This is an example in detail of what happens to all that money taken
from us by Brussels. The place is corrupt from top to bottom - and
Bulgaria is as bad,
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SUNDAY TELEGRAPH 17.11.08
The Peasants and the Palaces
Welcome to Bulgaria, the new wonderland of EU fraud
Tilled to this day by horse-drawn ploughs, the rolling pastures of
rural Bulgaria have long been known for their cheap wines, strong
tobaccos, sweet honey and juicy apricots.
By Colin Freeman in Sofia
Yet just a year after this former corner of the Soviet empire became
part of the European Union, its country lanes roar to the sound of
brand new four-wheel drives, while alongside tumbledown peasant
cottages have sprung up smart new villas.
Among the locals sipping brandy in the village bars, there is little
doubt what the most lucrative annual harvest is these days. It comes
not from the soil or the vine, but from piles of grant application
forms marked "Sapard".
Officially the "Special Accession Programme for Agriculture and Rural
Development"
to help former Eastern Bloc countries drag their backward farming
sectors into the modern world. But in Bulgaria and neighbouring
Romania, farm workers are already proving quick to spot what their
colleagues in France, Italy and Spain first noticed 30 years ago -
that as with any generous subsidies administered from afar, it is
ripe for fraud.
"I went last month to a farming town where the locals asked me 'Do
you know how to recognise somebody round here who has got a Sapard
grant?'" said Bulgarian MP Atanas Atanasov, an outpoken critic of his
country's corruption record, which is the worst of all 27 EU nations.
"They said, 'Just look for the people driving the most expensive
SUVs.' It isn't accidental that these people have suddenly got so
much money, and it isn't just in that one town either. It's everywhere."
The plundering of the scheme, which handed over more than £2 billion
to Bulgaria between 2000 and 2006, is just one of the many murky
tales surrounding what has really happened to the vast quantities of
taxpayers' cash poured by Brussels bureaucrats into Europe's poorest
nation, which is earmarked for another £7 billion between now and 2013.
The funds, a cornerstone of the EU's expansion plan, were originally
designed to woo Bulgaria's eight million mainly-Slavic-
people away from Moscow's sphere of influence - courting favour by
rebuilding crumbling roads and railways and replacing drab-Soviet-
style schools and town halls.
But that effort largely overlooked the fact that in Bulgaria, the
corrupt, gangster-ridden political class that emerged in the vacuum
of communism's collapse already owed far more to Russia than it did
to Europe.
Throughout the 1990s, its government became infiltrated by ex-
communists, former secret agents and organised criminals known as
"thick necks", who to this day cruise the boulevards of Sofia
accompanied by bodyguards, and who settle business feuds through
contract killings rather than the courts. For many of their number,
the EU grants are a once-in-a-lifetime chance not to rebuild their
country, but to line their own pockets.
"The former communists that rule Bulgaria are fond of European money,
but not European regulations,
change its fur, but not its temper. I hate to say it as a Bulgarian,
but corruption is rife here. It is not so much under the table, as on
the table."
Only in July, the European Commission suspended payments of £350
million to Bulgaria, accusing it of mismanagement of European funds
through corruption and inefficiency, and failing to prosecute
offenders, who are often thought to be shielded through political
connections.
Yet although much of the corruption goes undetected, there is little
doubt that the whispers Mr Atanasov picks up during his countryside
tours are more than mere village gossip. That much has been made
clear by a string of cases that opened in Bulgarian courts in the
past month, the first in what Brussels says is a litmus test of
Sofia's willingness to clean up its act.
In one, eight members of what EU anti-fraud investigators describe as
a "criminal company network composed of more than 50 Bulgarian
enterprises" face trial for allegedly defrauding Sapard of £4 million
in a scam involving grants to replace old meat processing equipment.
Rusting and worn after years of churning out stodgy Soviet fare, the
old East German-built meat processors should have been destined for
the scrap heap. Instead, they ended up as virtual money machines,
after being shipped to an accomplice in East Germany and "bought"
back as new for 24 times the original price. A leaked copy of a
report by the European Anti-Fraud Office seen by the Sunday Telegraph
also accuses the group of committing tax fraud, illegally importing
Chinese rabbit meat into the EU with fake health certificates and
buying rolling stock from Bulgaria's dilapidated Communist-era
railways. The report said that one figure, Mario Nikolov, had "close
links to the Bulgarian government", and accused him of passing around
200,000 leva (£90,000) to the Socialist Party of Prime Minister
Sergey Stanishev in 2005.
Further crony capitalism is detailed in allegations that another
group member was a business partner of a former government minister
who, the report says, tried to "influence an ongoing investigation"
against him. The whiff of corruption around Bulgaria's elite grew
even stronger last Thursday, when Assen Droumev, the former director
of the Bulgarian state agriculture fund, appeared in court on charges
that he had misappropriated money from the Sapard fund that he
himself was responsible for disbursing.
Both Mr Droumev and Mr Nikolov deny any impropriety, claiming they
have been made scapegoats so Sofia can persuade Brussels to reinstate
its funding. "I am not guilty, I am proud of my department's work,"
protested a bemused-looking Mr Droumev on Thursday, as he was brought
handcuffed into court by two paramilitary policemen.
The EU says it will watch the two cases closely and will review the
funding situation in the spring, ahead of Bulgaria's general
elections. "The situation is still problematic,
the European Anti-Fraud Office. "We appreciate that the authorities
are going in the right direction and we await the results."
But while Brussels says all it wants is for the Bulgarian courts to
start applying the law evenly, the likely role of these two cases in
determining whether the purse strings are re-opened means few people
believe the defendants will walk free. Seasoned observers of
Bulgarian political intrigue already claim to detect a crude
political hand in the timing of both the Nikolov and Droumev court
appearances, as well as last week's arrest of Bulgarian banking and
football tycoon, Hristo Kovachki on tax charges. All three cases,
they point out, took place ahead of a scheduled visit from Franz-
Hermann Bruener, director-general of the anti-fraud office, to see
how things are progressing.
The Bulgarian government says it is doing its best to end what is
mainly a legacy from the chaotic post-Soviet years, and that
opposition politicians are simply making worse by exaggerating the
scale of the problems. As in parts of the Third World, corruption
allegations have become so common that they are now part of routine
political score-settling, which makes investigating them even more
difficult. Many, though, believe that it is still business - corrupt
or otherwise - as usual. "All that is happening is that a few people
are being nominated as fall guys so that the system can carry on as
normal," said one British executive based in Bulgaria. "Things have
not been cleaned up since EU accession. If anything, it's got worse."
Monday, 17 November 2008
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