About the Short Memory of a Banker

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On the request of OFFNews dated September 11, 2013, Corporate Commercial Bank, (CCB or KTB in Bulgarian), has sent the following reply:

“CCB has no ownership of bTV or any other media, neither through its company, nor as direct shareholder.

It is difficult to currently verify the validity of this statement as ownership of some media linked to CCB, such as TV7, is “buried” in offshore companies. In the past, however, at the time when Irena Krasteva, (Delyan Peevski’s mother) bought up and virtually monopolized the print press, CCB companies and personally banker Tsvetan Vasilev, directly owned firms from her press group. And some people associated with CCB’s companies are still in the management of these media.

The relationship with media ownership can be tracked through the company Vives Corp., which co-owns the new shopping mall “Strand” in Burgas, built entirely with a loan from CCB, and mortgaged there. Veneta Nikolova is the representative of Vives Corp and member of its board of directors. She is also on the managing board of Strand Burgas Corp, the company managing the mall.

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The link between Vives and CCB is hard to deny. The majority shareholder of Vives Co., Alexander Tsvetkov (4500 shares), by the end of 2011 was also the owner and manager of the company KEMIRA Ltd. KEMIRA is currently owned by HEDGE INVESTMENTS BULGARIA. Biser Lazov and CCB, together with an offshore company EFV INTERNATIONAL FINANCIAL, represented by Veneta Nikolova, are shareholders in HEDGE INVESTMENTS BULGARIA. The minority shareholder of Vives Co., Biser Lazov (500 shares) is on the board of directors of BROMAK FINANCE, which is owned by BROMAC Ltd. The latter company is solely owned by banker Tsvetan Vassilev and through BROMAC Ltd he holds the controlling stake in CCB. Vives Corp, itself, holds 69218 shares of the CCB capital.

Look, Irena Krasteva!

Irena Krasteva, the mother of the infamous Delyan Peevski, bought the newspapers Monitor, Telegraph, and Politika (Politics) in late July 2007 through NEW BULGARIAN MEDIA GROUP HOLDING Ltd, registered on July 4, 2007. On August 27, 2007, the company was transformed into Corp, and its shares were recorded by the BALKAN MEDIA COMPANY, owned by Irena Krasteva and Vives Corp – 50% each.

By the end of 2007, Vives Corp had as a sole owner Veneta Nikolova. She also became then member of the board of NEW BULGARIAN MEDIA GROUP HOLDING, where she remained until October 16, 2008.

At the end of December 2008, the shares of Vives Corp in NEW BULGARIAN MEDIA GROUP HOLDING were already owned by TECHNOLOGY CENTER – Institute of Microelectronics (TC-IME). At this point, the company held 24% stake of the CCB capital, according to the Bulgarian trade registry.

*The shareholders record of NEW BULGARIAN MEDIA GROUP HOLDING where the shares owned by Vives and TC-IME are listed.

This is the interesting part, as Mediapool wrote in its investigative report, because BROMAC Ltd of Tsvetan Vassilev (with 49% stake) and KEN TRADE (with 51%) own TC-IME, while KEN TRADE is also owned by BROMAC.

In 2009, on the request of Member of the Parliament, Milko Dimitrov, the Prosecutor’s Office had to probe the sources of financing of the former director of the State Lottery, which had allowed her to purchase this many media. It emerged that Irena Krasteva has been granted a loan precisely from CCB.

51.11% of the shares in any of the companies covered by purchase were listed as guarantee for the loan.

Undercover

Between 2007 and 2009, Tsvetan Vassilev and Irena Kristeva did not keep their common interests secret. Both were very publicly on the board of United BULGARIAN NEWSPAPERS Corp., established for the privatization of the Publishing and Printing Complex, (IPK) Rodina. A few days before the general elections in July 2009, the banker-media mogul has decided to hide *. On June 19, 2009, he left the board the UNITED BULGARIAN NEWSPAPER Corp., and was replaced by… TC-IME.

In order to provide a full cover at the time of the events mentioned above, the shares of BROMAC Ltd in TC-IME have been transferred to the offshore company EFV INTERNATIONAL FINACIAL, represented by Veneta Nikolova.

Meanwhile, Krasteva had already become the sole owner of NEW BULGARIAN MEDIA GROUP HOLDING. On March 13, 2009, the Holding bought out all shares of TC-IME in the media empire and her connection with Vassilev was broken. At the end of March 2009, Krasteva in turn demonstrated “shyness” and left her position as managing director of TV7 Ltd, as well as her position in TV7’s owner CROWN MEDIA Ltd. Krasteva entered the board of the TV channel a year earlier, after the Cypriot offshore company CROWN MEDIA changed ownership.

“The hiding” of Tsvetan Vassilev and the withdrawal of Irena Krasteva coincided with the time of the election campaign, when Krasteva’s media hysterically supported the government of the Three-Way Coalition. On election night, the editorial policy was sharply changed and Krasteva’s newspapers woke up plastered with servile praise of the winner – Boyko Borisov. This lasted during the entire term in office of Borisov’s cabinet of his Citizens for European Development of Bulgaria party, GERB, until the early general elections in May 2013, when Krasteva’s media once again abruptly flipped their attitude.

“The Cloned Tsvetan Vassilev”

Tsvetan Vassilev’s memory obviously serves him well. In October 2011, he gave an interview in English for Leaders Magazine, where he did not deny CCB’s investments in media and complained from the negative effect of the economic crisis and from the “social and political sensitivity” of such investments. Also he recognizes he’s governing media.

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Interview of Cvetan Vassilev for Leaders Magazine, October 2011

Three months later, in an interview with TV host Rosen Petrov for his show “Let them Talk,” in December 2011, Vassilev did not remember ever making investments in Krasteva’s media.

“Another, bigger issue, is trading influence. Why did a banker decide to invest in media; actually are you investing in media or are these rumors?

These investments are rather rumors.

Huge rumors on top of it.

There is no way I have invested in Ms Krasteva’s media, because I should have cloned her or cloned myself. I only have interests in TV7, because there I represent the interests of several investors. It is another issue that Ms Krasteva’s media in reality, as media friendly to me, help me and defend my positions.”

However, documents indicate otherwise. Despite the offshore dive and the sweeping of evidence under the rug, at one point in the existence of Irena Krasteva’s media empire, documents show that banker Tsvetan Vassilev, through his companies BROMAC, KEN and TC TRADE and TC-IME owned 50% of her publishing group NEW BULGARIAN MEDIA GROUP HOLDING. This happened at the end of December 2008 and that’s when someone took out some 5.8 million levs and attempted to raise the capital of the company as was the decision of the shareholders. The attempt seemingly misfired because it is not recorded in the Registry Agency.

In addition, the prosecutor’s probe revealed that in 2007-2008, CCB has granted loans to Krasteva and companies linked to her to purchase media. It remains unclear how these loans have been paid off in a short time by the not very profitable newspapers of the press group.

By the way, Vassilev’s positions are currently defended as well and not only on some abstract friendly grounds, but by concrete individuals linked to him. In addition to national newspapers, Krasteva also bought up the biggest regional ones – Maritsa in Plovdiv, Struma in Blagoevgrad, Tchernomorski Far (Black Sea Lighthouse) and Factor in Burgas and Borba (Fight) in Veliko Tarnovo.

Veneta Nikolova, representative of STRAND, Vives, and the offshore EFV INTERNATIONAL FINANCIAL, pops up again in Borba. It also turns out that she currently manages Publishing House Borba, which is half-owned by NEW BULGARIAN MEDIA GROUP HOLDING.

CCB: “Bad Apple” Sugarcoated with State Money

In 2004, the TC- IME company was involved in a scandal with the acquisition of lands of “Sofia Railway Factory” for 9.1 million levs or 18 euros per square meter. Three years later, on May 17, 2007, the land was resold at a profit of 978 euros per square meter to the Spanish company URBAS. A more detailed report about TC-IME can be read in an investigation of the Bulgarian 24 Hours daily.

The scandal with this deal is quoted in an US diplomatic cable about Bulgarian “Bad Apple” banks, where CCB is listed among banks practicing “money laundering by Bulgarian and foreign criminals and connected lending, which leaves legitimate investors and account-holders holding the bag when bad loans go uncollected.

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In addition to CCB, the cable cites First Investment Bank (FIB) of Tseko Minev, International Asset Bank – the bank of SIC, Economic and Investment Bank of Tsvetelina Borislavova, Investbank of Petya Slavova, DZI Bank of the murdered Emil Kyulev, Central Cooperative Bank, a.k.a. “The bank of Varna group TIM,” and Sofia Municipal bank of Hristo Kovachki.

FIB, CCB, Central Cooperative Bank, and Investbank reacted nervously and attempted to exert financial and legal pressure on Bivol through the Central Bank, BNB. This attempt was strongly condemned by the international legal rights organization “Reporters Without Borders.”

Bivol’s staff have our full support,” Reporters Without Borders said. “At a time when Europe is undergoing an unprecedented financial crisis, it is imperative for banks to behave transparently. Investigative coverage of suspected corrupt practices within the banking sector is more than ever before in the public interest, and at the international as well as national level.” – RSF stated.

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BNB failed to respond to repeated invitations from Bivol to provide the text of the “Bad Apples” claim so that it can prepare its defense. Ultimately, the case was left hanging as an example of institutional pressure and intimidation of media in Bulgaria, which for years now ranks last among the EU countries by freedom of speech.

FIB, CCB, Central Cooperative Bank, and Investbank are also the “darlings” of those in power. Both during the terms of the Three-Way Coalition and of GERB, the government “pumped” them with the money of State-owned enterprises. In the spring of 2010, the publishers of Trud (Labor) and 24 Hours dailies requested information from the Ministry of Economy and Energy, from which it became clear that CCB holds 54% of the money of State-owned companies. This was followed by threats of former GERB Finance Minister Simeon Djankov of introducing strict rules for the allocation of State money, but they remained just words. Moreover, State investments in CCB continued to grow and reached an absolute peak. In the fall of 2010, Sega (Now) daily obtained information under the Law for Access of Public Information, from which it emerged that as of March 31, 2010, 70% of the money of State-owned companies under the authority of the Ministry of Economy and Energy were exactly in CCB.

In return, all media associated with CCB acted in an extremely servile manner towards the government of GERB and personally towards Boyko Borisov. And vice versa: the attempt of the caretaker cabinet of Prime Minister Marin Raikov to instate order and reduce the concentration of public money in several banks was met with hostility from Krasteva’s media, which attacked frontally President Rosen Plevneliev, who appointed the caretaker government.

The vicious cycle “State money – media – political influence – State money Prim,” promulgated by CCB with the complicity of the State did not go unnoticed in Europe. At a hearing in the European Parliament in June 2012, the director of “Reporters Without Borders” Olivier Basil clearly outlined these relationships as a factor distorting the free media market and limiting press freedom.

Original article in Bulgarian here

 

“The Clean Money” and Irena Krasteva’s Media Belong to Corporate Commercial Bank

Translation from Mediapool:

June 4, 2009, Team Mediapool

The Prosecutor’s Office announced the money, through which Irena Krasteva acquired a bunch of media and which helped her became the majority shareholder in the IPK “Rodina,” (“Rodina Publishing House”), is clean, and its owner has no outstanding tax obligations to the State.

This was told ten days ago to Member of the Parliament, Mitko Dimitrov, who requested the probe, and to the anti- corruption parliamentary committee.

With this conclusion, the Prosecutor’s Office has made it clear it has no further intentions to deal with Krasteva. However, how someone, who was a State servant until five years ago, has substantial funds to buy five newspapers and a regional publishing house; to manage another newspaper and a TV channel (a purchase no one knows anything about); then acquire the majority package of IPK “Rodina,” and to top it all, is about to make a deal with the State for a new building of the National Revenue Agency and (possibly) win the bid for digital TV broadcasts after the analogue is switched of – all these remain open questions.

The answer is simple – a significant capital, which at first flatly refused to be revealed, is behind Krasteva. The capital belongs to Corporate Commercial Bank (KTB), although its majority owner Tsvetan Vasilev declines direct answers about the involvement of the Bank and of affiliated companies in these transactions.

However, the link between KTB and Irena Krasteva can be traced in the Trade Registry.

In July 2007, the company “New Bulgarian Media Group Holding” Ltd., headed by Krasteva, bought the majority stake in the companies publishing the newspapers “Monitor,” “Telegraph” and “Politics” and the advertising and distribution companies “Presmarket” and “Prestrafik.”

Or, as it is publically known, Krasteva acquired all newspapers and publishing activities from then majority shareholder Petio Bluskov. Some reports list the transaction price at 3.5 million levs.

The Purchase of Bluskov’s Newspapers Was Made with a Loan from KTB

Before being established as a holding company, “New Bulgarian Media Group” was a company in which half of the capital belonged to the “Balkan media company,” owned by Irena Krasteva, and half to the “Technology Center – Institute for Microelectronics ” (TC – IME ). The founding capital of “New Media Group” was 50 thousand levs, as required by law.

TC – IME, by 2003 a company with 15 employees and assets in the amount of 145 247 levs, played the main role in the subsequent transformations of capitals managed by Irena Krasteva. The former State company, which was then in decline, was purchased through the Privatization Agency in 2003 by “Ken Trade” Ltd., in which “Bromak” Ltd owned 100% of the capital. This latter company is owned solely by Tsvetan Vassilev. 2.2 million levs were paid for TC – IME.

In 2006, the Central Bank, BNB, issued permission to TC-IME to acquire 29.06% of the capital of Corporate Commercial Bank and together with the affiliated company “Bromak” Ltd. – 98.41% of the Bank’s capital.

In other words, KTB, through its affiliated company TC – IME was partner of Krasteva when she decided to purchase Blaskov’s newspapers.

This did not prevent KTB from granting a loan to “New Bulgarian Media Group” for the purchase of the papers. 51.11% of the shares of all companies subject to the purchase were used as collateral, according to the prosecution’s probe.

This way, the Bank gave direct credit to a company affiliated with it, which is not banned by the law in principle, under certain conditions.

How Corporate Commercial Bank Got Involved with IPK “Rodina”

Through the companies purchased from Blaskov, Irena Krasteva also became one of the owners of IPK “Rodina.”

At the time when they were purchased by Krasteva, the companies “Monitor” Ltd and “Pressmarket” Ltd had shares in IPK “Rodina” through the company created for the privatization of the printing complex – “United Bulgarian Newspapers” JSC. The publishers of several major Sofia-based newspapers, such as “Monitor,” Standard,” “Novinar,” “Duma,” and “Banker,” were shareholders in it through specially established firms.

According to the prosecution’s probe, the loan from KTB was paid off several months later through the sale of the shares of “Monitor” and “Pressmarket” in IPK “Rodina.” The buyer was not listed, but it became obvious from some of Krasteva’s subsequent operations in IPK “Rodina” that this buyer was once again closely linked to KTB.

Around the same time, Krasteva also purchased “Novinar’s” and “Duma’s” shares in IPK “Rodina” and entered the management of the companies “Novinar Media Projects” and “PM Projects,” which, through the two newspapers, were shareholders in “United Bulgarian Newspapers.”

This way, Krasteva acquired 6/7 of “United Bulgarian Newspapers,” while 1/7 was kept by “Project Builders of Modern Bulgaria,” which published the newspaper “Banker.”

The buyout was accompanied by an increase of the capital of “United Bulgarian Newspapers” to 4.9 levs, which happened at the end of November 2008. Additional funds, in the amount of 3.92 million levs, were deposited in a special account in KTB.

The deals have been sealed through Krasteva’s company “SD Developments” JSC. The share in the ownership of the company is not listed in the Trade Registry, but in addition to Krasteva, representatives of TC –IME, the company of Tsvetan Vassilev, were on the Board of Directors.

After the change of ownership in IPK “Rodina,” Tsvetan Vassilev joined the Board of Directors of this company as well.

Sweeping the Trail under the Rug

In order to conceal the transfer of capitals from KTB in the deals for the acquisition of the newspapers, the loans for the purchase granted to affiliated companies, and their payoff, in March this year (2009), “New Bulgarian Media Group” bought the share of TC – IME and became a stock company with just one shareholder. For this purpose, Krasteva paid 1.4 million levs.

TC – IME disappeared from the ownership of the “New Media Group” and Irena Krasteva became the sole owner through her company “Balkan Media Company.”

The visible link between Krasteva and KTB was broken. The probe established that the newspapers have been purchased through a loan from a bank, and the loan has been paid off.

Krasteva’s Other Deals

The Veliko-Tarnovo-based company “Borba” and the newspaper with the same name were purchased in September 2008 with “New Bulgarian Media” own money and a loan from a brokerage house, according to the prosecution’s probe. The price was 1.955 million levs.

At the end of 2008, Krasteva, through “New Bulgarian Media Group,” assumed control (officially as consultant) over one more newspaper – “Express” and TV7. Until now (2009), neither the former owner of the two media – “Crown Media” – whose capital belonged to an offshore company “Crown Media Limited,” registered in Great Britain, nor Krasteva have offered any information on the change of ownership.

Krasteva, together with Teodora Taneva, a representative of the companies affiliated with KTB, became members of the managing bodies of the two media. Taneva’s name was also listed in the management of “SD Developments,” the main shareholder in “United Bulgarian Newspapers.”

KTB’s Goal

One can assume that the bank or the owners of its capital strive to influence the media. The five newspapers and the one national cable TV channel, owned by Krasteva, are a serious resource for public influence. If one follows their editorial policy, one will notice that they blindly serve the Prime Minister, the Bulgarian Socialist Party and the Movement for Rights and Freedoms.

The Bank had an even more substantial interest in the deal for IPK “Rodina” for the construction of a new building of the National Revenue Agency. Tsvetan Vassilev, himself, told media that the potential construction will be done through loans, but denied they would be granted by KTB, citing “conflict of interests” over his involvement in the management of the IPK.

This construction would be highly profitable for the private partner of “IPK Rodina” because of the parameters of the contract.

On should also stress that a new grandiose government center is planned to be built nearby; this is if the country’s new rulers give it green light.

The fact that during the last give-away of State jobs, Emil Atanassov, an individual close to Tsvetan Vassilev, was appointed Member of the Financial Supervision Commission in charge of the insurance sector, speaks volumes of KTB’s strong influence in the current political situation. Prior to the appointment, Atanassov was for 5 years executive director of the financial services company “Fina-S,” affiliated with KTB.

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