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June 29, 2020Los Angeles, CA, United StatesFinancial Crimes

Los Angeles-area man pleads guilty to bank fraud for role in credit card 'bust-out' scheme used to buy cemetery plots, luxury cars

LOS ANGELES – A Glendale man pleaded guilty today to federal criminal charges that he led a series of scams, including “bust-out” schemes where he and others fraudulently charged millions of dollars to credit cards sometimes opened with “synthetic identities” and later used them to buy luxury cars and cemetery plots that he sold for profit.

As the result of a probe by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Los Angeles, the U.S. Secret Service and the Glendale Police Department, Mikayel Hmayakyan, 43, pleaded guilty to two counts of bank fraud and one count of aggravated identity theft.

U.S. District Judge George H. Wu has scheduled a November 16 sentencing hearing, at which time Hmayakyan will face a statutory maximum sentence of 62 years in federal prison.

In his plea agreement, Hmayakyan, the case’s lead defendant, admitted to running a series of fraudulent schemes, including one from November 2014 to September 2015, where he used fraudulently obtained credit cards to purchase liquor and luxury watches worth hundreds of thousands of dollars.

Hmayakyan and others obtained the credit cards – sometimes using their real names, but often with synthetic identities created with a combination of real and fictitious information – that were run up to the credit limit. Members of the scheme then “paid down” by submitting payments from accounts with insufficient funds or through fake accounts to restore the credit line, which allowed them to make additional purchases.

As part of the scheme, Hmayakyan and others used the fraudulently obtained credit cards to purchase hundreds of thousands of dollars in alcoholic beverages on behalf of the now-closed Liquor Spot in Glendale, where co-defendant Vahan Aloyan, 45, of Glendale, was a manager.

During the execution of a search warrant in 2016, HSI special agents and law enforcement partners seized more than 37,000 bottles of alcoholic beverages, worth approximately $300,000, from the Liquor Spot. They also seized nearly $13,000 in U.S. currency from the store, as well as nearly $13,000 and 37 watches and other jewelry items from Aloyan’s residence.

In criminal conduct dating back to August 2010 and continuing until April 2016, Hmayakyan fraudulently applied for loans under an alias to obtain a Kia Optima and in a real person’s name for luxury cars, including Lexus automobiles, according to the plea agreement. Hmayakyan admitted that he never intended to pay any credit card bills nor made any payments on the loans.

Hmayakyan also admitted that from March 2014 until January 2017, he used fraudulent credit cards in the names of various aliases – including “Liam Sarcozzy” and “Marco Reus” – to purchase plots at Forest Lawn Cemetery in Glendale, which he later sold at a profit.

The total intended loss to which the financial institutions were exposed was $5,232,383, according to the plea agreement.

Co-defendant Gayane Hakobyan, 70, of Hollywood Hills, also pleaded guilty today to one count of bank fraud. Hakobyan admitted that she participated in the “bust-out” scheme by allowing others to open credit card accounts in her name with the victim financial institutions.

Judge Wu has scheduled an October 8 sentencing hearing for Hakobyan, at which time she will face a statutory maximum sentence of 30 years in federal prison.

Co-defendant Mikayel Hovhannisyan, 38, of North Hollywood, pleaded guilty in June 2019 to one count of bank fraud and is serving a nine-month federal prison sentence. Aloyan, the sole remaining defendant, is scheduled to go on trial in this matter on October 6.

This case is being prosecuted by the U.S. Attorney for the Central District of California’s Major Frauds Section.

Updated: 06/30/2020