustrates the effect that the pandemic has had (and currently has) on both the court system and the criminal law itself, with a focus on Romania’s position towards this issue.

On 16 March 2020, when Romania officially entered a state of emergency, the authorities issued Decree No 195/2020, through which a series of amendments was introduced, regarding the activity of the criminal prosecution bodies and criminal courts, mostly leading to a decrease in activity of the justice system at all levels, investigations and trials, unless cases are considered priority or urgent.

Considering these from a strictly temporal perspective, the pandemic has substantially hindered the judicial process, which was already protracted to begin with. Trials are delayed for longer than usual and courts had no difficulty in concluding that the current unfolding crisis is proving to be a “discrete” situation which justifies any further delays in the process of administering justice. Consequently, accusations are prone to hang over suspects’ and defendants’ heads for many months, or even years, and a circumstance of this magnitude represents a shortfall of the criminal justice system on its own, without further consideration of basic principles of criminal procedure.

Furthermore, since coercive measures to limit the virus’ spread are necessary, Romania has also imposed more severe criminal regulations through the Government Emergency Ordinance No 28/2020, by which the Criminal Code was amended and some penalties were increased (such as for the crimes of giving false information, intentional failure to comply with the measures taken for the prevention or control of infectious diseases, aggravated circumstances in the case of bodily harm or death of one or multiple persons) and even a new crime created (failure to disclose information as per the request of medical or public authorities).

A global crisis such as the COVID-19 pandemic represents a valid proxy for committing crimes, regardless of their frequency in judicial practice. In comparison to other states, it appears as if Romania has maintained a tough position with respect to criminal law, which can definitely be considered a mark of consistency, but also one of a less enlightened criminal justice system. Much remains to be seen about how much more traction the pandemic will gain, and how this will continue to affect the administration of justice.

Trends for the Future

Bearing in mind the aforementioned factors, in the immediate future it can be anticipated that the fight against corruption will continue in the conditions of the COVID pandemic and the criminal investigation authorities will still struggle with this problem in their day-to-day activity, along with old issues such as under-staffing or political involvement in the justice system.

It is to be expected and looked for that all the main authorities who handle corruption cases will re-start their activity with full force as, for example, the DNA is recruiting members and tries to recover the position of the “tip of the spear” in this fight against persons who perpetrate any type of corruption crimes. After the SRI was excluded from all criminal investigations, the DNA (as well as other investigative authorities) is trying to be once again in the position to gather swiftly and, most importantly, legally, the evidence needed in order to discover corruption crimes.

As for the opinion of the general public regarding the activity of the anti-corruption authorities, it can be said that the public is more concerned of late about the fight against violent criminality (trafficking of persons, drugs, violent criminality) and currently about the fight against the COVID pandemic, and therefore the focus is not on the criminal investigations and the results of the anti-corruption authorities. However, even the handling of the pandemic or of the fight against criminal networks is much criticised in the media as poorly managed because of corruption of high officials, so the fight against corruption will surely remain a constant in the efforts of justice in Romania. 

Enache Pirtea & Associates

32 Pictor Ion Negulici Str.
1st District
011943
Bucharest
Romania

+40 371 471 000

+40 371 607 160

office@enachepirtea.ro enachepirtea.ro
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Trends and Development

Authors



Enache Pirtea & Associates stands for Extraordinary Professionalism Applied to the requirements and needs of the clients and is the main drive and focus of the law firm. This is best encompassed by the firm's motto (“We go the extra mile”), as well as in its mission ("inside the business & outside the box") and vision (to provide businesses with integrated practical solutions for ethically moving forward and shaping the future). EPA was set up in 2018 in Bucharest, after the merger of the specialised law boutique offices of two highly reputed “new wave” business criminal law attorneys, Ms Simona Pirtea and Mr Mădălin Enache, both with extensive experience, mainly in white-collar criminality cases, but also in business crime matters of significant importance. The firm’s focal area of activity, where the main partners have professional experience of over 15 years, is criminal law – white-collar and business crimes, in its two main components: criminal investigation and litigation, as well as business crime consultancy and counselling (business ethics and integrity).

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