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Leaked recordings expose shocking state corruption in ‘U.S. governed’ Moldova

Originally published: The Grayzone on May 18, 2023 by Kit Klarenberg (more by The Grayzone)  | (Posted May 20, 2023)

The invasion of Ukraine placed the tiny country of Moldova on the immediate periphery of a conflict with global significance. Bordering Ukraine, counting hundreds of thousands of ethnic Russians as citizens, and home to the breakaway region of Transnistria, Moldova’s doggedly pro-Western government has been buffeted by crisis after crisis since Russia invaded Ukraine on February 24th 2022.

President Maia Sandu of the Party of Action and Solidarity (PAS) has remained steadfast as murmurings of a looming Ukrainian invasion, Russian plots to destabilize the country, and vast anti-government protests have reverberated on an almost monthly basis. Key to her endurance has been the unconditional backing of Western officials.

The sponsorship of NATO states has persisted despite industrial scale corruption at the highest levels of government. Indeed, as we shall see, foreign corruption in Moldova is actively facilitated and perpetuated with the support of Brussels and Washington, and continues apace with their full knowledge, consent, and even assistance.

The Grayzone has exclusively obtained video recordings of numerous well-connected figures within Chisinau’s political and business community openly—and gloatingly—testifying to rank malfeasance within the country’s government and economy, while outlining various schemes to enrich Western investors for an appropriate fee. It is the starkest depiction of how corruption operates in Moldova to ever emerge, gravely underlining its endemic, institutionalized nature.

In the recordings, pranksters posing as wealthy U.S. businesspeople contacted Moldovan politician and lawyer Stanislav Pavlovschi, asking for assistance in securing a gigantic return for investing $50 million in Chisinau. The pranksters are private citizens who approached The Grayzone with the bombshell footage, and have asked to remain anonymous.

Very quickly, Pavlovschi—a former European Court of Human Rights judge and self-styled human rights defender—told them that a “good lawyer” and water-tight contracts would not be of any use to them there, as “the level of corruption is very high.” He went on to note that the country was effectively a colony of Brussels and Washington:

Moldova now is governed by the U.S. Ambassador… He is practically governing Moldova at this particular stage. You have hundreds of consultants for the EU…working for each and every ministry here in Moldova. So it is under very, very strict control on the part of the EU.

When asked how this state of affairs could work given the high levels of corruption, Pavlovschi retorted that it functioned “perfectly,” “absolutely,” “brilliantly”—“everybody loves money.”

Well-connected investor promises ‘direct access’ to government

The pranksters were duly introduced to a number of influential local figures who could assist them in getting rich quick. Among them was Oleg Ciubuc, counselor to Vladimir Bolea, head of the Moldovan parliament’s agriculture and food commission. He professed in the leaked discussions to also be an “entrepreneur” whose “main direction” was connecting “investors with project developers.”

Beyond his “school friend” Bolea, who personally writes laws and regulations covering the country’s agriculture and food policy, Ciubuc revealed that his brother Alexandru runs state telecoms firm Moldtelecom. He is also a member of the PAS, which he described as “a big family,” connected “directly” to the “government, parliament and president.” In practice, this creates a dynamic not dissimilar from traditional mafia cartels:

All my colleagues are telling me, ‘you are a perfect connector, to find a point A point B and connect to make money’…we are all of us connected to each other. Any question you have, I’m going to the highest person in the country responsible for that field… That’s the beautiful thing, when you have the majority in the parliament, everything is made by this majority… All the power in the country is controlled by this majority, which is the ‘family’.

Ciubuc claimed his deal-making prowess was such that he was recommended for the post of Moldova’s state investment chief by his contacts, only for Sandu to personally reject the proposal. She supposedly reasoned that he should be working “multimillion investment funds” in the private sphere, which were “much more interesting projects than just a small agency under the government.”

“For me now is [sic] very easy to invite investors in my country because I can guarantee 100% the full political and security support,” Ciubuc swaggered.

Of course, being in that structure, we have access to all information, all the details in the country. And you need, like, you know, five minutes to find everything you need.

The issue of state-level protection for foreign investors in Chisinau was similarly raised by investment professional Olga Melniciuc, who formerly worked as a consultant to the Moldovan state economic council. She acknowledged that many outsiders were deterred from funding projects in the country due to a lack of “predictability”—whether favorable terms secured under one government would still apply if another was elected.

Melniciuc said that “predictability and some insurance for the stability” of an investment could be guaranteed by direct negotiation with government ministers, albeit via “non-formal communications.” Investors simply needed to “make sure the main person in the government knows what they are doing,” and they have official support for their endeavors, if only behind closed doors. She described an official “vetting” process for investments that was nothing of the kind, and did not involve scrupulous background checks or due diligence.

Melniciuc went to assure the pranksters that well-established forums in Moldova, such as the American Chamber of Commerce, Association of Foreign Investors, and European Business Association were already “very actively advocating for the rights of their members,” and “have direct access to [the] Prime Minister.”

“We have a pro-European government supported by the EU [and] U.S. government. So there is a lot of this pro-Western support,” Melniciuc said.

And we have all the needed documents and the association agreements signed. We are [EU and NATO] candidates…So all that is very good. It creates a good playground for investors.

Melniciuc felt it was “the best time to invest,” as the war in Ukraine’s impact on Moldova, which includes 30% inflation, had created “uncertainties” in the market.

Moldovan media tycoon ‘handles’ relationships with Prime Minister

Staffers within the ranks of U.S.-funded NGOs operating in the country were also eager to assist foreign investors to enrich themselves via dubious schemes. They included the education training organization Pro Dictactica, which is partnered with George Soros’ Open Society Foundations, the EU, the Lithuanian Ministry of Foreign Affairs, and U.S. Embassy in Moldova, among others.

He introduced the pranksters to a key figure in Pro Dictactica, Oxana Draguta, who enjoyed direct access to Maia Sandu. The pair worked together when Sandu was Minister of Education 2012—2015, and Draguta was a staffer in her ministry “responsible for coordination of foreign assistance in education.” After being elected President, Sandu “brought her team for the government,” meaning Draguta had a variety of contacts to exploit.

One method proposed to Dragutra of getting Sandu and her associates on board was by simply bribing her administration, via the funneling cash to “private entities,” which would pass these funds on to the PAS. The party’s coffers could be illicitly filled without the appearance of a direct foreign donation, providing the pranksters with astounding commercial benefits. Draguta concurred, noting her own involvement in facilitating such an arrangement could also conveniently be hidden:

I can reach them out [sic] and ask…They are actually across the street…Actually, I am…this kind of…a member of this party but not an active member of it.

Similarly unguarded comments were made by Cătălin Giosan, a Moldovan oligarch who in 1999 founded PRO TV, one of the country’s first, and now largest, private broadcast networks.

Giosan made clear he could serve as the bogus business peoples’ public relations “partner.” Keenly clarifying he was “not somebody who has experience in logistics or construction or whatever, but somebody to guide you in this political environment,” he promised to help them to connect “with local politicians and decision makers,” and “handle” those relationships on their behalf.

“I do this [sic] for 23 years. We…have the main news programs in urban Moldova. That means I saw generations of politicians coming and going,” Giosan boasted.

It’s not a question if we can establish a connection with them. I’ve met the key people I think should and can be involved in this project…One is the key decision maker in the administration. So I’m talking about the people you need.

He pledged once their discussion concluded to “think” about “how such support can be structured…the most efficient way,” and meet with local stakeholders, “to craft a plan, a solution.” He asked the pranksters to prepare a “brief” for his “partners”. In turn, he would meet with the pranksters over dinner, to discuss “the political, economical, social situation, the crisis situation, the war.”

“Then,” Giosan pledged,

I’ll make you a presentation on the decision making, political decision making processes in Moldova to understand how this where the power stays and how the decisions are made.

It is indeed “not a question” whether Giosan could connect wealthy foreign financiers with a high-ranking government decision maker. Moldova’s aggressively pro-EU, pro-U.S. Prime Minister Dorin Recean, who took office in February, is extremely rich by local standards. Official declarations of his assets show he owns several properties, including a lavish Romanian villa, and that he and his wife reap vast sums from their assorted business interests.

For example, Reacean is the founder of three highly profitable local companies, including U.S. Food Network, which manages outlets of KFC in Moldova. In each case, Giosan is also a shareholder.

Such an intimate relationship provides him with a direct and highly influential line to the heart of government, while offering some clue as to “how decisions are made” in the country.

Moldova makes mockery of USAID anti-corruption efforts

The recordings obtained by The Grayzone are all the more shocking when considering that Moldova is enrolled in the U.S. Agency for Aid and International Development (USAID)’s Countering Kremlin Malign Influence (CMKI) program. Under the auspices of USAID, a traditional cutout of U.S. intelligence, countries which once comprised the Soviet Union and Warsaw Pact receive vast funding and practical support to supposedly defend themselves from Russian meddling. Cracking down on corruption is one of the initiative’s foremost objectives.

This includes sponsorship of “reform-minded leaders and civil-society voices.” Maia Sandu happens to be one such “reform-minded leader,” which is why her upset victory was hailed in Western quarters as a watershed moment in Moldova’s battle against corruption. Since then, she has regularly touted high-profile legislative amendments and initiatives to tackle the issue, but critics charge they have achieved nothing, simply serving to replace one set of crooked officials with another.

One would not know that from the pronouncements of U.S. officials, however. In December 2022, USAID chief and humanitarian interventionist guru Samantha Power met personally with Sandu to “discuss U.S. support for the people of Moldova,” and the President’s “anti-corruption and democratic reform agenda.” An accompanying press release noted the U.S. had provided Chisinau with $320 million over the past nine months,

to address the economic, energy, security, and humanitarian impacts of Russia’s war against Ukraine.

This staggering sum follows almost $100 million gifted to Moldova by USAID through the CMKI program between 2017 and 2021, making it the biggest beneficiary.

Evidently, Washington has taken a relaxed attitude toward high-level graft and bribery in Moldova. As long as Western oligarchs and businesses are profiting, and the government toes an anti-Russian line in all matters domestic and foreign, Washington seems content to look the other way.

This dispiriting reality is apparently not lost on most Moldovans. While polls indicate Sandu remains the most popular politician in the country, 57% of citizens cannot name a single public figure they trust. Likely sensing the precarious position of their puppet in Chisinau, the EU announced in April 2023 it would deploy a “civilian mission” there to counter Russian “threats”.

Yet, the longer the war in Ukraine grinds on, the more probable it is the government will fall—not due to external interference, but because of internal upheaval. The coterie of business figures, well-connected actors and NGO operatives to whom Stanislav Pavlovschi introduced the pranksters—and the Western oligarchs they so eagerly serve—may be wise to line their pockets in Moldova while they still can.

Kit Klarenberg is an investigative journalist exploring the role of intelligence services in shaping politics and perceptions.

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