HomeCity NewsGlendale Man to Plead Guilty in COVID Loan Scheme

Glendale Man to Plead Guilty in COVID Loan Scheme

By City News Service

An employee of NASA’s Jet Propulsion Laboratory in Pasadena has agreed to plead guilty to bilking a government-sponsored loan program designed to help people and businesses survive the COVID-19 pandemic’s economic impact of $151,900 and admitted that he used part of the proceeds to fund illegal marijuana cultivation, officials announced Monday.
Armen Hovanesian, 32, of Glendale, a cost-control and budget-planning resource analyst for JPL, agreed to plead guilty to a single federal count of wire fraud. Hovanesian is expected to make his initial court appearance in downtown Los Angeles on Friday, Aug. 11.
After Hovanesian pleads guilty, he will face a sentence of up to 20 years in federal prison, according to the U.S. Department of Justice.
The plea agreement states that from June 2020 to October 2020, Hovanesian submitted three loan applications in the names of business entities under his control to the Economic Injury Disaster Loan Program, a program administered by the Small Business Administration that provided low-interest financing to small businesses, renters and homeowners in regions affected by declared disasters, including businesses impacted by the COVID-19 pandemic.
Hovanesian admitted to making false and fraudulent statements in the loan applications concerning the gross revenues each of the businesses had generated in the preceding year as well as false and fraudulent statements concerning his intended use of loan proceeds.
The defendant certified to the SBA under penalty of perjury that he would “use all the proceeds” of the loans for which he applied and caused others to apply for “solely as working capital to alleviate economic injury caused by disaster” consistent with the terms and limitations of the EIDL program, federal prosecutors said.
But Hovanesian instead allegedly applied those proceeds toward his own prohibited personal benefit to repay a personal real-estate debt and fund his illegal marijuana cultivation. Hovanesian fraudulently caused the SBA to transfer via interstate wire EIDL proceeds totaling $151,900, according to the DOJ.

First published in the July 29 print issue of the Glendale News-Press.

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