Corruption, sanctions and Russia – Geshev’s three sins that lead him to Magnitsky

The echo of Rep. Warren Davidson’s letter to the U.S. Treasury Department is yet to reverberate in the public domain. It demands measures against Bulgaria’s Prosecutor General Ivan Geshev. The reasons undermine the security of NATO and allies through corruption, actions in favor of Russia and ignoring US sanctions.

My letter concerning Bulgaria is real, as are the widespread concerns about sanctions evasion. pic.twitter.com/63RK9XtX7P

— Warren Davidson 🇺🇸 (@WarrenDavidson) December 23, 2022

Media analyses so far focus on the refusal of the Geshev-led prosecutor’s office to investigate individuals already sanctioned by the United States – DPS MP Delyan Peevski and former Deputy Chairman of the Bureau for Control of Special Intelligence Means Ilko Jeliazkov. It is this refusal to apply the sanctions under the global Magnitsky Act in Bulgaria that is pointed out in Davidson’s letter as “perhaps the most disturbing”.

Perhaps most worryingly, Bulgarian courts visibly followed the Attorney General’s refusal to take action against the sanctioned individuals and recently declared U.S. sanctions imposed under the Magnitsky Global Rule of Law and Human Rights Responsibility Act (the “Magnitsky Act”) ineffective and without legal force in the Republic of Bulgaria. A few months later, the Bulgarian Prosecutor’s Office suspended all investigations and measures against US-sanctioned Bulgarian citizens.

But the issue of corruption is also not insignificant. The letter explicitly cites a material of BIRD.BG about the “Josi” case and the warning of an assassination attempt being prepared, which the author of these lines received literally days after the publication not just anywhere, but from the US Embassy in Sofia.

In addition, investigative journalists had to be warned by the US Embassy of the imminent threat of bodily harm, just days after they reported corruption charges against the acting attorney general (a link to the publication of the BIDR.BG on the joint investigation with BOETS into the Josi case) was attached.

The “Josi” case is summarized briefly as follows: as a regular prosecutor, Ivan Geshev agrees to help the owner of the dairy company “Josi” in a business dispute with a competitor. In return, his father received a stake in the company, which at that time was valued at several million leva. Geshev’s help had to be expressed in influencing the competitor to obtain an accusation.

Davidson’s letter contains a very precise definition of such actions: “The use of the prosecution as a weapon for the benefit of organized crime and corruption.”

In the case “Josi” there are both vocal testimonies from the owner Georgi Georgiev – Josi, who offered Ivan Geshev the corrupt deal, and documents in the Commercial Register for the transfer of shares in favor of Stoimen Geshev, father of Ivan Geshev.

This case was included as an argument for the request for the removal of Ivan Geshev submitted to the Supreme Judicial Council by Minister Nadezhda Yordanova under the Petkov government, but met strong resistance from the members of the Council supporting Geshev and eventually dropped as an argument.

The facts of the “Josi” scandal are so clear and so strongly implicate Geshev in receiving an undue benefit, in other words, bribery that the refusal to discuss them in the SJC positions the magistrates who voted not to discuss them as accomplices in a crime against justice.

Davidson’s quotation of Josie is not good news for the Geshev majority in the SJC, because its key members are already dominated by the shadow of future sanctions.

Sanctioned Russian bank secretly acquires Vivacom

Other candidates for the expanded sanctions list, which will inevitably follow after Davidson’s letter, are the brothers Milen and Georgi Velchevi and Spas Rusev.

Their role in the covert takeover of strategic telecom operator Vivacom by Russian bank VTB, dubbed Putin’s bank, was detailed in testimony by Jocelyn Bennett before a British court, which was first published by the Affair website. A link to the testimony document is given in Davidson’s footnote letter.

Bennett is a financial manager (fiduciary) who admits that he was a straw of Spas Rusev in companies that acquired the ownership of Vivacom with a loan from the VTB bank, and the whole operation was designed to hide the name of Spas Rusev and the origin of the money for the deal. The scheme includes the Velchev brothers, who represent VTB Capital in Bulgaria.

Key are Bennett’s claims on pages three and four, which show that Spas Rusev had no money for the deal and that it was financed by the Russian bank. In addition, Bennett presented to the court documents – correspondence with Rusev and Velchevi, in support of his words.

I remember that there was a complex structure created deliberately to conceal the fact that VTB was behind Mr. Rusev. In particular, I understand from Mr. Rusev that VTB Capital had a stake on Mr. Rusev’s stake in BidCo, but that bet was settled at the highest level of HoldCo, again to make it difficult to see who was behind Mr. Rusev. In practice, VTB Capital acquired Vivacom through Mr. Rusev. […] The auction for the sale of Vivacom, led by VTB Capital in London, was an artificial process. I learned this from my conversations with Mr. Rusev.

Accordingly, Spas Rusev, who has no money, is just a proxy of the real owner with the money, and he is the Russian bank VTB.

These cases occurred while VTB was under U.S. sanctions. It follows that Velchevi and Spas Rusev conspired with VTB’s top management how to circumvent sanctions with all the consequences that Davidson summarized politically as follows:

Bulgarian critical infrastructure and defense companies are routinely transferred to Russian sanctioned banks and other corrupt elements, despite sanctions.

There is no doubt that Vivacom is part of the critical infrastructure and has a key role in the defense of NATO Bulgaria.

Spas Rusev is the connecting element between the interests of Peevski and the sanctioned VTB bank in plundering Corpbank’s assets, part of which is Vivacom. Details of their financial relationship are yet to be revealed.

What about Geshev’s role? We should look for it in the Corpbank AD case, which he worked out so that the corpulent figure of Delyan Peevski disappeared from it altogether. Stated by Congressman Davidson, it is about the following:

Particularly worrying are the signals of corrupt actions of Bulgarian Prosecutor General Ivan Geshev. The European Court of Human Rights has found repeated and serious violations of fundamental rights caused by expropriation against banking institutions carried out directly or indirectly under the supervision of the Prosecutor General’s Office.

To the objection that at the time of these actions the Prosecutor General’s Office was headed not by Geshev, but by Tsatsarov, we can only point out that the scope and time limitation period of Magnitsky do not exclude sanctions against former Prosecutors General.

From the political letter to real sanctions?

What’s next? Davidson’s letter is an invitation to action. It has no legal value, it is a political letter. But actions by OFAC (the US Treasury Department’s Office of Sanctions) are likely to follow, as followed by the letter of two US senators four months before Peevski was sanctioned in June last year.

In this regard, the journalistic references in Davidson’s letter are important because in the United States the press is recognized as a fourth power equal to other authorities. Even if there is no investigation or conviction against Geshev, journalists’ investigations legitimize the merits of the request for sanctions and their imposition.

Thus, Geshev may be under sanctions even just because of the “Josi” case, which in Bulgaria was never investigated on the merits. The data released by DG BOETS that Geshev had a close relationship with one of the alleged “killers of Peevski” was not investigated either, from which the attack on Corpbank AD began.

Here it should be recalled that not only the scandals involving Peevski and Ivan Geshev personally were ignored by the prosecution, headed by the latter. Under the visor of his Stalin cap are stalled investigations into all resounding corruption and financial scandals related to former Prime Minister Boyko Borisov – Barcelonagate, Drawergate, Gamblinggate, etc.

The equation is simple: If Geshev falls, Borisov falls. That is why the propaganda resource of GERB was immediately thrown on the embrasure against Davidson’s letter. On the first day after the publication of the letter by the Bulgarian-American journalist Tatiana Christie , the PIK site close to Boyko Borisov and the lesser-known Gerber mouthpiece Tribune.bg especially tried. It is likely to be included after the Christmas holidays of other media with corpse-corpulent broadcasting.

The situation of Bulgarian candidates for US sanctions will become particularly difficult if Warren Davidson heads next week the key subcommittee in Congress on “National Security, International Development and Monetary Policy“. It is in her portfolio that international sanctions exclude from the US financial system those accused of corruption and human rights violations.

Among those sanctioned are already two chief prosecutors: Iran and Bosnia and Herzegovina. If Ivan Geshev does not resign in a timely manner, he has every chance to become the first acting Prosecutor General of a country in NATO and the European Union to enter the US sanctions list.

Leading photo: Collage of Peevski with a real handshake of Borisov and Geshev.

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