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
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.
Richard Ayvazyan and Marietta Terabelian were the leaders of a family fraud ring that collected $18 million in pandemic relief for sham businesses in the San Fernando Valley.
They were caught and convicted — then they escaped to Europe
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.
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?