FACTBOX-Seven scandals from Bulgaria Reuters - 2009/6/29
Bulgaria's Socialist-led government has been plagued by high-level corruption scandals during its four years in power, prompting the European Union to freeze millions of euros in aid for the bloc's poorest member.
Brussels criticised Sofia for failing to cut links between virtually all political parties and "rings of companies", a phrase used by Ahmed Dogan -- the kingmaker in the ruling coalition and leader of the ethnic Turkish MRF -- to explain how parties are funded.
Last year, Transparency International rated Bulgaria the most corrupt EU nation. Despite numerous pledges, Sofia has not convicted a single senior official of graft and has sent to jail only one crime boss since the end of communism in 1989.
Suspected criminals have received temporary immunity from prosecution after registering to run for parliament.
The agriculture and environment ministries, both controlled by the MRF, and the construction and the economy ministries, controlled by the Socialists, have been allegedly involved in some of the most notorious schemes in the past few years.
Here are the main scandals:
JACUZZI AND INTIMIDATION
Valentin Dimitrov, director of the state-owned heating utility Toplofikatsia Sofia was sacked in June 2006 after an audit showed he had misused over 15 million levs ($10.63 million), installed massage chairs and a jacuzzi in his office, and claimed for a boat and a water scooter on expenses.
He was later charged with money-laundering and tax evasion after prosecutors said they had received a signal from an unidentified Austrian bank that he had a deposit of 1.6 million euros in it.
The scandal led to the dismissal of then Economy and Energy Minister Rumen Ovcharov in June 2007, after a senior investigator accused the minister of trying to blackmail him and influence the probe into Toplofikatsia. Ovcharov was investigated but not charged.
The Sofia City Court sentenced Dimitrov to 14 years in jail on June 25 after he was found guilty of misusing more than $4.2 million from the loss-making utility.
ENVIRONMENT CARE OR BENEFITS
Canadian mining company Dundee Precious Metals lodged a complaint against Bulgaria at the European Commission in 2007 for effectively blocking a planned $250 million investment in its gold operations in the country.
For more than two years Environment Minister Dzhevdet Chakarov had refused to sign environment permits for two gold mines, and Dundee had argued that the heart of the matter lay in the political interests of his ethnic Turkish MRF party.
The government and Dundee settled in March 2008 after Dundee agreed to pay a substantially higher fee to Bulgaria for exploring a gold mine, and allowed the state to take a stake in a planned gold and copper producing plant.
EU FARM AID SCHEME
In Feb. 2007, the police services of Bulgaria, Germany and Switzerland exposed a criminal network accused of abusing funds worth 7.5 million euros ($10.5 million) in EU pre-accession farm aid.
The network consisted of over 50 Bulgarian and various other European and offshore firms and was allegedly run by two Bulgarians -- Lyudmil Stoikov and Mario Nikolov -- who were said to have close links with the government, the EU anti-fraud agency OLAF said in a letter to Sofia last year.
"There are powerful forces in the Bulgarian government ... who are not interested in punishing anyone from the circle around Lyudmil Stoikov-Mario Nikolov," the OLAF letter said.
The group was allegedly involved in tax evasion, subsidy frauds, forgery, money laundering and illegal imports to Bulgaria, as well as exports to the EU before 2007 of Chinese rabbit and chicken meat.
Nikolov and Stoikov -- the latter donated 25,000 levs for the election campaign of President Georgi Parvanov, a Socialist, in 2006 -- were arrested. Stoikov was later released after no evidence of his guilt was found.
Stoikov is under investigation for alleged money laundering in a related case, prosecutors have said.
In July 2008 after pressure from Brussels, Nikolov, together with eight other people, was charged with participating in a criminal group and document fraud.
A Sofia court temporarily suspended the trial in mid-June as one of the defendants, Ivan Ivanov, won temporary immunity after registering to run in the July national elections.
BROTHERS AND ROADS
Veselin Georgiev, former head of the national road agency, resigned in February 2008 after media reports he had arranged contracts worth millions of levs for his brothers' construction firms. He was later charged with conflict of interests.
MEET THE CRIME BOSSES
Former Interior Minister Rumen Petkov was forced to step down in April 2008 after two former high-ranking police officers were arrested and accused by prosecutors of irregular phone tapping and passing sensitive information to crime bosses.
Petkov, a senior member of the Socialist party, said then he was "responsible for some appointments in the ministry through which I misled the leadership of the country". He later said he had met accused crime bosses and former members of the police anti-terrorism unit, Plamen Galev and Angel Hristov.
Business partners Galev and Hristov, charged with running an organised crime group and racketeering, spent some six months in custody until mid-June when they were released after registering to run in July elections, winning temporary immunity.
The former head of the State Revenue Agency, Maria Murgina, resigned in February after prosecutors said they were investigating a sizeable fraud involving value added tax. No details were made available but local media quoted police sources as saying the damage to public finances was more than 1.0 billion levs.
In May, Murgina was charged with abuse of power, putting pressure on a subordinate and document fraud. She denied any wrongdoing.
In March, the national security agency and prosecutors raided the agriculture ministry and seized documents in an investigation into large-scale illegal land deals. Prosecutors are investigating swaps of thousands of hectares of state-owned arable land and forests for private land that took place in 2008 and 2009.
Bulgaria has lost 8 billion levs in the past four years due to swaps of high quality state-owned land for cheaper, fragmented private land, according to a report by an anti-corruption coalition of 30 non-government organisations.
The Sofia-based anti-graft Centre for the Study of Democracy said the swaps had become "the most conspicuous and intolerable form of political corruption in Bulgaria in 2008". (Reporting by Irina Ivanova; Editing by Sara Ledwith)