Bulgarian MPs pass at first reading bill to criminalise undermining banks

Written by on July 16, 2014 in Bulgaria - Comments Off on Bulgarian MPs pass at first reading bill to criminalise undermining banks

Bulgaria’s Parliament passed at first reading on July 16 an amendment to the Penal Code that made it a criminal offense to spread misleading or false information about the country’s financial institutions.

The bill passed with 90 votes in favour, coming from opposition party GERB and the Movement for Rights and Freedoms (MRF), while 48 MPs from the other party in the ruling axis, the socialists, abstained.

The Bulgarian National Bank (BNB) drafted the bill after a smear campaign targeting First Investment Bank caused a run on deposits last month, and the amendment was tabled by budgetary committee chairperson Yordan Tsonev.

The amendment envisions an effective prison sentence of two to five years for anyone who “spreads misleading or false information or other reports about a bank or financial institution that may lead to creation of public panic.” In cases where such activity has resulted in “significant damage” or yielded “significant profits”, the proposed jail time is five to 10 years, accompanied by a fine of 5000 to 10 000 leva.

However, the amendment does not define what represents “misleading or false information”. Currently, the central bank has the power to impose administrative fines in such instances.

During debates on the House floor on July 16, Tsonev said that the bill was “not perfect”, but was tabled nevertheless at the request of the central bank “as a preventive measure […] during the peak of the crisis.”

Tsonev said that the bill, as it is, was meant to start a discussion on the issue, but it would be amended prior to second reading to ensure that it did not curtail freedom of speech.

Socialist MP Yanaki Stoilov said that the amendment went too far, suggesting that jail terms should be handed out only upon proof of criminal intent.

The BNB bill has been criticised, in recent weeks, by NGOs and the head of Bulgaria’s media regulator as creating the premises for censorship in the media and diminished transparency in the banking sector.

(Bulgarian Parliament. Photo: Clive Leviev-Sawyer)

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