Saturday

24th Feb 2018

Moldova takes action on EU-Russia money laundering

  • Filat (l) with European Commission chief Jose Manuel Barroso. The Moldovan PM has promised to monitor the case (Photo: ec.europa.eu)

Moldova has launched criminal proceedings in a money laundering case involving its biggest bank, the Russian mafia and six EU countries.

The move comes after a UK-based investment firm, Hermitage Capital, filed a complaint with the Moldovan prosecutor in June.

Thank you for reading EUobserver!

Subscribe now for a 30 day free trial.

  1. €150 per year
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

Documents obtained by Hermitage indicate that a Russian organised crime group - dubbed the Kluyev Group - in 2008 wired $53 million of stolen money from an account in Russia's Bank Krainiy Sever to two accounts in Moldova's Banca de Economii.

They also indicate that Banca de Economii later wired the money to multiple accounts in Austria, Cyprus, Estonia, Finland, Latvia and Lithuania, as well as Switzerland and Hong Kong.

Moldova's anti-graft body told EUobserver in a written note on Wednesday (6 February) that: "A criminal prosecution was started by our institution - the National Anti-Corruption Centre - on money laundering in December 2012. The case is now being investigated. No Moldovan bank accounts have been frozen up to now."

It said it cannot name the suspects because of "presumption of innocence."

It added that Moldova's Prime Minister, Vlad Filat, has "declared he would monitor this case" due to its high-profile nature.

The development is part of an affair with implications for EU-Russia and US-Russia relations.

Hermitage says the Kluyev Group embezzled hundreds of millions of euros from Russian tax authorities and conspired with senior Russian officials to murder its accountant, Sergei Magnitsky, in 2009 after he exposed the scam.

The US has imposed a visa ban on the Russian officials involved, causing outrage in Moscow.

Several national parliaments in the EU have called for similar action.

Authorities in Austria, Cyprus, Estonia, Latvia, Lithuania and Switzerland are also investigating the money trail.

Meanwhile, the state-owned Banca De Economii, Moldova's biggest lender, is already neck-deep in problems.

Its former chief, Gregory Gachkevich, who ran the bank at the time of the Kluyev Group transactions, was last week stopped by police at Chisinau airport because the bank, on his watch, also doled out huge, unsecured loans to offshore firms, putting it at risk of collapse.

For his part, Hermitage Capital chief Bill Browder says the money laundering case poses questions for Moldova's EU aspirations.

Prime Minister Filat is aiming to sign a political association agreement and a free trade pact with the EU in November.

He is also hoping the EU will this year take steps toward a future visa-free deal.

"Moldova is a key transit point for the money laundered from the Magnitsky case, so a genuine investigation will exponentially increase the ability of European law enforcement agencies to make arrests and expose the people behind this network," Browder told this website.

"What the Moldovans do or don't do will be a test of whether they are a reliable partner for further involvement in EU structures," he added.

Investigation

Cyprus launches probe into Russian mafia money

Cyprus has opened an investigation into evidence that stolen Russian tax money linked to the murder of Sergei Magnitsky was laundered through its banks.

EU proposes €5mn fines for money laundering

Individual staff should be fined up to €5 million and firms, such as banks, should be fined 10 percent of turnover for flouting anti-money-laundering laws, the EU says.

Opinion

Moldova's new crisis - an opportunity?

A fatal hunting accident has exposed the fault lines in Moldovan politics, but the crisis could be an opportunity to put pro-EU reforms on a more solid footing.

News in Brief

  1. EU calls for immediate ceasefire in Syria
  2. UK's post-Brexit vision is 'pure illusion', Tusk says
  3. EU leaders express solidarity with Cyprus in Turkey drill row
  4. EU to double funding for Sahel forces
  5. EU parliament president: 'The immigration problem is Africa'
  6. May to unveil EU departure strategy next week
  7. Pregnant workers may be dismissed, EU court rules
  8. Romanian minister demands anti-corruption prosecutor fired

Stakeholders' Highlights

  1. ILGA EuropeAnkara Ban on LGBTI Events Continues as Turkish Courts Reject NGO Appeals
  2. Aid & Trade LondonJoin Thousands of Stakeholders of the Global Aid Industry at Aid & Trade London
  3. Macedonian Human Rights Movement Int.European Free Alliance Joins MHRMI to End the Anti-Macedonian Name Negotiations
  4. Mission of China to the EUChina-EU Tourism Year to Promote Business and Mutual Ties
  5. European Jewish CongressAt “An End to Antisemitism!” Conference, Dr. Kantor Calls for Ambitious Solutions
  6. UNESDAA Year Ago UNESDA Members Pledged to Reduce Added Sugars in Soft Drinks by 10%
  7. International Partnership for Human RightsUzbekistan: Investigate Torture of Journalist
  8. CESICESI@Noon on ‘Digitalisation & Future of Work: Social Protection For All?’ - March 7
  9. UNICEFExecutive Director's Committment to Tackling Sexual Exploitation and Abuse of Children
  10. Nordic Council of MinistersState of the Nordic Region 2018: Facts, Figures and Rankings of the 74 Regions
  11. Mission of China to the EUDigital Economy Shaping China's Future, Over 30% of GDP
  12. Macedonian Human Rights Movement Int.Suing the Governments of Macedonia and Greece for Changing Macedonia's Name

Latest News

  1. EU agrees budget to focus on defence, security and migration
  2. EU leaders nix transnational lists, cool on 'Spitzenkandidat'
  3. Regions chief: calls for smaller EU budget are 'impossible'
  4. Election fever picks up This WEEK
  5. EU-Morocco fishing deal casts doubt on EU future foreign policy
  6. EU leaders put 'Spitzenkandidat' on summit menu
  7. European far-right political party risks collapse
  8. The key budget issues on EU leaders' table