SOFIA — The director of the Sofia central heating company might not have a glamorous job. The company, a Soviet- era behemoth, is more than €50 million in debt and is owed €80 million by customers unable or unwilling to pay their heating bills. The pay for the director is just €500 a month.

But Valentin Dimitrov, the director until April, managed to live well: making a splash at high-society parties with Elena Tihomirova, Miss Bulgaria 2003, living in a villa worth €400,000, or $506,000, and driving a customized Lexus sport utility vehicle.

After 10 years in the post, through three governments involving all the major political parties, Dimitrov inadvertently provoked the end of his career by seeking in February to raise consumer rates by 12 percent.

When municipal inspectors checked the accounting to see whether the increase was needed, Bulgaria was repulsed and fascinated by the findings. Television cameras filmed Dimitrov’s shiny Sofia office, where he had spent 180,000 levs, or $117,000, on remodeling and extras for his exclusive use: a Jacuzzi, a solarium, exercise equipment, a personal elevator to his office and a massaging chair.

He had also billed the company the equivalent of €46,000 for champagne and hors d’oeuvres; €12,800 for snacks at gas stations; €26,100 for a boat for water skiing at the company vacation house on the Black Sea; and a jet ski for €8,700.

Dimitrov remained on the board of directors after leaving his post. It was not until July 4, after financial investigators discovered that he had €1.64 million in an Austrian bank, that he was arrested. Dimitrov has been charged with money laundering and tax evasion and is also being investigated for embezzlement. A week ago, a Sofia appellate court declined to release him on bail.

As Bulgaria prepares to join the European Union on Jan. 1, EU officials have been hammering home the need for Sofia to prosecute and convict a senior state official for corruption. While Dimitrov is seen as only a medium-size fish, observers here said the scandal showed that Bulgarian state institutions were beginning to function properly.

The heating company, Toplofikatsia- Sofia, owned by the Ministry of Economy and Energy and the Sofia municipality, has 2,600 employees, 390,000 residential customers and annual revenue of about €244 million.

“This is one of the most powerful companies in Bulgaria,” said Boiko Naidenov, a spokesman for the prosecutor’s office. “With its behavior it affects every family in Sofia, since the huge bills for heat empty the pocket of every resident of Sofia. In this case, the individual is truly the center of public interest.”

Tihomir Bezlov, an analyst who studies corruption in Bulgaria at the Center for the Study of Democracy in Sofia, called the affair “an absolute precedent.” He said it was the first time he could recall when the existence of a foreign bank account of a Bulgarian official or businessman had been revealed, despite the billions of dollars in Communist Party money that left the country in the early 1990s.

The case has infuriated the cash- strapped residents of Bulgaria’s capital. Dimitrov “can use his Jacuzzi and I can’t turn on the heat,” said Rumyana Neshkova, who earns 220 levs a month selling costume jewelry on a folding table on a Sofia street. “Communism taught us to lie and steal, not to treat other people well.”

Neshkova said she could afford to heat only the rooms of her 16-year-old son and her elderly in-laws in winter, at a cost of 160 levs a month. The family survives on her in-laws’ pensions.

Damyan Boichev, a hydro-engineer, said his heating bills were 170 levs, about 25 percent of his income.

“Something is changing,” he said. “Sooner or later they will all get caught. Now, fortunately, it’s happening more often. This kind of thing happens everywhere.”

According to a draft audit by the municipality, the heating company made €5.8 million in illegal purchases over the last three years.

The corruption took various forms: overpayment of contracts, purchases where no contracts existed and billing in increments of less than 10,000 levs to avoid the disclosure procedures for public purchases. In one case, 43 payments were made for a single piece of equipment.

Investigators said that Dimitrov’s Austrian bank account received payments from seven offshore companies. The money is believed to have been received as “commissions” for granting orders to provide supplies, machinery and services at inflated prices. They believe the scale of the embezzlement will turn out to be much larger.

Tsetsa Dimitrova, the 81-year-old mother of Dimitrov, has become a focus of media interest and speculation. Investigators are searching for her connections with other individuals, firms and bank accounts. They believe Dimitrov used her as a front. Her name appears as the owner of various properties and companies, including 50 percent of Bansko Properties 2, which develops real estate in Bulgaria for sale to Britain.

The owner of the other half of the firm is Krassimir Georgiev, one of the biggest players in the state’s energy industry. At the moment, he is working on the construction of the Burgas-Alexandroupolis oil pipeline, among other projects.

The political fallout has so far been limited to the public exchange of accusations between Rumen Ovcharov, the Economy and Energy minister, and the Sofia mayor, Boyko Borisov.

“When you shake the system, it’s natural that other connections come out,” Bezlov of the democracy center said. “If they didn’t shake Dimitrov, the energy mafia never would have fallen out.”