Varna District Court has left the Chair of Varna municipal council, Borislav Gutsanov, in custody after he was arrested in Wednesday’s ‘Jellyfish’ police operation.

Gutsanov has been charged with participating in an organized criminal group, abuse of office, perjury and solicitation. The Court said that he should no be given bail as he may try to interfere with evidence if released.

Gutsanov’s lawyers suggested that Prosecutor’s could not link him with any wrongdoing in the public transport department of the Varna council and that he himself had provided full documentation to legal authorities in November 2009 regarding public transport deals in the Municipality.

Gutsanov, a member of the Executive Board of the Bulgarian Socialist Party, was arrested alongside the Director of the Varna municipality ‘autotransport’ department, Pencho Penchev and Yoana Krusteva, the department’s Chief Accountant, both of who were left under house arrest.

Businessman Daniel Slavov aka Dido Dunkata, suspected of organizing contraband cigarette channels in the Varna area, was also kept in custody after being arrested in his own Hotel 'Capitol'. His Dutch business partner is being searched for by police.

"The operation was aimed against corruption in local government. The detainees have allegedly abused taxpayers’ money, namely for deals to purchase second-hand buses. Information from our European partners has shown that false documents and diverted funds transfers were involved in the purchase process for these buses - part of those funds have gone into accounts of a range of people as ‘charity’" Interior Minister Tsvetan Tsvetanov revealed.

The second-hand buses from France and Germany were purchased from 2003-2007 and are believed to have cost a total of EUR 2 M.

Borislav Gutsanov has been a member of the Executive Board of the National Council of the BSP since November 2009, on which he is responsible for local government and regional policy. He was top of the BSP list during the municipal council elections in 2007 and was soon elected as Chair of the Varna municipality council. During the 2009 general elections Gutsanov was second on the BSP list for the Varna region behind party leader and ex PM Sergey Stanishev.