The attack on SIF Oltenia - a financial crime in broad daylight, in complicity with the ASF

Ziarul BURSA #English Section / 12 octombrie 2020


On October 9th, it has been two years since, following the completion of the deal whereby SIF Oltenia (SIF5) sold (to Erste Group Bank) its 6.29% stake (1,023,534,303 shares) in the Romanian Commercial Bank (BCR) for 140 million Euros.

That transaction led to the awarding, at the Annual BURSA Awards, of the Prize for Excellence for the most important transaction on the Romanian capital market in 2018, to Tudor Ciurezu, who was also praised in other festivities of the Romanian capital market, organized that year.

Everybody admired (or envied) the luck and wisdom of Ciurezu, who, after this success, speculated the time of the general stock price drop on the BSE (caused by the Emergency Ordinance no. 114 of December 28, 2018) and reinvested his money in liquid stocks, at good prices (for investing in BRD and Banca Transilvania he spent about 45 million Euros, and kept the rest of the money aside waiting for future opportunities; in the end, approximately 80% of the amount earned was used for buying bank stocks).

But that triumph was when the aggression of the manager of SIF Banat Crişana and the persecution of the Financial Oversight Authority against SIF Oltenia CEO Tudor Ciurezu and his management team began.

For two years now, Tudor Ciurezu and his team are being hounded with phantasmagorical claims and accusations which his competitors from SIF Banat Crisana are using to dismantle his management, to the detriment of the company and the other shareholders.

The manager of SIF Banat Crişana is using the support he gets from certain workers in the Financial Oversight Authority (ASF) - an institution which is notorious for its corruption, which is a constant supplier of convicts.

The ASF is tolerating the illegal acting in concert of the "cooperative" structured around SIF Banat Crişana made of a number of eleven other investment funds and with SIF Muntenia, so they can make rules in the General Shareholder Meetings of the shareholders of their competitor of SIF Oltenia.

Today, two years after that triumph which placed the management team of SIF Oltenia on the top position among the five SIFs, Tudor Ciurezu and his team are being faced with the certain prospect of being removed from the leadership and not just in any way, but the elimination is going to be humiliating, insulting, without any connection to performance, in actuality, despite the good results of the fund:

- The ASF has asked for documents in order to reevaluate all of the five members of the Board of Directors, perhaps in order to validate the undesirable ones, even though they are at the end of their term (and to prevent them from running in the next elections); the ASF is also considering harsh fines, like it has done before;

- The General Shareholder Meeting forced through by the "cooperative" of SIF Banat Crişana had on the agenda a number of topics which weren't just nonsensical, but also in violation of the law, as well as the bringing of a personal liability proceeding against four of the five members of the management team, for an imaginary fault, but that will not prevent "the cooperative" from approving the punitive measure; following which, "the cooperative" has made its goal to dismiss the managers and there is nothing preventing it from doing that;

- Another General Shareholder Meeting is coming for electing the members of the management team, where "the cooperative", of course, will push through its own people.

What is the logic behind a hostile competitor removing an effective management team through abusive maneuvers together with the market overseer?

How can a competitive management team, which includes among its consultants, as a major influence, a felon convicted for money laundering and stock market manipulation, a team stigmatized, itself, by market manipulation and by a really questionable management, get the large scale support of the ASF to impose its supremacy on SIF Oltenia, to the detriment of the other shareholders and of society?

The text that follows shows how it's done.

Through abusing the position of hostile, unsanctioned shareholder; through unfair competition, tolerated by the Financial Oversight Authority; through the manipulation of the market, with the complicity of the Financial Oversight Authority; through harassment, threats and fines directed against SIF Oltenia by the Financial Oversight Authority; by violating the law.


The method for the overthrow of the management of SIF Oltenia by its competitor at SIF Banat Crişana is rudimentary and could not have been applied without the complicity of the ASF: we are talking about the acting in concert of some entities which leech the shareholder structures of three SIFs - SIF Banat Crişana, SIF Muntenia and SIF Oltenia (with the potential of doing the same thing at SIF Moldova), an action in concert which is against the law, which the ASF refuses to acknowledge, no matter how obvious it may be.

The topic has been discussed in the article "AGA SIF Banat-Crişana şi un păienjeniş de vehicule investiţionale"/BURSA/April 27, 2020, where the chart displays the connections between SIF Banat Crişana and SIF Muntenia, with a number of eleven investment funds, acting together under the control of the chairman of SIF Banat Crisana, Bogdan Drăgoi.

Some of the business partners of the Drăgoi family claim that Drăgoi Jr. is under the total control of his father, Dan Drăgoi and under the influence of Najib el Lakis, former vice-president of SIF Banat Crişana, who was convicted in 2019, (with a 3-year suspended sentence) for money laundering and market manipulation.


- Rise Project writes that Dan Drăgoi is a retired general and he was the deputy of general Victor Atanasie Stănculescu as state secretary in the Ministry of the Economy between October 16 - November 8, 1991. The same source reports that "subsequently, Stănculescu and Drăgoi went into business, representing the interests of the Balli group in Romania. Dan Drăgoi was an executive with Sidex International Ltd. (London) and Dundee Ltd (Dublin) - both have leeched the Sidex Galaţi plant (when it belonged to the state)".

- Radu Tudor writes: " One of the most discreet and efficient multi-billionnaires in Romania, Dan Drăgoi has succeeded in getting his hands on a business of several dozens of Euros by placing his son Bogdan Drăgoi at the helm of SIF Banat. Dan Drăgoi went into business in the 90s as the right hand of general Victor Atanasie Stănculescu at Bali Trading. Bogdan Drăgoi was a finance minister in the PDL government and then presidential advisor to Traian Băsescu. Bogdan was and continues to be the shadow of his father Dan Drăgoi, a figure that has escaped the attention of those who have investigated the group of Romanian billionaires consolidated over the last 15-20 years."

Once Najib el Lakis and Bogdan Drăgoi assured their supremacy through the acting in concert of this "cooperative" in the General Shareholder Meetings of the shareholders of their own SIFs (Banat Crişana and Muntenia), they began climbing atop SIF Oltenia, which the ASF allowed, as it decided that "there were no elements" that would prove the acting in concert.

The issue has been discussed in the article "Dormi liniştit ASF! Lakis lucrează pentru tine!" /BURSA/April 23, 2020.

The complicity of the ASF leads to the illegality of the acting in concert, beyond any study on the law, is proven by the fact that, no more than two years ago, it declared that the funds owned by Erste Group which were shareholders in SIF Oltenia, to be acting in concert, who were tied by similar relationships to the ones presented by the ones in the scheme presented by BURSA (see Decizia ASF nr. 507/24.04.2018 ASF- Decision no. 507/April 24.2018).

By dominating the General Shareholder Meeting of SIF Oltenia, Lakis and Drăgoi have tried to subordinate Ciurezu, to force upon him the management of SIF Oltenia, according to their own interests of expanding the "cooperative".

Everything that came afterwards is, on one hand, harassment, and on the other, a mockery.


In the beginning of 2019, Bogdan Drăgoi, the president of SIF Banat Crişana misled the press with the idea that "president Tudor Ciurezu does as he pleases at SIF Oltenia as if it were his fiefdom" and that there was a need for an Investment Committee that would vet his decisions.

He personally told me this.

Given the notoriety of the abuse of the managers of SIFs who have speculated the rarefaction of the shareholder structure to perpetuate their positions for decades, Drăgoi's story seemed plausible.

I didn't know, at the time, that Bogdan Drăgoi had the habit of falsifying reality - some still don't know that (see "Preşedintele SIF Banat Crişana Bogdan Drăgoi se autodenunţă pentru manipularea pieţei"/BURSA/August 06, 2020). Much later I realized that for Bogdan Drăgoi, any forgery that is in his benefit becomes a truth and he strongly believes he isn't lying.

That is the possible explanation for the fact that SIF1 chairman Bogdan Drăgoi was not shy of providing false information to the Bucharest Stock Exchange, lies which he even places his signature on, in official papers.

The short story of the investment committee:

In April 2019, the SIF Banat-Crişana&SIF Muntenia "cooperative" forces onto the agenda of the next general shareholder meeting of SIF Oltenia the approval of the creation of an Investment Committee (the members of the executive committee and three employees), who would audit and evaluate the activity of the management of SIF Oltenia, vested with the power to approve or reject the proposal of the CEO (or of the deputy CEO) on any proposed deal exceeding 1 million lei.

On May 9th, 2019, the proposal is approved by the General Shareholder Meeting, which also approves the cut of the number of board members at SIF5 from 7 to 5, in a ghetto-like mood, with the shareholder factions hurling insults at each other.

On August 28th, 2020, the ASF rejects the creation of the Investment Committee, on claims that it does not meet a number of legal dispositions (for instance, because the responsibility for the management lies with the upper management).

For a year and a half, the wacky Investment Committee dreamed up by Bogdan Drăgoi has worked as a story of the manner in which "Ciurezu's dictatorship" can be repressed; general shareholder meetings, the amendment of the bylaws of SIF Oltenia, lawsuits, bureaucracy, endless talks which the mass-media got involved in as well.

In the end, it was found that the idea was a moronic illegality, a mockery which kept the management of SIF Oltenia busy, as a manager of a company that was a competitor to SIF Banat Crisana, and the ASF did not intervene to set things straight.

The first reaction of the ASF was a natural one, showing that the idea of the Investment Committee was illegal, only to then approve it and tolerate the unimpeded harassment, practiced by a competitor, under the pretense of it being a shareholder.


Calling for the personal liability of the managers of SIF Oltenia is a threat formulated as one of the items on the agenda of the General Shareholder Meeting of Monday's SIF Oltenia General Shareholder Meeting (October 12/13, 2020), but is also repeats itself in an absolutely frivolous manner and for various other reasons in other General Shareholder Meetings of SIF Oltenia, held this year.

On April 6, 2020, "the cooperative" alleged (see Report posted on the BSE) a loss upon the sale of Prodplast shares, claiming that SIF Oltenia lost 336,296 lei, because other trades were made at higher prices.

The proposal had no result at the time, because the geniuses of SIF Banat Crişana had not noticed that the board members who they wanted to bring a liability action against also included Radu Hanga, the president of the Bucharest Stock Exchange (who later resigned from the board of SIF Oltenia).

But the most ridiculous situation which "the cooperative" created was that it exempted SIF Oltenia vice-president Cristian Buşu (Drăgoi's man) from being held liable, even though he had also signed off on the Prodplast trade, along with all the other board members.

In fact, in the quoted report, the "cooperative" states its intention to "designate board member Buşu Cristian for bringing the lawsuit".

That fact proves that the calling for the the bringing of a personal liability action against the management is not being done because of any losses they might have caused, but as a form of threat and blackmail, in order to bring down the management of SIF Oltenia.

Now, for the General Shareholder Meeting of October 12-13th, the reason invoked by the "cooperative" for bringing a the personal liability action against the managers is embarrassing: that the company they are running should have paid dividends using it own resources, rather than taking out a loan for that purpose.

The reason illustrates the mediocrity of the manager of SIF Banat Crişana, who cannot understand that a loan which allows preserving some valuable holdings can bring overwhelmingly bigger profits than the cost of the loan.

The fact that perhaps Dan Drăgoi is not an expert in the stock market is not as important as the fact that again, "the cooperative" intends to exonerate its man implanted at the helm of SIF Oltenia - Cristian Buşu.

But Cristian Buşu has not only approved (this time as well) the measure incriminated by SIF Banat Crişana, but is even a co-signer on the loan agreement.


What is the "cooperative" seeking?

The good of the company from Oltenia or threatening, blackmailing, eliminating its management?


Drăgoi has wanted to dismiss Ciurezu for two years now, since Ciurezu refused Drăgoi's invitation to a meeting which would establish in common the investment policy of SIF Oltenia, after the sale of the shares in BCR.

The dismissal of the managers has been a recurring topic, being brought up by the "cooperative" together with that of the bringing of a personal liability proceeding.

In the General Shareholder Meeting of October 12/13, the Certinvest funds (which are part of the "cooperative") are asking for the dismissal of the managers of SIF Oltenia (except for Cristian Buşu, of course) claiming that "they are violating shareholders' rights, as well as defying the Financial Oversight Authority".

"Violating shareholders' rights" could be a valid reason for the desire to dismiss the managers, but "defying the ASF"?!

Isn't it strange?

Since when do the shareholders of a company take it upon themselves to consolidate the authority of the ASF?

I am convinced that a part of the shareholders of SIF Oltenia hate the ASF for its illegalities, for tolerating and providing support to the illegalities committed by the "cooperative".

In a lawsuit in court concerning the "defiance against the ASF", the Certinvest funds would be denied their position as parties in the lawsuit.


The end is near, maybe one or two days ago.

Nothing can save Ciurezu.

The "cooperative" is unbeatable.

The manager of SIF Banat Crişana, who, out of the five SIFs, has distributed dividends six times smaller than SIF Oltenia, over the last eight years, is driving him away and mocking him.

Which is something that, with the powerful support of that same ASF, an institution recognized as a "cesspool", has already happened at SIF Transilvania too, where Mihai Fercală was dismissed, after serving as its CEO for 28 years and ensured the distribution of record dividends among the SIFs.

The weakest, drives away the most performing one and that pleases the ASF "cesspool".

Total dividends paid out by the five SIFs, between 2011-2019

SIF 1 - 109,769,854 lei

SIF 2 - 555,978,952 lei

SIF 3 - 63,813,654 lei

SIF 4 - 327,818,234 lei

SIF 5 - 617,833,926 lei

But the phenomenon would be incompletely described if we didn't mention the seven years of NAV manipulation by SIF Banat Crişana, a manipulation where the ASF played an active part and which, at least so far, has not had any consequences, even though it is an offense punishable by jail.

In conclusion, the one who paid out the lowest dividends, who is a manipulator covered up by the ASF and a man who promotes falsehoods in public documents, under his own signature, succeeds in driving away the one who pays out six times higher dividends.

It is a financial crime perpetrated in broad daylight, with everyone's knowledge - it has all the characteristics of a terrorist act.

Words can't stop a terrorist act.

A terrorist act can only be stopped through an act of force.