The DOJ reviews three different members of the alleged fraud ring in California’s San Fernando Valley who have been arrested for exploiting COVID assist applications for almost $ 22 million

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Mar 13, 2021 – LOS ANGELES – Expanding a case that indicted four people last year, federal agencies have accused four new defendants of participating in a system that More than 150 fraudulent loan applications have allegedly been filed seeking nearly $ 22 million in COVID-19 relief funds approved under Coronavirus Aid, Aid and Economic Security Act (CARES), the Justice Department said on Friday with.

Three of the new defendants were arrested Thursday on a 33-count indictment alleging a total of eight defendants of using fake, stolen, or synthetic identities to file fraudulent claims for loans guaranteed by the Small Business Administration (SBA) at Economic Injury Disaster Relief Program (EIDL) and the Paycheck Protection Program (PPP) under the CARES Act.

The three defendants arrested on Thursday are: Manuk Grigoryan, 27, of Sun Valley; Edvard Paronyan, 40, from Granada Hills; and Vahe Dadyan, 41, from Glendale. All three were tried in the United States District Court in downtown Los Angeles on Thursday afternoon. During court appearances, which lasted into the evening, a United States judge released all three on bail and ordered them to stand trial on May 4th.

A fourth new defendant charged in the substitute indictment – Arman Hayrapetyan, 38, of Glendale – is still being wanted by federal authorities.

The replacing charges filed on Tuesday add the four new defendants to a November charge that resulted in the arrests of co-defendants Richard Ayvazyan, Marietta Terabelian, Artur Ayvazyan and Tamara Dadyan.

According to the replacing indictment, the eight defendants conspired together and with others as part of a disaster-relief loan fraud ring that submitted fraudulent loan applications, often including falsified identification documents, tax documents and pay slips. The eight defendants “submitted at least 151 fraudulent PPP and EIDL loan applications, prompting them to claim and received at least a total of at least $ 21.9 million in total PPP and EIDL income from the SBA and at least 11 financial institutions $ 18 million in PPP and EIDL loan proceeds from the SBA and financial institutions, ”the indictment reads.

The defendants allegedly used the funds fraudulently received as a down payment on luxury properties in Tarzana, Glendale and Palm Desert. They also used the funds to buy gold coins, diamonds, jewelry, luxury watches, fine imported furniture, designer handbags and clothing, cryptocurrency, and securities.

All of the defendants named in the substitute indictment are charged with conspiracy to commit wire fraud and bank fraud as well as conspiracy to commit money laundering. Each of the defendants is named on various other counts in the charges alleging wire fraud, bank fraud, money laundering and aggravated identity theft.

The replacement indictment alleges that Richard Ayvazyan and Tamara Dadyan committed crimes after being released on bail in the case. The substitute indictment also alleges that Richard Ayvazyan continued to use his pseudonym “Iuliia Zhadko” to launder the proceeds of the system, including using the money to buy cryptocurrency and securities. Tamara Dadyan has allegedly lied to a bank repeatedly in order to illegally obtain disaster relief funds that had been frozen in an account fraudulently opened with a stolen identity.

An indictment is just an accusation, and all defendants are presumed innocent until found unequivocally guilty in court.

The investigation in this case is being conducted by the FBI, the IRS Criminal Investigation, the Inspectorate General of the Small Business Administration, and the Office of Inspector General.

This case is being pursued by United States Assistant Attorneys Brian Faerstein of the Department of Environmental and Security Crimes in the Environment and Scott Paetty of the Serious Fraud Department and trial attorney Christopher Fenton of the Department of Justice’s Anti-Fraud Department.

The CARES Bill is a federal law passed March 29, 2020 designed to provide emergency financial aid to millions of Americans suffering from the economic impact of the COVID-19 pandemic. One source of relief from the CARES Act has been the approval of up to $ 349 billion in unsuccessful small business loans to help keep jobs and certain other expenses through the PPP, as well as $ 10 billion in low interest small business loans through the EIDL program. In April 2020, Congress approved more than $ 300 billion in additional PPP funding and an additional $ 10 billion in EIDL funding. In December 2020, Congress approved an additional $ 284 billion in PPP funding.

The PPP enables qualified small businesses and other organizations to obtain loans with a term of two years and an interest rate of 1 percent. PPP loan proceeds must be used by businesses for labor costs, mortgage interest, rents and utilities. The PPP enables the forgiveness of interest and principal when companies spend the proceeds on these expenses within a specified period of time and use at least a certain percentage of the loan on wages and salaries.

The EIDL program aims to provide economic relief to small businesses that are currently experiencing temporary loss of income. EIDL proceeds can be used to fund a wide range of working capital and normal operating expenses, such as: B. for continuation of health services, rents, utilities and payments for fixed debt. If an applicant is also receiving a loan under the PPP, the EIDL funds cannot be used for the same purpose as the PPP funds.

Anyone with information about suspected COVID-19-related fraud can report it by calling the National Justice Department’s Disaster Fraud hotline at 866-720-5721 or using the NCDF web complaint form.
Source: DOJ