Concealed from Bulgarian Public: “Bad Apple” Fibank and Dubai connection in CEZ deal

“When I opened what the Czech Prime Minister had sent me, what did I see: Russian-Georgian offshores, Russian banks, Bulgarian ones, and those banks that for some reason have had problems.”

This is how Bulgarian Prime Minister Boyko Borisov described before the media the information that, in his words, he had received from his Czech counterpart Andrej Babis on Ginka Varbakova’s funding to purchase the Bulgarian assets the State-owned Czech electric power utility CEZ.

The funding scheme was first revealed by the Czech daily Lidove noviny, while the information Borisov had allegedly received was immediately classified because it mentions bank names.

Bulgarian media, for their part, also “classified” a significant part of the Lidove noviny story. They all focused on the Russian-Georgian relationship through businessman Paata Gamgoneishvili, who is found in the Offshore Leaks database.

And not even one media brought up the fact that a significant part of the article is devoted to the “bad apple” – Bulgarian private lender First Investment Bank (FIB or Fibank) and that it is quoting Bivol’s investigations into the Bank’s links with the underground.

It also remained unclear what kind of “offshores” the Prime Minister was talking about, although public information on at least one of them is available.

Dubai “oshfore” and Sberbank

In an interview with Nova TV, Ginka Varbakova denied offshores participating in the financing of the CEZ deal, calling them oShfores. But Lidove noviny rebutted her with their report that two offshore companies will be participating with EUR 167 million. The same information appears in the report sent to Borisov.

The two offshore companies are Score Trade and Global Victory Trust. According to the funding scheme sent by the Czech Republic to Borisov, two Swiss banks – Julius Baer and Vontobel – are behind Score Trade, while the Russian Sberbank is behind Global Victory Trust.

Lidove noviny claims that Score Trade is linked to Russian-Georgian businessman Paata Gamgoneishvili. The Bulgarian Capital daily adds that, according to its sources, Global Victory Trust is also associated with Gamgoneishvili and his partner David Koblianidze, who build and then sold “Paradise Mall” in the Bulgarian capital Sofia for over EUR 250 million.

Who is the Russian Sberbank behind is an EUR 100 million question. There is no evidence of a link between Global Victory Trust and the Georgian businessmen. By the way, both Georgians, who have Russian passports, are already Bulgarian citizens and identify themselves in the Trade Register with their Bulgarian social security numbers.

Global Victory Trust is a Luxembourg company and, for a modest amount, anyone can obtain its company records. The document states that the company’s owner is Global Victory Investment Limited registered in the UAE, in the Ras Al Khaimah free trade zone, HDS Business Center, 3204 Jumeirah Lakes Towers, P.O. Box 309071, Dubai.

Global Victory е собственост на дубайска фирма, регистрирана в офшорната зона Ras Al Khaimah


The address of the Dubai company coincides fully with that of Freemont Services, which offers company registrations in one of the world’s most secret offshore locations where there is no public company register and the anonymity of the real owners is guaranteed.

There is no evidence of Score Trade entries in the offshore companies’ registers. It has probably been registered recently for the CEZ purpose.

Is it FIB? Classify!

Borisov’s move to classify the report from the Czech Republic was justified with it comprising information about banks, including those that “have had problems”. The Czech Republic report, itself, is not classified. There is only one bank with problems in it and it is FIB, but as it is “the tradition” in Bulgaria, politicians and the media avoided naming.

However, the Czech daily, Lidove noviny, has no such scruples and a significant part of its article is devoted to doubts about the banks that will finance the deal. The section on FIB quotes the US diplomatic cable on banks “bad apples” in Bulgaria, which Bivol published in 2011 as a Wikileaks partner. This is what the cable says about FIB:

First Investment Bank (FIB) was founded in 1993 by Tseko Minev and Ivailo Mutafchiev with funds of questionable origin. They remain owners, along with two offshore companies from the Cayman Islands and the Channel Islands. The European Bank for Reconstruction and Development (EBRD), an early supporter and investor, recently told us that their participation in FIB is seen as bad spot on EBRD’s record. FIB is now considered to have one foot in the legitimate retail world) it is known as one of the most aggressive and “polished” banks) as well as one in the murkier criminal realm.

Lidove noviny also does not spare the information that FIB had funded Bulgarian energy oligarch Hristo Kovachki with tens of millions of dollars. In addition, Bivol’s investigations into the drain of FIB and its links with the underground are also highlighted in the article.

“The Bulgarian site for investigative journalism, Bivol, links FIB with the organized crime group “The Killers”, cigarette and drug trafficking, and theft of EU funds.”

Therefore, the Czech public was informed in good faith that CEZ had sold its business in Bulgaria to an unknown company with funding from a dubious bank and from a suspicious Georgian, all with a State guarantee from Bulgaria.

However, the Bulgarian one, inhabiting a European territory with an African rating of freedom of speech, was purposely not told anything about the Czech doubts in FIB

*Later, in its analysis of the business connections of Ginka and Slavcho Varbakovi, Capital found a link with “The Killers” through Slavcho’s business partner in the company V-S-O, Oleg Popov, who was detained together with “The Killers” ringleader Mila Georgieva but then released, then detained again with 120 kg. of amphetamines and released again on bail.


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