Charges Filed Against Former Director of Yerevan Metro

The investigative department of the RA Investigative Committee has completed the preliminary investigations into two separate criminal cases initiated due to abuses at the "Yerevan Metro named after Karen Demirchyan" LLC. It should be noted that the criminal acts involve various periods, for which proceedings were initiated in different investigative bodies of the Republic of Armenia under different articles of the Criminal Code and were later consolidated into one case to ensure an objective and comprehensive examination.

During the preliminary investigation, it was established through investigative and procedural actions that the director of "Yerevan Metro named after Karen Demirchyan", identified only as P.Y., had, from March 2008 to May 2019, embezzled a particularly large amount of property entrusted to him, using his official position for personal gain. In June 2013, P.Y. proposed to alienate the 944.5 square meters of basement space located at 76 Baghramyan Avenue for an exceptionally low price to acquire it for his son, who held the positions of deputy head and then head of the "Communication and Signaling" branch.

With fraudulent documents and justifications, this area was put up for public auction, based on an obviously falsified appraisal report claiming the market value as of October 2013 was 106,850,050 AMD, while its actual market value was about twice that amount, at approximately 194,880,000 AMD. Thus, using the forged appraisal, the property was auctioned with a starting price of 106,850,050 AMD.

P.Y.'s son deliberately did not apply to participate in the first and second auctions, as per the rules of classic auctions, which dictate that if the property is not sold, the starting price decreases. Only at the third auction did he buy the mentioned property for 75,393,360 AMD. Continuing his criminal activities, P.Y., having reached a preliminary agreement with his son, decided to embezzle funds obtained from lease payments for another 60 square meters of property that was in good condition. In July 2014, they signed a lease agreement that purported to lease this space to the company for 25 years, setting the rent inexplicably at 120,000 AMD for one month. As a result, until March 2020, 7,104,000 AMD was unjustifiably transferred from the company’s funds to P.Y.'s son.

Moreover, with the assistance of a person connected to him, the chief engineer of the "Communication and Signaling" branch, A.S., P.Y. announced a nominal tender for replacing the lighting fixtures of traffic lights with LED sets. Only a company founded by A.S. participated, presenting a bid priced at 57,000,000 AMD, which was about four times the market value. P.Y., based on his relationship with A.S., confirmed the winning bid without further investigation into the justification of the proposal and awarded the contract worth 57,000,000 AMD to A.S.'s firm. A.S. did not employ any registered employees and instead involved metro staff to execute the work outlined in the contract.

Upon completing the work in October 2013, the parties signed a handover-acceptance act, and on the same day, an amount of 57,000,000 AMD was transferred from the metro's bank account to A.S.'s company account, even though the metro could have spent only 12,495,000 AMD for the specified works and products. Furthermore, it was revealed that from 2016 to 2019, a person holding the position of assistant to the mayor of Yerevan and subsequently deputy secretary of the Yerevan City Hall employed three acquaintances at the metro under the pretense of serving them, while they actually served him and his family.

At the request of this official, P.Y., using his official position, hired these individuals as drivers who did not actually work for the company, instead serving the aforementioned official and his family members, resulting in an unjust expenditure from the metro's budget amounting to 28,099,506 AMD during that period for wages and vehicle operating costs. Additionally, P.Y., in collaboration with the manager of metro affairs and an individual engaged in gasoline distribution under his instruction, engaged in embezzlement of particularly large sums through false additions in the purchases of gasoline from 2009 to 2019, amounting to a total of 39,963,327.6 AMD for approximately 110,010 liters of gasoline, which were used for personal benefits.

Beyond this, P.Y. had two individuals hired in the contractual legal department and the technological and economic refurbishment timetable of the organization, who, with P.Y.'s knowledge and tolerance, did not attend work or fulfill their job responsibilities but received monthly salaries from the company budget, leading to a total unjustified expenditure of 7,120,436 AMD for one individual and 4,084,874 AMD for the other.

Moreover, at P.Y.'s suggestion, in May 2016, a tender announcement was published for major repairs and modernization of two "81-717" type head wagons on the European Bank for Reconstruction and Development's website, which was awarded to a Russian company for a bid of 550,000 euros. However, the contract between the metro and this Russian company was signed in the amount of 1,100,000 euros instead, intending to modernize and refurbish four head wagons, the work being completed in December 2016, and a handover-acceptance act signed.

Then, P.Y. violated the obligation to conduct tenders for purchases exceeding one million AMD, signing in August 2017 a contract for the refurbishment of four wagons with the Russian branch at an inflated amount of 1,320,000 euros without announcing or conducting a tender, resulting in embezzlement from the metro budget amounting to a total equivalent of about 122,810,600 AMD due to the inflated 220,000 euros.

During the preliminary investigation of the criminal case, another criminal episode was uncovered. Specifically, it was established that according to the contract signed on September 5, 2019, for the needs of the metro and the handover-acceptance act dated November 11, the supplier company delivered four electric air compressors, which were accepted by relevant personnel, yet it was later revealed that the compressor motors were not new and did not meet the contract's conditions.

Based on sufficient evidence, charges have been filed against the director of the metro under Article 256, part 3, point 3 of the Criminal Code (7 episodes) and Article 256, part 2, points 2 and 3. His son faces charges under Article 46-256, part 3, point 3, the property appraisal expert under Article 46-256, part 3, point 3 and Article 457, part 1, a city hall official under Article 46-256, part 3, point 3, as well as the head of the supplying company under Article 255, part 3, point 3. The preliminary investigations of the two separate cases have concluded, and the materials have been sent to court with accusatory conclusions.