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18 people sued for money laundering and tax evasion. They damaged the state budget by 30,000,000 lei

Members of an organized criminal group, consisting of 18 people, will be on the bench for charges of tax evasion and money laundering. This after purchasing agricultural products from individuals and legal entities and not reflecting accounting and tax transactions. The damages to the state are assessed at 29,486,111 lei.



Prosecutors have determined that the organized criminal group, knowing with certainty that they have illicit agricultural production in the amount of 92 216 820 lei, in order to legalize the goods purchased without accounting documents, created a criminal scheme.

Thus, through interrelated legal and physical persons, the group liquidated the funds and extracted from the bank terminals financial means in the amount of 91,371,350 lei.

In the prosecution, it was established that each member of the organized criminal group had his predetermined role.

Some defendants had the role of acquiring agricultural products without documents of origin, transmitted information about transactions and received liquefied cash for payment to agricultural producers.

Other members of the organized criminal group received information on agricultural products purchased without accounting documents, on the basis of which they prepared fictitious accounting documents in order to legalize the purchased goods and extract money from cash from bank terminals.

At the request of the PCCOCS prosecutors, the court ordered seizure for the benefit of the state of the criminal assets obtained as a result of committing the crimes in the amount of over 12 mln. of lei.

Thus 18 individuals and 4 legal persons were sent to the court by the prosecutors.

If the court recognizes them as guilty of committing the offenses incriminated, the defendants are liable to imprisonment for up to 5-10 years imprisonment.


The Russian loan agreement declared unconstitutional – escaping the trap of excessive debt or missing a chance to overcome the crisis?



The judges of the Constitutional Court of the Republic of Moldova (CC) declared the Agreement between the Government of Moldova and that of Russia, providing for a loan of 200 million euros to be allocated to the Moldovan budget, to be unconstitutional. The decision was announced yesterday, as the adopted law on the ratification of the agreement, along with 2 related Government’s decisions have gained the same status.

The bill on the ratification of the agreement was adopted shortly after the Russian Federation and the Republic of Moldova had signed a loan agreement, on April 17. It was adopted with the vote of 56 socialist and democrat members of the Moldovan Parliament.

At the same time, the exercise of the constitutionality control of some provisions was requested by several opposition MPs, after the legality and feasibility of the conditions for granting the loan have been questioned by experts and civil society.

See also: Experts: What is wrong with the credit agreement signed with the Russian Federation?

In the Opinion on the conditions of the EUR 200 million loan offered to the Republic of Moldova by Russian Federation published by the Watchdog experts, Sergiu Tofilat and Valeriu Pasa, is mentioned that the purpose of the loan was to cover Moldova’s budget deficit and to finance joint projects of the agreement parties.

The agreement included abusive provisions though, according to the published opinion. First, the agreement provided that Russian companies would be contracted for projects funded by the loan. “Currently, no public information about the nature of the projects, the benefits for Moldova, the costs and the list of Russian companies is available. Given Russian widespread disreputable precedents and Igor Dodon’s obedience to Vladimir Putin, it is probable that Dodon will promote companies controlled by Putin’s people, which will execute the projects at higher costs in order to misappropriate a part from the loan,” is mentioned in the opinion.

Moreover, the loan agreement stated that the Republic of Moldova would have to undertake to repay other loans received from Russian Federation, in addition to the 200 million euros loan. Therefore, “there is a risk that Russian companies controlled by Putin’s entourage would register companies in the Republic of Moldova in order to borrow funds from Russian banks, under the guarantee of the Russian government, while the payment obligations would be registered as Moldovan national debt to Russian Federation.”

All debts would have been repaid at an interest rate of 2% per year, plus 2% annual penalty*150% to the entire debt, including  to the interest and penalties for other loans, that is while applying a penalty to another penalty is an illegal provision that can’t be applied in Moldova.

Taking into consideration that the loan agreement didn’t provide for the jurisdiction that would litigate any loan related disputes and that other loans including private debts could be simply added up to the consolidated national debt, that could create difficulties in a potential international litigation against the Russian Federation. “If Russia claims that the Agency, as a creditor of Moldova, is a separate entity from the Russian government, the Republic of Moldova will have to prove in front of an international court that all the actions of this creditor in relation to the debt of Moldova are dictated by Kremlin,” said the Watchdog experts.

Moldova would risk to have its access blocked to foreign financing by the Russian Federation. “According to IMF rules, lending is prohibited to countries with outstanding debts to other countries.” And Moldova would have been gather an impressive foreign debt as a result of the agreement.

In such a way, the experts concluded that the abusive conditions of the loan agreement would have allowed for a considerable increase of the Moldovan national debt to Russian Federation, which could be used as a control instrument in Moldova’s strategic infrastructure areas, as it previously happened in the natural gas sector.

The only Moldovan citizen that could benefit from this agreement would be President Igor Dodon. “The EUR 100 million second tranche, scheduled by October 31, 2020, may lead to the re-election of Igor Dodon as president,” Watchdog representatives opinated.

Prime Minister Ion Chicu and President Igor Dodon denied all accusations and repeated the same words in front of Moldovan people:

“This agreement does not involve any financial or political risks. This agreement does not jeopardise the economic security of the country, nor does it affect other agreements.”

As a consequence of the CC decision to declare the loan agreement unconstitutional, it’s ratification was blocked along with the funds that won’t reach the Moldovan budget. “In the context of the crisis, we can get through this year without Dodon’s airports and the roads around them. We can reduce the expenses for them by the amount of the Russian loan,” suggested Former Minister of Finance, Natalia Gavrilita.

According to the World Bank projections regarding Moldova’s economic development, the unfolding economic crisis will lead to a contraction of Moldova’s economy in 2020. “If the coronavirus outbreak is largely contained by mid-2020, with a recovery thereafter, in the baseline scenario by year-end, the economy will still have to deal with a recession of 3.1 percent. […] Increased social needs and unemployment, as well as fiscal stimulus through public investment, will bring fiscal deficits above the historical average in the years to come,” is mentioned in the report.

However, a prolonged disruption of economic activities until August 2020 would cause Real GDP growth to fall by 5.2%, which would be the biggest drop since 2009. “Weaker growth will further strain public finances faced with already large financing needs at 15 percent of GDP. A higher number of returning migrants, high social spending needs and high unemployment may put additional strain on labor market conditions and create further fiscal pressures,” said the World Bank projections that were updated recently.

Photo: Feodora Chiosea | Getty Images

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4 NBM directors arrested in relation to the bank fraud criminal case



The Prosecutor General of the Republic of Moldova, Alexandru Stoianoglo, announced today in a press release that 4 former and current employees of National Bank of Moldova (NBM) – ex-governor of the NBM Dorin Drăguțanu, ex-deputy governor Emma Tăbârță and current deputy governors Aureliu Cincilei and Ion Sturzu – were arrested today as a result of the investigations related to the bank fraud criminal case, carried out by the Anti-corruption Prosecutor’s Office. The NBM directors are suspected of participating in fraud and money laundering.

According to Prosecutor General, an ordinance has been issued allowing the detention of the 4 NBM directors. Alexandru Stoianoglo also mentioned that the NBM was directly involved in bank fraud. “We are sure that the NBM was the institution that was directly involved in the crimes related to the theft of the billion,” said the Prosecutor General.

Prosecutor General denied that the prosecution actions have something to do with yesterday’s statements made by Ilan Șor who held a press conference in which he stated that he has no attribution to the theft in the banking system and that in the process of liquidation of 3 commercial banks, for which 13 billion lei were allocated, employees of the National Bank would have been involved.

But if the prosecution actions don’t have any connection to Șor’s declarations, why the investigations and arrests of the NBM employees were conducted only now?

“The measures taken today were conditioned by the results obtained from a series of criminal prosecution actions and special investigative measures, the analysis of a wide spectrum of financial and legal documentation. They will be followed by other criminal prosecution actions that will target other people holding public offices who were involved in bank fraud,” is noticed in an official statement of the General Prosecutor’s Office.

At the same time, the NBM published a reaction, claiming that “the NBM cooperated to the full extent of its ability with the investigation bodies during the last years, in the investigations instituted and files concerning the banking sector and provided all existing materials, documents, expertise, explanations etc. and will continue to fully cooperate with them.”

The institution representatives expressed their hope and trust “in the conduct of an objective and professional investigation, which will identify the real responsible persons for the banking fraud.”

“At the same time, the NBM expresses its deep concern over the public declarations and actions, which increased in the last period, undermining the morale of the institution’s employees and the NBM’s capacity for exercising its functions in a professional and independent manner,” stated the NBM representatives.

Dorin Drăguțanu was the governor of the National Bank of Moldova in the period 2009-2016. Emma Tăbârță held the position of deputy governor of the NBM from 2008 to 2015. Aureliu Cincilei and Ion Sturzu were appointed deputy governors in 2013.


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The Citizenship by Investment Law put on hold again till September



A new bill providing for the application of a moratorium on the Citizenship by Investment Program until September 1, 2020 was voted in final reading by the Parliament. The bill proposed by the Chicu Government, which was also supported by the opposition parties, offers a new break to establish all the risks of the program.

During the parliamentary debates, the MPs especially insisted on removing the legal provision establishing the concealment of the identities of persons who apply to the program and obtain the citizenship of the Republic of Moldova.

The original bill proposed by the Government provided for the application of a moratorium until January 1, 2021. Afterwards, it was shortened in the second reading until September 1, 2020.

“We need to show that the risks are minimal, that thorough checks are made and that the economy of the Republic of Moldova can benefit from the program,” argued the Secretary of State of the Ministry of Economy, Iuliana Drăgălin, who presented the bill in front of MPs.

The previous moratorium applied by the Moldovan authorities on the Citizenship by Investment Law has expired on February 24.

Transparency International Moldova has repeatedly drawn the attention of the public and the authorities to the risk of adopting the Citizenship by Investment Program in Moldova, as it represents a mean of legalisation of financial resources of fraudulent origin, undermines efforts to combat major corruption and investigate bank frauds, and affects the national integrity system.

The Citizenship by Investment Law was adopted in October 2017. In June 2019, after several public debates, the Government, the Parliament and the Presidency of the Republic of Moldova introduced and adopted, through a joint effort, the bill on repeal of the  Citizenship by Investment Law at first reading. One month later, the President of the Republic of Moldova, Igor Dodon, declared the official interruption of the Citizenship by Investment Program.

So far, eight foreign nationals have obtained the citizenship of the Republic of Moldova by this way.

More details about the Citizenship by Investment Law, as well as the implementation of the respective program here.


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