Feds Uncover Armenian Fraud Network Accused of Embezzling $30 Million in COVID Relief Funds

For the second consecutive week, the Department of Homeland Security launched a significant early-morning raid in Los Angeles, targeting transnational crime organizations. This latest operation resulted in the arrest of fourteen individuals from an Armenian fraud ring accused of stealing an astounding $30 million in COVID relief and Small Business Administration loans intended to assist American taxpayers.

U.S. Attorney for California’s Central District, Bill Essayli, emphasized the seriousness of these actions, stating, “If you are taking money from the government that doesn’t belong to you, your door could be the next one that we’re hitting.” His comments underscore the federal government’s commitment to cracking down on fraudulent activities exploiting taxpayer funds.

Collaboration in Law Enforcement

In a coordinated effort, Fox News was embedded with the Department of Homeland Security during this multi-agency sting operation. The operation also involved crucial support from the IRS and the Small Business Administration, demonstrating a unified approach to tackling fraud.

Details of the Arrests

Among the fourteen suspects, thirteen were born in Armenia but have since become naturalized citizens. Notably, at least one of them faces potential deportation proceedings. The arrests unfolded dramatically as law enforcement surrounded a residence in the Los Angeles area. Officers utilized an armored vehicle, demanding the targeted suspect emerge.

The suspect, identified as Armenian-born William McGrayan, complied, slowly walking out of his home with his hands raised. Law enforcement observed that an informant previously labeled McGrayan as “unhinged,” highlighting his purported connections to gangs in Armenia and previous threats involving a firearm and a baseball bat.

Planned Fraudulent Endeavors

Evidence presented in court indicates that McGrayan allegedly masterminded the fraudulent operation, which sought to claim a total of $47 million in federal funds but successfully siphoned approximately $30 million. According to court documents, suspects used counterfeit documents, including fake banking and tax records, to establish multiple shell companies that applied for these federal funds.

As John Pasciucco, Acting Special Agent in Charge for Homeland Security Investigations in Los Angeles, stated, “That’s $47 million in taxpayer funds that was meant to go to good use, and these transnational criminal organizations are exploiting the American people’s good will and using it for their personal gain.” This highlights the appalling breach of trust and the need for stringent measures against fraud.

A Comprehensive Sweep

Following the arrests, the suspects were transported to a designated processing center for booking. Law enforcement officials seized a substantial cache of evidence during the operation, including approximately $20,000 in cash, two money-counting machines, and numerous cell phones and laptops. Additionally, authorities recovered two loaded semi-automatic 9mm handguns and several boxes of 9mm ammunition.

Serious Charges and Potential Implications

The suspects now face a variety of charges, including conspiracy, wire fraud, bank fraud, and money laundering. The federal authorities allege that these illegal activities were not just aimed at financial gain but included expenditures on real estate and luxury items. Some of the embezzled funds were reportedly funneled to accounts in Armenia, complicating the tracing efforts by U.S. officials.

Impact of Fraud on Communities

These developments shed light on the broader implications of such fraud. With the COVID-19 pandemic placing immense strain on the economy and countless families, crimes like these further undermine trust in governmental support systems. Keeping track of these illicit activities is crucial not only for legal accountability but for restoring public confidence in assistance measures.

As the investigation progresses, federal agencies are expected to intensify their efforts in identifying and dismantling criminal organizations that exploit government programs meant to help the vulnerable. This case serves as a stern warning to those who might consider taking advantage of public resources for illicit purposes.

Looking Ahead

The aftermath of this operation will likely lead to further investigations into other suspected fraud rings. Authorities remain vigilant as they combat fraud linked to COVID relief efforts, ensuring that those who have exploited these systems face severe consequences. The collaboration among various law enforcement agencies highlights a robust and united front against fraud and underscores the importance of safeguarding taxpayer funds.

As these events unfold, communities affected by such fraudulent schemes are left to contemplate the benefits of stronger enforcement actions. The message is clear: fraud will not be tolerated, and law enforcement will continue to work tirelessly to protect the integrity of financial assistance programs.