The speaker of Parliament Adrian Candu has published a Kroll report of the investigation of the billion theft from Banca de Economii (BEM), Banca Socială (BS) and Unibank (UB) in May 2015. These banks formed 35% of the assets of the entire banking system of the country and were closed at the end of 2015.
The National Bank of Moldova has hired Kroll on January 28, 2015 to investigate the transactions of these banks. The cost of the investigation is 350 thousand euros.
«Preparing the ground»
Kroll found out that in the period from 17 August 2012 to 30 November 2014 in BEM, BS and UB were many changes in the board of shareholders. The property rights were transferred to other persons, that weren't assotiated with each other. Later all three banks began to carry out transactions without economic sence, that in fact damaged the balance sheet of banks and led to their bankruptcy.
In the short period of these changes there was a policy of increasing the volume of available liquid assets in order to give large amounts of credits to economic agents from Moldova.
In August 2013 the minor shareholders of the bank had the opportunity to receive an additional share capital by issuing shares. The main shareholders of the bank: Agency for State Property (reduced quota for participation from 56.12% to 33.3 (3)%) and «Integrated information systems» (increased share participation from 9.8% to 33.8%) did not take part in it.
Source: Kroll Report
The new owners offered BEM liquid assets in the form of debt in 600 million lei and were to buy «hopeless» credit for not less than 300 million lei. This was possible because of a contract with the company Roseau Alliance LLP, incorporated in the UK. A similar contract with the company was signed in February 2013 for the purchase of «hopeless» loan of 1 billion lei in the BEM. Transactions increased the liquidity of the BEM and allowed to allocate credits.
Expert Grup argue that the crisis in these banks took place because of 5 main reasons: «a delayed reaction and ineffective actions of the National Bank of Moldova and other organizations, changes in the boards of shareholders of banks, violation of corporate governance principles, the artificial increase of the ability to give credits and bad management before the crisis in the banks.
The financial hole in all three banks was, according to the Kroll data, about 18 billion lei. The former head of the National Bank of Moldova, Veaceslav Negrutsa, at a parliamentary session on May 7, 2015 discreased the amount to 13-13,3 billion lei. He said that it is impossible to refill this amount, even through the sale of material assets, because there will still be 9 billion deficit to the end. According to Expert Grup, «this amount partly includes loans issued by the National Bank to BEM, BS and UB under the state guarantees in November 2014 (9.6 billion lei), and possibly in March of 2015 (5.6 billion lei )».
BEM and Shor'group
Kroll analysis shows that organizations that got the rights of property and didn't assotiated with each other united later in an affiliated groups. They recieved «hopeless» credits by a chain of virtual transactions between accounts of companies in the UK and bank accounts in Latvia.
These organizations are associated with the group of companies of Ilan Shor. In April 2014 Shor became chairman of the BEM Board of Directors. Between 2012 and October 31, 2014 the amount of «hopeless» credits of these organizations has increased from 1.1 billion to 8 billion lei as a result of the fact that BEM gave loans for four companies: Provolirom SRL, Dracard SRL, Caritas Grup SRL şi Voximar Grup SRL.
According to the report of the commission that was to explane the situation of the financial and currency markets, disclosed by the Parliament, BEM issued loans to the following companies in the Shor's group during the period October-November of 2014:
Provolirom - 3,400 million lei (437,3% form CNT)
Dracard - 3,000 million lei (385,9% from CNT)
Caritas Group - 3,800 million lei (488,7% from CNT)
Voximar Com -3,200 million lei (411.6% from CNT)
The credits were issued with violation of the 15% limit of regulatory capital. BEM argued this by existence of deposits in Russian banks.
This scheme was launched in 2012 when a group of companies led by Ilan Shor through intermediaries began to strengthen their control of the three banks. Kroll was unable to set whether Shor acted alone or with other interested parties.
In the article of Vitaly Sprynchyane published on platzforma.md it's said: «it is clear that Shor couldn’t realize his evil plan without the «absolute blindness» of the state agencies like National Commission for Financial Market, National Bank of Moldova, Security and Information Service, National Anticorruption Center. All the schemes were fullfiled with the complicity of these agencies. There is said about Shor in the report and nothing about the state institutions that were supposed to control everything».
In addition to these 4 companies Kroll mentioned as participants in the crediting the following companies: Ghermivali, Elcomet Prim, Vascovprod, Molint Grup SC SRL, Alutus Com, Alreda Pro, Davema Com, Contrade, Nobil Air, Moldclassica Internaţional, Dasler Con, Lavima Impex, Biro Media, Talnes, Storad Grup.
Source: Kroll Report
There is a theory that from 13.1 billion lei, allocated by BEM to 4 companies, 6.5 billion were for the debt payments to BEM and UB of some Shor's group companies. Nobody knows where is the rest of the money.
After the publication of the Kroll report Shor was arrested and placed under house arrest. Later he was released because he was a candidate for Mayor of Orhei town.
The National Bank of Moldova recently announced that the Kroll report confirms «the major participation» of Shor and his companies in the scheme. In responce Shor has organized a press conference in which he announced that the total damage amounted to 625 million dollars, most of which disappeared before he became head of the BEM Board of Directors. According to the banker, he offered a bribe of 250 million dollars to former Prime Minister Vlad Filat, that doesn't figure in Kroll report.
By the way, the decision to sell BEM to Shor's group was eventually adopted by the Government of Filat and confirmed by the Government of Leanca.
The complicity of the National Bank
The complicity of the National Bank of Moldova in money laundering becomes evident in the Kroll report. Moreover, the data presented in the report were taken from the National Bank, which means that the main state bank knew about what was happening in BEM, BS and UB but did not reacted.
On March, 11 this year Sergiu Chioklea was appointed a new Head of the the National Bank of Moldova. Former Head– Doryn Dragutsanu didn't appear in any criminal case, despite the fact that the National Bank facilitated money laundering. The experts consider that he should be punished for at least negligence in his work.