Bulgaria's new interim government finds many irregular defense contracts

SOFIA (Reuters) - Bulgaria’s new interim government has found that over half the defense procurement contracts signed last year were irregular and is examining nine of them on suspicion of fraud, its prime minister said on Friday.

The government launched checks at ministries it took over last month from center-right GERB-led coalition that resigned after its candidate lost the presidential election in November.

Corrupt procurement practices are rife in Bulgaria’s public sector. Despite declared political will by different governments since the fall of communism in 1989, little has been done to sever cozy ties between business and politicians.

Prime Minister Ognyan Gerdzhikov said 45 out of a total of 82 defense ministry contracts signed last year breached Bulgarian public procurement law and regulations.

“For nine procedures, indications for fraud and other serious shortcomings were established and they have been sent to the military prosecutors,” he told reporters. He declined to give details of the contracts.

Bulgaria ranks as the most corrupt EU member state on the Transparency International Index for 2016. Its failure to crack down on graft keeps it out of the bloc’s passport-free Schengen area and scares away investors.

Prosecutors have already charged former defense minister Nikolay Nenchev with misuse of his office for failing to implement a contract with Russia for the repair of its Soviet-era fighter jets.

They have also charged Nenchev for exerting pressure on a subordinate linked to a public procurement order for army uniforms that resulted in losses of about 250,000 levs ($136,203) to the ministry’s budget. He denies any wrongdoing.

Gerdzhikov said the review had also found weaknesses and delays in procurement at other agencies and ministries, which may put at risk inflows of European Union aid for regional development and for asylum and migration.

Reporting by Tsvetelia Tsolova; Editing by Tom Heneghan