Brazilian authorities are investigating Romanian Socialist party President Liviu Dragnea on suspicion of money laundering according to the Romanian investigative journal RISE Project and Folha de São Paulo, one of the largest publications in Brazil.
Liviu Dragnea is suspected of using money from corrupt businesses in Romania to acquire beach-side property in Cumbuco, 30 kilometers from Fortaleza, the capital of Ceara state in Brazil.
Brazilian investigators initiated the probe after Romanian prosecutors contacted them in July last year.
Brazil’s federal prosecutor said he was trying to determine whether Liviu Dragnea used “oranges” to launder money and buy property in Brazil.
In Portuguese, laranja, meaning orange, is the term used to describe someone who provides a legitimate front for corrupt or criminal politicians to hide their involvement in various businesses, Rise Project explains.
In this case, the two “oranges” were a former university colleague of Dragnea’s, Mugurel Gheorghias, and a Brazilian former taxi driver.
Gheorghias is also a former principal shareholder of TelDrum SA, a company which is widely suspected of being controlled by Dragnea, despite the politician’s denials. In Brazil, Gheorghias owns a firm that he used to buy a luxury villa with a tennis court, a swimming pool and an ocean view. Dragnea as well as many other high profile Romanian guests are thought to have stayed at the villa.
The second “orange” under investigation is Cauby Junior, a former taxi driver, who became wealthy working as point-man for Romanians business, and signed all the documents for Brazilian transactions conducted by Mugurel Gheorghiaş.
Prosecutor Barbosa Guimarães said Cauby Júnior had no money to invest in Brazilian firms: “We know the money came from Romania.”
The request for legal assistance came, according to the federal prosecutor, on July 25, 2017, from the Romanian police.
Allegations of corruption involving Tel Drum and Dragnea are not new. Last November Dragnea was prosecuted for allegations of establishing an organized crime group, use or misrepresentation of false or inaccurate or incomplete statements, and abuse of service for himself or for another, along with eight other people, including representatives of Tel Drum.
According to prosecutors, Liviu Dragnea, as president of the Teleorman County Council, established an organised criminal group in 2001 aimed at fraudulently obtaining large amounts of publicly funded contracts by committing offenses of abuse of office, European funds fraud, tax evasion, money laundering and the use of non-public information or allowing unauthorized people to access this information, DNA prosecutors say.
Dragnea denies the allegations.