Moldova’s anticorruption body arrests 16 judges in $20bn money laundering investigation

Moldova’s anticorruption body arrests 16 judges in $20bn money laundering investigation
By Iulian Ernst in Bucharest September 22, 2016

Prosecutors from Moldova’s National Anticorruption Centre (CNA) have detained 15 judges, CNA head Viorel Morari announced on September 21, adding that the operation is still in progress. One more judge was arrested later on September 21. 

The 16 judges are reportedly involved in the laundering of around $20bn siphoned off from Russian banks, according to unofficial sources. The move comes after reputed corporate raider Veaceslav Platon, who reportedly used Moldovan banks under his control to launder Russian money, was extradited from Ukraine and placed under investigation in Chisinau.

If the investigations focus only on the 16 judges, it is likely that the purpose of the action is to indict Platon as quickly as possible, the head of the Centre for Initiative and Monitoring of Public Authorities (CIMAP) NGO Ion Dron explained. The good thing is that there are some investigations, though maybe not in the way we expected, he commented. The investigations should be broadened to include CNA and central bank officials, he added.

The investigations into money laundering come two years after they were spotted in 2014 and furthermore they are taking during the campaign for the November presidential elections. 

Oligarch Vlad Plahotniuc and his Democrat Party (PDM), which heads a fragile parliamentary majority, is likely to derive political benefits from the investigation that could give his candidate Mihai Lupu a chance to get through to the second ballot of the elections. 

The logic is that voters would be given the impression that justice is being done and that the $1bn famously stolen from Moldovan banks will eventually be brought back by the incumbent authorities. In fact, the ongoing investigations are related to the laundering of Russian money not to the theft of the $1bn, most likely by local oligarchs. 

Even if Lupu stands only a slim chance compared to the leading presidential candidate, pro-Russian Socialist Party leader Igor Dodon, helping Lupu run against Dodon in the second round instead of a pro-EU candidate such as Andrei Nastase or Maia Sandu is essential for the ruling coalition. Either of the two, if supported by the other (which does not look likely at this moment) might defeat Dodon and initiate genuine investigations into the frauds in the banking system.

Furthermore, the case gives Plahotniuc the opportunity to indict his rival Platon, who reportedly refused to give up control of several Moldovan banks in a power struggle between the two businessmen. 

The investigations into money laundering started in August, when prosecutors issued a warrant for Platon and arrested three current and former central bank officials. 

The three suspects are believed to have ignored information available on money laundering carried out through Moldindconbank (MICB), Morari confirmed at a press conference after news of the arrests leaked to local media.

The operations in question took place between 2010 and 2014, Morari added. Prosecutors based their decision to make the arrests on testimony from witnesses.

Moldova stopped the laundering of Russian money through MICB, previously carried out with the support of corrupt judges, back in May 2014, the CNA said on May 25. It added at the time that its investigations into events at the bank were continuing.

Back in 2014, the internal affairs body Inspectia Judiciara drafted a report on the judges’ actions, head of the Centre for Judicial Resources NGO Vladislav Gribincea stressed in a comment on the recent developments. However, the magistrates’ body CSM still promoted two of the judges suspected of involvement to the Court of Appeal, he added.