Tzvetan Vassilev: Bulgaria’s Magnitsky?

Russia’s Tragic Precedent

When Sergei Magnitsky, a courageous Russian whistleblower, was left to die, beaten to death, between the walls of his cell in Moscow’s bleak Butyrka prison in 2009, his story of integrity and staunch resistance to Russia’s legendary corruption taught the world a powerful lesson. Such endemic corruption intimately corrodes the accountability of public institutions and leaves no space for the protection of the rights of the individual. Responsible for discovering and denouncing an elaborate fraud scheme orchestrated by the government to crush internal dissent, Magnitsky was denied access to all legal remedies during his illegal detention. His politically motivated persecution implicated corrupt state officials who continue to live in Russia with impunity–though they remain under sanction thanks to the pioneering US Magnitsky Act.

State-directed practices of victimization of political opponents endure in countries plagued by comparable, widespread corruption–especially those such as Bulgaria, historically subjected to Russia’s sphere of influence yet caught in tension between their economic dependence and longstanding political ties with Russia and their cherished NATO and European memberships. A member of the United Nations which also subscribes to a number of European and international conventions for the protection of human rights, Bulgaria continues to be regularly labeled as the most corrupt nation within the EU and is annually called out for its shameful human rights record and deteriorating environment of economic and political freedom. Just like in Russia, Bulgarian institutions fall captive for the aggrandizement of dominant–and unaccountable–financial and political interests.

The Case of Tzvetan Vassilev

Tzvetan Vassilev’s case returns a dismal, granular picture of autocratic rulers in a nominal democracy plagued by pervasive corruption and dominated by a Bulgarian mafia with its systematic abuses of state authority harking back to the fall of Communism. Vassilev is a prominent business leader and a highly influential figure in Bulgaria who over the past several years has faced egregious hardship triggered since he announced support for an anti-corruption party in 2013-2014. His demise accelerated when he refused to comply with the illicit requests of a political mobster, and peaked when he loudly protested against the illicit takeover of his bank and forced liquidation of its assets. Vengeful political leaders in collusion with entrepreneurs who maneuvered the media and co-opted the courts imposed a classic Soviet-style corporate raiding scheme aimed to definitively silence his voice – with scarce success. Vassilev continues from Serbia, where he and his wife Antoaneta are seeking asylum, to fight to have his voice heard. Meanwhile, Bulgarian authorities remain committed to obtaining his extradition, in a final effort to come full circle with the financial and personal destruction of an influential opponent of Bulgaria’s corruption and state-led corporate raiding machinations.

As an anti-corruption critic of the Bulgarian regime who has endured persecution based on fabricated charges, Vassilev stands as a salient example of injustices enumerated in the so-called Global Magnitsky Act. In 2016 President Barack Obama extended the Russia-specific sanctioning authority of the U.S. government granted under the Magnitsky Act to all countries worldwide where government sanctioned political oppression and retribution against opponents of corruption, and other victims of human rights violations, are validated. The Richardson Center is honored to align itself with Tzvetan Vassilev’s pursuit of justice against the kind of corrupt repression that I personally and the Richard Center have been fighting throughout my diplomatic career.

Why Tzvetan Vassilev?

Tzvetan Vassilev became an especially unwanted opponent of the Bulgarian government when he stood up in support of a newly constituted anti-corruption and anti-bribery political platform, Bulgaria without Censorship, in 2013-2014. In April 2014, he refused to transfer assets for free to the criminal network operating within DPS, an influential political party in Bulgaria. For years, Tzvetan Vassilev was targeted by allegations directed to undermine his credibility sparked by the Bulgarian State Prosecutor who was in league with a prominent Member of the Parliament and media mogul. The Member of Parliament initiated a pattern of conduct best characterized under U.S. law as extortion, demanding illegal payments from Vassilev. Naturally, Vassilev’s resistance encouraged sustained state-directed efforts to conclusively address his non-complicit conduct. A run on his bank, CorpBank (or CCB), the fourth largest bank in the country, was the price he would pay for interfering in the mafia’s plan to destabilize and secure control of the country’s financial system and government, he was told.

In June 2014, speculations that Tzvetan was involved in high profile criminal enterprises were ignited and amplified by the media, causing CorpBank to lose 20% of its assets within a week. Shortly after, the CCB management faced a catastrophic bank run precipitated by the Bulgarian central bank’s unorthodox refusal to concede even a routine liquidity injection. Moving away from consolidated European and Bulgarian banking praxis, the regulatory institution made no efforts to placate panicking investors, nor did they seek EU assistance while dealing with CCB’s liquidity crisis. CCB was deliberately weakened, forced into liquidation. Control of the bank was assumed by Bulgaria’s central bank and most of its assets were expropriated by political cronies, parsed out among favored loyalists. Other companies owned by Vassilev, whether directly or indirectly through CCB, were sold off for a fraction of their market value in the course of the politically engineered bankruptcy.

Fabricated Charges: Exacting Retribution Through the Media

In a country long known for ubiquitous corruption, rumors – not proven criminal charges – appear to suffice to originate corporate raiding schemes.  State prosecution in Bulgaria – which has been described as Soviet-style repressive – has established a documented track record of visibly bizarre charges. Many of the accusations leveled against Vassilev were scurrilously leaked to the media in time to meet evening news deadlines. Notably, this pattern includes a charge of conspiratorial murder against Vassilev that was withdrawn by the prosecutor who announced with embarrassment that the purported plot was nonexistent. However, the charge that so far remains accuses Vassilev of having stolen cash from CCB which he allegedly carried out of the bank and across Sophia in plastic bags on a day when, in reality, he was out of the country.

Eventually, Bulgaria’s central bank’s version of the charges against Vassilev, which the institution unfolded in an attempt to justify its non-intervention in rescuing the bank, abruptly changed. In 2014, the central bank claimed Vassilev had drained funds over several years through a complex structure of legal entities which he intended to exploit to finance acquisitions for his personal benefit. Preposterous allegations were floated that Vassilev had absconded with 1.78 million Euros in his role as head of an organized crime ring operating out of CCB that corrupted bank employees and auditors.

The Price for Unrelenting Integrity

Since June 2014, when Vassilev left Bulgaria for Austria on a routine business trip, he has been unable to return to his homeland. Falsely accused of embezzling 103.5 million Euros from CCB, he faces an Interpol Red Notice that calls on member nations to place him in custody. Because of the repressive nature of many politically motivated Red Notice requests, many member nations refuse to honor them. Serbia is one such country. The same scenario applies to his wife Antoaneta, who has been charged in an equally baseless Bulgarian case with laundering funds from her husband’s embezzlement to purchase a home in Switzerland.

From Serbia, the couple strives to retain their freedom to fight back against groundless accusations that ballooned into farcical criminal charges. The Vassilevs’ assets remain frozen in Bulgaria and Lichtenstein, severely compromising their freedom of movement as they now live essentially stateless in Serbia.

Seeking Justice through the Global Magnitsky Act

I am confident that the factual basis of Vassilev’s victimization as well as of Bulgarian officials’ serial misconduct should arouse the interest of U.S. authorities. The Bulgarian government’s attempts to violently suppress dissent and political opposition have thrived amidst the country’s leadership’s obstinate culture of corruption and passive attitude toward institutional reforms–a signal failure of commitment to protect basic human rights. The U.S. remains determined to assist efforts of people around the world to oppose such abuses and establish vibrant democracies.

Two state officials played a decisive role in the Vassilevs’ story and thus appear eligible for sanctions under provisions of the Global Magnitsky Act: the above mentioned media oligarch who doubles as a Member of Parliament, the ultimate strategist behind the State-led war against the Vassilevs; and an executive prosecutor who has consistently abused his office to serve contingent political interests and leaked false charges to the press owned by the aforementioned media oligarch.

Many other citizens – including CCB employees, partners, and clients – have suffered from serious threats and the loss of professional positions for protesting Vassilev’s victimization engineered by Bulgaria’s corrupt authorities. Several individuals only tangentially involved in the bankruptcy and criminal proceedings were targeted and publicly discredited when they refused to align with the state-led campaign to crush him. Journalists who covered the bank run were charged for merely offering positive comments on CCB management.

President John F. Kennedy taught us that if one person is oppressed, all people cannot be considered free. Political retribution anywhere in the world is a salient threat to democratic freedoms everywhere. So long as corruption remains unchecked, it spreads like an especially virulent form of cancer. I have faith that the so far unused provisions of the Global Magnitsky Act can pave the way to justice for those afflicted and make the democratic process prevail even in those states which are failing in their commitment to the protection of human rights against all forms of oppression.