A 67-year-old man accused of creating fraudulent auto loans as part of an organized ring that collected $2.6 million in payments was extradited from Poland to face charges in Los Angeles, the state Department of Insurance announced Monday.
Yeghishe Msryan — who is facing 24 counts of money laundering and 50 counts of grand theft — is being held in lieu of $1.98 million bail while awaiting arraignment.
Msryan allegedly worked with three co-conspirators to submit 50 fraudulent auto loans for high-end vehicles through Luxor Auto Group, a dealer/broker in Glendale, between July and October 2012, according to the Department of Insurance.
According to prosecutors, Luxor provided credit applications, loan contracts and personal data for supposed buyers of the vehicles by stealing their identities. The dealer didn’t own the vehicles, some of which were not even in California.
When the named buyers started getting account statements and requests for payments, they filed police reports for identity theft, stating they never bought the vehicles. Investigators found that one of the co-conspirators had links to several of the named buyers, who were not part of the scheme, according to the Department of Insurance.
Msryan was in the U.S. on a visitor’s visa when the alleged fraud was carried out, authorities said.
“This case sends an important message to those who commit fraud — we will find you and you will be prosecuted,” Insurance Commissioner Ricardo Lara said. “This complicated scheme not only defrauded insurers, it stole sensitive information from consumers and put them at great financial risk.”
The mastermind behind the scheme, according to authorities, was Peter Yerkanyan, 41, of North Hollywood, who was Luxor’s finance manager. He was previously sentenced to 10 years in state prison and ordered to pay $2.6 million in restitution after pleading guilty to four felony counts of grand theft.
A salesman, Artur Baghdishyan, 36, of Porter Ranch, was sentenced to one year in jail, three years probation and ordered to pay $181,000 in restitution after pleading guilty to one felony count of grand theft.
The third co-conspirator, Shoghik Baburyan, 57, listed as Luxor’s owner, is an Armenian national whose whereabouts are unknown, according to the Department of Insurance.
Msryan allegedly used some of the cash to gamble in Las Vegas and wired other funds to Armenia and then left the country in October 2012. Investigators allege most of the $2.6 million was laundered into other businesses owned by Baburyan or Msryan, including Worldwide Transport and National Automotive Funding.
>> Want to read more stories like this? Get our Free Daily Newsletters Here!