The United States on Wednesday rolled out sweeping anti-graft sanctions against high-profile Bulgarian power brokers and more than 60 entities, while the EU fails to confront the Balkan country’s spiraling rule of law crisis.
America’s unusually wide-reaching step is an embarrassment for the EU as it exposes the bloc’s inability to police its own backyard over a welter of corruption scandals often tied to EU funds that end up in the hands of Bulgaria’s mafia and powerful oligarchs. The move constitutes America’s biggest-ever action in one day under the country’s Global Magnitsky Human Rights Accountability Act, which targets perpetrators of corruption and human rights abuses around the globe.
“The United States stands with all Bulgarians who strive to root out corruption by promoting accountability for corrupt officials who undermine the economic functions and democratic institutions of Bulgaria,” Office of Foreign Assets Control Director Andrea M. Gacki said.
By contrast, the EU has conspicuously chosen not to stand with Bulgarians fighting corruption.
European Commission President Ursula von der Leyen and German Chancellor Angela Merkel have turned a blind eye to a rule-of-law meltdown in the EU’s poorest state in recent years. Former Prime Minister Boyko Borissov, who dominated the country’s politics for the best part of a decade, was their close ally on the EU political stage in the center-right European People’s Party and was never challenged over his country’s judicial failings. Although the former firefighter and karate champion lost power in an indecisive election in April, his GERB party is still ahead in polls ahead of another election on July 11.
While corruption has long been identified as a problem in Bulgaria, the scale of unfolding graft scandals over the past year has laid bare how an oligarchic mafia has effectively captured the state by exercising control through institutions such as the judiciary, security services and media.
The most high-profile tycoon to be sanctioned is Delyan Peevski, a controversial media mogul and former member of parliament.
Peevski “regularly engaged in corruption, using influence peddling and bribes to protect himself from public scrutiny and exert control over key institutions and sectors in Bulgarian society,” the U.S. Department of the Treasury wrote in its sanctions decision.
Peevski, who is affiliated with the Movement for Rights and Freedom, a member of the liberal Renew Europe grouping, has emerged as one of the symbols of the country’s corruption woes. The U.S. said he “worked to negatively influence the Bulgarian political process” in elections in 2019.
The department has also sanctioned fugitive casino baron Vasil “the skull” Bozhkov, one of Bulgaria’s wealthiest citizens, and Ilko Zhelyazkov, who currently serves on the National Bureau for Control on Special Intelligence-Gathering Devices— as well as 64 entities connected to the men, cutting off their access to the American financial system.
In parallel, the U.S. Department of State announced entry bans on an even broader list of Bulgarian public figures and their families, including a former deputy minister.
“The big question is, who did they corrupt?” said Elena Yoncheva, a member of the European Parliament, who is a leading critic of Borissov and a member of the Bulgarian Socialist Party.
Tip of the iceberg
In explaining its decision, the Treasury said that Bozhkov — who is currently a fugitive in Dubai but nonetheless registered a political party that won almost 3 percent of the votes in the April election — had “bribed government officials on several occasions,” including “a current political leader.”
It also said that the businessman “planned to provide a sum of money to a former Bulgarian official and a Bulgarian politician earlier this year” in order to help him “create a channel for Russian political leaders to influence Bulgarian government officials.”
The Treasury Department also accused Zhelyazkov of acting as a frontman for Peevski in corrupt dealings.
“Peevski used Zhelyazkov to conduct a bribery scheme involving Bulgarian residency documents for foreign persons, as well as to bribe government officials through various means in exchange for their information and loyalty,” according to the U.S. government.
Hristo Ivanov, head of the anti-corruption Yes Bulgaria party, welcomed the sanctions.
“Peevski and Bozhkov are participants in a grand corruption scheme which needs to come undone, while Borissov needs to leave the political scene,” he told reporters in Sofia.
Maya Manolova, a former ombudswoman and one of the leaders of Rise Up! Out With the Crooks!, an opposition party inspired by a wave of anti-corruption protests last year, said the sanctions highlighted a dire need for reforms.
“Bulgarians would like to see their institutions finally stepping up their fight against corruption,” she told online news platform Dnevnik.bg. The “Bulgarian state is the only one which has not realized the need for decisive anti-graft measures. ”
In a statement late Wednesday, the Bulgarian foreign ministry did not address any specific cases but said the country is committed to the fight against corruption and that it remained ready for dialogue with Washington. Bozhkov’s party declined to comment at the time of publication.
Peevski, meanwhile, rejected the U.S. move and vowed to challenge it.
In an open letter sent to Bulgarian media, he slammed the sanctions as “absolutely unacceptable, biased and violating the letter and the spirit” of the Magnitsky Act.
“I haven’t done anything to violate internationally recognized human rights, I’m not a state official, and I haven’t participated in acts of corruption,” he said.
Washington’s reasoning for imposing the sanctions “does not include a single true fact,” he added.