Why is Israel helping this Putin ally evade the law?

By Marc Champion

If Israel wants to signal the Kremlin that its support for Hamas has consequences, it holds a ready tool: Extradite Ilan Shor, the businessman-cum-politician who fled Moldova while appealing his conviction in a $1 billion bank-fraud case. He’s been working with Russia ever since to unseat the nation’s pro-European government.

For most countries that accuse Russia of interfering in their elections, the issue is both hard to prove and primarily diplomatic: The attempts to manipulate votes constitute serious hostile acts, but Moscow lacks the power to change outcomes.

Not so in Moldova, whose vulnerability was exposed in Sunday’s nationwide municipal balloting, seen as a plebiscite on the country’s decision to bid for membership in the European Union and a test-run for next year’s presidential election.

Moldova, a small ex-Soviet state squeezed between EU member Romania and Ukraine, lies within the sphere of influence that Putin has gone to war to reestablish. It has hosted a pro-Russia separatist enclave, protected by Russian troops, since the early 1990s, and lost much of its more ambitious youth to emigration since.

Toppling President Maia Sandu’s pro-western government was a sub-goal of the Kremlin’s plans when it invaded Ukraine last February.

Frustrated on the battlefield before it could reach the Moldovan border and infuriated by Sandu’s decision to apply for EU membership, Russia cut off the nation’s natural gas and power supplies.

The move forced a brutal switch to more costly energy, and a collapse in Moldova’s economic growth from a post-Covid-19 boom of 14 per cent in 2021, to a contraction of 5 per cent last year.

Shor has tried to capitalize on the resulting discontent by funding regular protests, calling for the government to resign, spreading disinformation through his media assets and promising a return to cheap energy and Russia’s embrace once Sandu’s “regime” is gone.

There was even an alleged Russia-backed coup plot. Though born in Israel, Shor moved back to Moldova with his parents as a child and followed his father into business.

He got into banking, the main airport’s duty-free franchise and — after falling under suspicion for massive fraud — politics.

As Moscow’s preferred party in Moldova, the Socialists lost popularity when the depth of its Russian funding were exposed.

Shor became Moscow’s new favorite, and his party leaders were received warmly in Moscow. He has denied receiving support from Moscow.

On Sunday, Sandu’s ruling Party of Action and Solidarity lost in cities, where people have to buy gas to heat their homes, but did better in rural areas to win a 40 per cent plurality of the overall vote.

To scrape that mixed endorsement, Sandu’s government resorted to steps she herself said she regretted, in a speech to EU parliamentarians on the eve of the vote.

Those included closing websites, suspending the licenses ofTV stations owned by, or affiliated with Shor, and — at the last minute — banning his party, Chance. “No democracy likes taking such measures, but neither can we allow Russia to threaten our security,’’ she said.

The government made public the results of an investigation into how it said Shor bought votes and funded political activities with funds brought into Moldova illegally.

About €600,000 ($642,000) per week was being carried in from Russia by cash mules, €50,000 per day on bank cards, and unspecified amounts via cryptocurrency and overbilling by Shor’s companies, according to a government report — not to mention the promise of cheap natural gas to towns that voted for him.

Shor, on his Facebook page, denied making illegal transfers. He said the government was trying to stop businessmen with Russian links from adding to pensions and welfare payments, because it wanted to keep the nation poor and addicted to EU loans (The EU in May doubled its aid for Moldova to €295 million, €75 million of which was in the form of grants and the rest credit).

In October 2022, the US Treasury sanctioned Shor and 11 others – including his wife, a Russian pop star known as Jasmin – for “persistent malign influence campaigns and systemic corruption in Moldova.”

All of this is reason enough to send a convicted felon home and end his use of Israel as a refuge from which to undermine a fellow democracy. But Israeli prosecutors have been slow to act.

They were first asked to consider Shor’s extradition in February 2020. He had just fled Moldova, after Sandu’s Party for Action and Solidarity was elected.

He feared enforcement of his conviction, which he was then appealing, in connection with a 2014 bank fraud that cost Moldova 12 per cent of its annual gross domestic product.

Indeed, he since lost the appeal in absentia, and in April was sentenced to 15 years in jail for his $254 million share of the fraud.

Israeli prosecutors started asking for information about his case in Zoom calls and emails this year when Moldova amended its extradition request accordingly, but went quiet after Oct 7, Veronica Dragalin, Moldova’s chief anti-corruption prosecutor told me. That’s understandable in the circumstances, she says.

Still, after nearly four years, the Israel’s Justice Ministry has yet to decide on whether to forward Shor’s extradition to the courts for a ruling. The ministry doesn’t comment on individual cases, so it can’t explain itself.

The case against Shor isn’t a close call. In what amounted to a carousel scheme, Moldova’s main savings bank, Banca de Economii and two others made $750 million in unsecured loans to companies, including Shor’s, with the money often sent to offshore accounts, never to be repaid.

Including unpaid interest on the supposed loans, that brought the theft to $1 billion. Shor bought shares in Banca de Economii in 2013 and became chairman of the board. When the wheels were coming off the scheme, a van full of the bank’s documents were found burned. The van belonged to a Shor company.

Shor denies wrongdoing. He routinely describes Sandu’s government as “lawless” and “scum.” Extradition cases also are notoriously difficult and politicized, the more so when – as with Israel and Moldova – there is no treaty to facilitate the process.

That leaves the decision entirely at the discretion of the Israeli government, but it does have the ability to extradite Shor to face justice and remove his money and media from Moldova’s politics if it wished.

In the process, it can thwart a Russian influence operation in a place that matters to the Kremlin. It shouldn’t be such a hard decision.