Low-class blackmail, this is the accusation Virgil E. addresses to most of the banks in Romania. Under the mask of the involvement in the lending policy of Romanian companies’ activity, the banks are actually practicing outright extortion, low-class blackmail, forcing people, under the threat of enforcement or bankruptcy, to mortgage their lives and their own assets or that of their relatives.
Once you joined the rollercoaster of financing the business with bank loans, you are lost, you entered the BANKING HELL and, just as in Dante’s world, you leave any hope on the doorsteps of bank’s building.
The banks place their stakes on the moral constraint of the Romanian company owners and take advantage, in the most abject manner, of their ability to enforce astronomical interest rates, without giving any consideration to the years work that was needed to support a company. Nothing counts, but the stupid concern to reach all-time revenue records, neither the people, nor the morality or the law. Nothing but the MONEY! Virgil is the perfect example of the way the ROMANIAN BANKING SYSTEM not only that it does not help the Romanian companies or the economy, but it CRUSHES them, squeezes them as lemons of any energy, acting just like grasshoppers that HAVE TO CONSUME EVERYTHING AND LEAVE NOTHING BEHIND.
We pretend that we don’t see, that we don’t care, but if we leave this scourge to expend in the national economy we will deliberately allow this diabolic scheme to destroy and enslave us. A cold mechanism, with no feelings, that doesn’t care for the human being more than the guards cared for the prisoners in the Gulag. Virgil was blackmailed: you either sign the contract with a huge interest and mortgage your life and the one of your wife, or you face enforcement, you are left on the streets and the bankruptcy will follow. What can I tell you about these boogie-man style enforcements? From my legal experience I can tell you that if you decide to confront them and have a good lawyer, THE BANKS WOULD NOT GET TO APPLY ENFORCEMENT, but this is exactly what they are counting on, on the fear they spread just like a poisoning gas over their customers.
What if you would say to their face: you want to apply enforcement on me? Just try it and I will bring about 30 actions in court and eventually I will win because you enslaved me all these years without giving anything in exchange. If you draw the line, after 5 or 10 years of bank financing, your company grew, you go on holiday in Greece instead of Romania, but YOU HAVE NOTHING. ALL IS ENCUMBERED OR MORTGAGED AT THE BANK and when the bank decides to mess with you, it’s all over.
Here is the experience with Virgil:
Good afternoon,
I read with a lot of interest every day the emails with information coming from the “customer assistance” address …. I eventually decided to ask for your advice because, sincerely, I’M EXASPERATED BY THE BANKS.
But, let’s start with the beginning. My name is Virgil E and I am director of SC XYZ SRL (advertising production). Among other loans I had to contract to develop the company, I took also 2 loans from the former FinansBank, the current Credit Europe Bank. A credit facility for which I paid monthly installment for the amount drawn and a transporter loan that I used to buy a car. In July this year the credit facility matured and an addendum was concluded whereby my company undertook to repay this credit facility in equal installments. So far, so good. My contact person in the bank kept delaying me until the last moment with the documents (the last day) when he presented me an ABERRANT contract that I was “forced” to sign under the “threat” : “if you don’t agree, tomorrow you have to show up with the money or you enter enforcement procedures with the other loan too”. You can imagine my desperation. I had to agree with a 25% annual interest rate and in case of delayed payments, I was applied a penalty interest of 28% per year. Moreover, I has to sign-off a blank promissory note (in addition to the one I had already signed one year ago when I opened the credit facility and the one that I signed when I contracted the “transporter” loan that I used to buy the car. The problem is not that I signed 3 blank promissory notes (although I found it out-of-place since one promissory note has already been submitted to secure the credit facility), but this last promissory note had to be endorsed both by myself as a natural person and director of the company, but also by my wife that is just an employee of our company. Ever since, I have been threatened by the bank, upon each delayed payment, with enforcement… for both the loans contracted with them. Leaving aside the ABERRATIONS imposed by the bank, but that I had to swallow, my kind request to you is as follows: which is actually the enforcement procedure? Could such a procedure be initiated over the phone? Should a written notification be sent? Shouldn’t they offer a last payment term? Aren’t the parties invited to a conciliation meeting? Since I do not know this procedure, I let myself be intimidated each time by the bank and I play by their rules.
There are some other issues relating to the banks, but I don’t know how many of them could be solved. Anyway, let me know tell you about my second experience with my company. At least people would know as many information as possible and eventually someone would take some actions, in practice, because in theory, they kept taking actions as of 1990. Last year also, I contracted from Leumi Bank Romania a loan for procurement of equipments that covered for 75% of the purchase price, the remaining 25% being my own contribution (capital contribution).
In June one year passed. According to the contract concluded, in the first year the interest was fixed at 10% p.a.. As of June, the interest started to grow monthly to reach now 15.5% p.a. The bank put this growth on the something related to the index of inflation in EUR, but the loan I took was in lei. What EUR index has to do with this? Something else. Last month, the equipments were revaluated and, following the revaluation, I received a letter from the bank whereby I was informed that “following the valuation report, we concluded that your company is in financial regress, and, therefore, we have to increase the interest by 1% p.a.”. Sincerely, I have never heard of a bigger ABERRATION. They come, valuate the equipments, and reach the conclusion that my company is going through a financial regress? And, to make matters worse, such abuses are “perfectly legal” from their point of view since these are clauses laid-down in the agreement. For example, for the credit facility the contract had a clause whereby my company undertook to have a monthly account activity of RON 10,000, but the term was not specified. I understand that this clause is valid for the 6 months I used the credit facility. But it appears that I was wrong. In June (that was the same month when the loan for investment turned one year), I received another letter whereby I was informed that I didn’t meet my obligation regarding the account activity of RON 10,000 and consequently the interest was increased by 4% p.a. .. I don’t know how they came-up with this, since there was no provision in the agreement in this respect. For use this increase of the interest rate was not done only for the credit facility, but also for the loan for equipments. So that not, both loans have a 15.5% p.a. interest rate in less than 2 months, from 10% p.a. … because of the EUR inflation index.! I advise anybody concluding contracts to be very careful if the loan is in lei. Such a clause should not be in the agreement. It seems aberrant to me. And the variable interest rate… it should be somehow laid-down in the agreement. Because each bank increases it as per “its desire”, to quote some pawnbrokers I know, that frankly speaking, I think are more reliable than the banks. It was said on the internet that banks are “legal pawnbrokers”. I confirm. They steal in your face, legally and nobody sys anything. And all of these happen to the detriment of us, the consumers and especially of the small businessmen. How could the national economy grow if all our revenues are split between the bank and state dues?
And then why people wonder when a person working up to 14 hours a day goes and spends any saved money abroad after having been taken for a fool the entire year by the state and the banks? We should let ourselves be treated equally by the seaside “slicks”? I was watching TV the other days and I saw a X5 driving on the beach and injuring people. And to conclude, thank you for your patience to read this email. I apologize if I am not entirely right, but I CANNOT TAKE IN ANYMORE. The banks are simply preventing me to do my business and I am force to close it eventually. If I cannot pay the rent or the phone the activity of my company is paralyzed and, subsequently, I cannot pay the installments to the bank. If I go and ask for help from a bank, I get obstructed, I am delayed until the last second when I am forced to sign whatever they want me to. Last year I was looking to buy various things for my company… First I went to Banca Transilvania where I had already had a credit line and a discount line. I applied for an investment loan. I was replied “You don’t have repayment power”. Ok, I said to myself and I went to another bank. I ended up at the former Finans that told me “We cannot grant the loan you want because you don’t have repayment power. But, what we can do is to grant you a credit line and a credit for procurement of a car” … Said and done. But I wanted the equipments… I ended-up again at Leumi where I tried to convince them to take-over all my loans and to extend them to cover for the equipments, but I was told “You don’t have repayment power. What we can give you is a credit facility and another loan for investments. Now the question… Why each of them considered that I don’t have repayment power, but now I have 6 loans concluded with 3 banks? And this because I don’t have repayment power. I don’t think so! I think that each of them tried to obtain as much a possible from my company and offered, in addition to the lending options they agreed to, also another one. I don’t think that any bank would ever share the risks fairly with the company in which it invests. We assume all the risks and the banks sometimes cover themselves even 3 times the value of the loan they granted. Banca Transilvania asked me, for a EUR 30,000 investment loan, besides the 2 blank promissory notes endorsed by myself as director, also mortgage on the equipments and another asset that would cover for the entire value of the loan. Are they covered 3 times. I say they are and this is not normal. We risk, we pay and the bank does not move a finger, just as the Romanian state . We are told that we need them, take it or leave it.
To conclude, please, as per your available time, explain to me in a couple of words this enforcement procedure. I will handle the rest. This year I will terminate all my loans. Either by paying them or I start to collect evidence. And by the end of the year, no matter what, I take them to court. They always have their own way imposed on our time and money and especially on our work.
Thank you one more time for the information you send us almost daily that is a good coffee-lecture for a small entrepreneur .
Please have all my respect for the work you do to the benefit of the consumers.
PS: if you think that this email could be a lesson to learn from for others too, please publish it in your newsletter. Don’t say my name or the name of my company. However I insist you to publish the names of the banks I mentioned. I’m not afraid of them, moreover since I now I am right. Thank you in advance for understanding.
For any comments and suggestions regarding this material, or if you have experienced similar situations and think they have to be known and reported to the authorities and to Justice, please write to me at the following address: iulian.urban@gmail.com
Serious fraud accusations against MKB ROMEXTERRA BANK made by Iulian Doftoreanu
A first extremely virulent reaction, after publishing this material
http://www.urbaniulian.ro/2008/08/20/cum-ajuta-bancile-mici-intreprinzatori-din-romania-ori-semnezi-cu-dobanda-de-25-pe-an-ori-te-executam-silit/
came from Iulian Doftoreanu that brings-up serious fraud accusations against MKB Romexterra, alleging that he was the victim of an “union” formed by some employees of this bank that, acting without the knowledge of the shareholders, have actually buried him financially and morally. Doftoreanu even created a blog where he discloses the fraud mechanisms whose victim he was! He accuses blunt false and use of forge documents, alleging that, without his signature and while he was abroad, loans amounting to lei 80 billion (more than 2,2 million Euro) were granted.
Dear brother in suffering.
My company is active in the same field of advertising production, so I had and have pretty much the same needs as you. Reading your story, I experienced a deja-vu. I have lived the same nightmares as yourself, I didn’t have the courage or the skill to set down my foot. I visited myself the banks you mentioned, I contracted loans with them too and I felt the fear of enforcement, the fear of CIP (Payment Incinent Bureau) or CRB (Banking Risc Bureau). Moreover my desperation to find a bank that would not take everything away from took me to MKB ROMEXTERRA BANK. Here was the apogee. They financed any business, any idea, any equipments. We were one happy family. Total confidence, blind confidence. The only thing was just the loans were terminated and reopened monthly. That was the product, that is what they did… no matter the fees charged for each extension …especially since it was in the range of 1 point … Later on I realized that since was not the only fee, the cost I incurred each time was 3 point… But let’s get over this. Slowly, new rules have started to appear. One said that once you close the loan in the end of the month, and in the next minute it is re-granted to you, it should be used to pay the suppliers. It didn’t matter that you borrowed the settlement money for one hour to comply with the norm of the bank regarding the product. One or several suppliers had to be paid. That is how a “union” of the borrowers of MKB ROMEXTERRA BANK was created. Huge amounts were transferred between companies that had practically no business relation whatsoever, but that issued invoices and may circular payments. That is how I, that produced larges-size prints, posters and other similar, ended-up selling trucks of carrots, cucumbers, broken stone, sand, double-glazed windows, diesel fuel, mineral oils, degreasers and the person actually selling vegetables or operating a stone pit ended-up selling tones of electoral prints. And so, gradually, we have been stuck. The Manager of the bank communicated to us in the morning which was the “desired” payments circuit, the accounts and the companies (even now I don’t know to whom some companied belonged to or what they were actually doing) , which loans had to be closed, which company was supposed to take a new loan, etc. I was smart enough to keep the emails from that gentlemen because one might have though that I am delusional. You will be able to see them on the blog that I created out of desperation. I was very often away abroad attending fairs and the circle couldn’t have been broken because certain companies would have ended-up in CIP, CRB, enforcement, in big SHIT. I produced a stamp with my signature and a set of company stamps that I left at the bank. That is why on my blog you will find articles of “TRAVELING LOANS”. I signed for about 80 billion while I was in Berlin, Dusseldorf, Amsterdam, Shanghai, Beijing, Tokyo, Kishinev, Kyev, etc.
I would have gone over it if, eventually when the problems surfaced, the gentlemen afore-mentioned hadn’t left me with EUR 4 million in loans, in addition to what I had known as money in the account balance and paid to the various companies forming the circle. Last, but not least, certain opportunists showed-up, having the money in the account, but that have been suddenly hit by amnesia and did not recall whatsoever that Doftoreanu transferred to them, as per the instructions of the Mr. Manager, a couple of thousands billion, and, moreover, one that used this money received from several companies to make true its political dreams, sent his “bodyguards” to extort some other additional tens of billions because the member of the Deputies Chamber thought he received too little and he has to two sons to bring-up and another mandate to buy. A self-denunciations followed, in the entourage of deputy GRASSHOPPER people were arrested, revenge and low-class accusations were brought forward, deputy GRASSHOPPER paid articles in the media, and MKB ROMEXTERRA BANK used huge budgets to create a large-scale media campaign to create an image of a reliable bank.
Would you care to know what happened next? The people from the Bank’s HQ came to talk. I was so eager to know how would they close the loans I have never used, but very calmly they asked me how did I intend to close the loans. They came-up with the solution also: they offered me other loans to close the old ones. But they were very careful this time to have everything on file, my genuine signature, not just a stamp, to contaminate the collaterals, and so on… I had to mortgage a house that worth 200.000 for a value of 2 million, but the same mortgage included also a plot of land of 200.000 and a deposit of 1.5 million and another plot of land of a couple of hundreds thousand of EUR. And, as we in the advertising production use to say, dear Virgil, we got tricked one more time. For fear of CIP, CRB, ENFORCEMENTS, out of stupidity, regardless all the promises for a fruitful cooperation and the handshakes of the CEO of MKB ROMEXTERRA BANK.
Now all my companies are bankrupt, I have no loans with MKB ROMEXTERRA BANK because the bank set-up a SRL (limited liability company) and assigned all the loans to them to get rid of the provisions and to look good in the balance-sheet they have to submit to the Hungarians from MKB Bank Zrt and the Germans from BayernLB. They have been struggling to enforce me from two years now, I fight back, they pay some money to the media, I set-up a blog, they sell money, I sell banners and electoral prints, they try to intimidate others like me or you with CIP, CRB and ENFORCEMENT, I don’t care anymore. They are more careful, I think that I am smarter. So, dear Virgil, put an end to your nightmare, don’t get scared by enforcements, CIP, CRB.. Your business it what it counts, it is more important that any bank. Do this as you still can, until your nightmare does not become my Hell. If you think it would be helpful for you to learn more of my experience, please visit: http://www.iuliandoftoreanu.blogspot.com
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