Widespread Investigations Underway to Determine Legality of Kocharian Family Assets

The National Security Service of the Republic of Armenia, in line with its functions and based on the norms of international law and domestic legislation, is consistently combating crimes directed against economic security. As part of a criminal case under investigation by the Investigative Department, large-scale investigative actions and operational-search measures have revealed incidents of tax evasion on a particularly large scale and the laundering of criminally obtained income, involving Sedrak Kocharyan, the son of the second President of Armenia, Robert Kocharyan.

According to the established factual data in the criminal case, Sedrak Kocharyan organized and led a process in which responsible employees of one of his founded LLCs included obviously false data in tax base calculations and evaded payment of income tax on particularly large amounts. Subsequently, aiming to distort the origin and real nature of the criminally obtained income, which had not been taxed to the state budget, he legalized it through several bank transfers, allocating those funds for property acquisition.

In particular, to receive an untitled amount of $5,300,000 invested in one of the businesses by a third party, Sedrak Kocharyan engaged in fictitious transactions to formalize and obtain this sum in the name of his established company.

As reported, wanting to evade the associated tax obligations, he instructed the director of the aforementioned LLC to sign two fictitious untitled loan agreements and also provide them with accounting formalities. Consequently, the $5,300,000 was transferred to Sedrak Kocharyan's personal account as a loan repayment.

Meanwhile, the director of that LLC, in violation of legislative requirements and as a tax agent, was obliged to withhold and transfer to the state budget the income tax from the amount received untitled by Sedrak Kocharyan from a third party. Under Sedrak Kocharyan’s organization and leadership, to reduce the taxable income owed to the state budget, false data was entered into the relevant summary calculation, resulting in a failure to pay taxes amounting to 916,706,560 AMD (including fines and penalties totaling 1,968,627,338 AMD).

Afterwards, to obscure the true nature and origin of the aforementioned income from criminal activities, involving other companies linked to him and his family through a series of transactions, Sedrak Kocharyan mixed it with $5,682,960 in his bank account and legalized it through several bank transfers aimed at acquiring the “Best Western Congress” hotel.

Based on the interconnected and credible evidence obtained in the case, Sedrak Robert Kocharyan has been charged under Articles 38-205, Part 2, and Article 190, Part 3, Point 1 of the Criminal Code of the Republic of Armenia for organizing tax evasion on a particularly large scale and laundering particularly large amounts of criminally obtained income. The director of his established LLC, Aleksan Samsoni Horskanyan, has been charged under Article 205, Part 2, and has pleaded guilty to the charges.

As a preventive measure, they have been ordered to sign an agreement not to leave the country. Widespread investigative actions are ongoing to clarify the legality of the acquisition of numerous real estates and other assets by Sedrak Kocharyan and his family members, and the investigation of the criminal case continues.