SHARE THIS ARTICLE Share Tweet Post Email

Romanian Prime Minister Victor Ponta likes fast cars. His favorite, a 300-horsepower Mitsubishi Lancer he raced in rallies, may just put the brakes on his political career.

“This is not a car, it’s a toy,” Ponta told a red-haired television reporter in June 2009 as he took the jet-black sedan for a spin on camera. “It’s for big boys who spend a lot of money on toys.”

Most of the money spent on that particular toy, it turns out, came from a business partner. The partner also paid Ponta $46,000 for work that was never done, says the Romanian Anti-Corruption Directorate. After Ponta became prime minister, the man won several government appointments, which now are being investigated by the directorate.

The scandal prompted an easily thwarted parliamentary challenge to Ponta’s premiership last week. The investigation will take longer to play out, rattling markets and foreshadowing political turbulence for a key eastern European nation that’s the region’s fastest growing economy and home to a NATO missile defense system.

Ponta is being questioned by the directorate, the latest target in a nationwide anti-corruption drive that last year convicted some 1,150 Romanians. The car was legitimately underwritten for his rally races by the business partner and the payments were for criminal-law work, Ponta said.

At a time of economic promise, the focus on his finances eight years ago detracts from Romania’s progress and mostly benefits countries such as Russia that want an unstable region, he said.

Reputational Damage

“Absolutely, it is damaging Romania’s reputation,” said Ponta, 42, in an interview Thursday, the day before he won a confidence vote in parliament. “Romania has done the most in the fight against corruption, and we will keep doing.”

Among those swept up in that fight: A former judge was probed for smuggling goats to Russia, a minister was convicted for taking sausages (and $17,000) as bribes and a third was investigated for accepting bags of cash in a cemetery. All denied the allegations and investigations are ongoing for the two incomplete cases.

A Mitsubishi Lancer Evolution X. Source: Mitsubishi

The graft-busting drive is led by an ex-basketball-star-turned-chief anti-corruption investigator, Laura Codruta Kovesi. Those arrested last year were often dragged in front of television cameras in handcuffs; in all 4,500 investigations were completed. Among those being probed are Ponta’s brother-in-law, father-in-law and mother, each in separate cases. All deny wrongdoing.

4,000 Cases

This year, Kovesi told Adevarul, a local newspaper, she expects the directorate to work through 4,000 cases -- almost 10 a day. She declined to comment on Ponta’s investigation.

Her initiatives have resonated across the region. In neighboring Moldova, Prime Minister Chiril Gaburici, battling a $1 billion misappropriation from his tiny country’s banks, resigned Friday after he was questioned by prosecutors over the authenticity of his high school and college degrees. He said his departure would allow the public to “focus on the country’s real problems” and didn’t address the documents’ authenticity.

On the same day, the largest newspaper in Slovakia ran a front-page story headlined “Slovaks Jealous of Romanian Prosecutors.”

More Challenges

“Romania is not alone in the region when it comes to these kinds of cases,” said Otilia Dhand, a Brussels-based analyst for Teneo Intelligence. “But in Romania, there seems to be something moving. The cases have follow-up, and may even lead to successful prosecutions. I doubt this is the last time we will see Mr. Ponta challenged, especially as we get closer to next year’s elections.”

Currency slumps after probe announced

Romania is tied with Bulgaria, Greece and Italy among the lowest-ranking EU countries on Transparency International’s Corruption Perception Index.

For Ponta, the revelations threaten one of the European Union’s poorest yet fastest-growing economies. His government canceled this week’s planned 10-year bond sale and turned down bids at last week’s as the political crisis drove yields up 19 basis points. Ten-year bonds yielded 4.007 percent on Friday as they reached the highest close since October. The currency has sunk about 1 percent during the week-long political crisis.

A prolonged political crisis could threaten $3.4 billion in funding from the EU, the sale of state assets and tax cuts to spur the economy, Ponta said. He pledged to prevail, using skills honed in the Mitsubishi and other fast cars as the navigator for a national championship-winning rally duo in 2010.

“To focus, to concentrate and to keep my mind clear -- these are the most important lessons from my rally car years,” he said in the interview. “I am a politician, so I am quite used to difficult times.”

Immunity Retained

He denies the accusations for which he’s being investigated. They include forging invoices, money laundering and complicity in tax evasion, all before he became premier.

A second set of allegations against Ponta, for favoring Dan Sova, the man who ran the law firm that had had Ponta on retainer, in government appointments won’t be pursued further. The Romanian parliament voted on June 9 not to lift Ponta’s immunity for actions taken as prime minister. Sova, a senator, is under judicial monitoring for abusing his office as a lawmaker. He has denied the accusations.

Ponta is Romania’s 14th prime minister since the end of Communism in 1989; only three of his predecessors managed to complete their terms. In 2014, after two years in office, he lost a presidential race to Klaus Iohannis, who has twice asked him to step down.

Eschewing Mediocrity

Ponta knows his strengths and his limitations, said Titi Aur, a rally-car driver who helped train the prime minister to be a championship-winning navigator.

“He could have been a rather mediocre driver, but instead he chose to be on one of the best navigators in the country,” said Aur, sitting in a trailer at the construction site of his new race track, about 25 kilometers from Bucharest.

He remembers the Mitsubishi being used at several rallies, where Ponta, even as prime minister, would memorize race routes and spend an entire day competing.

In a conference room across from Victory Square, where protesters waved signs against Ponta and TV crews camped out, Ponta grimaced from a knee injury, an Apple Watch on his wrist. He’ll undergo surgery this week for the injury, which he suffered while playing basketball, according to Mediafax.

As he laid out his arguments -- the economy needs him at the head of a stable government, the details of the case are in the distant past -- he pointed out that the only clear beneficiary from this crisis was outside Romania’s borders: Russia, which benefits from an unstable eastern Europe.

When the conversation turned to his time on the rally courses, Ponta said he used those experiences to help him navigate his challenges.

“In all my political career, this has been very useful,” he said.

(Updates with premier’s health in 24th paragraph.)