The Justice Department has reached a settlement in a civil forfeiture case involving a mansion in the Holmby Hills section of Los Angeles, owned by the family of Gagik Khachatryan, a former government official in the Republic of Armenia.
In 2011, a trust benefiting Khachatryan’s sons purchased the property with funds provided by an Armenian businessman. At that time, Khachatryan was the senior official overseeing taxes and customs in Armenia. The sons claimed that the funds were loans from the businessman. However, the United States alleged that these loans, which were repeatedly extended without repayment, were actually bribe payments. These payments are also under criminal prosecution in Armenia.
Under the settlement terms, the mansion will be forfeited to the United States. The property will then be sold at market value, with 85% of net proceeds retained by the U.S., while the remaining proceeds will go to Khachatryan’s sons and their corporation. The Attorney General has discretionary authority to transfer forfeited property to any foreign country involved in its seizure or forfeiture. The offices handling this case plan to recommend transferring some or all of the proceeds to Armenia.
Principal Deputy Assistant Attorney General Nicole M. Argentieri; U.S. Attorney Martin Estrada for the Central District of California; Acting Assistant Director Krysti Hawkins of the FBI Los Angeles Field Office; and U.S. Marshal David M. Singer made this announcement.
The FBI’s Eurasian Organized Crime Task Force (EOCTF) and U.S. Marshals Service investigated this case. The EOCTF includes multiple law enforcement agencies such as the FBI, IRS Criminal Investigation, U.S. Postal Inspection Service, Glendale Police Department, Los Angeles Police Department, and Los Angeles County Sheriff’s Department. Assistance was also provided by Justice Department’s Office of International Affairs and Armenian authorities.
Trial Attorney Hunter Smith from MLARS and Assistant U.S. Attorney Maxwell Coll for California prosecuted this case.
The Kleptocracy Asset Recovery Initiative is led by prosecutors in MLARS along with federal law enforcement agencies and often collaborates with U.S. Attorneys’ Offices to forfeit proceeds from foreign official corruption. Individuals with information on potential foreign corruption proceeds located or laundered through the United States are encouraged to contact federal law enforcement or send an email to kleptocracy@usdoj.gov or visit https://tips.fbi.gov/.