Attorney who filed RICO claim took $300,000 from Tsvetan Vassilev

The name of the fugitive banker is auspiciously absent from the list of defendants

Tsvetan Vassilev

At the end of January 2019 a case was filed with a district Court of New York under the US Racketeer Influenced and Corrupt Organizations Act (RICO) by three companies and the Varna lawyer Zahari Tomov against a total of 24 defendants. The dispute is over real estate in the Bulgarian city of Balchik and a project that never got off the ground – Silverbeach.

The lawsuit is against the Bulgarian National Bank, the former CorpBank conservators Stanislav Lyutov and Elena Kostadinchev, the Bank of New York Mellon, First Investment Bank, the businessmen Tseko Minev and Ivaylo Mutafchiev and lawmaker Delyan Peevski. An investigation conducted by the daily newspaper 24 Hours reveals who the lawyer who filed the claim really is.

What is noteworthy is the absence of Tsvetan Vassilev in the story described in the over 190-page claim, which involves real estate, loans, contracts, annexes, set-offs, cessions, bank accounts and Mexican bonds. His name should also be on the list of defendants. He is the alleged secret owner of the offshore company EFV International Financial Ventures Ltd., which is identified as one of the participants in the “conspiracy”. The claim does not even mention the fact that the fugitive banker is being tried for leading an organised crime group responsible for the embezzlement of CorpBank and that he has been hiding for over four years from the Bulgarian judicial system. Never mind that there is enough evidence, witness accounts, audit reports (including by the international consulting firm AlixPartners), a report by a special parliamentary committee and even a summary by the Prosecutor’s Office, saying that the “CorpBank model” represented a financial pyramid, which extended billions worth of loans to shell companied affiliated with Vassilev.

The suspicions that the former banker is behind everything are further increased by the fact that the RICO media campaign is eerily similar to that surrounding the Global Magnitsky Act claim, down to the mouthpieces voicing their opinions on the topic and the involvement of another Bulgarian lawyer – Sylvia Rolinski, who used to head the political cabinet of the late foreign minister Stoyan Ganev. She was part of his team at the time when Ganev was President of the 47th session of the United Nations General Assembly between 1992 and 1993.

The New York case is in its early stages – it is yet to be determined whether the claim is admissible on US territory (as it turns out a similar case was dropped in Texas and it did not feature the CorpBank accent, which means that the connection between the Balchik real estate case and the lender’s collapse was made up later) before it can be heard on its merits.

A friendship with a price tag of $300,000, however, reveals a clear connection between one of the claimants under RICO – Zahari Tomov – and the former CorpBank majority shareholder Tsvetan Vassilev. This tie could compromise the entire construct of the filing in front of the US court because it speaks to dependence and creates reasonable doubt that this claim, like the one under the Magnitsky Act, is serving the interests of Tsvetan Vassilev.

The only person on either side of the RICO case who has given a statement is the Varna attorney Zahari Tomov. Even though in his TV interview for Lyuba Kulezich (known to give platform to Tsvetan Vassilev’s side of the story only) the lawyer parroted the claim’s content, his words seemed as part of the RICO media scenario. Tomov’s filing with the US court omits an important detail – a likely attorney fee of $300,000, which later became a personal deposit in CorpBank in 2014.

Silverbeach was a project planned to cover a 100ha plot near Balchik and set to be realised by Air Property Development, which involves partial US ownership. The idea was for over $400m to be invested in the construction. A portion of the money was provided by First Investment Bank (FIB). However, the project fell through. The New York claim insists that the FIB loan was not used as intended and instead, in breach of regulations, was funneled into the purchase of Mexican bonds. Later, when it became clear that Silverbeach will not be come to fruition, neither banks nor US “investors” financed the project, Air Property Development entered bankruptcy proceedings and the land was sold by the bankruptcy administrator. The buyer was the main creditor – FIB – and the money it paid turned up in CorpBank later. Following the collapse of Tsvetan Vassilev’s CorpBank, the claim was sold by FIB to other companies, which reduced the amount of their own debt to the failed lender with it.  

Of everything described above, it becomes clear that the only victim of the scheme is probably FIB because the majority of the tens of millions of levs in real money it paid, practically twice over, has not been recovered. In his RICO claim attorney Tomov entirely skips both Tsvetan Vassilev’s and his own roles in the case.

Here is the chronological order of events. In 2008 CorpBank, at the orders of Tsvetan Vassilev, extended a €10m loan to Project Company Development AD, secured only by a mortgage on a 29.9ha of land of “wood-producing forest” near Balchik, owned by All Seas Property 2 OOD. The loan had to be repaid in just five months, but the term was extended via annexes multiple times, as was the mechanism so often used in the CorpBank pyramid. The managing director of All Seas Property 2 OOD at the time was Chavdar Angelov, now a defendant in the RICO case, while the company itself is a claimant (of course, the information about his involvement is also withheld from the US court).            

Although in her legal claim lawyer Silvia Rolinski maintains (as a proxy of Zakhari Tomov) that All Seas Property 2 is only an investor in the Silverbeach project it has been proved that the company participates, albeit indirectly, in a scheme aimed at diverting €3,5 m of the CorpBank depositors’ money. On 3 May 2011, Air Property Development company was declared insolvent (part of the land allocated for the construction of Silverbeach include those 29,9 ha mortgaged in favour of CorpBank) and, by that moment, the debt of Project Company Development to CorpBank ran at about €6m. On 22 June 2011, the bank of Tsvetan Vassilev transfers part of the debt (€3,5m) to Finance Engineering Company managed by Genadi Tabakov, ex-director of the Central Cooperative Bank where Vassilev worked as broker in 2000.

Finance Engineering is a firm connected with CorpBank, partner of Haskovo thermal power plant via one of Vassilev’s “safety fuse” companies, Aflik. In 2012 this debt was transferred to SEEK foundation LLC registered in Missouri, US whose proxy is lawyer Zakhari Tomov.  It turns out that another lawyer from Varna, Vladimir Skochev was also involved in the scheme, he was a proxy of Finance Engineering and partner of All Seas Property 2 until 2006. There are no documents for these two transfers which would confirm whether the price was really paid, be it in favour of CorpBank or Finance Engineering. From the annual reports of Finance Engineering it does not transpire that this company was a beneficiary of a loan worth BGN 7m from Vassilev’s bank. Its business activities does not envision revenues which could afford such transactions and, even if such payment was effected, it is possibly fictitious and the fact that the money originates from CorpBank is highly probable. On 20 February 2012, the bankruptcy administrator of Air Property Development enters SEEK Foundation LLC on the list of the mortgage creditors and at the beginning of 2013, Zakhari Tomov manages to get hold of a writ of execution for these recivables and files an executive suit (which makes the sum soar because of additional costs). As a final result, the receivable note worth of €3,5m is presented for payment to Ganka Kolyovska, bankrupt administrator of Air Property Development, who in turn includes SEEK Foundation LLC in the list of creditors and the initial allocation account made on 18 November 2013. Several days later, Kolyovska submitted a notice of resignation from the post of bankruptcy administrator and Martin Apostolov was appointed in her stead. Today, he is one of the defendants in the case of the organised criminal group charged with laundering CorpBank money.

Most probably the sum has been already paid to SEEK Foundation LLC during an earlier period and in violation of the rules for liquidated property from the insolvency mass. The doubts that it has happened raises a letter made available to 24 Hours newspaper by lawyer Zakhari Tomov addressed to private law-enforcement officer in Targovishte, Anelia Zagorova. The letter is dated 5 August 2013 and it reads that SEEK Foundation LLC agrees to be substituted as creditor on a foreclosure case by bankruptcy administrator of Air Property Development on the basis of effected payment of the insolvency mass to Air Property Development for payment of receivables by Project Company Development according to the levy of execution. It means that Zakhori Tomov, as a proxy to SEEK Foundation LLC, has received the sum. 

However, even if the millions have not been “absorbed” for some reason (the insolvency case of Air Property Development filed in the Targovishte regional court abounds in complaints of the affected parties) it suffices to say that the sum originating from CorpBank landed in a foreign company controlled by Zakhari Tomov and was duly entered on the list of accepted receivables (at that these were the privileged receivables secured by mortgage) as well as in the allocation account.             


Private meeting and the finale of a “well-done job”

It becomes clear what was the role of Tsvetan Vassilev several months later when one of his “safety fuse” companies Nikcommerce on 31 January 2014 provided a loan to lawyer Zakhari Tomov amounting to $ 300,000 or about 8% of the receivables realized by SEEK Foundation LLC. The account of Nikcommerce was “replenished” on 24 January 2014 by another company gravitating to Vassilev – Yulinor, again as a “loan”, as the origin of this money is from CorpBank proper. However, most probably it is a usual fee for the “salvation” of €3,5m which instead of being restored to the bank most likely were sent abroad where the sum was absorbed, and only Tomov and Vassilev know how. Zakhari Tomov deposited the received fee in the CorpBank as his private asset, it transpires from the list of depositors compiled by the bankruptcy administrators. According to the notorious “visitors books” of the banker, Tomov visited the office of Tsvetan Vassilev on 22 January 2014 which fully coincides with the chronology of $ 300,000 loan provision.

Now we are in 2019, and apparently time has come to return “the favour”. After the failure of Vassilev’s Magnitski affair the case with the property in Balchik is the ideal pretext for Vassilev to launch another media campaign. This time under the RICO Act. And if the core proceedings are started it is for sure that the US prosecutors office of the State of Missouri where SEEK Foundation LLC is registered would show interest and check whether the money - the abovementioned €3,5m from the CorpBank financial pyramid - was laundered on the US territory in the manner described above. It is not clear if this “petty affair” involving several millions was simply “overseen” on the background of the vanished billions featured in the suit which has been already brought against Tsvetan Vassilev in the Specialized Criminal Court.   



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