Weekly Roundup
September 11 - September 17
Welcome back to Moldova Matters! In this weekly roundup we will check in with the top stories of the week in Politics and Economics. Subscribe to Moldova Matters to get our Weekly Roundup and other content sent right to your email! And consider becoming a paid subscriber to support our work at Moldova matters. For just $5 / month, the price of a nice coffee, you can support this work and help us expand into even better content!
Political Updates - Continued Personnel Changes
This week parliament and the government moved further in cleaning house and appointing new people to key positions. One major area is the Central Election Commission or CEC. Parliament appointed candidates to the CEC as did the presidency and the commission elected Angela Caraman a lawyer and Romanian teacher as chair. The term for the CEC is 5 years and they will be tasked with key reforms to make it easier to vote, especially in the diaspora.
Additionally, President Sandu officially signed the decree on the resignation (dismissal) or the head of the Army General Staff General Gorgan. The new Minister of Defense accused General Gorgan of presiding over lax discipline in the ranks, embezzlement, and promoting his relatives up the career ladder. The General in turn said that it is the new Minister of Defense who wants to enrich himself. We recall that Minister Anatolie Nosatii is himself from the army and a veteran of the war in Iraq.
Finally, the Minister of Infrastructure Andrei Spinu dismissed the director of the state owned electric company Moldelectrica. In explaining the move, Minister Spinu noted that the former director has been in the post for 13 years, is paid over 1 million lei a year, and once tried to hike prices on citizens 350%. Minister Spinu has the extremely challenging portfolio of dealing with state enterprises, most of which lose money and are thought to be hotbeds of corruption and backroom dealing.
The Natalia Morari Story Continues to Evolve
This week, embattled former TV8 journalist Natalia Morari continued to make facebook statements regarding her undisclosed relationship and child with wanted criminal Vyacheslav Platon. As we discussed last week, Morari shocked the country with this revelation and resigned her post on the TV8 Board which subsequently canceled her show permanently. This week, Morari made 2 followup posts on facebook. The first apologized to viewers for not revealing things earlier and to TV8 for the criticism this has brought the network. She asked viewers to judge her, not TV8. The second post, made one day later, was much more explosive. Titled “Final Manifesto” Morari noted that she would be leaving facebook for a while after posting. She responded to criticism against her online and in the press by writing in defense of Vyacheslav Platon saying that he is not the man he is portrayed to be. She said he has faults but is entitled to the “benefit of the doubt.” She further went on to say she wanted to correct the record with regards to Chiril Lucinschi, son of the former president and also convicted of financial crimes including money laundering. Morari previously had a relationship with Lucinschi as well and until the announcement last week many people believed her son was his. About Lucinschi Morari said that she should have spoken up earlier to defend him when he was arrested because she “knew the charges were false but was afraid to speak.” Not content with these statements Morari continued and wrote that Moldova’s embattled Prosecutor General Alexandru Stoianoglo was an “an extremely fair man I've known for years.” Finally, speaking about the condemnation against her and these 3 men she said that in Moldova we live in an “absolutely sick” society and that we cannot speak of a "rule of law state” as people are afraid to make unpopular decisions.
In response to this final post, TV8 issued a statement categorically distancing itself from Morari. saying that her statements do not represent the editorial policy of TV8. Marina Rata, now top anchor at TV8 spoke clearly on her show in defense of the network while condemning the actions and statements of Morari. In response, Platon has threatened to sue TV8 journalist Mariana Rata for defamation. He says that he will sue her in Bucharest as she is a Romanian Citizen. It is not known if Platon is, but he is known to have at least 16 passports including forged ones and illegally issued diplomatic passports. Platon’s threat was made on a telegram channel he posts to and basically amounted to an attempt to smear Rata as an agent of the Moldovan intelligence agency SIS. Mariana Rata responded saying she will be happy to respond directly to Mr. Platon when he returns to Moldova to face arrest. Until then, in spite of the campaign of intimidation being run by Platon as well as others, she intends to keep doing her job. As we’ll see in our corruption news roundup below she followed through on that promise with new investigations.
In response to these explosive stories and developments, President Sandu went on TV8 and discussed the Morari issue. The President said that once she heard the first accusations, that Morari was being blackmailed by SIS agents, she called the SIS director for clarification. The agency reported that it had no idea what Morari was talking about. The President then said that if Morari has something to say she should “say it until the end” and name names so that law enforcement can do their job. President Sandu asked that people not simply throw accusations as they further erode people’s already dangerously low trust in Moldova’s institutions. Finally, President Sandu firmly pushed back on Morari’s statement that the Prosecutor General was an “extremely fair man.” She noted what an asset he has been to major corruption and criminals as he arrests no one and allows others to flee the country. Here she was clearly referring to Mr. Platon. The President noted that "we are at war with these people. They left the country but have not given up on the idea of stealing from it." She further noted recent statements by Platon that Mr. Plahotniuc is “running low on money.” The President said “it’s like Platon is his accountant and he’s worried!” She noted that it is clear all of these criminal elements have formed a common front that is attempting to undermine the new government in order to return to their schemes.
Now it is not our role at Moldova Matters to editorialize, but it is important here to try and summarize and analyze this really important story in Moldova. Firstly, we have to note that at no time has Natalia Morari apologized or taken responsibility for her actions. She appeared on TV to interview the father of her child who was representing candidates in the election without ever disclosing this fact. Further, she has worded her posts carefully so as not to disclose the nature or duration of their relationship. This has led some to believe that this was some one night stand that produced a child. Perhaps, but if so it is clearly in her interest to say so and admit a mistake in judgement. From what she has made public we have no idea if this was a short relationship between a journalist and the notorious criminal at the heart of many of her reporting, or if they are planning a wedding in the Caribbean right now. We simply do not know. None of this is meant to dive into her personal life more than we already have. It is simply to underscore that there was an undisclosed relationship between Moldova’s best known pioneering investigative journalist, and the corrupt figures at the heart of Moldovan corruption, and we have no idea how long this was taking place.
Morari dissabled comments on all her posts so it seems she does not intend to answer any questions the public has for her.
Mayor Ceban Also has a Beef with SIS
Chisinau Mayor Ion Ceban decided he also wanted to level unfounded accusations at the intelligence agency this week. The Mayor gave a strange video conference where he first congratulated himself and his administration for Chisinau having the “least smelly” summer on record. For reference, Chisinau has been plagued in past hot summers with foul odors of unknown origin settling over the city and generally making life pretty terrible. Some years, this is from the poorly managed municipal dump, some years it’s because companies illegally dump huge amounts of waste into the city’s Bic river.
Unfortunately, Mr. Ceban wasn’t speaking just in self congratulation… he was telling us that the stink is coming soon. But instead of the usual culprits he said that he believes that SIS will be putting “pills into the water supply” in order to make the city smell and therefore discredit his management. As a source, he cited “ex-SIS employees who wish to remain anonymous.”
SIS responded by asking politicians not to spread false information and that if they have real indications that crimes are afoot to call the authorities. SIS noted that their mission is to protect against national security threats and fight illegal activity... not cause the water to smell like farts. (admittedly the last sentence was paraphrasing on my part).
When thinking of all these random attacks on SIS, an agency many Moldovans have never heard of, we should remember that just this month SIS was directed to take a leading role in combating corruption in Moldova. Attempts began almost immediately to discredit the intelligence agency. This may be entirely a coincidence, or not.
COVID-19 Update
Moldova is now feeling the onset of the 3rd wave as the 7 day average rose to 869 cases per day and 13 deaths. Unfortunately, we should bring out charts out of retirement for context.
As we can see, after a rather steady summer we are moving decidedly in an upward direction in terms of both cases and deaths. Current projections from the University of Washington (interactive tool linked in English) show this wave continuing to grow before cresting in early November. There is the potential to match, or even exceed, the daily death rates reported in March and April of this year. The WHO has similar, if not more dire projections.
In a move to address the crisis more systemically, the government has reformed the membership of the Extraordinary National Commission for Public Health which oversees the COVID response. It will now have 50% minimum doctors and public health specialists. The new commission will begin meetings next week and vote on new processes for containment. It seems inevitable that new restrictions and vaccine policies are coming soon.
Commenting on the vaccination campaign, the Minister of Health was asked why the government is no longer conducting “vaccine marathons,” an idea that showed high promise in the early days of the pandemic. She noted that the last marathons, where one site will allow open walk-in vaccinations 24 hours a day for a weekend, had very low effectiveness and high costs. The Minister noted that with the vaccine more widely available the goal now is to target small communities specifically meeting with mayors and developing local approaches. Unfortunately, the problem of low vaccination is not constrained to local communities as a report from parliament shows that only 49 of 101 members of parliament have submitted proof of their own vaccinations. Of those, 41 were PAS, 8 Socialists, and zero from the Shor party.
Further commenting on vaccination, the Minister of Health noted that the investigation into fake vaccine certificates is proving very difficult. These schemes started in may but accelerated rapidly with the 1 shot J&J vaccine’s arrival in Moldova. People basically would buy certificates, pay a bribe, and the real vaccine would be thrown out. The Minister noted that these are official certificates from the government so it’s impossible to figure out which are fake. In total, several thousand were issued. Importantly, this was limited entirely to people who wanted fake certificates - there is no risk of people accidentally not getting the vaccine if they wanted it. The Minister lamented that people are likely to suffer quite a bit from this as other countries may consider rejecting Moldovan certificates. The National Anti Corruption Center and law enforcement are continuing to investigate.
Meanwhile, in pandemic news that all Moldovans and visitors will find very sad, National Wine Day has been canceled. The national celebration was scheduled for the first weekend in October but has been canceled due to the evolving 3rd wave situation. A sad day for wine producers and wine drinkers.
Economic Updates
One More Small Business Down...
This has been a crippling difficult year and a half for small companies as restrictions and a general climate of uncertainty upended the market. Dorin Mereuta’s bakery is the latest company to shutter. Dorin has been pursuing a dream of a natural, artisanal bakery in Moldova for years and has more than once been saved from the brink by loyal customers and international support programs. He announced this week that he is throwing in the towel cryptically noting that the “90s bandits are still here.” He claims there is no hope in Moldova and that we all must simply flee. It is not clear what actually happened to the business but it is notable that even with his high profile and years of work corruption, or banditry, has driven one more small business owner into exile.
Apples Apples Everywhere… But no Customers
It’s that time of the year in Moldova where there are pictures of entire trucks of apples being dumped off the side of the road by frustrated farmers who say there is nowhere to sell the apples. There is certainly a lot of truth to the fact that Moldova produces lots of apples but has few valued added export opportunities and far too few businesses who just need apples. But there are some saying that the photos are staged by disgruntled farmers as well. Whatever the case, it’s a yearly ritual by now and serves to highlight the distance Moldova needs to travel in terms of access to foriegn markets and investment in value added processing for fruit.
Time to Demonopolize the Railroad?
Parliament is set to debate a new law on “demonopolizing” the national railway. In the law, the government would retain ownership of, and control over, all the infrastructure of the railroad. But they would license private companies to conduct passenger and freight service according to a new set of regulations. The draft is a necessary step for Moldova in fulfilling obligations under the EU Association Agreement. Broadly speaking, it also seems like a mechanism to introduce competition into the system and find ways to keep the trains running in the event that the national passenger or cargo service continue their long long march to bankruptcy. It will be interesting to see if the draft has additional mechanisms to combat the theft and corruption endemic to the national railroad that we have talked about time and again at Moldova Matters.
Crime and Corruption Update
Prosecutor General Investigating Former Officials
The Prosecutor General announced an investigation into a scheme from 2008 where the company Energocom colluded with officials in the Minister of Economy and National Agency for Energy Regulation to inflate the cost of important electricity and profit from it. The scheme basically worked like this. A shell company was created and established as a middle man on all electricity imported from Ukraine. This company pumped up the price before transmitting the power to Moldovan customers taking a commission along the way. The entire purpose of the company, which only existed on paper and had no infrastructure at all, was to benefit as a middle man in this way. This investigation was previously halted in 2017 but is being reopened. The media immediately noted that the original investigation was launched based on the work of investigative journalists who uncovered the scheme which directly implicated Igor Dadon, Vlad Plahotnuid and Zinaida Greceanii. Mr. Dodon loudly called “fake news” and noted that the Prosecutor General made no mention of him in the statement reopening the investigation. This is true, but not at all the point. It seems we will have to see where the investigation goes.
Shor Lost his Paycheck
Parliament this week voted to strip Ilan Shor of his paycheck for never showing up to work. While this is not likely to affect the man wanted for orchestrating the theft of a billion dollars it is symbolically important…. I guess. The Shor party deputies who do go to work noted that this is actually an anti-populist move because Ilan Shor always donated his salary from parliament and as mayor to charity. Now, they also had to note that no one knew this until now as it was a “secret.” I’m sure everyone in parliament feels terrible at disrupting Shor’s secret charitable schemes.
Sanetata Restaurant Raised to the Ground
In Chisinau the old restaurant Sanetate was raised to the ground this week by wrecking crews. In the process a wall fell in an uncontrolled way and obliterated a parked car on the main street nearby. Fortunately, no one was hurt. The Mayor’s office noted that no permission to raise the building was given and has threatened an investigation. Given how wildly out of the mayor’s control construction seems right now with lots of investigations and never a single arrest or even public shaming, it’s fair to say we shouldn’t hold our breath.
Picture from Newsmaker.md / Telegram
Plahotnuic’s Last Scheme?
Well, probably not last. But TV8 conducted an investigation showing a major laundering or theft of money that happened in 2019 on the day that Maia Sandu and Igor Dodon created their coalition of last resort to oust Plahotniuc. On that day, Moldovatransgaz, the state gas transit enterprise signed a 2 page loan document without collateral for 100 million lei (around 5.6 million dollars) to Victoria Leasing, a company controlled by Democratic Party deputy Vlad Andronache. Moldovatransgaz did not have this money so it urgently requested prepayment for services from Moldovagaz (another state company) which made advance payments on its subsidiary Moldovatransgaz’s future work. Note, Moldovatransgaz was not authorized to give such loans without consent from the Company's board. Immediately, the money was moved from Victoria Leasing to Avia Invest, the company that manages the airport (known to be Shor affiliated) - also sent as a loan. The money then went to a series of other Shor affiliated companies in Moldova. After this already confusing web, it vanished through a set of shell companies offshore around the world. Presumably, the money wound up in the accounts of Shor and Plahotniuc. Immediately on the arrival of the new government Moldovatransgaz demanded urgent repayment. Victoria leasing made the payment by taking out a major loan from Moldindconbank against their holdings in the GBC building - the former office of Plahotniuc. In total 400 million lei in loans bounced around a web of companies before the original 100 million was lost offshore in Cyprus and Switzerland. Much of the money wound up going through an Avia Invest subsidiary company. It's owner is listed as a man who worked at the airport all his life. He is now 80 and resides in a small town. His wife said he was unable to speak now and was very ill but that he didn't own any companies. He was likely used to make transfers and sign papers.
So what was happening here? A last theft of some kind? Or simply a very elaborate way to force the sale of a building? It’s not clear except that Shor and Plahotnuic wound up with a hefty payday at the expense of the Moldovan taxpayer just as they were getting ready to board their private planes and flee the country. Meanwhile, Vlad Andronache did not flee at that time but stayed on in Parliament. He fled Moldova this year 3 days after the recent election results when he was seen boarding a plane for parts unknown.
This case, both in its complexity and wide reach through state and non-state companies, shows just how incredible the thefts perpetrated by these oligarchs against the citizens of Moldova have been.
Ending on a High Note!
What can we say about Sheriff? The Tiraspol football club Sherriff made it into the champions league this year in a first for Moldova. They played their first game of the group phase ironically pitted against Shakhtar Donetsk. The two football clubs are from regions that have broken away from their countries as part of Russian backed wars. And both have risen to some success in European football with the backing of oligarchs and the kleptocracy that hosts them. Our local separatists, Sheriff, one the game 2-0. Is this good news? Not many in Moldova seem to think so. The prevailing thought from football (soccer) watching friends has been “a pox on both their houses!” 2 weeks from now Sheriff will travel to play Real Madrid in their 2nd group phase game. I guess we’ll see how public opinion evolves in this odd kleptocrat funded cinderella story.
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