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The Kleptocrat Next Door

Moldovan oligarch Vladimir Plahotniuc has been sanctioned by Trump’s State Department. So why is he now holed up in the U.S.?

Vadim Ghirda/AP/Shutterstock

Two months ago, the Trump administration made a momentous, and surprising, decision to put post-Soviet oligarchs on notice. Secretary of State Mike Pompeo, in an unexpected January 13 announcement, revealed that the United States would be issuing sanctions against Moldovan politician Vladimir Plahotniuc, one of the most conniving figures Moldova has ever produced. “In his official capacity, Plahotniuc was involved in illicit acts that undermined the rule of law and severely compromised the independence of democratic institutions in Moldova,” Pompeo said, describing Plahotniuc as an “oligarch” involved in “significant corruption.”

Nothing that Pompeo said was inaccurate. For years, Plahotniuc effectively steered Moldova’s economic development, transforming it into a key linchpin of post-Soviet kleptocracy. As the head of Moldova’s Democratic Party from December 2016 to June 2019, Plahotniuc styled himself as a reformist figure, dedicated to bringing Moldova’s struggling democracy closer to the Western fold and away from Russia’s embrace. All the while, he had his hand at the till of some of the most nefarious schemes to come out of the region.

Plahotniuc, who also served several off-and-on stints in the Moldovan parliament, was finally ousted from office in  July 2019, thanks to an unlikely coalition between Moldova’s Moscow-leaning Socialists and a new pro-reformist party. He pulled up stakes and left the country: a clear victory for a post-Soviet nation hoping to escape the clutches of crooked elites who prey on the populace. The Trump administration’s decision to issue a visa ban against Plahotniuc was thus a relatively easy call, and it received plaudits across the political spectrum and across the region.

But there was one catch, which only surfaced last week. It turns out that Plahotniuc hasn’t spent the past few months hiding away in London, Moscow, or Dubai. Instead, he’s been lying low in the very country that supposedly banned him—the U.S.—and it seems he has at least one key ally high up in the Trump administration.

Even in the seamy world of post-Soviet corruption, Plahotniuc has distinguished himself. In one scheme, in 2014, he swiped the holdings of a number of Moldovan banks to the tune of approximately $1 billion. That’s the equivalent of over 10 percent of Moldova’s GDP, up and gone, swindled in what investigative journalists dubbed the “theft of the century.” Another scheme, which earned the title of the “Russian laundromat,” enlisted Moldovan judges in a plot to launder tens of billions of dollars in ill-gotten Russian boodle that ended up scattered across the West. As The New York Times wrote, Plahotniuc’s involvement in these and similar enterprises was enough to earn him the reputation of the “most-feared figure” in Moldova, one who, analysts contended, had become widely skilled in “corruption, kompromat, and an adroit use of geopolitical rhetoric.”

So it was something of a shock within the community of foreign corruption watchdogs when, last week, Radio Free Europe/Radio Liberty’s Mike Eckel confirmed a series of rumors about Plahotniuc’s whereabouts in the U.S. “Moldovan officials and U.S. officials with knowledge of the situation … told RFE/RL that Plahotniuc had been in the United States on several occasions in recent months, including at least once since the State Department imposed the visa restrictions,” Eckel wrote, noting that one eyewitness placed Plahotniuc at a “lavish dinner at a Chinese restaurant in Miami, Florida, in late January.” Moldovan President Igor Dodon confirmed as much, announcing last month that American officials had told him Plahotniuc remained holed up in the U.S.

The revelations kicked off, at a bare minimum, an entirely avoidable scandal. In one swoop, the U.S. had gone from leading international efforts to sideline Plahotniuc and highlight his propensity for graft, to aiding and abetting one of the most loathsome figures the region had ever produced. The development not only devastated those familiar with Moldova’s efforts at cleaning up its internal malfeasance—and completely trashed America’s soft power along the way—but it put paid to the Trump administration’s laughable claims to be interested in clamping down on transnational corruption.

The logical question, then, is: Why? Why is the U.S. continuing to shelter Plahotniuc, even with all of the recent stories linking Trump directly to any number of similarly corrupt post-Soviet oligarchs, including Ukrainian figures Dmitry Firtash and Ihor Kolomoisky? Why is the U.S. seemingly willing to abnegate any claims to moral superiority in the region and unwind all the gains it’s recently made in claiming to care about corruption? We don’t have an answer at the moment. The State Department and Department of Homeland Security both declined to comment, and both the chair and the ranking member of the Senate Foreign Relations Committee didn’t respond to questions.

One possibility, though, hangs in the air. Both Firtash, facing potential extradition to the U.S., and Kolomoisky, facing an American lawsuit accusing him of laundering hundreds of millions of dollars in the U.S., have recently begun hiring pro-Trump figures in Washington, wooing Trump lawyer Rudy Giuliani, and dangling potential “dirt” on Trump’s primary political rival, Vice President Joe Biden. All of that so-called “dirt,” of course, is based solely in conspiracy theory; Trump’s recent impeachment attested as much, with the president and his lackeys buying those tales of “dirt” wholesale. But they set a model of crooked plutocrats dangling fabricated information, which Trump eagerly lapped up, in exchange for political favors.

Conveniently enough, Plahotniuc was the primary force behind Moldovan politics during Obama’s two terms, and especially during the post-Crimea years, when the Obama administration—and Joe Biden himself—were endeavoring to shore up allies in the region. One of those self-proclaimed allies was Plahotniuc. Who’s to say Plahotniuc hasn’t spied a new opportunity for a new ally in the White House? If so, Firtash and Kolomoisky provide the model means by which he, too, might worm his way into Trump’s good graces: Spin some deliciously sordid yarns about Biden that might be deployed in this election year’s fake-news charnel house.

Of course, the U.S. may be continuing to shield Plahotniuc, and kneecap its reputation as a global leader in the anti-corruption fight, for reasons beyond Trump’s reelection. Whether or not Plahotniuc is looking to break into the burgeoning field of anti-Biden conspiracy-mongering, it’s worth noting that Plahotniuc suddenly has a friend slowly moving up the White House’s organizational chart: Richard Grenell, whom Trump recently tapped as the acting director of national intelligence.

Grenell, in a previous life, was an infamous right-wing troll, a “partisan propagandist” elevated solely for his Trumpian sycophancy. But according to recent reporting, he carried on another professional hobby: whitewashing nefarious foreign figures and shilling on behalf of foreign interests. As ProPublica revealed last month, before the 2016 election Grenell had penned a number of op-eds effusively praising foreign actors. Responsible Statecraft also uncovered that Grenell had provided P.R. services “aimed at U.S. media” for other foreign entities.

Much of Grenell’s work, as the publications uncovered, had never been registered with the Justice Department’s Foreign Agents Registration Act, or FARA, in a manner similar to that of other crooks associated with Trump’s 2016 campaign, such as former campaign chairman Paul Manafort. And one of the figures that Grenell saw fit to whitewash, time and again, was none other than Plahotniuc, who just happened to be running an outsize, and notorious, lobbying operation in Washington at the same time.

Unlike Manafort, Grenell hasn’t been charged with any crimes related to this activity. His lawyer claims, somewhat ludicrously, that Grenell was simply spinning Plahotniuc as some kind of pro-Westernizing figure “strictly on his own.” Who among us hasn’t mistaken unimaginably corrupt figures in faraway lands for Westernizing figures and issued numerous op-eds defending them, out of the kindness of our hearts, after all?

It’s unclear right now whether the DOJ will follow the blinding, blinking red lights about Grenell’s potential FARA violations and open an investigation into the matter. (Senator Chuck Schumer recently asked it to do so.) If it does, though, we might have some more answers as to why Plahotniuc apparently feels comfortable enough to dine out in Florida, presumably on dirty money, despite U.S. sanctions. And we may learn exactly who Plahotniuc has been talking to while he’s here, what kind of tales he’s been spinning, and who in the White House may be listening.