City Insurance’s main owner reportedly siphoned out EUR 18 mln since 2017

Troubled Romanian insurer City Insurance has paid EUR 18 mln to its main shareholder, Vivendi International, for fictitious loans since 2017, disclosed the director for the insurance market in Romania’s Financial Supervisory Authority (ASF), Valentin Ionescu, Ziarul Financiar reported.

Specifically, City Insurance declared that it borrowed EUR 50 mln, EUR 25 mln, and another EUR 50 mln this year from Vivendi - but the accounts in the Swiss banks indicated by the insurance company do not exist, and Vivendi extended no loan to City while cashing interest rates of 10%-12%.

Valentin Ionescu was appointed at ASF earlier this year, specifically to investigate the situation in the insurance market.

Nicu Marcu, the current ASF president appointed in 2020, has launched extensive controls on insurance companies, including overseas operations. Before Nicu Marcu, during 2017-2020, the president of ASF was Leonardo Badea - the current vice-governor of the National Bank of Romania (BNR).

In an interview given to Radio Europa Libera, Valentin Ionescu discloses other irregularities at City Insurance, such as understating the cost generated by the green cards issued - as an effect understating the capital requirements.

(Photo source: Inquam Photos/Octav Ganea)