By May 15th each year, individuals holding public office are required to file an asset declaration with the **Anti-Corruption Commission (ACC)** under the Anti-Corruption Act (ACA). However, behind this seemingly routine administrative procedure often lie mechanisms that can lead to serious consequences, including asset audits, the imposition of injunctions, and civil forfeiture claims. Such a situation often arises even without a pending criminal charge. The mere failure to file an asset declaration is sufficient grounds to initiate an audit, regardless of whether any violation has been established or proven. An audit can also be initiated even if the declaration is filed within the legal deadline. An indication of potential problems, in this case, is receiving a notification from the ACC to correct omissions and errors in the declaration. It is important to note that correcting the discrepancies or fulfilling the obligations outside the specified period in no way guarantees that an audit will not be conducted.
The principle is as follows: if a discrepancy of less than BGN 10,000 is found, the audit is forwarded to the National Revenue Agency (NRA), which is considered the more favorable option. However, when the discrepancy is BGN 25,000 or more, the ACC, at the proposal of the director of the "Public Register" directorate, decides to conduct a full audit of the asset status of the person holding a public office.
If you see your name in the public register of persons holding high public office (the so-called "orange list") as someone who has not filed a declaration on time – expect trouble.
A distinction must be made between the discrepancy check performed by the ACC's "Public Register" directorate and the audit for significant asset discrepancy conducted by the territorial directorates of the **Commission for Forfeiture of Illegally Acquired Assets (CAFI)**. The former is carried out within a six-month period through direct access to electronic registers and databases and usually does not lead to reputational damage. In contrast, the CAFI audit necessarily involves the disclosure of bank secrecy, tax information, and other sensitive data, meaning that a wide range of institutions and individuals are informed that you are under investigation. This can lead to potential damages such as a deteriorated credit history, loss of trust, and other reputational harm.
The absence of any involvement in a crime is irrelevant to CAFI. A CAFI audit can be initiated solely on the grounds of failing to file a declaration, without requiring the commission of a crime, a pending charge, or any other violation. This circumstance turns a formal omission – even for valid reasons – into a prerequisite for activating a severe administrative procedure.
The formal reminder letters sent by the ACC for late declaration filings often fail to fulfill their corrective function. Their main purpose is to fix the moment of non-compliance, after which – even with a timely and justified response – CAFI almost invariably proceeds with an audit. The reasons for the delay are usually not taken into account, regardless of whether it is a health problem, an administrative error, or force majeure circumstances like a pandemic.
Declarations are filed with the ACC, but the decisions on the substantive asset audit are made by CAFI. Although the two commissions have formally separate and independent functions, they share the same leadership. This creates an apparent division, but in practice, the two structures are notifying themselves – a flawed model whose systemic failures we examine in detail in our new analysis.
In the vast majority of cases, the audit for significant discrepancy concludes with a decision to terminate due to a lack of "significant discrepancy" (i.e., a discrepancy exceeding BGN 150,000 for the entire ten-year audit period). For this reason, many public officials do not even realize they have been subject to an audit, as the affected person is usually not notified of the outcome upon its conclusion.
The situation becomes much more unpleasant when the established discrepancy exceeds the legal threshold.
How CAFI Calculates Discrepancies: Income Isn't Always Income
The approach applied by CAFI to establish a significant discrepancy differs substantially from that used in tax audits by the NRA, as well as from generally accepted accounting principles. For example, CAFI treats every debit transaction to a bank account as an acquired asset and, for the purpose of the analysis, includes it in the expenditure side, regardless of the fact that common sense suggests the opposite. Thus, a large part of the established discrepancy is often due to this specific approach in analyzing bank information. Of course, "salary" deposits are considered income, but these are almost the only debit transactions treated this way. All others must be proven by the person under review. It is this standard that makes the audits particularly risky and often incomprehensible to those affected.
The deadlines for completing audits are one year, with a one-time extension of another six months. In practice, however, these deadlines are often instructive, and audits can conclude years later. Thus, it is not uncommon for a public official to receive a seizure notice four or five years after the year of failing to file their asset declaration on time. A large part of CAFI's current seizure proceedings in 2025 concerns declarations not filed during the COVID pandemic, when the normal administrative rhythm was severely disrupted. Now, years later, people who failed to file a declaration then are surprised by seized assets.
The Results are Often Nil – But the Consequences Remain
According to public data, the majority of CAFI's audits hardly stand up to judicial review within the civil forfeiture proceedings. By then, however, the reputation of the person under review has already been undermined, their assets may be frozen, and the psychological burden is significant.
That is why you should not underestimate May 15th – the deadline for filing asset declarations. This is the line between controlled risk and potential institutional uncertainty.
Filing the declaration is not just an administrative duty – it is your best defense against a form of legal arbitrariness where formal violations can trigger disproportionate consequences. File the declaration, even if you are not entirely sure of its accuracy. An error can be corrected, albeit at the cost of an administrative violation act. In certain cases, however, a fine of BGN 1,000 to 3,000 (and BGN 3,500 to 6,000 for a repeat offense) is preferable to the risk of becoming the subject of a multi-year and exhausting investigation.
Frequently Asked Questions (FAQ):
- Who is required to file an asset declaration?
All persons holding a public office within the meaning of the ACA – including members of parliament, magistrates, mayors, deputy ministers, directors of state agencies, and others. If you are unsure whether you fall within the scope of obligated persons, check if your position is listed in the register of persons holding public office on the ACC's website: https://register.caciaf.bg/
- What is the deadline for filing the declaration?
- Annual Declaration: By May 15th of the current year – for the previous calendar year.
- Initial Declaration: Within one month of assuming public office.
- Final Declaration: Within one month of leaving public office.
- Declaration upon Change: Within one month of a significant change in the declared circumstances.
Declarations under Art. 49, para. 1, item 1 (initial) and item 3 (final) are filed with the electing or appointing body. Declarations under para. 1, item 2 (annual) and item 4 (upon change) are filed with the Anti-Corruption Commission (ACC).
Within one month of filing an asset and interest declaration, the person can make changes to it if necessary to correct omissions or errors.
When changing from one public office to another, a final declaration and a new initial declaration are not required.
- What happens if I don't file the declaration on time?
Within two months of the filing deadlines, the ACC publishes on its website the declarations of persons holding public office, as well as a list of persons who did not file their declarations on time. Failure to file can lead to the initiation of an asset status audit.
- Does the audited person know they are under review?
Usually not, until security measures are imposed – seizures, liens, freezing of accounts. Ideally, the person may receive a notification with a 14-day period to correct omissions and errors. However, even after such correspondence, the person is usually not notified of the result of this initial check. In practice, there is no real control mechanism at this stage. Obligated persons are not given the opportunity to review the evidence collected nor to appeal the administrative act for initiating an audit before the competent administrative court.
- How long does the audit take?
- Preliminary Check by the ACC's "Public Register" Directorate: Usually up to 6 months.
- Substantive Audit by CAFI (if a significant discrepancy is found): The legal term is 1 year, with a one-time extension of another 6 months. In practice, however, audits can last for years, sometimes up to the 10-year statute of limitations for civil forfeiture.