Gurgen Israyelyan, Theft of Government Property, California 2023

Gurgen Israyelyan, a 39-year-old man from West Hills, California, pleaded guilty to stealing government funds designed to aid medical providers in the treatment of patients suffering from COVID-19 and small businesses during the pandemic.

Israyelyan admitted to owning Saint Christopher Hospice Inc. (SCH), a hospice agency in North Hollywood, which received approximately $89,162 in COVID-19 relief funds. However, he used the funds for his personal use and transferred them to family members, including a family member in Armenia, instead of using the funds in conjunction with pandemic relief efforts as required.

The charges against Israyelyan resulted from his intentional misuse of funds distributed from the Coronavirus Aid, Relief, and Economic Security (CARES) Act Provider Relief Fund, money specially apportioned by the CARES Act to help health care providers who were financially impacted by the COVID-19 pandemic to provide care to patients who were suffering from COVID-19, and to compensate providers for the cost of that care.

As part of his guilty plea, Israyelyan further admitted that he submitted, or caused to be submitted, five fraudulent Economic Injury Disaster Loan (EIDL) applications to the Small Business Administration (SBA) on behalf of SCH and four other entities that Israyelyan controlled: GMG Holdings LLC, Double G Ventures LLC, One Touch Assistants LLC, and G.I. Construction Group. As a result of the fraudulent EIDL applications, the SBA disbursed approximately $428,100 of EIDL funds to Israyelyan, all of which were proceeds that Israyelyan knew he was not entitled to and which Israyelyan used for his own personal benefit, contrary to EIDL requirements.

Israyelyan pleaded guilty to three counts of theft of government property. He is scheduled to be sentenced on June 13 and faces up to 10 years in prison for each count. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

The case was announced by Assistant Attorney General Kenneth A. Polite Jr. of the Criminal Division; U.S. Attorney Tracy L. Wilkison for the Central District of California; Special Agent in Charge Timothy B. Francesca of the U.S. Department of Health and Human Services’ Office of Inspector General’s Los Angeles Regional Office; Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division; and Assistant Director Kristi Johnson of the FBI’s Los Angeles Field Office.

Israyelyan’s actions were part of a larger scheme to misuse COVID-19 relief funds, which were intended to support medical providers and small businesses during the pandemic.

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