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SENTENCING RESCHEDULED IN PONZI SCAM TARGETING ARMENIAN-AMERICANS
City News Service
May 1, 2006 Monday 11:46 AM PST
Los Angeles
Sentencing has been rescheduled to June 14 for a Van Nuys man who
ran an investment scam that primarily targeted Armenian-Americans and
took in nearly $20 million, the U.S. Attorney's Office announced today.
Melkon Gharakhanian, who authorities say also used the name Mike
Garian, pleaded guilty in January to one count of mail fraud.
If U.S. District Judge George Schiavelli follows the recommendations
in a plea deal between Gharakhanian and prosecutors, the 43-year-old
defendant could be sentenced to two to four years behind bars.
Gharakhanian admitted that between 1999 and 2001, a Glendale investment
firm that he and others ran, National Investment Enterprises Inc.,
took money from people who believed they were investing in specific
stocks -- including initial public offerings for Internet businesses
and other high-tech companies.
Contracts and other documentation seemed to back up that assertion,
the plea agreement states.
In reality, investor funds were used to buy non-liquid stocks that
were never listed on account statements, according to the court
document. Investor money was also being used to pay returns to other
investors in what is known as a Ponzi scheme.
Some of the investor money also went to pay salaries and other expenses
for National Investment Enterprises, the plea deal states.
Although some of the investors were paid more money than they invested,
Gharakhanian and prosecutors have agreed that the amount victims lost
in the scam was between $2.5 million and $10 million.
Beyond that range, the amount remains in dispute, and a judge must
make a finding on the issue. The total amount that victims lost in the
scam will be a major factor in how long a prison term is recommended
under advisory sentencing guidelines.
Under the law, the maximum term that could be imposed for the mail
fraud count would be five years.
In addition to the prison time, Gharakhanian will likely be ordered
to pay restitution to his victims. However, the lead prosecutor in
the case, Assistant U.S. Attorney Michael Wilner, said a previous
$2.6 million judgment against Gharakhanian -- stemming from a related
U.S. Securities and Exchange Commission civil action -- has so far
been unrecoverable.
From: Emil Lazarian | Ararat NewsPress
City News Service
May 1, 2006 Monday 11:46 AM PST
Los Angeles
Sentencing has been rescheduled to June 14 for a Van Nuys man who
ran an investment scam that primarily targeted Armenian-Americans and
took in nearly $20 million, the U.S. Attorney's Office announced today.
Melkon Gharakhanian, who authorities say also used the name Mike
Garian, pleaded guilty in January to one count of mail fraud.
If U.S. District Judge George Schiavelli follows the recommendations
in a plea deal between Gharakhanian and prosecutors, the 43-year-old
defendant could be sentenced to two to four years behind bars.
Gharakhanian admitted that between 1999 and 2001, a Glendale investment
firm that he and others ran, National Investment Enterprises Inc.,
took money from people who believed they were investing in specific
stocks -- including initial public offerings for Internet businesses
and other high-tech companies.
Contracts and other documentation seemed to back up that assertion,
the plea agreement states.
In reality, investor funds were used to buy non-liquid stocks that
were never listed on account statements, according to the court
document. Investor money was also being used to pay returns to other
investors in what is known as a Ponzi scheme.
Some of the investor money also went to pay salaries and other expenses
for National Investment Enterprises, the plea deal states.
Although some of the investors were paid more money than they invested,
Gharakhanian and prosecutors have agreed that the amount victims lost
in the scam was between $2.5 million and $10 million.
Beyond that range, the amount remains in dispute, and a judge must
make a finding on the issue. The total amount that victims lost in the
scam will be a major factor in how long a prison term is recommended
under advisory sentencing guidelines.
Under the law, the maximum term that could be imposed for the mail
fraud count would be five years.
In addition to the prison time, Gharakhanian will likely be ordered
to pay restitution to his victims. However, the lead prosecutor in
the case, Assistant U.S. Attorney Michael Wilner, said a previous
$2.6 million judgment against Gharakhanian -- stemming from a related
U.S. Securities and Exchange Commission civil action -- has so far
been unrecoverable.
From: Emil Lazarian | Ararat NewsPress