MINISTRY OF FINANCE NATIONAL CUSTOMS AGENCY Seminar Addressing the links between Organized Crime and Corruption 27 February – 1 March 2013, Blagoevgrad Plamen Velkov – chief expert, Customs Intelligence and Investigation Directorate, National Customs Agency

The prevention of and counteraction to the corruption and the maintenance of highly professional standards and integrity of the customs officers is a priority objective of the National Customs Agency. In this respect the Agency follows a zero tolerance policy towards any acts of corruption or any other illegal actions of the officers. The measures applied along these lines cover all aspects of the administrations activity – from the selection and appointment of new officers, initial and subsequent training, the control carried out by the managers at all levels in the Agency on the activity of their subordinate officers, to carrying out internal inspections and conducting disciplinary proceedings. PREVENTION OF AND COUNTERACTION TO CORRUPTION

ORGANIZATION AND CONTROL OF LEGAL REQUIREMENTS FULFILLMENT According to Article 10, par. 6 of the Customs Act upon their appointment, discharge and annually until 31. May the customs officers are obliged to declare the properties owned by them and the properties owned by their familys members. According to Article 10, par. 6 of the Customs Act upon their appointment, discharge and annually until 31. May the customs officers are obliged to declare the properties owned by them and the properties owned by their familys members. Upon their appointment the customs officers shall lodge a declaration regarding the circumstances under Article 10, par. 1 and 2 of the Customs Act /the customs officers are not allowed to act as sole traders, to sign additional employment agreements, to have a hierarchical relation of management and control with their husband or wife or direct line of descent relatives/. Upon their appointment the customs officers shall lodge a declaration regarding the circumstances under Article 10, par. 1 and 2 of the Customs Act /the customs officers are not allowed to act as sole traders, to sign additional employment agreements, to have a hierarchical relation of management and control with their husband or wife or direct line of descent relatives/. The customs officers shall also lodge a declaration according to the Conflict of Interest Prevention and Ascertainment Act. The customs officers shall also lodge a declaration according to the Conflict of Interest Prevention and Ascertainment Act. Upon their appointment the customs officers shall sign a declaration providing that they are aware of the standards of the Customs Officer behavior Code /approved by the Minister of finance/ and in case of non-observance of the standards the officers bear disciplinary responsibility. Upon their appointment the customs officers shall sign a declaration providing that they are aware of the standards of the Customs Officer behavior Code /approved by the Minister of finance/ and in case of non-observance of the standards the officers bear disciplinary responsibility.

STRUCTURAL REFORM As a result of the reform carried out in the period the structure of the National Customs Agency was optimized as the number of customs officers appointed was reduced from 4003 to As a result of the reform carried out in the period the structure of the National Customs Agency was optimized as the number of customs officers appointed was reduced from 4003 to A whole level of the structure was removed – the Regional Customs Directorates. A whole level of the structure was removed – the Regional Customs Directorates. The number of Customs Houses was reduces from 17 to 10. The number of Customs Houses was reduces from 17 to 10. In order to improve the management of human resources and to prevent and counteract to corruption 2 new departments were created in Organization and Management of Human Resources Directorate, Central Customs Directorate – Methodology, Selection and Career Development Department and Professional Standards and Internal Investigation Department which took over the functions of the Inspectorate of the National Customs Agency closed since 1. September In order to improve the management of human resources and to prevent and counteract to corruption 2 new departments were created in Organization and Management of Human Resources Directorate, Central Customs Directorate – Methodology, Selection and Career Development Department and Professional Standards and Internal Investigation Department which took over the functions of the Inspectorate of the National Customs Agency closed since 1. September This structural changes had a double effect – the distance between the management of the Agency and the executive officers was shortened and the available financial resources were used for the purpose of increase of the individual salary of the officers in order to ensure higher life standard as an additional anti-corruption measure. This structural changes had a double effect – the distance between the management of the Agency and the executive officers was shortened and the available financial resources were used for the purpose of increase of the individual salary of the officers in order to ensure higher life standard as an additional anti-corruption measure.

OPERATIONAL MEASURES In the middle of 2010 HCS Integrity Check was introduced for selection of the staff in the National Customs Agency in order to limit the corruption practices in the system. This check could identify if a job applicant or an official tends to commit insignificant or serious offences of the regulations and the discipline. In the middle of 2010 HCS Integrity Check was introduced for selection of the staff in the National Customs Agency in order to limit the corruption practices in the system. This check could identify if a job applicant or an official tends to commit insignificant or serious offences of the regulations and the discipline. The training course of the newly appointed officials includes a module related to the prevention of and counteraction to corruption and other illegal actions of the staff, as well as conflict of interest. Training in this matter is also organized for the rest of the staff, also by the Institute of Public Administration. The training course of the newly appointed officials includes a module related to the prevention of and counteraction to corruption and other illegal actions of the staff, as well as conflict of interest. Training in this matter is also organized for the rest of the staff, also by the Institute of Public Administration. New Guidelines for establishment of disciplinary offences and conducting of disciplinary proceedings in the National Customs Agency are elaborated and introduced. New Guidelines for establishment of disciplinary offences and conducting of disciplinary proceedings in the National Customs Agency are elaborated and introduced.

OPERATIONAL MEASURES Internal verifications and investigations are carried out regarding alerts for possible irregularities committed by customs officers received in the Agency; Internal verifications and investigations are carried out regarding alerts for possible irregularities committed by customs officers received in the Agency; Disciplinary proceedings are started and conducted against officers who have committed disciplinary offences. Where data on offences committed by customs officers is established, competent authorities shall be informed; Disciplinary proceedings are started and conducted against officers who have committed disciplinary offences. Where data on offences committed by customs officers is established, competent authorities shall be informed; Internal verifications on the property of customs officers are carried out; Internal verifications on the property of customs officers are carried out; The activity of customs officers is subject of a daily control; The activity of customs officers is subject of a daily control; Constantly, working meetings on prevention of and counteraction to corruption are organized in all Customs Houses with the participation of officials from Professional Standards and Internal Investigations Department at the Organization and Management of the Human Resources Directorate, Central Customs Directorate. Constantly, working meetings on prevention of and counteraction to corruption are organized in all Customs Houses with the participation of officials from Professional Standards and Internal Investigations Department at the Organization and Management of the Human Resources Directorate, Central Customs Directorate.

OPERATIONAL MEASURES Anonymous inquiries are being carried out on travelers and carriers crossing through the Border Crossing Points, as well as on business sector representatives (also representatives of NGOs take part to the inquiries – e.g. Transparency International - Bulgaria). The purpose is to obtain information regarding the activities of the customs administration, including if any corruption practices. Anonymous inquiries are being carried out on travelers and carriers crossing through the Border Crossing Points, as well as on business sector representatives (also representatives of NGOs take part to the inquiries – e.g. Transparency International - Bulgaria). The purpose is to obtain information regarding the activities of the customs administration, including if any corruption practices. An electronic Work Place Determination System was introduced at the Customs Border Crossing Points. The system rotates the operational customs officers at different work places – monthly the officers shift changes and at the beginning of each shift the officers are being randomly allocated at different work places. An electronic Work Place Determination System was introduced at the Customs Border Crossing Points. The system rotates the operational customs officers at different work places – monthly the officers shift changes and at the beginning of each shift the officers are being randomly allocated at different work places. On the web site of the Agency there is a hotline and indicated in order to receive alerts related to possible illegal acts of customs officers. Post boxes for alerts and recommendations are located at visible place in each Customs Office. On the web site of the Agency there is a hotline and indicated in order to receive alerts related to possible illegal acts of customs officers. Post boxes for alerts and recommendations are located at visible place in each Customs Office.

RESULTS ACHIEVED During 2012 a total number of 139 controls and internal investigations were carried out. As a result 60 disciplinary punishments were imposed on customs officers including 22 dismissals. Incompatibility with regard to Article 10 of the Customs Act was established regarding 14 customs officers. The employment relationships/contracts with them were respectively terminated. Property checks of 16 customs officers were carried out. In one of the cases the National Revenue Agency was approached in order the relevant verification to be carried out. Regarding one of the files the Commission for Prevention and Ascertainment of Conflict of Interests was approached. Providing for that there was data available about committed crimes, 9 alerts were sent to the Prosecutors Office as the customs authorities have no powers to investigate crimes related to Criminal Code when the crime has been committed by an official in direct connection with the customs service. Natural and legal persons sent 28 messages about customs officers illegal acts by the hotline for receiving of alerts. In all of the cases the relevant actions were undertaken.

During 2012 a total number of 232 persons crossing through the customs points Lesovo and Malko Tarnovo were inquired for the purposes of completion of the tasks laid down in the six-months Schedules of governments and judicial authorities urgent measures and activities on covering the progress criteria in the areas of judicial reforms, fight against corruption and organized crime. The results of these inquiries give reasons to be considered that at the customs points there are no corruption practices associated with the activity of the customs administration, but it is necessary the relevant managers – heads of customs points and shift leaders to carry out constant control on the activities of their subordinates. RESULTS ACHIEVED

LEGISLATIVE, ADMINISTRATIVE AND ORGANIZATIONAL MEASURES ENSURING PARTICULAR RESULTS LEGISLATIVE, ADMINISTRATIVE AND ORGANIZATIONAL MEASURES ENSURING PARTICULAR RESULTS During the last several years significant investments were made in order to ensure the necessary technical equipment and modernize the available technical means; Two fixed systems for container scanning were bought for Varna and Burgas ports; Two of the available x-ray systems allocated at the EU external land frontiers were modernized; 6 high energy mobile x-ray systems were provided. Two of them are located at EU external borders and 4 are located on the main roads in the country;

Location of X-RAY systems by Customs Houses Location of X-RAY systems by Customs Houses HCVM HCVM Cab 2000A THSCAN MT1213 DE HCVM HCVPHCVP SScan M300 ZBV HCVM THSCAN MT1213 DE Cab 2000A

In relation to the investigating customs inspectors activities 10 specialized mini-busses were bought and for the purposes of the operational control at the Customs Houses 30 high road-ability vehicles were provided; In relation to the investigating customs inspectors activities 10 specialized mini-busses were bought and for the purposes of the operational control at the Customs Houses 30 high road-ability vehicles were provided; Six customs dogs were trained to detect tobacco products at the Customs Canine training school in town Balchik; Six customs dogs were trained to detect tobacco products at the Customs Canine training school in town Balchik; 24/7 coordination centers were created at central and territorial level, as well as X-ray systems units where officers with technical education had been appointed; 24/7 coordination centers were created at central and territorial level, as well as X-ray systems units where officers with technical education had been appointed; Customs Intelligence and Investigation divisions are equipped with modern means for surveillance and control. The operational units are provided with GPS devices and the coordination centers carry out real time surveillance. Customs Intelligence and Investigation divisions are equipped with modern means for surveillance and control. The operational units are provided with GPS devices and the coordination centers carry out real time surveillance. LEGISLATIVE, ADMINISTRATIVE AND ORGANIZATIONAL MEASURES ENSURING PARTICULAR RESULTS LEGISLATIVE, ADMINISTRATIVE AND ORGANIZATIONAL MEASURES ENSURING PARTICULAR RESULTS

Technical equipment and customs dogs.

The newly appointed officer undergo a seven-months training course, as well as different specific trainings depending on the tasks performed by them /X- Ray systems courses, work in operational teams, sample taking etc. The newly appointed officer undergo a seven-months training course, as well as different specific trainings depending on the tasks performed by them /X- Ray systems courses, work in operational teams, sample taking etc. As of April 2013 a new information system will be functional – Bulgarian Centralized Excise Information System. It combines the functionalities of all existing systems in the excise area and allows automation of all business processes and enhances the electronic exchange with the trade sector. As of April 2013 a new information system will be functional – Bulgarian Centralized Excise Information System. It combines the functionalities of all existing systems in the excise area and allows automation of all business processes and enhances the electronic exchange with the trade sector. The human factor will be significantly reduced by achieving high level of automation of the administration and control of the excise goods related activities. This is an important condition for the limitation of the corruption pressure on the business. The human factor will be significantly reduced by achieving high level of automation of the administration and control of the excise goods related activities. This is an important condition for the limitation of the corruption pressure on the business. LEGISLATIVE, ADMINISTRATIVE AND ORGANIZATIONAL MEASURES ENSURING PARTICULAR RESULTS

EXAMPLES OF SIGNIFICANT CASES AND SOME CONCEALMENT METHODS WITHIN EU INTERNAL BORDERS USING ROAD/RAILWAY TRANSPORT

Vidin ferry - On 12/02/2011 seized quantity of cigarettes pcs - Transported goods: flour, napkins, sugar products and perfumes.

Border check point Kulata on 03/05/2012 – seized quantity of cigarettes pcs. Transported goods Reinforcing steel. Border check point Kulata on 03/05/2012 – seized quantity of cigarettes pcs. Transported goods Reinforcing steel.

Border check point Ilinden on seized quantity of cigarettes pcs.

Border check point Kulata on seized quantity of cigarettes pcs. Transported goods - snails

Border check point Kulata seized quantity of cigarettes pcs. Transported goods - lentils

Border check point Kulata on seized quantity of cigarettes pcs.

Border check point Kulata seized quantity of cigarettes pcs. Transported goods Insulating panels

Railway station Border check point Kulata seized quantity of cigarettes – pcs. Transported goods – perlite of marble

Railway station Border check point Kulata on seized quantity of cigarettes – pcs. Transported goods – perlite of marble

Customs office Ruse kg cocaine seized on concealed in a metal box with 35mm wall thickness fitted inside the combine. Customs office Ruse kg cocaine seized on concealed in a metal box with 35mm wall thickness fitted inside the combine.

4 202 kg hashish – Vidin Ferry on the largest quantity of narcotics, seized by Bulgarian Customs Officers for the last 15 years.

Customs Administration seizes contraband cigarettes and packages for their illegal production.

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