Corruption Scandal: Hundreds of Millions Embezzled in Government House Renovations

Significant embezzlement involving hundreds of millions has been reported in the renovation of government residences under the supervision of the Prime Minister's Office, with law enforcement currently investigating the matter. Official bodies have confirmed that the financial misconduct pertains to activities carried out by a state-owned enterprise operating directly under the Prime Minister's authority.

The governmental residences are recorded under the balance of the 'Kondi Residences Economy' State Enterprise, which is responsible for the maintenance of government houses, including organizing renovations. Back in 2019, it became a major issue when it was revealed that around $2 million had been allocated from the state budget for renovating and furnishing a government house serving Prime Minister Nikol Pashinyan and his family, which was already refurbished in the past to cater to the previous President of Armenia. However, the Pashinyan family requested a new refurbishment, and as a result, the government allocated funds to the Prime Minister's Office under the title 'secret.'

The completed renovations, which reportedly involved millions being spent on items as trivial as toilet bowls, have even been deemed problematic by the State Audit Office. According to reliable information sourced by Factinfo, the audit office discovered financial irregularities within the 'Kondi Residences Economy' State Enterprise, particularly concerning the renovation works, leading to discussions about potential criminal proceedings.

On August 25, Factinfo sent written inquiries to the State Audit Office and law enforcement agencies, confirming that our information was officially acknowledged. Specifically, we requested to know whether the State Audit Office investigated the activities of the enterprise, if so, which years were under scrutiny, whether any violations had been identified, and what financial damages were inflicted on the state.

We also inquired whether any embezzlements were found during the renovation works of specific governmental residences and what actions were taken regarding them. In response to our written inquiry, the State Audit Office confirmed the existence of embezzlements, stating that violations were recorded during the works carried out in 2019.

In reply to your inquiry dated August 25, 2020, the State Audit Office indicated that it had been continuously monitoring the 'Kondi Residences Economy' State Enterprise. They monitored the works conducted in 2019, including the renovations of governmental residences. Information regarding the identified violations has been forwarded to law enforcement. However, the State Audit Office refrained from answering our question regarding the scope of the financial misconduct, while Factinfo has learned that the amount in question is approximately 250 million drams.

Thus, the multi-million dollar renovation of the number one residence, managed under the direct supervision of Eduard Aghajanyan's 'Kondi Residences Economy' State Enterprise, has been accompanied by manifestations of corruption. We note that the director of the enterprise is the accountant of the 'Armenian Times' newspaper. According to a public document published on the government website on January 31, 2020, the powers of the director are being executed by Arusyak Manavazyan, who has been part of Pashinyan's team since 2008 as the accountant of 'Armenian Times' and, since 2018, also the chief accountant of the 'Civil Contract' party. Before that, in 2018, the director of the enterprise was Hakob Simidyan, the current secretary of the 'My Step' faction, who, according to employees of the enterprise, continues to play an active role. It should be noted that this deputy combines his parliamentary status not only unofficially but also officially with several other jobs. In addition, the deputy serves as an advisor to the president of the Football Federation.