Ciprian Chiorean, legal director of CEC Bank: Instant payments, which most banks use, are the most targeted in online fraud

Banks do not want to have customers in foreclosure. Any non-performing client for a bank means additional costs, states Ciprian Chiorean, legal director of CEC Bank.

Ciprian Chiorean, legal director of CEC Bank, and Mircea Stroe, CSALB conciliator, lawyer, in dialogue with Vasile Coman, journalist, founder of Bancherul.ro.

Vasile Coman:Because it is an election year in which various legislative proposals may appear, it would be good to be prepared, both banks and customers. What are the changes with the biggest impact?

Ciprian Chiorean: We are constantly on the radar of legislative changes, especially in an interesting year like this one that we are going through. The year started with the Emergency Ordinance 15/2024, which came with some new elements, so that the obligations owed by creditors were better scored. It is a normative act which, I say, came to somehow strengthen the relationship between professionals and consumers in the market. For example, any kind of modification of the credit agreement will have to be brought to the attention of the consumer beforehand, in order to ensure that he is correctly informed. Then, before starting, for example, the foreclosure, the creditors are obliged to prove that they have tried to restructure the respective loans, that they have tried to come up with concrete measures to restore the contractual relationship, before initiating a foreclosure.

Vasile Coman:In other words, now if someone is unable to pay the installment on a loan, can’t the bank go straight to foreclosure before proposing some payment solutions?

Ciprian Chiorean: Exact! This is the spirit. Even before the entry into force of Ordinance 15, it was not possible to proceed directly to forced execution. The banks were trying to restore this relationship and come to the support of the client with concrete recovery and restructuring measures, but now the normative act comes and clearly highlights this obligation.

That’s good news for consumers, especially since banks don’t want any customers in foreclosure. Any non-performing customer for a bank means additional costs: with the establishment of provisions, with execution costs, with the administration of these non-performing loans. Banks are interested in having financially sound customers. The client-bank relationship is one of partnership, in which there is always room for improvement. That is precisely why we look very carefully at absolutely all the reports we receive from our customers. Consumer problems are like the pipe in the wall – you only find out about them when the pipe breaks. That’s why you have to prevent, and to do that you need each to trust the other.

Vasile Coman:Do you anticipate that there will be more amicable settlements between customers and banks under CSALB as a result of this ordinance? Mircea Stroe: There will certainly be a greater openness to sitting the parties at the negotiating table, before reaching a conflict situation. It all depends on how the parties will understand how to resolve these issues and accept mutual waivers of various expectations.

And until now, in the framework of conciliations, before the existence of this regulation, banks were interested in identifying restructuring solutions. Contrary to a public perception that the bank wants to reach foreclosure, in fact banks have no interest in this.

For example, one advantage of foreclosures or court cases being settled at CSALB is that, in these cases, the claims of the parties are already expressed. The exact level of the debt is known, the credit institution’s expectations regarding the payment term, how much the consumer is willing to pay. Obviously, when enforcement is reached and only after that amicable settlement is attempted, there is also a degree of frustration. Because some stages have been passed, during the reconciliation we could run into various conceits or ambitions. But in general there is a greater willingness on the part of the parties to accept a compromise following negotiations.

Vasile Coman:We change the register and look at CEC Bank. Although it did not buy any banks, it grew organically and reached the 3rd place in the market. How is this situation explained and what strategy do you have for the bank’s presence in rural areas?

Ciprian Chiorean: If we refer to the situation of mergers in the banking market, I think it is a natural situation. The consolidation trend will continue, because historically we come with a large number of banks for the Romanian banking market. Obviously, everyone wants a solid, consolidated banking market, with strong banking groups behind the banks operating in Romania. This year we have a 35% increase in assets compared to the previous year. We acquired the Rural Credit Guarantee Fund and are working intensively on establishing an insurance company.

The more than 1,000 banking units at national level and 1,300 ATMs certainly represent an asset, given that we have a moral duty towards Romanians to facilitate financial inclusion,

even in areas where other banks have a harder time reaching. We try to serve rural areas as well, where practically the only element of connection with the banking world is often represented by a CEC Bank unit or ATM. That is why we will maintain this network, although we see that at the market level, at the level of other players in the market, the tendency is to restrict the territorial units.

In our relationship with customers, we want to build a mix between technology and human presence, given that people are a bit tired of talking to robots. We consider digital solutions because we want to ensure quick access to all our services and products, but the human factor remains very important. We want to continue to maintain the ability for all our customers to interact with a bank worker.

Vasile Coman: There were many customers who sued the banks, there are still, but we have seen lately that CSALB has managed to take over these problems and reconcile the customers with the banks outside the courts.

Mircea Stroe: In recent years, the number of cases whose object was the alternative resolution of some disputes in court has increased. People understood that a faster resolution of these files is necessary, given that the legal system does not allow a solution in a shorter period of 12-24 months. In addition, lawsuits mean costs and a number of uncertainties about the status of those loans. It must be said that many of the processes start from a lack of financial education. Many consumers access loans without knowing all the details and without understanding everything that such a loan means, which implies the development of a loan agreement.

The lawsuits also start from commissions, because many consumers still believe today that they have abusive commissions

. It is very difficult to explain to those people that not all claimed fees are abusive. When a consumer has some problems, they actually try to shift those problems to third parties and look for culprits. It is by human nature.

On the other hand, we meet the desire of some consumers to resolve their disputes within the CSALB. We have had cases where the consumers were magistrates, judges and prosecutors who came with requests to CSALB. I personally solved several such cases. In other words, the benefits of conciliation have come to be understood even by some representatives of the judicial system. Magistrates understood that, despite being much more familiar with the courts, they have more to gain in an alternative court procedure, conducted within the CSALB. Moreover, we also reconciled consumers who came from the banking system, but had dysfunctional relations with the bank, some even having the status of employees of the respective bank. In conclusion, the lack of financial education generates part of the problems. But, the fact that you are financially or legally educated does not mean that you will never have problems.

Vasile Coman: At the moment all industries offer digital services. Along with these came the online frauds. What measures are you taking to keep this phenomenon under control?

Ciprian Chiorean: Within each bank there is a category of vulnerable customers who are not very familiar with the use of digital tools, not having a complete understanding of the phenomenon, and then they become favorite targets for cybercriminals. Instant payments, which most banks use, are the most targeted in online fraud. That’s why we always warn users not to reveal your PIN and not to access unauthorized links, whether they receive them by email or SMS.

Vasile Coman: How do people get their money back in case of online fraud? Sometimes thousands of euros are lost…

Mircea Stroe: Unfortunately, the number of cases has increased and will continue to increase as digitization expands. It must be said that, in most cases, frauds are facilitated by users who disclose their personal data.

The only option is permanent information and awareness that these benefits of digital applications also come with some risks.

The police or the bank are quite limited in what they can do, since it is the consumer who accessed a clone site or leaked confidential data. Often times, the amounts stolen by cybercriminals immediately end up in other countries and cannot be recovered, they are lost. Who else can recover an amount from Vietnam? Or from Russia? You don’t even get it back from Italy or Spain, which are in the European Union.

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