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I’ve been able to make a few observations about the Bulgarian banking operations. It seems as if they’re collecting a form of street tax from small business owners, but doing it through the financial system as a means of disconnecting the cash flows directly from the victims’ accounts to theirs as well as reducing the short term impact on those they’re robbing.

The crooks are targeting their victims either by brute force, or or by crafting business relationships that they can leverage. Once they have someone to squeeze, they pull cash out of the business. However, instead of directly extracting cash from the bottom line, it looks like they’re forcing the business owners to take cash advances out on their credit cards. Ironically enough, this helps the business owner because they don’t have to fight a large initial cash outflow. Instead, their obligation to the financial institution is the small monthly minimum payment. This keeps the business operational for as long as possible, though saddled with immense debt, so when the credit card balances are paid down, the Bulgarians force the owners to advance more cash.

The economy is both helping the Bulgarians in this regard. From the bank’s perspective, it’s almost impossible to tell which businesses are impacted by the Bulgarians versus which businesses are just increasing debt levels as a result of macro economic conditions. This gives the Bulgarians some additional operational cover. However, to their detriment, banks are protecting themselves from losses by cutting available, unused credit lines. This severely diminishes the amount of cash they can pull from business owners. The Bulgarians are effectively extorting less cash, but they’re doing it without as much risk of getting caught.

Mother’s concern is that if the cash trickles to a point where Bulgarian public officials aren’t being greased enough to continue cooperation, there will be retribution against the business owners.

While I don’t think this is the only angle the Bulgarians are playing, at least I’ve found some activity to investigate.

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