The customers of his brokerage firms (WBS Holding and WBS Romania) cannot get access to their money and have no idea whether they still have it or not. Securities market watchdog CNVM started an investigation into WBS Romania and continues its investigation of Sibex. The Sibiu police started its own investigation, too. Former finance minister Daniel Daianu is looking for his money, says it was there on paper but the reports were fake.
Musician Tudor Chirila says he is no longer one of Sima’s clients, but some of his friends cannot get their money back. The amount Sima is said to have taken from his clients’ accounts is rising by the day (about EUR5 million to EUR10 million). The list of clients affected by this reportedly includes big names in Romania’s business sector and showbiz.
The replacement of Cristian Sima from his positions as chairman and general manager of Sibex brought out in the open his disappearance from the local capital market and soon after that the rumor mill started.
The way he disappeared after selling all his businesses in Romania, the fact that he can no longer be reached by cell phone or at the phone number of his Switzerland home fuelled rumors that he had run with the money he was managing for the clients of brokerage firm WBS Holding, making people quickly remember Bernard Madoff and other cases of fraud unveiled in the US in recent years.
Meanwhile some clients started talking and complaining they could not get their money from WBS Holding and WBS Romania. The biggest name is former finance minister Daniel Daianu.
“I’m stunned by the disappearance of Sima. I learnt that Cristian Sima is nowhere to be found and left with the clients’ money from the press. The reports I got for my account from the brokerage firm at the end of September showed profit not loss, but now I wonder whether that information is true or not,” said Daianu, adding he had also invested in Sibex at the recommendation of Sima.
Musician Tudor Chirila is a former client of Sima. He says he no longer is because he no longer invests on foreign markets. “I’ve got close friends who cannot get their money back now. I want to believe that it’s not true, that the situation is reversible. I want to believe I invested in a friendship with a real man,” writes Chirila in his blog.
Sima’s VIP client list also includes businessman Radu Dimofte, one of the low-profile partners of Gabriel Popoviciu (the owner of the Baneasa mall) and fashion designer Irina Schrotter, who are among those that Sima is said to have persuaded to invest in Sibex. They may also be among WBS Holdings clients, but the information has not been verified yet. None of them could be reached.
Sima became famous because of being on TV often as a guest commentator on economic issues. He built connections with important people in the business world. Until recently he had been a partner in a residential development (Doamna Ghica Plaza in NE Bucharest) along with Dan Pascariu, the chief executive of UniCredit Tiriac Bank and lawyer Catalin Zamfirescu (farther in law to former justice minister Catalin Predoiu).
Sima was also one of the supporters of Bucharest mayor candidate Nicusor Dan this year. He also owned 9% in news portal Hotnews, which he sold at the end of September.
The circles he was part of allowed him to attract important clients, to whom he promised he would multiply their money on international markets. No official information about the losses he caused his clients had surfaced until Thursday, but rumor had it it was about EUR5 million or EUR10 million.
The securities market watchdog, CNVM, started an investigation of WBS Romania after learning about the issue from the media. WBS Romania is a brokerage firm established by Cristian Sima, and licensed to trade on both the stock market in Bucharest and the monetary and commodities market of Sibiu. A number of WBS Romania clients have complained they cannot withdraw their money from the broker and the personnel is unable to assist them.
It was reported that some of the money in WBS Romania’s accounts were transferred to WBS Holding, registered in the Virgin Islands and as such out of CNVM’s jurisdiction.
Contacted by ZF, Anca Bunea, general manager of WBS Romania, said the firm no longer had anything to do with Sima, who sold his stake in it last year. She would not provide any further comment. Bunea is listed as manager of other companies controlled by Cristian Sima, according to the Trade Registry information.
CNVM recommended the clients of WBS Romania who felt they had lost money to file a complaint with it. No complaint has been filed yet. The police started an investigation, too, after learning about the issue from the media.
Securities market’s watchdog investigation of WBS Romania started on Thursday, October 11 and could shed light on the status of the clients’ accounts and on whether it has any connection with WBS Holding or not. As WBS Holding is registered in the British Virgin Islands, CNVM has no jurisdiction over it to check its operations and clients’ accounts, and an investigation thereof falls upon the police.
The Brokers Association says that “operating any trading platforms and companies registered in tax havens, not subject to the regulations of the national capital market in Romania may be detrimental to both investors and licensed brokers, who are fair and honest to their clients, and comply with the capital market legislation,” and that it has nothing to do with such practices.
Sima had supporters on the local capital market, as well as very many enemies, and many of those operating on the market thought he bragged too much. Many doubted his achievements. However, Sima was even a member of the Bucharest Stock Exchange board of directors for a few months and left after a scandal in which Dan Paul, the chairman of the Brokers Association accused him of attempting to illegally take over the stock exchange.
Sima then turned to Sibex and bought shares in it and encouraged many people close to him to buy shares in it, too, thus controlling a significant stake. He could not have removed former chairman and founder of Sibex Teodor Ancuta from his position without support from the regional investment funds (SIFs). Some say Sima allegedly ‘bought’ the votes of the SIFs last year to get himself elected Sibex chairman.
Teodor Ancuta, former Sibex chairman, is accusing Sima of having ‘squandered’ Sibex’s money, collected from shareholders over 15 years, using it on trips abroad and sponsorships. Sibex slipped into the red in 2011 and was also in the red in the first half of 2012. There was also talk about Sima taking money from Sibex accounts, but the current management denies the rumors.
“Four CNVM inspectors are currently conducting an investigation at the Sibex headquarters and I do not rule out the possibility of them asking for more information about Sibex’s activity in light of the recent news in the media. I’ve checked the accounts of Sibex for problems and got verbal confirmation from the accountant that there is no problem with the accounts of Sibex or of the Sibex group,” said Paul Miclaus, the new Sibex chairman.
(English version by Loredana Fratila-Cristescu)