Romanian Court suspends Carpatica Asig’s bankruptcy procedure

Romania’s High Court of Cassation and Justice has admitted the request of the National Anticorruption Directorate (DNA) related to the bankruptcy of local insurer Carpatica Asig. DNA had requested the court to block the insurer from going bankrupt as Carpatica Asig is involved in a corruption case DNA has been investigating. Following the decision, the bankruptcy procedure will be stopped, until mid-October, reports local Profit.ro. This also means that the compensation of the Carpatica Asig customers will be delayed. The decision affects millions of Romanians, as Carpatica Asig has over one million policies, most of them being mandatory car insurance (RCA) policies. The Financial Supervisory Authority (ASF) withdrew the insurer’s operating license at the end of July. The DNA prosecutors argued that the company would be quickly liquidated and dissolved if the court confirmed its bankruptcy. This means that the insurer could no longer be held responsible in a criminal case. Carpatica Asig and its main shareholder Ilie Carabulea were sent to court for charges of buying influence and bribery at the end of April 2014. A court sentenced Carpatica Asig to pay a RON 600,000 penal fine, but the company filed an appeal. The case is still pending. editor@romania-insider.com