CEZ Deal: “50% Mafia, 50% State” Mind the horns!

On Monday, March 19, Bivol sent questions to the Parliamentary Ad-hoc Committee tasked to examine all the facts and circumstances regarding the privatization and the planned sale of the Czech State-owned power utility CEZ Group in Bulgaria (AKA “The CEZ Committee”). We publish them below. We expect the Committee to consider this request and to address the issues of high public interest to clarify the links of persons from the executive branch with individuals involved, both, with criminal structures and with the management of CEZ Bulgaria, as well as the credit history and reliability of the people connected to the buyer of CEZ Bulgaria.

On October 20, 2009, three months after the first government of the Citizens for European Development of Bulgaria (GERB) party took up office, Dimitar Nikolov “Mitko the Karate Player” Stefanov, was appointed member of the Supervisory Board of CEZ Bulgaria. Until July 26, 2011, the same person also managed Omega 96. The former owner of Omega 96 is Rumen Gotzov “the Pasha” Nikolov, a partner in the alleged infamous organized crime group from the 1990s – Intergroup and Partners, also known as SIC.

Connections to this person with controversial reputation can be found, both, in the government and the buyer of CEZ Bulgaria – the company Inercom. On the one hand, in the 1990s, Rumen Gotsov Nikolov was a partner with Prime Minister Boyko Borisov in several companies, including Teo International, investigated for an illegal cigarette factory in the Black Sea coastal town of Kraimorie. On the other hand, the husband of Ginka Varbakova (owner of Inercom), Slavcho Varbakov, was a partner with Evgenia Kalkandjieva, who founded the Visage modeling agency together with the sister of another organized crime boss, Krassimir “The Marguin” Marinov, who was also a co-owner with Rumen Gotsov Nikolov in Intergroup.

A recording of the following statements about Dimitar Stefanov by Vanko Georgiev Anastasov is a public fact:

“Mitko Stefanov is a very strong man, you know. He is capable of such things that we cannot come up with even in our wildest fantasies. Mitko is in direct contact with Ceco (Tsvetanov Tsvetanov, seen as the Prime Minister’s right hand and the second most powerful person in GERB – editor’s note) with Boyko… I am painting the picture for you. Mitko is 50% mafia, 50% civil servant. He continues to keep a hold on certain structures.

Vanko Anastasov should be a well-informed person because his business record shows connections with, both, Rumen Nikolov and Dimitar Stefanov.

Vanko Anastasov is a former partner in Bona 2000 with Emil Ivanov Mladenov, Sports Director of the Bulgarian Canoe-Kayak Federation and current manager of Arena 95, owned by Rumen Gotzov Nikolov.

Nikolov, himself, had managed Arena 95 until 2011, when Anastasov’s son – Georgi Vankov Anastasov – had replaced him. He had remained manager until 2014, when he had been replaced by Emil Mladenov. The connection with Dimitar Stefanov is through the company Orbo Trading Bulgaria. Emil Mladenov is a co-owner of the company, while Zhivko Stoyanov Kostadinov is the manager. The same was also a manager of the aforementioned Omega 96, together with Dimitar Stefanov.

At present, Omega 96 and Orbo Trading Bulgaria have a common manager – Zhivko Kostadinov, and are owned by companies from England and the United States, represented by the same lawyer – Evgeniy Kostov Delibaltov. Evgeniy Delibaltov and Rumen Nikolov are co-owners of a real estate property in the Bulgarian capital Sofia, acquired in 2001

After a media caused scandal in the Czech Republic in 2013, Dimitar Stefanov was removed from the Supervisory Board of CEZ Bulgaria.

Responding to a question about Dimitar Stefanov in an interview with the publication E15, then- Regional Manager of CEZ Bulgaria, Peter Dokladal, said that Stefanov had been recommended by the Ministry of Economy (led then by Minister Traicho Traikov) at the time when Bulgaria had a 33% stake in CEZ Bulgaria. However, he had remained in office after the sale of the Bulgarian share in CEZ. In response to questions from Bulgarian media in 2013, the CEZ Board said that Stefanov had been appointed because “he knew the social and political environment in Bulgaria”.

In an interview with Darik Radio on March 17, 2018, the lawmaker from the opposition Bulgarian Socialist Party (BSP), Stoyan Mirchev, said that the had information about “good relations” between Ginka Varbakova and Dimitar Stefanov’s wife. Perhaps, he was referring to the lady with whom Stefanov has children and common properties – Tatyana Nikolova Georgieva, a political person, currently a member of the Sofia Municipal Council from the GERB quota.

Questions:

How was the decision to appoint Dimitar Stefanov made in 2009?
Has Prime Minister Boyko Borisov ordered Minister Traicho Traikov to recommend him or did the Minister take such a decision on his own?
Has Prime Minister Boyko Borisov talked to the managers of the parent company in the Czech Republic about the appointment of Dimitar Stefanov and has he insisted on this appointment?
What education and what competencies does Stefanov have in the field of energy?
What is the “good relationship” between Ginka Varbakova and Tatyana Georgieva?

On April 3, 2013, prosecutor Nelly Zlatkova announced at a press conference the results of an audit of CEZ with the following words:

“The main focus of the audit of CEZ has been on the way electricity prices and services are formed. Only two of CEZ’s companies can be called energy in terms of the law – “CEZ Distribution Bulgaria” and “CEZ Electro Bulgaria”. These two companies have provided CEZ Bulgaria with most of these activities and the company has outsourced these services to third companies. There is also a service contract for just over BGN 464 million; a contract for general conditions – BGN 340 million and a contract for the selection of suppliers – BGN 9.9 million. This is probably a violation of the license.”

According to the Prosecutor’s Office, these contracts have affected electricity prices. The audit also identified attempts to circumvent the Public Procurement Act. The Public Financial Inspection Agency (PFIA) has also audited these contracts.

Questions:

What is going on with this Prosecutor’s Office investigation?
Has it turned to pre-trial proceedings?
Does the prosecution have any evidence of abuses by the CEZ management and in particular by Dimitar Stefanov?

At a hearing at the Commission for Protection of Competition, the Energy and Water Regulation Commission, the Financial Supervision Commission, the National Revenue Agency, the Privatization and Post-Privatization Agency, the State Agency for National Security and the State Agency for Intelligence in connection with the sale and purchase of CEZ Group’s assets in Bulgaria, held on March 1, 2018, the Chair of the National Security Agency (DANS) announced “the presence in the Prosecutor’s Office of the Republic of Bulgaria of probes in 2010, 2014, 2015 and 2016 into a leasing company that had been harmed by an outside property where the borrowers were from the Varbakovi family. Four of the probes have been terminated. On two of them, the work continues, with no charges yet against the individuals.“

Questions:

Who are the individuals subject to the terminated probes?
Who are the individuals subject to the pending probes?
At what stage are the pending probes – verification or pre-trial proceedings?

In an interview with bTV, on Saturday, March 10, 2018, Energy Minister Temenuzhka Petkova said that 20 years ago an acquaintance had introduced her to Ginka Varbakova and her then-to-be husband, and this acquaintance had later become their best man.

Questions:

Who is this person?

Has this person been or is he in business contacts with persons in government positions and associated with the management of CEZ Bulgaria?

Pictured: Dimitar “The Karate Player” Stefanov

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