One hundred dollar bills currency
Photograph ©2016 by Brian Cohen.

Steal $20 Million and Flee: How NOT to Travel Luxuriously

This is quite a story with a lot more to it.

Three members of a family in the San Fernando Valley in California were sentenced to years in federal prison as they were convicted for scheming to fraudulently obtain greater than $20 million in funds designed for economic relief from the current 2019 Novel Coronavirus pandemic from both the Paycheck Protection Program and Economic Injury Disaster Loan by submitting numerous fraudulent applications for loans as emergency aid for as many as 151 businesses which did not exist.

Steal $20 Million and Flee: How NOT to Travel Luxuriously

Palm trees at sunset
Photograph ©2010 by Brian Cohen.

According to this official press release at the official Internet web site of the Department of Justice of the United States, Artur Ayvazyan — who is 41 years of age and one of the three members of the family in Tarzana — was ordered on Monday, November 15, 2021 to serve five years in federal prison…

…but the other two members of the family were sentenced in absentia after they fled justice following their convictions at trial:

  • Richard Ayvazyan — who is 43 years of age — was ordered to serve 17 years in federal prison
  • Marietta Terabelian — who is 37 years of age and the wife of Richard Ayvazyan — was sentenced to six years in federal prison

After a trial which lasted eight days, on Friday, June 25, 2021, a federal jury found each of the three defendants guilty of:

  • One count of conspiracy to commit bank fraud and wire fraud
  • Eleven counts of wire fraud
  • Eight counts of bank fraud
  • One count of conspiracy to commit money laundering

In addition, Richard Ayvazyan was also found guilty of two counts of aggravated identity theft; and Artur Ayvazyan was found guilty of one count of aggravated identity theft. Other defendants were found guilty of various charges as well.

Stephen V. Wilson — who is the judge of the United States District Court for the Central District of California in Los Angeles who formally issued the sentencing of the aforementioned three individuals — could not recall a fraud case conducted in such a “callous, intentional way without any regard for the law.” He further described Richard Ayvazyan as “an endemic, cold-hearted fraudster with no regard for the law” and someone who “views fraud as an achievement.”

The following quotes were extracted from the press release and attributed to:

  • Tracy L. Wilkison, who is an attorney for the United States: “The defendants used the COVID-19 crisis to steal millions of dollars in much-needed government aid intended for people and businesses suffering from the economic effects of the worst pandemic in a century. These sentences reflect our office’s determination to root out and punish wrongdoers who use national emergencies to defraud the government and the American taxpayer.”
  • Kenneth A. Polite Jr., who is an assistant attorney general of the criminal division of the Justice Department of the United States: “The defendants engaged in a scheme to steal critical relief funds intended to assist small businesses during the pandemic. This case, involving an egregious example of pandemic relief fraud, was the first in the country to go to trial. The Department of Justice, along with our law enforcement partners, will continue to use every available tool to combat and prevent criminals from exploiting national emergencies for their personal benefit.”
  • Kristi K. Johnson, who is the assistant director in charge of the Los Angeles field office of the Federal Bureau of Investigation of the United States: “The defendants lived a lavish lifestyle by defrauding the government at the expense of small businesses and American taxpayers already facing financial and pandemic-related hardship. The FBI is actively investigating the whereabouts of fugitives Terabelian and Ayvazyan and will pursue them until they are taken into custody to pay for their crimes.”

The Federal Bureau of Investigation of the United States offered a reward of up to $20,000.00 on Friday, September 17, 2021 for information leading to the arrest of Richard Ayvazyan and Marietta Terabelian, who were free on bail and allegedly cut their tracking bracelets on Sunday, August 29, 2021 — despite prosecutors urging the judge to lock up Ayvazyan immediately after the conclusion of the trial — and went on the run while awaiting sentencing in this case, as they allegedly took a private jet to the Balkans and vanished into a posh town in a villa on the Mediterranean Sea in Montenegro while living under falsified identities with expertly forged Mexican passports.

“Rich and Mary were adopting new names worthy of a 19th century novel: Robert Niko De Leon and Nataly Rose Perez Garcia”, according to this message which was posted at the official Twitter account of the Los Angeles Times.

The couple had supposedly taken their dog — as well as had two vehicles shipped — to Montenegro; but “Back home in Tarzana, the couple had abandoned two sons, then 16 and 14, and a daughter, 15”, according to this message which was posted at the official Twitter account of the Los Angeles Times. “In his goodbye note, Richard Ayvazyan claimed he and their mom had no choice. ’While I am writing this our tears are dripping on our breakfast table,‘ he wrote.”

Richard Ayvazyan, his wife, and his sister-in-law were reportedly caught and arrested on Tuesday, February 22, 2022.

What About Those Paycheck Protection Program Loans?

The Paycheck Protection Program is a business loan program which was established by the Small Business Association of the federal government of the United States through the Coronavirus Aid, Relief, and Economic Security Act in order to help certain businesses, self-employed workers, sole proprietors, certain nonprofit organizations, and tribal businesses protect employee payrolls and afford to continue paying their workers. Taxpayers in the United States contributed towards the $953 billion which was used for this program.

Travel companies applied for — and received — a significant amount of financial support by taxpaying citizens of the United States. Many of those loans had been forgiven entirely — meaning that the companies are not required to pay them back…

…and yet, those companies could not “afford” to offer benefits and amenities which were typically offered prior to the current 2019 Novel Coronavirus pandemic — such as continental breakfast at hotel and resort properties where that is included in the room rate. Although the travel companies can now offer those benefits and amenities once again, some of them simply have no intention to do so.

That is where capitalism arguably ends — but then again, the process is all legal. Some people might argue that if lodging companies, airlines, and other major multinational corporations did not receive that financial assistance, their possible collapse would send shockwaves throughout the entire economy and adversely affect many more people that just stakeholders — which is indeed possible…

…but interestingly, some of those people who publicly complain reportedly benefitted from the program itself. One supposed “travel blogger” who constantly bloviates in a sanctimonious manner about companies which accept free bailouts has himself or herself allegedly benefitted from almost $21,000.00 in loans from the Paycheck Protection Program — despite publicly admitting earning at least six figures of income. That borrowed money has purportedly since been forgiven — including accrued interest from that loan — which means that taxpayers funded that windfall with interest.

That person will not be identified in this article; but in case you are interested, you can search for any company or individual who accepted funds from the Paycheck Protection Program, how much money was taken, and how much of the loans were forgiven by clicking here.

Also, you can find out which airlines, lodging companies, and other companies or individuals funded the campaigns of political candidates by clicking here and arrive at your own conclusions as to whether the “bailouts” were a possible matter of political favors and cronyism. For example, Hillary Clinton was hoping to become the next president of the United States in 2016; and despite criticizing airlines for high airfares back in October of 2015, she had already received at least $145,246.00 from the airlines — placing her as the top recipient of funds from airlines as released by the Federal Election Commission of the United States as of Monday, February 22, 2016.

Final Boarding Call

handshake
Photograph ©2007 by Brian Cohen.

This article only highlights an egregious example of only one of what may possibly be many schemes to defraud the government by applying for essentially free money under false pretenses — even though some legitimate applications may have been technically legal but not ethical. Did anyone actually believe that fraud would not be committed as a result? Why was the federal government not more diligent about to whom the free money was given? Were we really all in this together, as I asked back on Thursday, April 16, 2020?

For the record, I believe that companies in the travel industry in general absolutely should return the benefits and services which they used to offer in return for the more expensive room rates that they have been charging in recent months…

…but admittedly, that is from the biased point of view as a customer. If you were operating a company, would you not try to profit from your customers as much as reasonably possible?

Besides, things usually happen in cycles: eventually, rates will lower and benefits and services — some of them, at least — may return.

Although several individuals named Brian Cohen are on that aforementioned list of people who accepted funds from the Paycheck Protection Program, do not bother to look me up, as neither me nor The Gate has accepted one single cent of funds from the Paycheck Protection Program. Perhaps I should have applied, as it was certainly not illegal — but was it ethical? Would you trust the words I write in each article if I had accepted those funds and never paid them back simply because they were forgiven? Did I do the right thing — or did I possibly foolishly leave money on the table?

Perhaps I am wrong in this way of thinking; but how can I trust the words of someone who does the very action about which he or she vehemently criticizes publicly — even though it is all technically legal? I no longer read the articles which that particular person writes for a variety of reasons.

As for major companies in the travel industry, I judge them primarily by how they treat me; and I patronize them based on price, convenience, value, and a variety of other factors — in other words, free markets based on choice and capitalism at its finest. Hilton has treated me well over the years; and I reward that treatment with my continuing to patronize them. Conversely, this lodging company has treated me unsatisfactorily; and I plan to redeem the points in my membership account of their frequent guest loyalty program before shunning them for good as a customer…

…but if they or their franchisees accepted funds from the Paycheck Protection Program, should I no longer trust them as well?

All photographs ©2007, ©2010, and ©2016 by Brian Cohen.

  1. I have heard of very small businesses that got small PPP loans and only a small part was forgiven as the business was not very profitable. Profitable businesses got a bigger portion or all of the loan forgiven. There is good news though. Some of those very small businesses were eligible for a 2nd round of PPP loans that were easier to be forgiven.

    1. I hope that those very small businesses put that money to good use, derek, as some of them were definitely unfairly caught in the crosshairs of the pandemic…

  2. Regardless of one’s political affiliation, both sides of the aisle were more than happy to hand out “free money” in order to score political points.

    The end result was just a big money grab (at taxpayers’ expense) where a lot of small businesses got the free money and laid employees off once they got it. I wont even get into the big businesses that applied and still got paid for doing absolutely nothing to help out those really in need.

    PPP was poorly conceived but who cares – the recipients think its “free” and the politicians got to brag they helped the American people. A “win-win” in the most perverted sense possible.

    Good for you for having the morals to not take PPP money, Brian. As you well know, life isn’t only about making money.

    1. Thank you so much, John L.

      I truly appreciate your comment — and I absolutely agree: life isn’t only about making money.

      In my opinion, the key of enjoying life is to have fun with whatever you do. For me, travel is one of the ways I have fun…

    1. Hmm…

      …well, that person would not be me, Mike, as I have not received a single penny from that publication.

  3. It’s funny and sick to see a former federal judge talk about how he’s never seen a fraud case where so and so when the U.S. government perpetrates the biggest frauds against citizens in history.

    Citizens are threatened with violence to pay tax for things it doesn’t support or consent to yet there are 40 million Illegals aliens who violate the sovereignty of American citizens and they received 10K a year per kid just for K-12 school funding alone plus welfare, medical, and college tuition in California.

    We are supposed to be upset at these people but not a government which steals from citizens in the form of taxation or draconian regulations which force violent criminals into our neighborhoods. It’s ridiculous.

    I would vote not guilty for these people. The money they “stole” was already stolen by the government from citizens.

    1. You have an interesting perspective, John Warton.

      I am usually not happy about the federal government using taxpayer dollars for anything other than services which are supposed to benefit…

      …the taxpayer.

  4. It’s all very interesting but I’m always amazed at criminal fugitives that can’t seem to manage how to hide. Shipping cars to themselves? How stupid. Did they think no one would even try to look for them? Of course, if they had been smart they wouldn’t break the law in the first place I guess.

    As far as the PPP funds it was just another welfare program. I had a local public official (old school conservative’ish Democrat)recently discuss with me their upcoming retirement and medicare. They said, “I don’t know how (the USA) affords to offer medicare to retired persons, it’s such a good benefit?” They seemed shocked when I told them that medicare is paid for by us, it’s a welfare program. It was like a come to Jesus moment for them. Like they had never considered that taxpayers have to pay for it. All that from a person who had been an elected local official for over 20 years.

    1. Many people thought that those funds were “free” money, DaninMCI.

      Those funds had to come from somewhere…

      …and the first part of your comment reminded me of something which happens every day on Interstate highways in the United States: people who are stopped and pulled over for transporting illegal drugs. I always thought to myself that if I was ever going to transport drugs, I would drive the speed limit in a motor vehicle which complies with all laws.

      People who engage in unlawful acts usually do stupid things which results in them getting caught…

    1. I don’t know about castrated, Debit; but those three children of theirs must feel quite neglected — regardless of their ages…

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