Alleged SAPARD Fraudster Took 5 Million in EU Financing and Is Bidding for 30 More Millions Mind the horns!

Notorious businessman Mario Nikolov, still on trial for theft of pre-accession European Union (EU) funds in the affair “SAPARD” has prepared projects for about 30 million levs in EU funds in the new programming period from the Rural Development Programme (RDP).

So far he has received about 5 million levs under Measure 121 “Modernization of agricultural holdings” for 2007-2013 by participating in 4 companies: SAMI MEAT BG, HOLID, NICK FUD BG and AGROVAL BG.

He has taken the same amount under OP Competitiveness with other four companies: EUROFRIGO STAR, INTELLIGENT FOOD SYSTEMS, AVISPAL and SIKAN, Bivol established in a previous investigation.

Nikolov is still being tried for the draining of pre-accession funds, but there are no obstacles to apply and win new millions using the same scheme – dummy frontmen and double invoicing.

The scheme involves the same companies that pop up in the SAPARD case, but renamed and with new managers. Nikolov’s dummy people have been reshuffled with a listed manager becoming a listed owner and another owner becoming manager, an inquiry of Bivol in the Trade Register showed.

Mario’s scheme

The theft of EU funds is carried out under the same old and tested scheme almost without variation since 2007, a source familiar with the scheme told Bivol under condition of anonymity.

In order to obtain EU funding, the company should participate with its own funds. They are supplied with loans from First Investment Bank (FIB) with which Nikolov has a privileged relationship.

The money from the bank loans goes to companies that have won the projects. Mario Nikolov stands behind each one of these companies.

The beneficiary companies pay suppliers and construction companies behind which also stands Mario Nikolov.

If the project is for the supply of machinery and equipment (OP Competitiveness), the supplier imports cheap Chinese machines and produces invoices with German rates. When it comes to construction (duck farms under RDP) the prices of construction works are inflated.

The European subsidies are paid on the basis of the inflated invoices and with them the companies repay the loan to FIB with interest.

The machines, what is constructed and 20% of the total amount of the project remain for Mario Nikolov and his partner in this scam – Dimitar Kerelov. Kerelov is known with the nickname “Mitko The Flash Stick” from the scandals in the Sofia City Court, where he was in charge of maintaining the computers at the time of the Court’s now-suspended notorious boss Judge Vladimira Yaneva and when the greatest abuse of the random allocation of cases was happening.

The scheme differs from the SAPARD one only in that the delivered equipment is not old and repainted from Germany, but new from China.

The same and all over again

Curiously, the defendant Nikolov, who defines himself as “ancestral socialist” has not even applied much effort to hide and participates with the same companies and frontmen.

The supplier in the affair SAPARD was the company Hranmehanika Engineering. Since 2008 it has been renamed Technofood and it is once again the supplier for all projects of Mario Nikolov. Dimitar Kerelov, who is a beneficiary of EU funds with the company Intelligent Food Systems, has also worked for Technofood.

The current manager of “Technofood” is Bogomil Grancharov Illarionov, a former representative of “Eurofrigo” – the company that pocketed the money in the SAPARD affair. Two dummies are listed as owners of Technofood. One of them, Plamen Gevezov, is the owner and manager of Nick FOOD which won a contract for 1,399,538.69 levs for an RDP project: “Building a poultry farm for breeding ducks in the village of Zhivkovo, Ihtiman Municipality.”

OLAF conducted a preliminary analysis and found no irregularities

Bivol published information on the schemes as early as October 27, 2015, and inquired whether the EU funds anti-fraud office, OLAF, has checked those specific projects.

The response received from the press service of OLAF and signed by Silvana Enculescu reads as follows:

In 2015, OLAF conducted a preliminary analysis of the available information regarding this specific matter. After this analysis, in early 2016, the office decided not to open an investigation as there was no suspicion of fraud or irregularities justifying the opening of an investigation.

Elated by this indulgence, the ancestral socialist Mario Nikolov has submitted documents for projects in the new programming period, this time for nearly 30 million levs, Bivol learned. The State Fund Agriculture (SFA)has not responded to questions we sent, asking for which projects the firms connected to Nikolov have applied. But after all, why not? As the saying goes – the appetite comes with eating.

Firms beneficiaries under OP “Competitiveness”

EUROFRIGO STAR 202156765

BG161PO003-2.3.02-0387-C0001 “Investments in energy saving refrigeration equipment” in EUROFRIGO STAR LTD

Total budget: 3,879,548 BGN

Approved budget: 1,939,774 BGN

Total disbursements: 1,260,853 BGN

http://umispublic.government.bg/srchProjectInfo.aspx?menu=search&id=115234

FIB

Credit: 750, 000 BGN; Contract 000LD-L-000 617/June 26, 2015

Bank guarantee: 1,260,853 BGN; Contract 000LG-L-005 171/June 26, 2015

====================

INTELLIGENT FOOD SYSTEMS 201699270

Energy efficiency investments in “Intelligent Food Systems” LTD

Project Economy Ministry: 3,840,951 BGN

Approved budget: 1,920,475 BGN

Total disbursements: 1,248,309 BGN

http://umispublic.government.bg/srchProjectInfo.aspx?menu=search&id=113108

FIB

Credit: 750,000 BGN; Contract 000LD-L-000 616/June 26, 2015

Bank guarantee: 1,248,309.01 BGN; Contract 000LG-L-005 178/June 26, 2015

===================

AVISPAL 201696783

BG161PO003-2.3.02-0388-C0001 “Investments in new energy-saving equipment in “AVISPAL” LTD

Total budget: 3,776,329 BGN

Approved budget: 1,888,164 BGN

Disbursed: 1,227,307 BGN

http://umispublic.government.bg/srchProjectInfo.aspx?menu=search&id=115188

FIB

Credit: 750,000 BGN; Contract: 000LD-L-000 615/June 26.2015

Bank guarantee: 1,227,306.88 BGN; Contract 000LG-L-005 072/June 26.2015

===================

SIKAN Ltd 175326107

BG161PO003-2.3.02-0386-C0001 “Investments in energy-saving equipment” in SIKAN Ltd

Approved budget: 1,939,025 BGN

Disbursed: 1,260,367 BGN

http://umispublic.government.bg/srchProjectInfo.aspx?menu=search&id=115241

FIB

Credit 750,000 BGN; Contract 000LD-L-000 612/June 26, 2015

Bank guarantee 1,260,366.50 BGN Contract 000LG-L-005 183/June 26, 2015

====================

Companies beneficiaries under the Rural Development Programme, measure 121 “Modernization of agricultural holdings” RDP 2007-2013

SAMI Meat BG 200303323

Project for 2,831,952.92; Contract 23/121/05720 /April 26, 2013

“Building a poultry farm for breading turkeys and a domestic-administrative building in the village of Zhivkovo, municipality of Ihtiman”

Contracted 1,415,976.46 BGN

FIB

Credit 1.47 million BGN; Contract with 000LD-L-000 630/June 26, 2015

=================

HOLID 202374415

Project for 2,878,016.38 BGN; Contract 23/121/05700/March 15, 2013

“Construction of a farm with domestic-administrative building for poultry”

Contracted 1439 008.19 BGN

FIB

Credit 1.47 million BGN; Contract 000LD-L-000 614/June 26, 2015

=================

NICK FOOD BG 200303273

Project 2,799,077.38 BGN; Contract 23/121/05606/March 13, 2013

“Building a poultry farm for breeding ducks in the village of Zhivkovo, municipality of Ihtiman”

Contracted 1399 538.69 BGN

FIB

Credit: 1.47 million BGN; Contract 000LD-L-000 620/24 July, 2015

==================

AGROVAL BG 200303425

Project 2,114,492.96 BGN

“Poultry farm for breeding turkeys with a domestic-administrative building in plot 036 055 in the site “KARATOPRAK”, village of Zhivkovo, Ihtiman Municipality

Contracted 1057 246.48 BGN

FIB

Credit: 980,000 BGN; Contract 000LD-L-000 631/July 27, 2015

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