Protest in Moldova over missing $1.5 billion from banks

05.05.2015 | By Mariola Śmietana

On May 3 some 10,000 people took to the streets of Chisinau, capital of Europe’s poorest nation Moldova, to protest over the disappearance of US$1 billion (€900 million, RM 3.59 billion) from three banks. Protesters also called on the government to implement reforms to bring the country closer to the European Union.

In April, the Central Bank of Moldova discovered that the three banks in question granted loans worth a total of US $1 billion, equal to 15 percent of the impoverished ex-Soviet state’s GDP.

According to a parliamentary committee’s report, leaked to the press, some of the money is believed to have landed up in the Russian banks. The three Moldovan financial institutions involved – Banca de Economii, Banca Sociala and Unibank – hold about a third of all bank assets in the country, including money intended for pension payments.

Moldovan officials have recently launched an investigation into the disappearance of the money in November 2014, before the country’s parliamentary elections in which the pro-European Union parties narrowly squeezed pro-Russian representatives out of the majority. Prosecutors and American auditors have been searching the banks’ books for the clues about the mysterious transactions, an embarrassment for the ex-Soviet state on track for the EU membership.

The scandal has threatened to destabilize the whole banking system in the country of 3.5 million people. Moldova’s currency has lost 20 percent value this year.

The current government is backed by the communists, who favor a slower approach to reforms. Last year, Moldova signed an association agreement with the EU.