OLAF Halts Money for Bulgarian Food Products Promotion Mind the horns!

Payments under the European program for the promotion of Bulgarian agricultural products abroad are now completely suspended after an investigation by the European Anti-Fraud Office OLAF. Brussels has found documents and evidence of inflated prices and fictitious deliveries to subcontractors in the implementation of the program.

Four projects for nearly EUR 19 million have been blocked, according to an investigation by Bivol, confirmed by information received under the Access to Public Information Act (APIA) from the State Fund Agriculture (SFA). To date, the following projects will not receive funding: “Go, Get, Eat Organic!” will not receive EUR 4,574,551, “Variety of Tastes” – EUR 2,982,967, “European Quality Cheese” – EUR 3,971,788, “European Sheep – 100% Quality” – EUR 3,705,096, “Release the European Taste” – EUR 3,759,660. OLAF has requested a 100% adjustment, which means returning all the amounts already paid.

The projects of the National Association for Breeding Dairy Sheep in Bulgaria, the Union of Processors of Fruits and Vegetables in the Republic of Bulgaria, the Bulgarian Association Bio-products and the Association of Dairy Processors in Bulgaria are affected. All of them are carried out by the based in Brussels Agropromotion SARL, which had been investigated by OLAF.

The Agropromotion site reveals that the millions are being spent mainly on the production of advertising materials – leaflets, bags and cooking aprons, multi-language websites for the production of Bulgarian producers, participation in exhibitions held in the Middle East and CIS countries, and publications in the target markets press.

Excerpt from the Belgian Commercial Register

Agropromotion SARL is not a phantom company. It was registered in 2007 and is owned by Stella Scarlis, an Australian citizen living in Cyprus, a check in the Belgian Commercial Register revealed. Bivol sent questions to the company about OLAF’s findings. An e-mail response denied any comment.

Only Bulgarian projects are halted

The information provided by OLAF to the SFA does not make clear what the subcontractors are; what services had been overcharged and how fictitious deliveries had worked. However, it is indicative that Agropromotion implements other projects under the EC promotional program that are not suspended.

Bivol checked the status of the Milky Way project of the Czech Milk Association of Dairy Producers, which is for over EUR 5 million. Our OCCRP partners in Prague received an official response from the Czech Ministry of Agriculture, signed by spokesperson Marketa Jezkova. It claims that no information has been received from the European Commission about project-related irregularities.

“It’s not good to stir noise”

The orders for suspension of payments were issued by the SFA on December 23, 2016 and are signed by the former SFA Director, Rumen Porozhanov, but had been kept secret, probably to conceal that Brussels is freezing European money for Boyko Borisov’s government. The SFA refused to officially provide the orders under the Access to Public Information Act (APIA), citing secrecy due to the ongoing inspections. However, a reply to the request for information on payments for specific projects confirms that they have been suspended and not processed.

Bivol contacted three of the affected associations and they provided different comments.

“We received letters from SFA informing us that payments under our programs are temporarily suspended in connection with suspected irregularities by the company that performed them. We have appealed these letters in court, and we hope that the case will be solved in our favor. The programs themselves are still running. As far as we know, four associations with five programs have been affected,” was the reply of the Program Manager of the National Association for Breeding Dairy Sheep in Bulgaria Desislava Krachanova.

Albena Simeonova, of the Bulgarian Bio-Products Association, also said that Porozhanov’s orders are being appealed in court. She finds the promotional program very useful because it allows small organic producers to showcase their production on the European market. Simeonova assumes that the investigation by OLAF is due to defamatory reports by Greek producers, envious of the Bulgarian competition.

The Association of Dairy Processors in Bulgaria provided the scarcest answer. The attempt to get an opinion from its boss Dimitar Zorov failed, while an employee of the Association said on the phone that “it is not good to stir noise” around the information on the suspended European money.

Peevski also uses European money to advertise his cheese in Dubai

The list of members of the above Association, which does not want to stir noise about the case, includes Lodis Invest, maker of the products with the brand name “Lakrima”. Bivol revealed that it is part of the estate of lawmaker and media magnate Delyan Peevski. The suspended project worth nearly EUR 4 million had to be used to advertise Bulgarian feta cheese and yellow cheese at two exhibitions in Dubai, one in Abu Dhabi, Baku and Kazakhstan each. As it is well known, Dubai is the new business stronghold of the corpulent MP, laboring hard in the areas of lawmaking, cigarettes, media business… and cheese.