The secrecy surrounding an EU report into alleged dodgy dealings in the Romanian motor insurance market is raising eyebrows in Brussels, as multiple MEPs brought the matter to the attention of financial services commissioner Mairead McGuinness earlier this week.
Questions have been raised recently about the strange goings-on in Bucharest’s notoriously corrupt motor insurance industry when the Romanian Financial Supervisory Authority (ASF) pulled the operating licence of the insurance company Euroins Romania after what is described as a campaign of harassment against the firm.
The origin of the dispute lies in Euroins’ refusal to perform an emergency buyout of beleaguered Romanian insurance group City Insurance in 2019, which Euroins executives claim contributed to a decision by ASF to pull the company’s operating licence in February on the grounds of alleged insolvency, a fact disputed by Euroins directors.
Euroins’ Bulgaria-based holding company, Eurohold, referred the matter to legal authorities in March, alleging a criminal-led conspiracy to muscle it out of the Romanian market in a move they claim could destabilise the wider Romanian economy.
An attempt by the European Bank for Reconstruction and Development (EBRD) to mediate the matter and recommend an independent auditor be appointed to examine if Euroins was actually insolvent was dismissed by the European Insurance and Occupational Pensions Authority (EIOPA), which carried out its own investigation with ASF.
The matter has generated controversy in Romania as the government prepared for the impact of 1.7 million insurance policies with emergency measures caused by the departure of Euroins from the domestic market.
The matter has been further intensified by the revelation this week from German MEP Lars Patrick Berg that EIOPA’s report into Euroins’ finances has been withheld from European parliamentarians.
Speaking to The European Conservative, a spokesman for Mr. Berg’s office criticised the Commission’s lack of professionalism when investigating recent irregularities around ASF and considered the disappearance of the report an example of “contempt” for parliament.
Separately, an independent report by the EBRD challenged some of the rationale for the revoking of Euroins’ licence on the grounds of insolvency, as insiders suggest that Euroins is being driven out of Romania in order to consolidate the market under one state-backed insurance company.
In response to the accusations of chicanery, EU Commissioner Mairead McGuinness affirmed the EU’s support of ASF’s decision to put the squeeze on Euroins against accusations that the decision was politically motivated. Romania’s ruling Europhile government is currently in the EU’s good books, as critics claim that Brussels is ignoring endemic political corruption in the country due to its political compliance, unlike neighbouring Hungary.
In a statement to The European Conservative, Euroins cited “highly disputable actions by EIOPA,” including failing to consult with the company during its reporting and that Euroins had themselves struggled to gain access to the EIOPA report, which had condemned the company.
Regardless, many experts claim that a costly financial bomb is about to go off in the Romanian motor insurance market, worsened by the EU turning a regulatory blind eye.
Neither the office of Commissioner Mairead McGuinness, EIOPA, nor ASF responded to media inquiries regarding the audit report.
