In the aftermath of the scandal known in Bulgaria as “The “Eight Dwarfs”, Lyubena Petrova earned BGN 1.5 million from the sale of real estate and acquired a luxury house in Sofia’s affluent suburb of Boyana for at least BGN 2 million. The deals had been inked in early October 2020. The value of these property gains differs significantly from Petrova’s officially declared income, research by BIRD found. Petrova’s name is also associated with expensive properties in downtown Thessaloniki.
Lyubena is the wife of former investigator Petyo Petrov, also known by his emblematic nickname “The Euro”. The two are the main protagonists in a scheme for extortion and the takeover of a business with the participation of lawyers, senior prosecutors and thugs, exposed by an entrepreneur named Iliya Zlatanov in a series of interviews with the Anti-Corruption Fund.
Zlatanov says that he asked Petyo “The Euro” Petrov for help to resolve a business dispute and received it but against a huge commission. The meetings with Petrov took place in his informal office located in the restaurant “The Eight Dwarfs” in Sofia. At the behest of Petrov, the prosecution attacked Zlatanov’s opponents, but then he, himself, fell victim to the group, which took over his business and confiscated his assets worth BGN millions.
A key figure in “The Eight Dwarfs” raider scheme is Lyubena Petrova or “The Snow White” from “The Eight Dwarfs”. Iliya Zlatanov issued promissory notes in her name as a guarantee for the services of Petrov and the prosecutors from his circle. Iliya Zlatanov claims that he received death threats and was forced to flee and take refuge abroad. According to him, he is not the only victim of Petrov’s schemes and the shemes of his group which has been operating for years.
Zlatanov’s statements are evidenced by subsequent events. Lyubena Petrova used the promissory note to seize all his properties. Thugs from a notorious Bulgarian security company Delta Guard occupied Zlatanov’s factories and even refused to obey court orders while enjoying the full cooperation of the police.
What is the money trail and how is the income from criminal activities legalized? It seems that this has happened according to the classic real estate scam scenario, data studied by BIRD revealed.
The money from the “commissions” invested in real estate?
In 2016, Petrov’s future wife, still under her maiden name Pavlova, acquired from Petrov’s parents an apartment of 96 square meters in Sofia on “Louis Ayer” Street. The transfer was declared before a notary for the symbolic EUR 100 per square meter.
In 2017, Pavlova was already officially married to the infamous ex-investigator. She received then as a donation by private individuals a land plot with an area of 907 square meters in Simeonovo, another affluent Sofia suburb. The donors seem to be relatives of Lyubena as they have the same permanent address in Sofia.
In 2018, Lyubena acquired in a personal capacity a large villa in the village of Kladnitsa at the foot of Vitosha Mountain, near the western city of Pernik. The young businesswoman paid BGN 313,000 for 430 square meters. There is no evidence of a mortgage or loan for the acquisition of this property.
Earlier acquisitions of LP Logistics are known from an investigation by Bulgarian Capital weekly published in 2017. At that time Lyubena Pavlova presented herself as a civil activist, organizing actions in defense of Prosecutor General Sotir Tsatsarov. But along her “human rights” activity, she ran a business and made profitable real estate transactions. In 2016, LP Logistics bought two apartments on “Svilenitsa” Street, next to the now infamous “The Eight Dwarfs” restaurant, which serves as Petrov’s office. The sellers were companies associated with the failed private lender Corporate Commercial Bank (CCB), Capital notes, while the price for the acquisition seems too low compared with market prices. Petrova’s company paid only BGN 399,455, or EUR 815 per square meter, for two apartments of 126 square meters in downtown Sofia. She also bought another apartment in the winter resort of Bansko for the much more modest amount of BGN 47,000.
But even these favorable prices are unattainable for the financial means of LP Logistics, which was incorporated in April 2014 and has not reported any activities and revenues for 2014 and 2015. For 2016, the annual financial statements submitted to the Registry Agency list tangible assets of BGN 212,000 and the same amount of liabilities. The difference between the declared assets and the acquisition prices of the two apartments in Sofia and the one in Bansko is over BGN 230,000.
On October 9, 2020, the two apartments in Sofia were sold for BGN 782,332, according to a reference in the Property Register. The buyer was the company “GS River” based in the second largest city of Plovdiv. So it turns out that either the values of the properties have gone up almost twofold in four years, or they have been declared at fictitious prices four years ago, in the classic spirit of “ApartmentGate”.
“GS River” is a newly incorporated company, registered in June 2020 in Plovdiv by Dimitar Kyosev. He is the owner of the companies “Rental Group”, “Pool Invest and “Autohouse.bg”, and through the latter of the joint-stock company “Haupthouse”. His wife and son Angel also have a solid company history and dozens of properties are registered in the name of their companies. With such “patrimony”, it would not be a problem to finance the three property acquisitions of “GS River” in Sofia”, for example through a loan. And they are three, because “GS River” has another very interesting deal with Lyubena Petrova.
Huge house in Boyana at a ludicrous price
In May 2020, “BND-Build New Day” acquired the company “GSB”. It bought from the previous owners the shares of “GSB” worth BGN 910,000. The main shareholder with 8,000 shares was Georgi Bazovski, who owns a commodity marketplace in the northwestern city of Vratsa. According to sources, he is a former Customs officer. BIRD reporter contacted Bazowski on his mobile phone. “I’m hardly that interesting to you. I don’t care, bye! ” – he ended the conversation after the reporter introduced himself and before listening to our questions.
The interest is however justified because the deal escapes any business logic. In fact, the capital of “GSB” consisted of three properties – a huge house with an area of 506 square meters in Boyana on 30A “Panorama” Road, a three-story neighboring house with an area of 270 square meters and another apartment on 20 “Petko Voyvoda” Blvd. with an area of 127 square meters. The BGN 910,000 paid by “Snow White” for the shares make the deal extremely profitable.
But that is not all. On October 9, 2020, the above-mentioned company “GS River” bought from “GBS” the smaller house in Boyana for BGN 860,565 or EUR 1,634 per square meter, which is line with the market prices for this area and for such property. The big house and the apartment remained in “Snow White’s” hands.
So, Lyubena Petrova officially paid BGN 910,000 for the three properties. Then she sold one of them for BGN 860,000. Thus, the investment melted down to BGN 50,000 and she received in return a house worth at least BGN 2 million and an apartment for at least BGN 200,000. After this lucrative deal, Lyubena also collected BGN 782,332 from the two apartments on “Svilenitsa” Street. The amount should be enough for new luxury furnishing of the huge house and the apartment.
A reasonable assumption can also be made that the officially declared amounts in the “GSB” deal have been fictitious. But paying the real market price of BGN 3 million for the three properties of “GSB”, would have revealed be a serious discrepancy between this price and the means of “BND – Build New Day”. For 2019, Lyubena Petrova’s company reported BGN 255,000 in deposits and BGN 579,000 in retained earnings, according to the data submitted to the Commercial Register (but not yet entered). On the other hand, the company does not have and has not had a single property to use as a collateral for an official loan for the remaining amount.
Unlike Lyubena, her husband Petyo “The Euro” Petrov has not been involved in real estate transactions for many years, neither in a personal capacity, nor through companies. While he was an investigator, he was a co-owner with 30% in the Vratsa company Lucky Commercial, which in 2015 went bankrupt due to loans to CCB. After leaving the judiciary in 2015, Petrov registered as a lawyer. Only on November 2, 2020, he officially returned to the business as a member of the Board of Directors of “GSB”.
Three cafes in Greece?
The properties listed above could turn out to be a drop in the bucket if Lyubena Petrova manages to cash in on Iliya Zlatanov’s properties in Sofia, the city of Smolyan, and the resort towns of Devin and Nessebar seized by private enforcement agents in her favor. So far, however, no public sale has taken place. BIRD contacted Iliya Zlatanov, who said that the group’s actions against him and his business continue with the support of the prosecutor’s office which was looking for an excuse to charge him with something.
Zlatanov’s revelations provoked strong public response and media interest but not an investigation by the prosecutor’s office, which actually emerged as the main protagonist in the criminal scheme. After a heated legal battle, Zlatanov managed to take possession of one of his elevator factories in Dupnitsa, but his factory in Sofia remains under the control of “Delta Guard”. According to Zlatanov, there is an ongoing seizure of the assets of the latter factory. An entire production hall had been turned into scrap, he complained in a video interview with BIRD, which will be broadcast next week.
Zlatanov also said he had come across information on three expensive properties in Greece associated with Lyubena Petrova. The first is a coffee shop on 1 “Eleftheriou Venizelou” Street, the main shopping in Thessaloniki. The name of Lyubena G (eorgieva) Petrova is listed in connection with this address both in the phone directory and in the public register of the establishments, where she is indicated as the owner of the cafe “Ritz” in Thessaloniki. Until 2016, the restaurant was called “Zogia”. In Google Street photos from 2019, the old name is still visible on the sidewalk enclosures in front of the restaurant.
Another address associated with Lyubena Petrova can be found in the phone directory of the Greek telecom operator OTE. This is a very expensive location, the coastal “Leoforos Nikis” or “Nikis” Avenue. Cafe “Ernest” is located on 13 “Nikis” Avenue.
The companies that run the Ernest and Ritz cafes are Greek-owned and have nothing to do with Lyubena Petrova. But they are tenants and do not own the premises, a search in the Thessaloniki property register showed. It also found that Lyubena Petrova is not listed as a property owner in Thessaloniki, however, the properties may have been purchased in the name of companies that are controlled directly or indirectly by her.
But Lyubena G. Petrova certainly cannot be present in an official phone directory if she has nothing to do with the ownership of the properties listed on the addresses in question. A third address associated with her names is found in the directory of the Greek city of Serres.
BIRD journalists and Greek colleagues called the numbers listed in the directory several times, but no one answered. Due to the epidemiological situation, it is not possible to carry out an on-site inspection.
Unfortunately, the Greek Commercial Register does not allow searches by company owner or director’s names. Thus, the disclosure of full information about possible property acquisitions of “Snow White” in northern Greece remains hidden from the public but this is hardly a difficult task for Greek law enforcement. In this case, there is sufficient grounds to probe the origin of the funds. The two prestigious commercial properties in downtown Thessaloniki are valued at a minimum of EUR 3,000 per square meter. With them, the fortune of “The Euro’s” wife swells by even more millions of inexplicable source.
/to be continued/
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