In September 2018, the state made a gift to the honorary leader of the Movement of Rights and Freedoms, Ahmed Dogan, by including the mothballed Varna coal-fired power plant majority-owned by him in the so-called cold reserve - the generating capacities that power producers are paid millions of euro to keep in readiness. Now, it is about to double down. In the past few months, state regulators have issued a number of decisions and licenses to a small seaport terminal adjacent to the power plant and used for the unloading of coal deliveries that may allow it to grow into a full-fledged operating port. This hectic activity has been in stark contrast to the authorities' refusal to license other applicants to build new ports.
On 12 April, Bulgarian investigative journalism website Bivol released information implicating the then deputy minister of economy Alexander Manolev in the use of a guesthouse built with EU funds on a plot of land owned by him as his private villa. The guesthouse was one of 746 such projects developed with financing from the Rural Development Program of the EU administered by Bulgaria's State Fund Agriculture (SFA) in the 2011-2014 period.
While the intentions of the EU were to boost village tourism in Bulgaria, the funding for the construction of most of these houses went to politically connected persons. In some cases, the entire extended families of some politicians were granted funding for such guesthouse projects. Relatives of Mustafa Karadayi, leader of the Movement for Rights and Freedoms party have won funding for five guesthouses in the village of Borino in the Rhodope mountain.
No one yet knows how many of those 746 houses were built in breach of the law, but the inquiry into 120 of them made by SFA in May found administrative breaches in 62 properties requiring financial corrections of 10 million levs (5 million euro) that have to be reimbursed to the EU. The High Court of Cassation ruling from the end of May declared void the methodology of SFA that required guesthouse owners to pay back the state in such problematic cases.
This means that taxpayers' money would be used to fill the financial hole. The scandal led to the resignations of Mr Manolev, agriculture minister and ex-SFA head Rumen Porozhanov and the deputy director of SFA Ivanka Bagdatova - Mizova. Several mayors from various parties implicated in receiving EU subsidies for their relatives to build guesthouses also resigned. Still, no one at SFA is thought to be under investigation for the apparent lack of basic supervision, a fact well known since 2015.
Before the Apartmentgate scandal exploded among top members of the governing GERB party, in early March Bulgaria's Prosecutor's Office and the Commission for Illegal Assets Forfeiture (CIAF) had quietly shut down a similar earlier probe involving Finance Minister Vladislav Goranov.
The finance minister has never concealed that he lives free of charge in an apartment owned by Ivan Sariev, a businessman, high-ranking member of one of the two Bulgarian freemasons' lodges and godfather to Mr Goranov's children.
The authorities launched an investigation at the end of 2018 to establish whether the finance minister was in a conflict of interests. This ended on 1 March with no wrongdoing established. The prosecution and CIAF decided that Mr Goranov and Ivan Sariev were not related parties under definitions stipulated by Bulgaria's anti-corruption law. The authorities also found no indication that Mr Sariev had won any public procurement tenders because of his relationship with the finance minister. Mr Sariev's association with other businessmen who might have won public tenders falls beyond the scope of the definition of conflict of interests and the authorities didn't pursue this line of investigation.
In another case where the Bulgarian judiciary has failed to detect a conflict of interest, the ex-head of the Banking Supervision Department of the Bulgarian National Bank (BNB) dropped charges against Nelly Kordovska after she withdrew her personal 64,000-euro deposit from Corporate Commercial Bank (Corpbank) on 19 June 2014, а day before the bank was closed and put under special supervision by the BNB.
On 11 March the administrative court of the city of Sofia decided that Ms Kordovska has acted like any other citizen would have done if they had read the headlines about the bank's deteriorating health. According to the court, CIAF had issued an unlawful indictment that ignored all the evidence in favour of Ms Kordovska and had built its conclusions on a misinterpretation of circumstances.
The court also said that the anti-corruption body had ignored how other depositors had managed to withdraw their cash without having the same "inside information" as the BNB official. "The CIAF decision does not contain any comments on the inside information used by other depositors in Corpbank, who, according to the publicly available information issued by BNB, withdrew 907 million levs (453 million euro) in the period from 13 to 20 June, against 64 195 euro withdrawn by the defendant," the decision reads.
In September 2018, the state made a gift to the honorary leader of the Movement of Rights and Freedoms, Ahmed Dogan, by including the mothballed Varna coal-fired power plant majority-owned by him in the so-called cold reserve - the generating capacities that power producers are paid millions of euro to keep in readiness. Now, it is about to double down. In the past few months, state regulators have issued a number of decisions and licenses to a small seaport terminal adjacent to the power plant and used for the unloading of coal deliveries that may allow it to grow into a full-fledged operating port. This hectic activity has been in stark contrast to the authorities' refusal to license other applicants to build new ports.
