After Bulgarian authorities have shown the ability to effectively manage European Union pre-accession funding, which resulted in numerous suspicions that the money was being embezzled, the European Commission (EC) would suspend the right of two Bulgarian Government agencies to allocate any financing under the Phare programme, Bulgarian National Television (BNT) reported on July 17.

Quoting a draft version of the EC interim report on Bulgaria's efforts to fight organised crime and corruption, which commissioners are scheduled to vote on when they next meet on July 23, BNT said that the two agencies were the Phare executive agency with the Regional Development and Public Works Ministry and the Central finance and contracts unit of the Finance Ministry.

The total amount of money that would be be affected the move more than 610 million euro, including 250 million that was yet to be allocated to projects. Furthermore, the Commission was ready to investigate the projects that have fully spent the money that they were allocated and ask for a refund if any wrongdoing is found, BNT said.

The draft version of the EC report said that Bulgaria's administrative capacity was weak and that there were strong suspictions of fraud and conflict of interest in awarding of money. Furthermore, there appeared to be no political will to eradicate fraud, while the lack of tangible results in the fight against corruption was causing serious concerns, BNT said.

Investigations by the Eurropean Anti-Fraud Office (OLAF) found that Bulgarian judges would break down court cases into several new ones, which slowed down court proceedings and complicated investigations, the draft document went on to say. There were suspitions that confidential information was leaked under pressure from organised crime.

In its conclusions, the draft report said that low wages in the state administration made it susceptible to corruption; there was no political will to eradicate fraud; there were no results in combatting corruption in the high echelons of administration or organised crime, all of which were cause for concern, BNT said.

The leaked draft report comes just two days after an Olaf letter to Deputy Prime Minister in charge of EU funds spending Meglena Plougchieva was leaked. The letter had allegations of a powerful criminal network involved in sundry crimes, including abuse of EU funds. Among the allegations was that an individual involved in the criminal network had donated to President Georgi Purvano'v re-election campaign.

Purvanov broke silence on the issue on July 17, when he hosted a meeting of the consultative council on national security. In a statement posted on the presidency's website he said that the Olaf letter did not uncover any facts that were not known before.

"All donors are recorded down to the last man and last lev in the report of the Audit Office," Purvanov said. "Each of them had signed a declaration that they meet the legal requirements. The campaign staff did not use and could not use any mechanisms other than those stipulated by law to ascertain the honesty of campaign contributors," he said.

"I think that based on facts, the State Agency for National Security should clarify to what extent Olaf's statement that 'there are influential forces in the Bulgarian government and/or Bulgarian authorities, who are not interested in punishing anyone,' is grounded," Purvanov said.

"I want the competent institutions to take all the measures to guarantee full transparency and control in the process of applying and using European Funds. In this respect there should be no one who is untouchable," he said.