The consequences of the so-called “Laundromat” – the laundering of around 20 billion dollars from Russia through the Moldovan banking system – can still be felt. International perception of the Moldovan banking system has suffered greatly, says National Bank Governor Sergiu Cioclea. In a press interview, the governor stated that several foreign banks have severed their ties with Moldovan banks, and added that this process could continue if no major efforts are made to improve our country’s reputation.
“As far as we are concerned, the National Bank has toughened supervision of local banks considerably. We work to improve inspections, by implementing an IT solution and by more frequent on-site inspections. We ask all banks to undergo an external audit specialized in fighting money laundering and funding of terrorism. It is a first for Moldova. We will, as soon as possible, amend the legal framework to include new provisions for the Law on Combating Money Laundering and Terrorist Financing,” says Sergiu Cioclea.
According to him, in order to make sure another “Laundromat” isn’t possible and, especially, that the new Law on Voluntary Wealth Statements will not be used by some to create a loophole in the anti-money laundering procedures, BNM will train all banks to apply strict measures of precaution concerning all of the declared money. If their wealth statements will include bank shares over 1%, shareholders will be subjected to a fit-and-proper test and, should they fail, be obligated to sell their shares according to forced sale procedures.
Taking into account the risks that come with tax or capital pardons, central banks usually a reluctant to support them. However, since the law has passed, the goal of BNM is to ensure that it doesn’t create potential for abuse.
Referring to the “theft of the century”, Sergiu Cioclea stated that the investigation by international consortium Kroll and Steptoe & Johnson had concluded at the end of last year. Investigation results were published in Romanian and English on the BNM website in December 2017. The final report, dubbed “Kroll 2” by the press, has been officially submitted to BNM in March 2018, and has later been picked up by the Anti-corruption Prosecutor’s Office. Therefore, no other report is expected from the international investigation consortium.
According to the governor, however, Kroll and Steptoe & Johnson have stated their availability to continue working with Moldovan authorities in their international pursuit of the stolen funds, through initiating civil files in support of the criminal files submitted by the Agency for Recovery of Infractional Goods (ARBI). In order to determine the necessity and scope of involvement by the international consortium, BNM has previously organized several work meetings between Kroll representatives and the Anti-corruption Prosecutor’s Office, CNA, and ARBI.
Additionally, BNM has ensured cooperation between Kroll and national banking authorities from other countries, especially with those in Estonia and Latvia, where the money laundering “headquarters” were located. Throughout the investigation, briefing meetings were organized by representatives from the IMF, World Bank, European Commission, and the US Embassy.
“I want to highlight that all investigation material available to BNM has been forwarded to the Prosecutor’s Office and to the Kroll company. Missing, as mentioned in the conclusion, are informations that haven’t been granted by authorities from other states through which the stolen money has transited. The National Bank isn’t a pursuit authority and cannot thus substitute law enforcement in this case. Meanwhile, BNM has requested all banks undergoing liquidation to intensify their acts in the aid of justice, as many criminal files have been initiated in response to their claims,” added the governor.
The interview with the governor was conducted based on questions asked by mass media institutions, at the request of BNM.
