• How Bank Fraud Cases Have Evolved in the Last Year

    How Bank Fraud Cases Have Evolved in the Last Year
    by
    04 December 2020 | 10:50

    Six years after the banking system robbery, the Moldovan judiciary has not yet punished the billion-dollar thefts. While the law requires citizens to cover the financial hole in the state budget, the main perpetrators in the bank fraud criminal cases have managed to alienate much of their property and fled the country. The authorities released some of them from criminal prosecution, and others, although sentenced to years in prison, are released on parole until the criminal trial is reviewed. Transparency International Moldova has analyzed the evolution in the last year of the resonance files regarding the billion-dollar theft, and ZdG presents you with a summary.

    Following the report of a special commission formed to elucidate all the circumstances of the banking system robbery, on October 17, 2019, the Parliament made recommendations and provisions to several authorities. The Commission concluded that in 2015-2019 the General Prosecutor’s Office (PG) had sabotaged the investigation, without a systemic and integrated approach. Also, the Commission came with the recommendation for the Prosecutor General, within 30 days, to present in the Parliament, a report on the investigation.

    Two hundred criminal cases initiated 

    The Prosecutor General presented the report much later than expected, in February 2020 in the meeting of the National Security Commission, instead of the Parliament. Also, they didn’t make the decision public, thus the society did not find out the conclusions of the discussions.

    According to official data, prosecutors initiated approximately 200 criminal cases, investigating the activity from 2009 to 2014 of the three defrauded banks: Banca de Economii (BEM), Banca Socială, and Unibank. During this period, these banks offered non-performing loans. The damage made was 646 million euros (13,5 billion Moldovan lei). Consequently, the damage transformed into state debt, and the Government will repay 1,1 billion euros (22,9 billion Moldovan lei), including interest on credit. By the time of reporting, about 110 million euros had been reimbursed from the three banks and another 58 million euros are to be recovered after being seized.

       Five economic interest groups investigated

    According to the Prosecutor General, 41 individuals and 11 legal entities were held accountable as suspects in connection with bank fraud, and by 2019, 28 criminal cases had been sent to the court with eight convictions.

    The report states several economic interest groups are being investigated: former BEM chairman Grigore Gacichevici, Shor Party leader Ilan Shor, businessman Veaceslav Platon, former Democratic leader, Vladimir Plahotniuc, and the former prime minister, Vlad Filat.

    Six years after the bank fraud, in 2019-2020, Transparency International Moldova has found developments in the files of Shor, Platon, and Plahotniuc, Shor Party deputies, but also in the so-called bankers’ file.

    The Shor file

    Ilan Shor is charged in two criminal cases. The first, filed in May 2015, concerns abuse of office with serious consequences, committed during the period when he held the position of Chairman of the Board of Banca de Economii a Moldovei.

    The second case, initiated on June 22, 2016, for fraud and money laundering in particularly large proportions, was sent to the Court in August 2016. The Court reclassified the act as “causing material damage through deception or abuse of trust in particularly large proportions if the act/deed does not constitute an appropriation”, and money laundering in large proportions. In June 2017, Shor was sentenced to 7.5 years in prison in a semi-closed regime, but the Court ordered that the sentence enters into force only after it became final.

    Currently, the case is being examined by the magistrates of the Cahul Court of Appeal in Cahul district, where he was displaced in February 2018, because all the judges of the Chișinău Court of Appeal declared themselves incompatible with the trial of the case.

    Although he was convicted of causing material damage to a particularly large extent, his property was not seized, and Shor managed to alienate several of them. At the same time, although Shor had a ban to leave the country, he left for Israel, from where the Moldovan authorities requested his extradition, but, according to its national law, Israel does not extradite its citizens [Shor is a citizen of Israel]. Shor left the country illegally and in August 2019, he was deprived of parliamentary immunity.

    Meanwhile, the hearings in his case have been postponed consecutively, the latter being canceled after Shor’s lawyers submitted a request to relocate it from Cahul Court of Appeal to another Court of equal rank. At the same time, on November 27, judge Nina Valeva, after examining the Shor case for more than two years, resigned, the examination of the case being resumed from scratch.

    Platon’s file

    Platon was sentenced in April 2017 to 18 years in prison for allegedly obtaining, through illegal schemes, around 50 million euros (1 billion Moldovan lei), through loans granted to companies run by third parties. On June 15, 2020, the Court suspended the execution of the sentence and made it depend on the evolution of the criminal process review.

    Platon figures in another case initiated after a video was leaked to the public in the summer of 2020. According to the Prosecutor General, Veaceslav Platon had a hearing in the criminal case, taken over from DIICOT Romania, which targets Vladimir Plahotniuc and several dignitaries. The hearing was carried out by a group of prosecutors, in the presence of his defenders, the trial being filmed by a forensic expert. A video from the trial was leaked to the public. A media scandal broke out and a criminal case on ”the interference in the administration of justice and the disclosure of data of the criminal investigation” was initiated.

    The Plahotniuc case

    The prosecutors initiated two criminal cases against Vladimir Plahotniuc after the Democratic Party of Moldova was ousted from the government in June 2019. He fled Moldova. Plahotniuc was accused of creating and leading a criminal organization, scam, and money laundering, both in particularly large proportions. On May 22, 2020, he was arrested in absentia and announced in search. In 2020, based on the information on his location, Moldova requested the USA, Turkey, Cyprus, and Saudi Arabia authorities to extradite him. The prosecutors froze some of his properties from Moldova, Switzerland, France, and Romania.

    According to the Prosecutor General, available evidence indicates that Plahotniuc was the beneficiary of the money obtained as loans from Bank of Economy of Moldova, through the Shor Group, subsequently covered by the National Bank of Moldova’s financial means – in total, over $100 million. Plahotniuc used the money to purchase the shares of a bank, the buildings of the ASITO Company, the Fashion House, and the “National” hotel. The Prosecutor General admits that Plahotniuc used the money for personal purposes or his affiliated companies to purchase an airplane, to pay for charter flights, and for his people.

    The file of the deputies from the Shor Party

    On October 2, 2020, the Anticorruption Prosecutors announced that they removed from prosecution four shareholders of Unibank, including Shor Party deputies Tauber and Apostolova. 

    This comes about a month after six shareholders of the same bank, including the former president of Moldova, Petru Lucinschi, were prosecuted. On September 16, 2019, Tauber and Apostolova were detained, and their parliamentary immunity was suspended.

    Subsequently, ten Unibank shareholders were charged with large-scale fraud and money laundering in the interests of an organized criminal group. According to the prosecutors, after a thorough study of the evidence, they concluded that the facts of those persons do not meet the elements of the alleged crimes.

    The bankers’ case

    In March 2020, several National Bank of Moldova dignitaries were detained and charged: Dorin Drăguțanu, ex-governor, Emma Tăbîrță, ex-vice-governor, Aureliu Cincilei, vice-governor, Ion Sturzu, vice-governor, and chief of a department. They are suspected of participating in fraud and money laundering in large proportions.

    As previously reported, in March 2015, after the hearing of the report by the Parliament, there followed two resignations, that of Emma Tăbârță, and Artur Gherman, the head of the National Financial Market Commission. In 2016, Tăbîrță together with two heads of departments from the National Bank of Moldova were detained for neglecting their duties in connection with the laundromat investigation.

    This material is published within the “Mobilization of civil society for monitoring and reporting on the integrity of state institutions and anti-corruption activities in Moldova” project, implemented by Transparency International – Moldova and funded by the US Embassy in Chisinau, INLE section. The views expressed in the publication do not necessarily reflect the position of the donor.

    AUTHOR MAIL eng.zdg@gmail.com

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