Bulgaria: Official Sacked over Lavish Lifestyle Exposes ‘Tip of Iceberg’
Agriculture official Yanaki Chevenyakov was dismissed from his post as head of contracting for the Bulgarian State Fund for Agriculture (SFA) after an investigation by Bivol (an OCCRP partner) exposed his lavish lifestyle.
The Bivol investigation revealed that Chervenyakov drives expensive limousines registered to his father and lives in a luxury gated community in an upscale suburb in the Bulgarian capital of Sofia.
In addition, his apartment was paid for by Tsetsa Petrova Krasteva, his mother-in-law, who has been awarded two contracts by the SFA under the Program for Rural Development (PRD) financed by the European Union (EU).
The SFA is one of largest distributors of money in the country. According to the EU Structural Funds Single Information Web Portal, it allocates billions of euros under the PRD and Operational Fisheries Program.
While Chervenyakov worked at the SFA, two of Krasteva’s companies won bids for EU financing for two projects. The first is a guesthouse in the village of Popina Luka, in the municipality of Sandanski, funded under the PRD. The second was funded under the Fisheries Program.
Chervenyakov’s name is further tangled in the Zemen Affair also investigated by Bivol, which involves a 2012 project to build a large sports field in the small town of Zemen in western Bulgaria.
One investor submitted cost estimates for the sports facility of between 760,000-1 million Bulgarian levs (US$ 437,714-574,854). The bid went to another bidder for more than 3.4 million Bulgarian levs (US$ 1.95 million).
At the time, Chervenyakov led the SFA department in charge of approving such projects.
Rumen Porozhanov, executive director of the SFA, has dismissed media reports that he was close to Chervenyakov, saying the latter was lead expert before he took over the SFA. However, Porozhanov promoted Chervenyakov in 2015 to directorate head.
Chervenyakov was fired three days after Bivol’s investigation was published. According to the SFA’s official press release, he was fired for failing to submit required property declarations in 2014 and 2015.
An anonymous SFA source told Bivol in a videotaped interview that Chervenyakov’s case is just the tip of the iceberg. The source said that after the investigation was made public, Porozhanov ordered all employees who drive expensive cars to come to work in more modest vehicles.
Bivol reporters say they have “an array of documents that the team is analyzing in order to paint a detailed and documented true picture of the abuses of EU financing.”
The Bivol site has already published an expert report via Balkanleaks, its platform for anonymous sharing. According to the site Mediapool, the unsigned report was sent to the European Commission to reveal colossal abuse of EU money in SFA in the period 2010 – 2015.
The 16-page report, written in English, describes the draining of millions of euros in EU funds through inflated project costs and inefficient monitoring and control.
According to the report, “in the EC's annual audit reports the infringements have only been mentioned but the corrupted practices continue since no further disciplinary actions have taken place.”
Meanwhile, three days after Chervenyakov’s dismissal, Bulgarian media reported that the National Security Agency (DANS) has raided the SFA offices.
Details about the raid and the findings remain unavailable.
The Security Agency raid coincided with opposition lawmakers stating in the Parliament that the EU will impose a financial correction in the record amount of € 250 million (US$ 282.5 million).
Prime Minister Boyko Borisov, his deputy Tomislav Donchev, and Finance Minister Vladislav Goranov dismissed the above claim and the reports of a scandal brewing at the fund. However, both Borisov and Goranov said if the probe establishes breaches, there will be consequences and even prison sentences.