{"id":1732,"date":"2014-07-25T10:14:11","date_gmt":"2014-07-25T07:14:11","guid":{"rendered":"http:\/\/www.aej-bulgaria.org\/en\/?p=1732"},"modified":"2014-07-25T10:14:11","modified_gmt":"2014-07-25T07:14:11","slug":"bulgaria-the-banks-and-the-media-or-where-is-the-watchdog-of-democracy-buried","status":"publish","type":"post","link":"https:\/\/aej-bulgaria.org\/en\/bulgaria-the-banks-and-the-media-or-where-is-the-watchdog-of-democracy-buried\/","title":{"rendered":"Bulgaria: The banks and the media, or where is the watchdog of democracy buried?"},"content":{"rendered":"

Ivan Radev, AEJ-Bulgaria<\/strong>
\nCan restricting the access to information bring stability?
\nThe metaphor \u201cMedia is the watchdog of democracy\u201d is widespread in the English speaking countries. The so-called \u201cWatchdog journalism\u201d, or journalism that watches over the community interest, which often is in contradiction with private interests, is part of the idea of the fourth estate, monitoring the actions of the other three estates.
\nIn the middle of the panic that was manifested most visibly as queues at bank offices, the Bulgarian National Bank (BNB) tried to shift most of the responsibility straight to the \u201cwatchdog\u201d and even submitted a proposal to restrict its access to the system, because the \u201cbarking\u201d caused panic, which in turns threatens the financial stability. Are the media responsible and does restricting access to information create more trust in state institutions and more stable banks? Or, if we continue with idioms: Was the whole mess caused by the dogs, or was it because the caravan went on, although the dogs were barking?
\nThe first publications about the now infamous Corporate Commercial Bank (CCB) and some other banks appeared in the media in 2011, when the French newspaper \u201cLe Monde\u201d quoted a secret US report, released in WikiLeaks. In the report, dated from 2006, the former US Ambassador in Sofia John Beyrle wrote: \u201cConnected lending continues to be a problem among some banks as their owners funnel money to related – less competitive – companies, with no intention of repaying.\u201d Instead of investigating the problem, in 2012 the Bulgarian authorities tried to prosecute the journalists, who published the information in the Bulgarian press. Article 152a from the Credit Institutions Act is mentioned, which imposes a severe fine for any person, who \u201cdisseminates misleading or false information or circumstances about a bank, by which imperils its good name and the confidence in it\u201d.
\nIs this information misleading or false? The prosecutor Ivan Geshev, part of the team, which is investigating CCB, explained in an interview, published in the \u201c24 chasa\u201d newspaper on July 19th, 2014: \u201c3.5 billion leva [about 1.75 billion euro] from the loan portfolio of CCB are high-risk\u201d. Some of the loans are unsecured, for some there are no documents for the establishment of the borrowing companies or for their financial state, many of the companies had been established just before taking the loan or had no real operation. Such loans were granted to companies and persons, connected with CCB de facto, but not de jure. The persons were low-level employees of the bank \u2013 a driver, a secretary, an archivist, a door-keeper, a security guard\u201d.
\nAnd now the authorities confirm the media reports from years ago.
\nSo today we can hardly call this information false.
\nThe changes in the Criminal Code, proposed by BNB, were passed on first reading by the Parliament, despite the objections of many experts and organizations. These changes intend a criminal penalty not only for misleading or false information, but also for distributing other information, which can cause panic and fear in the public.
\nThe Association of European Journalists \u2013 Bulgaria released the following statement:<\/a> \u201cThis, in fact, means that you can say nothing but good of the banks. The journalists are deprived of their key function \u2013 to reveal and expose the irregularities in this area of the public life. Furthermore, the incrimination of the dissemination of \u201cother information\u201d regarding the financial institutions puts at risk of prosecution commentators and experts from the banking sector and, in fact, all citizens who dare to express their opinion or to seek answer in regards to the stability of their personal assets or the public ones.\u201d
\nIn the case of CCB we saw that the media publications had had the potential to prevent the fiasco.
\nAnd even more \u2013 thanks to another fact revealed by journalists, that a disproportionately large part of state company funds are concentrated in that bank, and the following public pressure, the authorities were forced to establish rules, which restrict such concentration. Information supplied by the Government shows that in a year 75% of state funds were withdrawn from the bank, which probably limited the damage from its collapse.
\nStill, thanks to the public and media reaction, the Parliament made a substantial change in the texts of the Criminal Code between the two readings. Now the text, passed in the Legal Affairs Committee, is as follows:
\n\u201cWhoever, with intent to gain for themselves or for another person a material benefit or to harm, disseminates false information for the financial state of a bank or a financial institution, and this may cause substantial harmful consequences, shall be imprisoned for 2 to 5 years.\u201d For someone to be convicted based on this article, it has to be proven that both the disseminated information is false and the person intended a material benefit.
\nMaking the dissemination of lies about banks a crime would probably have a preventative effect, but there is no way to achieve a 100% guarantee against rumors and their publication in the media. A more effective filter would be the global improvement of the media environment, but for that far more serious efforts will be needed. First, the state must never cooperate with circles that try to obtain a monopoly on the media market in the country. We saw the tragic consequences of this, paying the price of the collapse of this media-bank conglomerate.
\nGreat benefits may be gained by establishing an efficient system of self regulation, which would give to media users information which newspapers, radios, TV channels, agencies and websites follow the professional and ethical standards and which are disposed to manipulation and distribution of sensational, but unproven claims. It is telling that only a small part of the media covered the problems of CCB, and for this they were often under attack from the media circle, which was close to the Government. Others generously bestowed awards to the management of the bank, e.g. \u201cMister Economics\u201d, and the rest preferred to avoid troubles and to their eyes and mouths wide shut.
\nThe media outlets that work responsibly should not be prevented from investigating the bank system, even if the findings are negative. The timely uncovering of a problem is just the thing that would have a healing effect. The society, which until now let itself be convinced that there is no need for the media to be the watchdog of the people\u2019s bank savings, because that\u2019s what BNB\u2019s supervision does, must realize the importance of in-depth journalism in public interest.
\nEvery attempt to gag these journalists would in fact be the most serious alert for trouble, because this would mean that something is going on behind the scenes.
\nEven though the connection between freedom of speech and economic prosperity isn\u2019t quite obvious, it does exist \u2013 good media environment is the most effective regulatory mechanism, and vice versa, in societies without strong media the levels of corruption are high. In other words, for its financial prosperity the members of the society must choose carefully their watchdogs, and neither encourage breeding of ones who are barking only to distract and create panic, nor accept dogs who serve the wolves \u2013 the mafia that gets richer and more powerful at the expense of everyone else. Everyone is responsible for that, because all of us make a choice every day with the newspaper we read, the TV channel we watch, the radio we listen to, the website we get information from. We should ask ourselves whether the specific media supports our and society\u2019s interest or, on the contrary, we confer our trust to someone who acts against us, as in the Bulgarian saying \u201cFeed a dog to bark at you.\u201d
\n <\/p>\n","protected":false},"excerpt":{"rendered":"

The metaphor \u201cMedia is the watchdog of democracy\u201d is widespread in the English speaking countries. The so-called \u201cWatchdog journalism\u201d, or journalism that watches over the community interest, which often is in contradiction with private interests, is part of the idea of the fourth estate, monitoring the actions of the other three estates.<\/p>\n","protected":false},"author":1,"featured_media":27188,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[960,973,970],"tags":[],"class_list":["post-1732","post","type-post","status-publish","format-standard","has-post-thumbnail","category-analyses","category-media-news","category-whats_new"],"_links":{"self":[{"href":"https:\/\/aej-bulgaria.org\/en\/wp-json\/wp\/v2\/posts\/1732","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/aej-bulgaria.org\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/aej-bulgaria.org\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/aej-bulgaria.org\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/aej-bulgaria.org\/en\/wp-json\/wp\/v2\/comments?post=1732"}],"version-history":[{"count":0,"href":"https:\/\/aej-bulgaria.org\/en\/wp-json\/wp\/v2\/posts\/1732\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/aej-bulgaria.org\/en\/wp-json\/wp\/v2\/media\/27188"}],"wp:attachment":[{"href":"https:\/\/aej-bulgaria.org\/en\/wp-json\/wp\/v2\/media?parent=1732"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/aej-bulgaria.org\/en\/wp-json\/wp\/v2\/categories?post=1732"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/aej-bulgaria.org\/en\/wp-json\/wp\/v2\/tags?post=1732"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}