{"id":1873,"date":"2020-10-14T18:22:52","date_gmt":"2020-10-14T16:22:52","guid":{"rendered":"https:\/\/bird.bg\/eusubsidies-turkstream\/"},"modified":"2023-04-06T18:08:12","modified_gmt":"2023-04-06T16:08:12","slug":"eusubsidies-turkstream","status":"publish","type":"post","link":"https:\/\/bird.bg\/en\/eusubsidies-turkstream\/","title":{"rendered":"Fictitious Project: Construction Equipment Funded with EU\u2019s \u2018Innovation\u2019 Millions Pops Up on TurkStream 2"},"content":{"rendered":"

Dump trucks and wheel loaders for BGN 1.5 million paid under the EU program “Innovation and Competitiveness” had not been used as intended for nearly two years only to pop up on the construction site of TurkStream 2. The firm that received the generous subsidy appears to be a shell company. To absorb European Union (EU) funding, it has declared that it owns a production facility that actually belongs to a large construction company known for violations in carrying out EU projects, an investigation by BIRD with the help of the Civil Association BOETS (Fighter) established.<\/p>\n

The information that brand new construction equipment purchased under a European project is used at the construction site of the TurkStream 2 (which Bulgarian rulers prefer to call Balkan Stream) gas pipeline became public last Saturday, October 10.\u00a0Then activists of BOETS, Green Mladost, other civil society organizations and the political party Yes Bulgaria traveled to the construction site to protest against the gas pipeline.<\/p>\n

\"\"
Brand new truck with Pernik license plate Photo: BOETS<\/em><\/figcaption><\/figure>\n

The protest was organized just days after BOETS filmed construction works at the site, showing the presence of representatives of a Belarusian company and Russian and Belarusian workers.\u00a0No Bulgarian workers or experts were seen there.<\/p>\n

But demonstrators noticed on 10 October several dump trucks, excavators and loaders with Bulgarian license plates near the trenches where the pipes are being laid.\u00a0The dump trucks looked brand new and were marked with signs for financing under European project BG16RFOP002-3.001-0252-C01.\u00a0Photos\u00a0published<\/a>\u00a0by BOETS on Facebook show that the dump trucks are registered in the western city of Pernik.<\/p>\n

The construction equipment was just parked at the site during the weekend, but BOETS activists visited it again on Monday, October 12 and filmed the dump trucks being loaded with bags filled with dirt. The bags were unloaded a few kilometers away and there the dirt was laid as padding underneath the pipes.\u00a0A wheel loader with Pernik license plates also took part in the process.\u00a0The very organization of such a movement of earth masses is puzzling because there is plenty of the same dirt around the pipes.<\/p>\n

\"\"
Loader filmed working at the site.\u00a0The trucks and the loader are the Caterpillar brand and are supplied by Eltrak, as the inscriptions show.\u00a0Photo: BOETS<\/em><\/figcaption><\/figure>\n

\u201cEnergy efficiency\u201d equipment sits on the back burner for two years<\/strong><\/h2>\n

Research by the Bureau for Investigative Reporting and Data (BIRD) showed that this equipment had been purchased by the company Verda-008, incorporated in Pernik, with money from the EU\u2019s Innovation and Competitiveness Operational Program.\u00a0The contracts date from 2018. The total value of the European project is BGN 2,131,955.94. The company has provided BGN 638,086.79 in own financing.\u00a0The remaining BGN 1,493,869.15 came from Brussels.<\/p>\n

The origins of the provided by Verda 008 substantial own financing are unclear since the company has posted very modest profits, as evidenced by Bulgarian registries.<\/p>\n

\"\"<\/p>\n

The company registered to one Petar Petrov from Pernik has not published email address or phone number for contact, as such are missing in the project documentation in the Information System for Management and Monitoring of EU Funds in Bulgaria (EUMIS).<\/p>\n

The following machines have been purchased under this project – one modular rotary crusher, one wheel loader, two mini wheel loaders, one hydraulic excavator and two articulated dump trucks.\u00a0The articulated dump trucks and one of the mini front wheel loaders purchased by Eltrak were seen at the construction site.<\/p>\n

\"\"Each of the dump trucks cost BGN 490,522 and the cost of one mini wheel loader is BGN 78,600, according to the price offer.<\/p>\n

The contract for the dump trucks and the wheel loaders was signed on March 12, 2018. But from the dump trucks brand new exterior it can be concluded that they have not been used at all for construction until now.<\/p>\n

\"\"
The delivery contract was signed between Eltrak and Verda-008 in March 2018<\/em><\/figcaption><\/figure>\n

This fact contradicts Verda-008’s plans to use the technique to \u201censure a continuous cycle of operation of the modular rotary crusher<\/em>\u00a0provided for in the project\u201d<\/em>, which\u00a0required<\/em>\u00a0\u201cregular supply of raw materials and \u00a0transport of finished products<\/em>\u201d, as recorded in the\u00a0project<\/a>\u00a0at the time of its submission in 2017.<\/p>\n

\u201cCurrently, the company uses external transport services that are irregular, expensive and inefficient.\u00a0This leads to non-fulfillment of the ordered volumes of excavated materials and delays in the execution of the construction sites<\/em>,\u201d Verda-008 explained.<\/p>\n

The reason for seeking funding under the EU Innovation Program was the need to \u201cincrease the energy efficiency of the production<\/em>\u201d because the crusher is modern and optimized and dump trucks and loaders have low fuel consumption monitored by electronic systems.<\/p>\n

No such production site<\/strong><\/h2>\n

There is an explanation of the mystery of why\u00a0the dump trucks have not been used\u00a0in the said \u201ccontinuous production process<\/em>\u201d that is very scandalous. Verda-008 does not have a production facility described in the project\u2019s documentation where the equipment should be operating.<\/p>\n

It is written there that \u201cthe\u00a0modular rotary crusher will be installed in a\u00a0production facility in the village of Belotintsi<\/strong>\u201d, <\/em>while the loaders \u201cwill supply the container of the modular rotary crusher with primary and secondary crushed aggregates to ensure a continuous production cycle and it will operate\u00a0only within the production site<\/strong>\u00a0of Verda-008 Ltd\u201d. <\/em>(Emphasis added by the author).\u00a0The dump trucks were to \u201censure a continuous cycle of operation of the modular rotary crusher provided for by the project<\/em>\u201d.<\/p>\n

The fact that the wheel loader is used not only within Verda-008 production facility but kilometers from it, at the site of TurkStream 2, in itself points to violations of the objectives and the subject of the EU project.\u00a0But what is even more scandalous is that the concrete and asphalt production facility in the village of Belotintsi, Montana Region, has nothing to do with Verda-008 and belongs to the company Caro Trading Ltd.<\/p>\n

Representatives of BOETS talked with the mayor of the village, who had not heard anything about Verda-008.\u00a0They visited and photographed Caro Trading\u2019s site, an asphalt and concrete manufacturing facility. No one at the site wished to assist them in clarifying the participation of Verda-008 in Caro\u2019s activities (see\u00a0video<\/a>).<\/p>\n

It is noteworthy that Caro Trading has also received\u00a0European funding<\/a>\u00a0of BGN 1,428,674.86 under the same program for similar machines – crushers and loaders, but not for dump trucks.\u00a0The description of the activities in Verda-008 and Caro Trading projects is carbon copy with the only differences being the characteristics of the specific machines.\u00a0This is also quite strange because the projects\u2019 consultants have not been the same ones.<\/p>\n

Construction company Caro Trading is one of the medium-sized firms in the construction industry and is owned by\u00a0Bozhidar Roev and Krassimir Karaivanov<\/strong>.\u00a0It has won\u00a0public procurement contracts<\/a>\u00a0for nearly BGN 350 million, of which BGN 244 million are EU funding, according to BIRD\u2019s database registries.<\/p>\n

Caro Trading was involved in a scandal with a 5km rural road\u00a0to the mountain resort of Panichishte financed under the EU Rural Development Program (RDP) with BGN 5,394,108.36 or BGN 1 million per kilometer.\u00a0The \u201ccommission\u201d for the mayor of the nearby town of Sapareva Banya had been 40% of this amount, insiders told the site for investigative journalism Bivol in 2016.<\/p>\n

Bivol\u2019s investigative journalist Dimitar Stoyanov found then that to achieve this \u201ccorruption target\u201d, the construction had been of poor quality with replacement of materials listed in the project with cheaper ones. The prosecution launched an investigation into the case but its fate is unclear.<\/p>\n

One of the owners of Caro Trading, Krassimir Karaivanov, is well-known in Sapareva Banya.\u00a0Years ago, the municipality sold him the \u201cZdravets\u201d mountain lodge for BGN 390,000 which he turned it into a luxury hunting estate.\u00a0Karaivanov also owns hunting grounds in the area.<\/p>\n

Fictitious project but with real profits?<\/h2>\n

From the presented so far facts, one can reasonably assume that the “innovative” European project of Verda-008 is fictitious and has aimed to purchase new construction equipment through a fictitious company not to advance energy efficiently production of excavated materials but to simply rent the machines.<\/p>\n

Inflated prices of construction equipment rentals are among the known theft schemes while all the prerequisites for abuses are present in the case of the mega-project TurkStream 2.\u00a0The site costs the Bulgarian taxpayer the exorbitant BGN 4 billion.\u00a0Officially, the money has been given to the Saudi company Arkad but the actual builder is the Russian company IDC.\u00a0On the one hand, the Russians hire cheap subcontractors and workers from Belarus, and on the other, they use expensive new equipment from a shell Bulgarian company.<\/p>\n

\"\"
BOETS placed a European flag on the site of Turk Stream 2 but it was gone two days later<\/em><\/figcaption><\/figure>\n

Thus, if in the end, TurkStream 2 fails to materialize because of US sanctions, the money will at least go into the pockets of the \u201cright\u201d shell companies and the “good and loyal people” behind them.\u00a0And it will happen with the generous EU facilitation and guarantees for quality and energy efficiency.<\/p>\n","protected":false},"excerpt":{"rendered":"

Warning! This is an automatic translation from Bulgarian. The translation has not been checked by the editor desk and may be inaccurate or ambiguous. The publisher endorses only the Bulgarian version of the article.<\/p>\n","protected":false},"author":2,"featured_media":1827,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_crdt_document":"","_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"_wpas_customize_per_network":false},"categories":[67],"tags":[149,113,150,142,138,139,140,141,143,144,148,147,151,152],"coauthors":[201],"class_list":{"0":"post-1873","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","6":"hentry","7":"category-investigations-en","8":"tag-abuses","9":"tag-balkan-stream","10":"tag-caro-trading","11":"tag--en","12":"tag---en","13":"tag--008-en","18":"tag-eu-funds","19":"tag-european-projects","20":"tag-theft","21":"tag-turkstream-2"},"acf":[],"yoast_head":"\nFictitious Project: Construction Equipment Funded with EU\u2019s \u2018Innovation\u2019 Millions Pops Up on TurkStream 2 | BIRD<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/bird.bg\/en\/eusubsidies-turkstream\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Fictitious Project: Construction Equipment Funded with EU\u2019s \u2018Innovation\u2019 Millions Pops Up on TurkStream 2\" \/>\n<meta property=\"og:description\" content=\"Warning! 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