Tim W Hayes  05/18/2009 11:32:43 AM  From  DB/Inbox:  Tim W Hayes

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UNCLAS        SOFIA 00229
CXsofia:
    ACTION: CONS
    INFO:   POLEC RSO AMB DOJ DCM

DISSEMINATION: CONX
CHARGE: PROG

APPROVED: CONS: DPERRONE
DRAFTED: CONS: CTURPIN/IKOLIS
CLEARED: NONE

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RUEHTI RUEHVI RUEHRO RUEHMD
DE RUEHSF #0229/01 1351030
ZNR UUUUU ZZH
P 151030Z MAY 09
FM AMEMBASSY SOFIA
TO RUEHC/SECSTATE WASHDC PRIORITY 5992
RUEHBW/AMEMBASSY BELGRADE 0039
RUEHSQ/AMEMBASSY SKOPJE 2037
RUEHBM/AMEMBASSY BUCHAREST 0215
RUEHVB/AMEMBASSY ZAGREB 0992
RUEHTH/AMEMBASSY ATHENS 0001
RUEHTI/AMEMBASSY TIRANA 1161
RUEHVI/AMEMBASSY VIENNA 1214
RUEHRO/AMEMBASSY ROME 0528
RUEHMD/AMEMBASSY MADRID 0653

UNCLAS SECTION 01 OF 04 SOFIA 000229 
 
DEPT FOR CA/FPP; DEPT ALSO PASS TO KCC; POSTS FOR 
FRAUD PREVENTION MANAGERS 
E.O. 12958: N/A 
TAGS: CVIS KFRD CPAS CMGT ASEC BU
SUBJECT: Semi-annual Fraud Summary Sofia; October, 2008 - March, 
2009 
 
REF:  08 Sofia 0645 
 
¶1. SUMMARY:  Though overstay rates for Bulgarians may still be 
declining overall, low wages here continue to fuel problems in this 
area.  Our latest H2B validation study, for instance, indicated a 33 
percent overstay rate.  On the other hand, our most recent B1/B2 
validation study found the overstay rate down to around 3 percent. 
We continue to implement and refine our "No Thugs to America" 
policy, refusing applicants we believe to be connected with 
Bulgarian organized crime.  FPU prepared a new in-house report 
regarding the evolution of organized crime structures and 
enterprises here.  IV encountered some step-child fraud, along with 
more irrefutable evidence of false Roma asylum claims in 
follow-to-join cases.  We saw no ACS/passport fraud during the 
reporting period.  End summary. 
 
¶2. COUNTRY CONDITIONS:  Bulgaria's geographic position at the 
intersection of Europe and Asia makes it a transit point for illegal 
migration and alien smuggling.  Relatively trying economic 
conditions in the country mean that Bulgaria is also a source 
country for illegal migrants to the U.S.  With an average monthly 
wage of EUR 269 for last quarter of 2008 and prognosis of EUR 307 
for the first quarter of 2009, Bulgaria has one of the lowest income 
levels in the EU.  The unemployment rate for the last quarter of 
2008 averaged 6.42 percent, down by 1.3 percent from the last 
quarter of 2007. 
 
The unemployment rate for the first quarter of 2009 averaged 6.7 
percent, up by 0.3 percent from the last quarter of 2008.  In March 
2009, according to the NSI business inquiries, the industrial 
confidence indicator fell by 3.2 percentage points compared to the 
February level.  The decrease was due to the lower demand and the 
low expectations of managers for production activity in industry 
over the next 3 months.  In February 2009 the harmonized index of 
consumer prices increased by 5.4 percent overall compared to the 
same month of 2008, due to an increase in prices registered in all 
observed groups with the exception of transport and communications. 
 
For the period January, 2009 - March, 2009 the inflation rate in 
Bulgaria was 6 percent, which is higher than it was for the same 
period last year.  The government expects the inflation rate for the 
end of 2009 to be 4.2 percent.  This would edge Bulgaria closer to 
meeting requirements for Euro adoption by 2010. 
Unemployment stood at 5 percent in the fourth quarter of 2008. 
Compared to the same quarter of the previous year, the unemployment 
rate dropped by 1.1 percentage point and the number of the 
unemployed persons decreased by 37,600.  These figures do not take 
into account underemployment and overall low wages, however. 
 
According to the Bulgarian National Statistical Institute, the 7,578 
Bulgarians who visited the U.S. in the reporting period represented 
a 0.8 percent increase from the same period last year.  The number 
of Bulgarians visiting the United Kingdom (where they need no visa 
for tourism) decreased 1 percent.  The number of Bulgarians visiting 
other countries in the EU rose 24 percent. 
 
Local press and reports that more than 50,000 Bulgarian immigrants 
returned to Bulgaria because of the increasing unemployment rate 
abroad during the first quarter of 2009.  Perhaps another fifth of 
Bulgarian economic migrants may return home in the near future 
because of the global crisis.  According to a recent local NGO 
survey out-migration by Bulgarians has probably decreased by around 
50 percent over the last 12-18 months.  This year only 8 percent of 
Bulgarians aged 20-35 who were polled intended to leave the country. 
 Last year's figure was 16 percent. 
 
OC - EU:  According to the European Commission interim report on 
Bulgaria's progress in implementing judicial reforms, Bulgaria has 
not demonstrated convincing results in key areas such as in the 
fight against high-level corruption and organized crime.  "The 
commission's analysis of a sample of high-profile cases [organized 
crime] registered shows that only one case has been finalized since 
2000 and half of the cases are still at the investigation stage." 
The European Commission also recommends that Sofia strengthen 
"actions to fight corruption within local government and vulnerable 
sectors such as healthcare and education."  Cases of alleged 
high-level corruption and organized crime, when pursued at all, have 
continued to be subjected to frequent referrals and long delays on 
procedural grounds.  An investigation of OLAF uncovered many 
irregularities related to a large number of tender offers which were 
used to support SAPARD applications in Bulgaria.  Due to allegations 
of fraud and misuse, the European Commission froze more than USD 750 
million in pre-accession funding to Bulgaria in 2008. 
 
¶3. NIV FRAUD: fraud in Sofia remains fairly common, although FPU 
still does not see signs that visa fixers are becoming particularly 
advanced.  Most fraud is relatively unsophisticated and easily 
identified, including phony bank statements, invitation and/or 
employment letters and so on. 
 
B Visas - During this reporting period, problems consisted mainly of 
petty document fraud and applicants attempting to conceal previous 
overstays/illegal activities in the U.S. FPU completed a B1/B2 
validation study for applicants who received visas from August to 
December 2007; we predicted a 10 percent overstay rate which 
generated a sample of 8 percent of the 4906 approved applicants for 
B1, B2 and B1/B2 visas.  Using ADIS we verified returns for the 
people included in the sample.  The overall overstay rate was 4 
percent, up 0.75 percent from our last such study on January - July 
2007 B visa recipients.   Unemployed applicants from poorer regions 
were over-represented among overstays, but otherwise we found no 
telling indicators.  Age, gender or prior visa issuance did not 
prove to be relevant factors in fraud cases.  Individual B1/B2 
investigations revealed occasional applicant connections with 
organized crime, including illegal weapons possession, involvement 
in arms or narcotics trafficking and association with known OC 
figures.  For the reporting period FPU assisted in seventeen B1/B2 
cases where applicants were suspected to have connections with OC. 
In all cases the visas were denied. 
 
C1/D Visas - Bulgaria has a long coastline on the Black Sea which 
includes the two major ports of Varna and Burgas.  The shipping 
industry is a major employer in that region, so we have a steady 
stream of sailors applying for C1/D visas.  FPU maintains close 
contacts with all notable local shipping companies for monitoring 
and verification, but C1/D fraud can still be a problem.  To combat 
it we reserve a certain morning of the week for C1/D applicants to 
apply separately from other NIV applicants, which allows us to 
better monitor flow and spot outliers more easily.  In addition FPU 
routinely monitors and investigates press reports and advertising, 
as well as internet chat rooms that indicate attempted abuse of this 
category by both facilitators and past or potential applicants.  The 
most common profile of the dubious C1/D applicant is a relatively 
young man with limited experience as a seaman, a new passport, a 
limited travel history or no travel history at all and not from 
Varna or Burgas.  Typically he intends to work on a private yacht, a 
job he says he found on the internet. 
 
H Visas - FPU completed a validation study of applicants who 
received H2B visas for the calendar year 2007.  During that period 
consular officers approved 982 applications for H2B visas, while 
refusing applicants at a rate of 30 percent.  Using the same methods 
as described in the B visa study, FPU sampled 10 per cent of the 
approved applicants.  We found an overall overstay rate of 33 
percent, down slightly from our last H2B study.  This confirmed 
overstay rate, especially when considered in light of a high refusal 
rate, is consistent with the facts on the ground: many Bulgarians 
have limited opportunities to make good salaries in their own 
country and continue to seek legal and illegal opportunities to work 
overseas.  For the reporting period we had 149 H2B applicants, a 43 
percent decrease compared with the same period in 2007 - 2008. 
 
J-1 Visas - We noted in reftel our interest in seeing if a couple of 
new factors connected with the J1 Summer Work and Travel program 
would have an impact on overstay rates for this visa category.  In 
2007, for the first time, final year university students were 
eligible to participate in SWT.  Thus our refusal rate for these 
final year students and, consequently, our overall SWT refusal rate 
was significantly lower that year than in the past.  Our SWT volume 
in the first quarter of 2009 dropped significantly, by nearly 50 
percent.  FPU predicted an overstay rate of 8 percent for the 
purposes of conducting a SWT validation study, which generated a 
sample of 314 approved applicants.  Upon accounting for 100 percent 
of these SWT participants, we were pleasantly surprised to find an 
overstay rate of only 6 percent, a 2 percent drop from the year 
before.  More final year students applied and were issued in 2008 
than in 2007, so we conducted a separate study for all last year 
students who were issued visas.  The overstay rate was 11 percent 
for this group. 
 
For the first quarter of 2009 SWT season we had just over 1,500 J1 
visa applicants, with only 3 cases of fraud detected.  All 
applicants presenting fake documents were interviewed by FPU.  In 
most of the cases alterations were made by the applicants.  We found 
no evidence for the possible existence of an organized production of 
false student documents. 
¶4. IV FRAUD:  We have a steady trend of Chicago step-child fraud 
cases, in which American Citizens who have recently married 
Bulgarians (fraudulently) petition for the stepchildren of their new 
spouses.  In most of these cases we come to the conclusion that the 
marriage is for the purpose of the adoption only, and that the 
natural parents are still in reality "together," though not both 
living in the U.S.  Presumably the other natural parent plans on 
trying to get to the U.S. subsequently by some other means.  For the 
reporting period we had one marriage fraud case, one fraudulent case 
of third preference employment based visa. 
 
¶5. DV FRAUD:  The number of DV applications at post has decreased in 
recent years as available numbers have dropped, and DV fraud is not 
common here.  We had just one counterfeit high-school diploma, and 
had no DV marriage fraud cases for this reporting period. 
 
¶6. ACS AND PASSPORT FRAUD: We have traditionally experienced 
extremely low levels of ACS and passport fraud in Sofia, and FPU had 
just one fraudulent attempt to secure an American passport for a 
baby. 
 
¶7. ADOPTION FRAUD: FPU has seen no recent cases of adoption fraud. 
Bulgaria began implementing new laws governing adoptions by 
foreigners in 2004, in order to bring the country into compliance 
with the Hague Convention, and as a result the number of such 
adoptions dropped precipitously.  In 2008 only 5 adoptions by U.S. 
citizens took place in Bulgaria, a drop of more than 90 percent from 
only 5 years earlier. 
 
¶8. ASYLUM AND OTHER DHS BENEFITS FRAUD:  Asylum claims by Bulgarian 
citizens based on alleged Roma ethnicity may have decreased somewhat 
in recent years, but we still see discouraged asylum seekers granted 
voluntary departure from the U.S.  When these individuals are 
interviewed by FPU upon their return to Bulgaria, they typically 
admit they are not Roma, and that they sought asylum in the U.S. due 
to the lack of economic opportunities in Bulgaria.  During the 
reporting period there were seventeen Visas 92 cases in Sofia.  Due 
to the high-fraud rate in this visa category we conduct 
investigations into almost all Visas 92 cases and have yet to see 
one where we believe the original asylum claim was not fraudulent. 
We have sent several cables on this topic in the past year.  We have 
also seen an increase in the number of family members applying for 
B1B2 visas who want to visit relatives (usually children or spouses) 
who have claimed asylum and have green cards. In most cases the 
family members here admit that they are not Roma and say that their 
relatives decided to claim asylum for economic reasons.  These visas 
are usually denied. 
 
¶9. COOPERATION WITH HOST GOVERNMENT AUTHORITIES: Cooperation with 
Bulgarian authorities remains good.  Post receives valuable 
assistance from Law Enforcement Agencies, including entry/exit data 
upon request from the Bulgarian Border Police database. 
 
¶10. AREAS OF PARTICULAR CONCERN:  At 33 percent, the H2B overstay 
rate is certainly worrisome.  Our refusal rate in this category is 
already high (over 50 percent for the reporting period), and our 
challenge is to develop useful criteria that will help us to 
distinguish among applicants.  Over the past three quarters, we have 
for the most part been issuing applicants who previously worked on 
H2B visas and honored the terms of those visas, returning to 
Bulgaria intermittently for regular, substantial periods.  Officers 
are more apt to refuse applicants who have used H2B visas and 
DHS-approved extensions to spend virtually all of their time over 
the last several years in the U.S.  Those individuals are building 
lives in the U.S. and do not seem to see their futures in Bulgaria. 
First-time applicants who cannot articulate any credible plan or 
vision for a life in Bulgaria, or those who are long-time employees 
in the same occupation in which they seek to work in the U.S. 
(waitresses or bartenders, for example), also routinely fail to 
overcome 214(b). 
 
FPU continues to monitor closely the major Bulgarian Internet 
forums, which openly discuss a variety of Immigration issues, 
including how to evade U.S. immigration laws. 
 
¶11. ALIEN SMUGGLING, TRAFFICKING, ORGANIZED CRIME:  Bulgaria is a 
transit point for illegal migration and alien smuggling as well as a 
source country for illegal migration to the United States.  A common 
smuggling scheme remains for Bulgarians to travel to Mexico as 
"tourists" (they no longer need Mexican visas to do this) and then 
be smuggled across the southern U.S. border.  This route has been 
used for many years, and is probably becoming even more traveled now 
that the Mexican visa requirement has been lifted.  See the above 
comments about false asylum claims. 
 
According to Bulgarian Border Police 7,262 illegal immigrants have 
been captured in Bulgaria since the beginning of 2007.  Most of the 
migrants come from Iraq, Palestine and Turkey via Turkish territory. 
 The border police also tell us that in 2007 they broke up 11 gangs 
that were trafficking people to Bulgaria, arresting the operators. 
According to the Ministry of Interior, Bulgaria received 120 million 
Euro from the EU to equip National border police with technical 
equipment for processing passports with biometric data. 
 
Bulgarian Organized Crime continues to be active and very visible in 
Bulgaria, and we continue to tune and enforce our "No Thugs to 
America" program.  Our goal is to deny visas to all those connected 
with organized crime and corruption, and to publicize this intent in 
order to emphasize the seriousness of the problem.  We hope this 
will encourage the Bulgarian public to decry it and the Bulgarian 
government to fight it.  FPU prepared a new in-house report this 
period, supplementing an OC "who's who" it had already circulated, 
outlining new structures and developments in the major criminal 
organizations.  We also maintain databases that can search business 
ownership and identify members of boards of directors and executive 
officers. 
 
¶12. HOST COUNTRY PASSPORT: The current Bulgarian passport is a 
secure, up-to-date document with appropriate security features that 
meet EU requirements.  The passport does not yet have biometric 
security features apart from a digitalized photo, but counterfeiting 
is difficult and incidents of bio-page alteration are rare. 
Anecdotal evidence suggests that genuine passports are occasionally 
sold or stolen and altered for the purposes of illegal travel, but 
we have seen very few cases of stolen or sold Bulgarian passports 
used for illegal travel to the U.S.  Due to low-quality forgeries, 
the majority of these cases are easily detected by the Border 
Police.  Identity theft is the major concern for the passport 
issuing authorities in Bulgaria.  According to government officials, 
blank passports have never been reported lost or stolen.  We expect 
that GOB will start replacing current passports with a newly 
designed e-Passport sometime in the summer of 2009. 
 
¶13.  STAFFING AND TRAINING: The current Fraud Prevention Manager is 
vice consul Carolyn Turpin.  She will be replaced by vice consul 
Sarah Stewart effective May 22, 2009.  Iglika Kolishka is the 
Consular Investigator.  FPU continues to make increased and 
effective use of the latest available anti-fraud technology such as 
the ADIS search engine, Lexis/Nexis and CCD text search, in 
conjunction with local tracking systems and an image database. 
 
McEldowney