Former head of Romanian restitution office arrested in corruption probe

By bne IntelliNews November 25, 2014

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The former head of Romanian restitution body ANRP, an institution set up to compensate people who had property confiscated by the Communists, was arrested for 24 hours at the request of prosecutors of the anti-corruption body DNA, online news agency HotNews announced on November 24. Prosecutors have interrogated Crinuta Dumitrean, who headed the ANRP during 2011-2013, at their headquarters in connection with a corruption case involving the former head of the anti-crime body DIICOT Alina Bica, and they plan to ask a law court to place her in police custody for 30 days.

In terms of political affiliation, Dumitrean was backed by the centre-right PDL party, which was in government in 2011 but is now in opposition, and personally by PDL MP Ioan Oltean.

Prosecutors have started a criminal investigation into Dumitrean and arrested her for 24 hours, a DNA statement said. Prosecutors provided evidence they claim points toward the restitution body’s committee headed by Dumitrean being aware of the overvaluation of a plot of land outside Bucharest. The property was valued at more than €90mn instead of its fair value of €30mn, resulting in damage to the public purse of some €60mn, prosecutors allege. The plot was claimed by Gheorghe Stelian who purchased the restitution rights from former owners now living in Italy for €1.5mn. Based on the evaluation accepted by the ANRP committee, Stelian was given Property Fund [Fondul Proprietatea] titles in the amount of over €90mn.

Property restitution in Romania has turned into a never ending process that is incurring endless costs for the state, because of the unclear, changing procedures and corruption among state bodies that manage the process. The case involving DIICOT head Bica and former ANRP head Dumitrean is the largest corruption case related to the process so far, but given the size of the restitution process and the ambiguous procedures, it could well be followed by a series of similar cases.

President Traian Basescu endorsed a new controversial bill on property restitution, drafted by the government and aimed at compensating the victims of communist nationalisation, in June 2013. Under the legislation, the government postponed new restitution claims until 2016. During 2014-2018, the state would however compensate in cash the 14,000 recipients of restitution rights that have had their claims reviewed and approved. The rest of the recipients whose files would be reviewed in the meantime will be compensated mainly in kind (starting as of 2016) – namely by giving them state properties, or in cash gradually paid out over seven years starting 2017. The compensation in kind would however be done under a complicated system, involving a bidding procedure for each real estate asset.

The government surprisingly announced in 2013 that there are still 200,000 restitution claims to be reviewed, which is a very large amount compared with the 13,000 already reviewed and compensated, plus the 14,000 reviewed but not compensated yet. The state has already had to allocate large resources to this – 9,000 buildings, more than 1mn heactares of land, and €5bn in cash and shares in the Property Fund. This makes it one of the most generous restitution processes amongst the former communist countries.

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