Los Angeles area man accused of fraudulently obtaining COVID-19 relief loans for his bogus tailoring business
LOS ANGELES – San Fernando Valley man who allegedly fled the United States today faces federal criminal charges for allegedly obtaining more than $ 860,000 in Paycheck Protection Program (P3P) loans for a shell company, then transferred most of its illicit earnings to its personal bank accounts.
Arman Manukyan, 49, of Panorama City, was charged today with one count of bank fraud and one count of aggravated identity theft in a criminal complaint filed in a U.S. district court on Monday.
This investigation was conducted by the US Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI) Los Angeles, in conjunction with the Inspector General of the Treasury at the Tax Administration, the Small Business Administration – Office of Inspector General , the US Postal Inspection Service, and the Department of Employment Development, Investigations Division.
According to an affidavit in support of the complaint, Manukyan in June submitted two applications for PPP loans to Bank of America for $ 1.7 million on behalf of two shell companies registered in his name – Argo Global, Inc. and Express. Wiring.
Manukyan allegedly claimed that Argo Global was a sewing company with 73 employees and submitted to Bank of America, and later the Small Business Administration, false tax documents claiming to show the company’s wages and taxes. The underwriting record also did not include a list of employees or associates of Argo Global, which listed a virtual office address in Beverly Hills as their place of business, according to the affidavit. Ultimately, a loan of $ 867,187 was approved for Argo Global, Inc.
Shortly after receiving the funds on behalf of Argo Global, Manukyan reportedly transferred most of the balance to two of his personal bank accounts. When a bank investigator contacted Manukyan after one of his accounts was frozen due to suspicious activity, he allegedly told the bank that he was going to use the PPP loan to start a limousine business, contradicting what he said. had written on his loan application.
In June, Manukyan also reportedly submitted to Bank of America a loan application of $ 884,748 for Express Wiring, a shell company with an address in Glendale. The Small Business Administration rejected the request, saying it was submitted after the June 22 deadline for PPP loans or that allocated PPP funds were used up.
In July, a seizure warrant was executed on Manukyan’s bank accounts, recovering $ 866,019.
A search warrant executed by HSI special agents and law enforcement partners at Manukyan’s home on July 22 revealed several debit cards used for unemployment benefits from the California Employment Development Department (EDD) on behalf of different persons. Manukyan reportedly told law enforcement that he found two of the EDD cards on the street and decided to keep them, but insisted he never used them. Investigators recovered an additional $ 118,474 from debit cards linked to Manukyan.
On August 9, HSI and partner investigators received reports that Manukyan had boarded a flight from Mexico City to Paris with final destination in Minsk, Belarus.
If found guilty on both counts, Manukyan would face a legal maximum sentence of 32 years in federal prison. This case is being pursued by the United States Attorney at the Major Fraud Section of the Central District of California.
The CARES (Coronavirus Aid, Relief, and Economic Security) law was designed to provide emergency financial assistance to millions of Americans who are suffering the economic effects resulting from the COVID-19 pandemic. One source of relief under the CARES Act is the authorization of up to $ 349 billion in forgivable loans to small businesses for job retention and certain other expenses under the PPP. In April, Congress authorized more than $ 300 billion in additional P3 funding.
The PPP allows small businesses and other eligible organizations to receive loans with a two-year term and an interest rate of 1%. Businesses must use the proceeds of the PPP loan for salary costs, mortgage interest, rent, and utilities. The PPP allows for the forgiveness of interest and principal if companies spend the proceeds of these expenses within a specified time frame and use at least a certain percentage of the loan for salary expenses.
In April, HSI launched Operation Stolen Promise to prevent and investigate illegal criminal activity surrounding the pandemic, strengthen the security of the global supply chain, and protect the American public. Operation Stolen Promise combines HSI’s expertise in global commerce, financial fraud, international operations and cybercrime to investigate financial fraud schemes, importation of banned pharmaceuticals and medical supplies, websites defrauding them consumers and any other illicit criminal activity associated with the virus that compromises legitimate business or financial systems or endangers the public.
One of the main goals of Operation Stolen Promise is to educate the public on the different types of fraudulent activity targeting innocent victims, how to identify this type of crime and how to report it to authorities. HSI is using its Strategic Targeted Awareness (STOP) program to provide the public with the tools to do so and to help HSI and its law enforcement partners fight COVID-19 fraud. The STOP COVID-19 FRAUD campaign provides red flag indicators and asks people to report COVID-19 fraud to [email protected]