Romania: OCCRP Partner Probes President Iohannis over ‘Undeclared Rents’

The president of Romania may have earned a lot more from his rental properties than he has publicly declared, according to an investigation by OCCRP partner RISE Project Romania.

Screen Shot 2015 08 25 at 5.32.10 PMKlaus Iohannis, President of RomaniaPresident Klaus Iohannis, former mayor of the city of Sibiu and now fourth president of Romania, has been required in the course of his public roles to disclose all of his income in official annual declarations.

But documents seen by RISE showed a € 115,000 (US$ 132,048) difference between Iohannis’s official declarations and the sums found on a series of lease contracts obtained from the Registry of Companies in Romania.

The first contract, dated November 2001, was signed between Raiffeisen, on one side, and Iohannis and Ioan Baștea, on the other side. Iohannis owns half of the property and Baștea owns the other half.

The agreement was signed by Iohannis, both in his name and in the name of Ioan Bastea.

The latter had empowered him to rent his half of the property in his name.

The contract lays out the price for renting a commercial space of 146 square meters to Raiffeisen in the center of Sibiu. It bears two signatures by Iohannis, as well as the “signature: of Raiffeisen.

Raiffeisen hired the property out for five years at US$ 20,000 per year.

RISE reports that the contract was renewed through an appendix on the last working day of 2006 for another 10 years, increasing the rent to €60,000 (US$ 79,020) per year.

The bank agreed to pay in advance for the first three years of rent: €180,000 (US$ 237,060).

Half of that payment, € 90,000 (US$ 118,530), went directly to Iohannis in 2007.

This should have been included in Iohannis’s public income statement as the mayor of Sibiu in 2008.

But, according to RISE, such a declaration is nowhere to be found. Instead, Iohannis declared 16,278 lei (US$ 5,794).

The 16,278 lei figure was also found consistently on each of Iohannis’ public property declarations for 2005 and 2006.

But RISE reports that the real sum received from the bank during this time was much higher.

The bank did not wish to comment specifically on the Iohannis case but said it paid the amount shown on rental contracts “in all cases”.

Meanwhile, Iohannis also leased a villa to Netex Production Company.

According to a contract inspected by RISE, Iohannis was due 38,880 lei in 2004 (US$ 12,960), 38,533 lei in 2005 (US$ 12,844) and 42,600 lei in 2006 (US$ 15,165).

The annual assets declarations made by Iohannis as mayor of Sibiu showed 19,424 lei (US$ 6,475) on all three years.

The documents lead RISE to believe that from 2004 to 2007, Iohannis received more money from rentals than they publicly declared.

The National Integrity Agency in Romania (ANI) launched an investigation to “assess the wealth” of Iohannis in 2010. But, in November 2014, the case was frozen by the Romanian Constitutional Court.

According to a Romanian law established in 1996, the Romanian president’s assets can only be officially investigated after his term ends, unless the probe is ordered by Parliament.

President Iohannis has declined to comment.