Ungureanu, who was appointed prime minister only two months ago, after an unprecedented wave of protests forced the departure of his predecessor Emil Boc, said that he would take over Borbély's duties as environment minister.
It was also announced that President Traian Băsescu signed a decree ending Borbély's functions.
According to the daily Adevarul, Borbély is unable to explain the origin of the sum of €80,000, used for the purchase of an apartment which he allegedly bought in the name of a close relative.
Following to the legal procedure, the country's chief prosecutor has made a request to Parliament to begin criminal proceedings against the minister, who is also a parliamentarian.
In the past, the Romanian Parliament has repeatedly denied the right to begin investigations against MPs accused of wrongdoing. This time however, the leader of the upper chamber of Parliament Vasile Blaga, who is also one of the leaders of Basescu's Democratic Liberal Party (PDL), said there would be no obstacles to lifting Borbély's immunity.
The Democratic Union of Hungarians in Romania (UDMR), to which Borbély belongs, and which is member of the governing coalition, said however that they consider him innocent and would give him support.
Last year, Borbély has already been accused in a different case, of having used his influence to secure a contract for a private company from the administration of waters, under his responsibility. According to the accusations, he benefited from a free refurbishing of his apartment to the value of €20,000. But on that occasion the governing coalition stood behind him and he kept his position.
Romania is struggling to convince the European Commission that it has reformed its law enforcement system, and that politicians are no any longer above the law. Bucharest hopes that in summer the Commission could put an end to a legal mechanism for monitoring its progress in fighting corruption and improving the work of its judiciary (see background).