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– The President of the Committee on Budgetary Control of the European Parliament Monica Holmeier believes that a delegation from the committee should go on a mission to Bulgaria to identify on the spot the problems in the fight against fraud with European funds
The European Anti-Fraud Office (OLAF) is investigating 29 cases of alleged misuse of European funds and corruption in Bulgaria.
This was announced by Francesco Albore to the Committee on Budgetary Control of the European Parliament, which organized on Monday night a hearing on the management of agricultural and cohesion funds, concerned about the sanctions imposed on Delyan Peevski, Vasil Bozhkov and Ilko Zhelyazkov under the US “Magnitsky” sanctions for corruption. .
Albore said many of the investigations were open, thanks to signals from the press, anonymous citizens and NGOs, but did not give details about their nature and the programs they affected. In 2020, OLAF closed 8 cases in Bulgaria, and for seven the Bulgarian authorities were given recommendations for financial sanctions and a lawsuit. The violations amount to a total of 35m euros.
The most common targets of abuse and error are agricultural and rural development funds, where fraud involves falsely declaring ownership of agricultural land, keeping animals and non-existent gardens, for which subsidies are received from the EU budget. And the most common frauds with European funds are concentrated among white-collar workers and are committed through bribery, forgery, abuse of power and conflict of interest, according to an analysis by the European Parliament prepared for members of the Committee on Budgetary Control.
The European Commission announced that the Bulgarian authorities are nearing the end of the investigation into the fake guest houses, in which 88% of the 288 inspected houses built with European funds were used for personal needs and the wrongly spent money in the European budget is to be recovered.
The experts invited to the commission by the European Commission’s Directorates-General for Agriculture and Regional Policy said that they conduct annual inspections and audits in Bulgaria, and despite the problems, the Bulgarian control bodies are able to detect violations and eliminate them.
It was also reported that immediately after the announcement of the sanctions under the Magnitsky law, the European Commission immediately asked the Bulgarian authorities to find out whether the sanctioned individuals and companies were recipients of European funding, to which Sofia gave a negative answer.
Mission to verify the facts in Bulgaria
“I don’t care who is in power in Bulgaria. We should not turn a blind eye to the fact that three Bulgarians have been sanctioned for their role in corruption by a US agency,” said Polish EPP MEP Tomasz Zdechowski and his Green counterpart Daniel Freund. (Germany) commented that it is necessary to study “what Americans see, which we miss about corruption in Bulgaria”.
“The biggest problem for me is that the European Commission says it controls things, but when you open the media and talk to someone independent on the spot, cases of corruption follow one after another,” Freund said.
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Monica Holmeier, Chair of the Committee on Budgetary Control (EPP, Germany), said that consideration should be given to sending a parliamentary mission to Bulgaria to investigate on the ground “what are the problems, which laws can be changed and how to ensure that the right projects are being recruited “.
“We do not need to go to Poland, the Czech Republic and Hungary every time, it will be useful to do a fact-finding mission in Bulgaria as well,” Holmeier said.
Laws, white collars and oligarchs: the problems in Bulgaria
According to Holmeier, the mission should check why European-funded projects go to the same companies, what is behind the approval of unpaid projects and what the state is doing to take power from the oligarchs. The chairman of the commission believes that it should be investigated as well whether Russia and Turkey do not influence the government of Bulgaria through the oligarchs, “which would be a problem for us”.
According to OLAF, a significant obstacle to the prosecution of high-level corruption in Bulgaria is the legal statement that criminal liability can be borne only by individuals, and legal entities are subject only to administrative sanctions and fines. This limits the search for liability, as companies are usually the ultimate recipient of European funds, and no perpetrator can be found to be brought to justice.
Aureliou Ceciliou from the regional directorate of the European Commission told about attempts to divert money for the reconstruction of the railway network through public procurement appeal, aimed at delaying its financing and redirecting it to the construction of highways after the expiration of the project deadlines. According to the Commission, the tactic was applied as there were no Bulgarian companies with the capacity to implement railway projects and it was preferred that the money be used for roads instead of inviting international companies. This runs counter to the priorities of Brussels, which relies on clean transport to reduce greenhouse gas emissions from climate change.
“In Bulgaria, anyone can appeal a public procurement. Even a hairdresser can appeal a large European project,” the European official said.
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According to Bulgarian MEP Alexander Yordanov (EPP, UDF), who spoke in Polish, the problems in Bulgaria are no more serious than in other countries. He said Bozhkov was investigated in Bulgaria when he secretly went to Dubai and then formed a party. Yordanov also told his colleagues that there are non-governmental organizations in Bulgaria that are connected with oligarchs and serve them, concluding that “every coin has two sides”.
Tsvetelina Penkova from the BSP, who is a member of the Budget Control Commission, pointed out as a problem the lack of independent auditors in Bulgaria, as well as the feeling of Bulgarians that European funds are used to enrich a certain circle of businessmen.
An analysis of the European Parliament prepared for the Committee on Budgetary Control states that in 2015-2019 OLAF investigated 1126 reports of fraud and irregularities with EU funds in Bulgaria and 8 reports of evasion and fraud with VAT. The cases affect 1.7% of payments, which is comparable to other countries in Eastern Europe. In 2019, irregularities affecting financial interests in the EU are six in agricultural funds and one in cohesion funds, with damage to the European budget amounting to 685 thousand EUR. The errors in the work with European money, which did not lead to losses for the EU budget, are 184 under the agricultural programs and 57 under the cohesion programs and affect a total of projects for 13.9 million euros.
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