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Moldova’s Gray Cardinal

Vladimir Plahotniuc finds that wealth and power attract an unwelcome spotlight. by Dmitri Romanovski 11 July 2013

CHISINAU | In 2010, the press in Moldova did not even have a photo of Vladimir Plahotniuc.

 

That was the year the man who has been called Moldova’s only oligarch entered politics, winning a seat in parliament. Since then, he has become one of the country’s most controversial figures, and probably one of the most influential, despite efforts to avoid the spotlight.

 

Plahotniuc is, by one account, Moldova’s second-richest person, with a fortune a Ukrainian business magazine estimated at $300 million. He is believed to control several nationwide broadcasters, although his involvement is difficult to confirm. Some say he also controls a handful of political parties, including one that is part of the country’s ruling, pro-EU coalition, and through it influences key law-enforcement agencies. He has been accused many times, though never convicted, of corruption.

 

Vladimir Plahotniuc speaks at the dedication of a new laboratory for the Technical University of Moldova, which his Edelweiss Foundation funded. Photo courtesy of the Edelweiss Foundation.

 

But it is his conflict with a former prime minister, which arguably led to the collapse of the government in April, that put Plahotniuc on many people’s radar, especially outside Moldova.

 

Political scientist Vitaly Andrievsky said Plahotniuc likely pulls many strings in the country’s political and business life, offering “preferments for high positions and opportunities for cushy jobs” to get what he wants.

 

One measure of Plahotniuc’s power might be the difficulty in finding people willing to talk about him. A host of politicians, former business colleagues, and associates refused or deflected requests to comment for this article. Even his nominal former boss, the erstwhile leader of Plahotniuc’s Democratic Party, refused to be interviewed.

 

Otherwise, Plahotniuc uses the courts to silence critics. In March, he sued four members of parliament for “compromising his honor, dignity, and good business reputation” by airing charges of his involvement in corporate raiding and organized crime. In 2011 he won a similar judgment for $120,000 against a frequent critic who leads a non-parliamentary anti-corruption party.

 

The man himself turns down most requests for interviews (as he did TOL’s), an approach that has created a vacuum into which gossip, conjecture, and rumor have rushed.

 

AN OLIGARCH’S RISE

 

According to his official biography, Plahotniuc was born in 1966 into a family of teachers in a small village in central Moldova. It says he finished high school with honors, received a degree in food industry engineering, worked as an economist in several companies, and then established a Moldovan-American financial group in 2001.

 

In a television interview in 2010 Plahotniuc said he got his “first taste of business success” in 1996, when he and some partners started making wine for export to Russia.

 

Five years later came a seismic shift in his career, when he became sales director at Petrom Moldova, a major oil company. After getting degrees in business management and law, he rose to the company’s general directorship. Simultaneously he was elected chairman of one of the biggest commercial banks in the Moldova, Victoriabank.

 

Plahotniuc used his position at Petrom to get close to then-President Vladimir Voronin and boost his business career, according  to Bogdan Tsirdea, a political scientist and an unsuccessful candidate for parliament from a rival party in 2009. Plahotniuc has denied having close ties with Voronin.

 

In 2010, Plahotniuc ran for parliament on the list of the Democratic Party after giving 360,000 lei ($30,000) to its campaign fund. The Democrats were part of a new pro-European alliance that had ousted the Communist government in elections the year before. He was elected in late November and barely a month later was named deputy speaker of parliament and his party’s vice chairman.

 

For a time, Plahotniuc raised his public profile. He launched a charity that helped orphans, young athletes, and victims of floods; received an award for reconstructing a treasured 18th-century monastery; and established a lobby group for business people. He gave interviews and appeared on magazine covers. But after a short period he retreated into the shadows again. He has made little noise in parliament, seemingly preferring to operate via private conversations with his colleagues.

 

“Plahotniuc never really promoted himself. He doesn’t have the political charisma for that,” said Andrievsky, the political scientist. “His strength is in schemes, his network of assistants, and resources. It’s better for him to remain in the shadow than to be in the limelight.”

 

Plahotniuc prefers to be seen as a hard worker who gets things done. At a December 2011 press conference he called himself a “worker bee, not a glamorous politician.” In another, he said he worked 16-hour days and had not had a vacation for 10 years.

 

“The press needs scandals, but I need efficiency. I want there to be less rhetoric and more action in politics. I didn’t get into politics to make money. I want to be known for efficiency,” he told a reporter in 2011.

 

But Plahotniuc was known this spring for a push to change the way members of parliament are elected, from the current party list system to one in which half the legislature comes from single-member districts. Single-member constituencies in post-Soviet countries raise objections from anti-corruption campaigners, as they tend to favor wealthy candidates, or their proxies, who can spread a lot of money around in questionable ways.

 

Plahotniuc also pushed to give control over the General Prosecutor’s Office, the Central Election Commission, and an independent auditing agency to opposition parties – smaller entities controlled by him, according to the Communists, themselves in opposition.

 

Both proposals ultimately failed, and Plahotniuc was criticized for promoting his own interests.

 

Those interests are largely apolitical, according to Alexei Tulbure, an ex-Democratic Party member and Moldova’s former representative to the Council of Europe, a good-governance and human rights watchdog.

 

“You can hardly call him a politician,” Tulbure said. “His actions don’t have to do anything with the public interest, policy, or development. Politics and parliamentary immunity are just more leverage for him.”

 

He said Plahotniuc’s position could become untenable – as happened in Russia to the late exile Boris Berezovsky or the imprisoned Mikhail Khodorkovsky – if the political wheel was to turn.

 

For now, that is unlikely, according to Tulbure, because the Democrats continue to control key government agencies, including the Prosecutor General’s office and the National Anticorruption Center.

 

Tsirdea agreed that the division of agencies among ruling parties has protected Plahotniuc. “For four years the prosecutor general refused to open any case that was at all connected with Plahotniuc. And there was no reaction from the courts, either,” he said.

 

THE RAIDER

 

If the scandals that are periodically linked to him are any indication, Plahotniuc might need that protection.

 

Most famously, he was accused of engineering raids on major Moldovan banks and an insurance company in 2010 and 2011, using secret court decisions to obtain shares held by others and transfer them to companies located in the United Kingdom.

 

The charges, which Plahotniuc denies, were reportedly backed by evidence unearthed in connection with a British lawsuit, although his spokeswoman told Business New Europe magazine in October that the supposedly compromising documents were forgeries.

 

Two stockholders who say there were robbed were Victor and Viorel Tsopa, former business partners of Plahotniuc (whose lawyer disputed repeated media reports that the two men are related). Since going public with the charges, Victor Tsopa has been sentenced to 10 years in prison for blackmailing, kidnapping, and stealing bank shares from a business partner in 2007. Viorel Tsopa was sentenced to eight years for embezzlement from another bank. Both men live in Germany, beyond the reach of Moldovan authorities.

 

The Tsopas contend their prosecutions were retaliation, brought by a Plahotniuc-controlled prosecutor’s office. Plahotniuc said at the time that the their accusations were part of an effort by former Prime Minister Vlad Filat’s Liberal Democrats – an uneasy partner in the ruling coalition – to smear him.

 

The Tsopas’ lawyer, Andrei Nastase, said they have filed cases with the European Court of Human Rights concerning the alleged theft of the shares and the criminal convictions in Moldova.

 

THE PUPPET MASTER AND INTERPOL

 

In June 2011 Filat said an unnamed “puppet master” was trying to take control of several state-owned companies, including fixed-telephone-line operator Moldtelecom, the Franzeluta bakery, and metals exporter Metalferos. After a month of hints, he identified the mysterious figure as Plahotniuc.

 

Vlad Filat
“Plahotniuc became a first deputy speaker of parliament having behind his back off-shore companies, stolen money, and crimes that he will have to answer for in the future,” Filat said at the time.

 

The Filat-Plahotniuc feud was likely behind the most recent in a long list of political crises in Moldova since the Communists left office in 2009.

 

After a man was accidentally shot and killed on a December hunting trip attended by top business people and some members of the judiciary, Filat accused Prosecutor General Valeriu Zubco, who was backed by Plahotniuc’s Democrats, of covering up the episode. The prime minister demanded, and received, Zubco’s resignation.

 

That move upended a deal under which the coalition parties had divided up government agencies, and the gloves came off. In February, Filat’s Liberal Democrats and the Communists held a non-binding vote of no confidence in Plahotniuc, who then resigned his leadership position in parliament.

 

The next month, the Democrats and Communists rounded on Filat, reviving old corruption allegations. His government lost a confidence vote in March, and the West-leaning coalition seemed doomed.

 

Since then, another pro-European government has been formed that includes the Liberal Democrats, Democrats, and a splinter group from the previous coalition’s third party, the Liberals. Filat and Plahotniuc give the appearance of having patched up their differences, with Filat even saying he regrets calling Plahotniuc a puppet master.

 

As the political scandal unfolded earlier this year, the Communists claimed Plahotniuc was under surveillance by Interpol, the global police organization, for participation in international organized crime.

 

Plahotniuc initially denied the Communists’ claim but later said he had inadvertently come under Interpol’s gaze by landing his private jet in an airport in northern Italy, where Russian business people – presumably the police agency’s real target – were buying up large tracts of land. He said being under Interpol scrutiny is commonplace for top officials and business people.

 

Interior Minister Dorin Rechan, appointed by Filat’s Liberal Democrats, released documents showing that Plahotniuc had been eyed by Interpol in 2007 but is no longer monitored.

 

Plahotniuc’s lawyers implied that the stories of litigation against him are fabricated, saying their inquiries in London and elsewhere have turned up no court cases involving “our client’s name.”

 

Alexander Stoianoglo, a member of parliament from the Democratic Party, said Plahotniuc has been unfairly demonized and is even unaware of many of the tales circulated about him.

 

‘BADDIE’

 

But circulate, they do. On Internet forums, Plahotniuc has been given the nickname Plohish, a play on his last name that means “baddie” in Russian. He came in next-to-last in an April survey by the Moldovan Institute for Public Policy of Moldovans’ trust in their politicians. Only 0.4 percent of respondents said they completely trust him, and 4.5 percent trust him somewhat.

 

In 2011 Justice Minister Oleg Efrim unsuccessfully proposed ousting Plahotniuc from a council on reforms in law enforcement and the judiciary, saying he lacked the public’s confidence.

 

Lawyer Andrei Nastase, who represents the Tsopas, has repeatedly addressed the same request to President Nicolai Timofti but has received no response.

 

More recently, Plahotniuc was accused of violating Moldova’s law against media monopolies. Although media ownership is difficult to pin down in Moldova, AO Apollo, a media monitoring group based in Chisinau, last year followed a paper trail that led to the Netherlands and Cyprus to unearth evidence that Plahotniuc controls three of Moldova’s six nationwide television channels and two radio stations.

 

The organization asked the country’s broadcast regulator to revoke some of the licenses and assess penalties, but it has also received no response.

 

A journalist who works for one of Plahotniuc’s media properties and has covered him agreed to speak for this article, but only on condition of anonymity. She described him as hard-nosed, grasping, crafty, and unprincipled.

 

The journalist said Plahotniuc’s media outlets work to counter his bad reputation: “There are unspoken rules everyone knows, not to criticize him or the Democratic Party.”

 

But, she added, all of Moldova’s media work that way, only with different masters. Journalists who work for Plahotniuc properties don’t resign, she said, because he “sets a value upon professionalism and pays well.”

Dmitri Romanovski is a journalist in Moldova.

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