The Anti-Corruption Fund (ACF) has published the second part of its investigation into Hristo Kovachki’s secret energy network, “Uncle Trevichko’s Holding Company,” entitled “Veselin Todorov: Orion Holding from the Inside”.
The film presents the testimony of Veselin Todorov, who was in charge of gas trading at the holding company between April 2019 and December 2023. He is the manager of Bulgarian Gas Company, one of the key companies trading in natural gas within Kovachki’s structure. Prior to that, Todorov was a natural gas expert at the Energy and Water Regulatory Commission.
His account provides comprehensive and systematic inside information on how Kovachki’s secret holding company operates, its control and coordination schemes, financial practices, and numerous instances of violations of Bulgarian and European law.
“Veselin Todorov’s account should be carefully considered by the European Public Prosecutor’s Office and Bulgarian law enforcement authorities, as it contains specific direct evidence of numerous crimes and leaks of information about upcoming and already conducted proceedings by the Bulgarian office of the European Public Prosecutor’s Office. The European Public Prosecutor’s Office owes Bulgarian citizens detailed information about the fate of this investigation, which dates back a long time—who led it and what control was exercised, what procedural actions were taken in the course of it, and what the results were”, commented Andrey Yankulov, senior legal advisor to the ACF.
How Orion Holding is managed: structure, dependencies, control
“Everything in the holding company happens through offshore companies and front men”, Todorov testified:
“I myself was a front man for one of Kovachki’s companies.”
When he joined Holding Orion, Veselin Todorov was formally appointed as an employee of Toplofikacia Pleven. In reality, he coordinated the gas heating plants and the companies that traded gas within the holding company.
The actual management of the holding company is highly centralized, with all decisions—from strategic deals to routine expenses for consumables in individual companies—approved personally by Hristo Kovachki.
All accounting for the holding company’s seemingly unrelated companies is also carried out centrally by a limited circle of accountants who collect all flash drives with the electronic signatures of the formal senior managers and manage the transfer of funds between companies.
“I haven’t had access to my electronic signature for four years. I only had access when I had to go and renew it. The moment I renewed it, they took it away from me again. This happens to all company managers.”
Senior managers in the holding company are also controlled through their obligations to the holding company’s companies by means of promissory notes for amounts of several million—something that, according to Todorov, is routine practice in the holding company.
“Next to Hristo Kovachki’s office is that of Vanya Milcheva, his chief lawyer, where there is an iron safe containing a huge number of promissory notes. Each manager signs for a certain amount of money that they owe to a given company or another company, or to a natural person, in most cases a legal entity. And in this way, that person never dares to do anything again because they owe a very large amount of money to someone. It always varies between two and three million leva for the higher positions.”
In the interview, Veselin Todorov outlines the structure of the holding company’s economic divisions and the relationships between them. Todorov describes hundreds of companies linked in an opaque network of mutual loans and accounting coordination.
At the heart of the holding company are the thermal power plants, the most important of which are Bobov Dol and Brikel, surrounded by numerous companies that stand at their entrance and exit. These companies make it possible to manipulate the data on the revenues of the heating companies in the holding company, which are artificially kept at a loss or minimal profit. In this way, their real profits are hidden and the price of heat energy for end users is kept artificially high. This is done by heating plants purchasing all raw materials, consumables, and services for their operations from related suppliers (including mines) at inflated prices and then selling the energy produced to related traders at reduced prices.
“This scheme works in such a way as to make as much money as possible”, says Todorov and added:
“But at the expense of consumers – with the highest possible prices. End consumers in all the cities where Kovachki has heating companies pay more for their heating in winter.”
“The profits come out of the heating plants and go to the companies trading in electricity or natural gas. If the heating plants behaved like normal companies, the prices for end consumers of heat energy would be much lower than they are now.”
Cartel practices, manipulation, and abuse of market position
Todorov claims that the holding company maintains an active cartel structure in the energy market, with at least two companies in each of its strategic fields of activity that can manipulate prices between themselves.
“The two companies, which are independent of each other de jure, can make deals between themselves that influence the market. Which is a cartel par excellence.”
The common accounting system, which effectively unites all the companies that are independent on paper into a single entity, allows for coordination and concealment of the real financial flows.
Falsification of carbon emissions and destruction of evidence
Todorov confirms the information from the first episode and from the AKF “Pelletgate” investigation into carbon quota abuse. He claims that Kovachki was informed in advance of upcoming inspections, including by the European Public Prosecutor’s Office, and that he ordered the destruction of documents by shredding, burning, or disposal.
“While I was working at the holding company, there were several occasions when the order was given to ‘burn’ or ‘throw away’. All the documents we had were shredded, burned or thrown away. This was done when Kovachki was informed that there would be a raid somewhere the next day. They would enter some headquarters.”
“In the case of the European Prosecutor’s Office investigation into carbon emissions, it happened the same way. On Monday, investigators entered the headquarters and offices, and the warning had come on Friday. In 2-3 days, they managed to clear everything.”
Coercion, control, and pressure on employees
According to Todorov, Hristo Kovachki received information not only about the upcoming searches led by the European Public Prosecutor’s Office in 2023, but also about the testimony of his employees during subsequent interrogations.
“Kovachki gave my colleagues who were interrogated his own testimony to read. He had access to the statements of everyone who was investigated, even when the investigators were only from the European Public Prosecutor’s Office.”
This creates an atmosphere of fear among the majority of employees. Todorov himself is subject to intimidation and pressure when he decides to leave the holding company.
“When I wanted to leave the holding company, because I was very involved in the things that were happening there, he asked me to sign a promissory note to guarantee my silence. When I didn’t, he sent people to wait for me at home.”
After his departure, Hristo Kovachki initiated legal proceedings against him, freezing his accounts for an amount of 350,000 leva.
Despite the threats against him, Todorov said he was ready to cooperate with any Bulgarian or European institution that wanted to investigate his revelations.
“I am ready to respond to any institution that contacts me. If no one talks about these things, Bulgaria will never change.”
“The information disclosed is of exceptional public importance. Veselin Todorov’s testimony, together with the documents published so far by the ACF, reveal mechanisms that distort the market, harm consumers, threaten energy security, and undermine trust in institutions. Urgent, effective, and independent action is needed in accordance with Bulgarian and European legislation”, commented Boyko Stankushev, director of the Anti-Corruption Fund.
The ACF calls on the competent authorities—the European Public Prosecutor’s Office, the Prosecutor’s Office of the Republic of Bulgaria, the Commission for Protection of Competition, the Energy and Water Regulatory Commission, and other responsible institutions—to familiarize themselves with the investigation and take the necessary steps to establish the facts presented.
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