PLEA AGREEMENT filed by Plaintiff USA as to Defendant Edvard Paronyan — USA v. Ayvazyan et al (Dkt. 368)

Summary

Edvard Paronyan's plea agreement, filed 05/26/21 as Document 368 in Case 2:20-cr-00579-SVW in the Central District of California, commits Paronyan to plead guilty to counts one and twenty-six of the first superseding indictment in United States v. Richard Ayvazyan et al., charging conspiracy to commit bank and wire fraud and conspiracy to commit money laundering. The parties put restitution at approximately $430,187 and the total maximum sentence at 50 years' imprisonment.

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Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 1 of 28   Page ID #:3732
Q)

TRACY L. WILKISON
Acting United States Attorney
BRANDON D. FOX
Assistant United States Attorney
Chief, Criminal Division
SCOTT PAETTY (Cal. Bar No. 274719)
BRIAN FAERSTEIN (Cal. Bar No. 274850)
Assistant United States Attorneys
Major Frauds/Environmental and Community Safety Crimes Sections
1100/1300 United States Courthouse
312 North Spring Street
Los Angeles, California 90012
Telephone: (213) 894-6527/3819
Facsimile: (213) 894-6269/0141
E-mail: Scott. Paetty@usdoj.gov/Brian. Faerstein@usdo}j.gov

DANTEL S. KAHN
Acting Chief, Fraud Section
Criminal Division, U.S. Department of Justice
CHRISTOPHER FENTON
Trial Attorney, Fraud Section
Criminal Division, U.S. Department of Justice
1400 New York Avenue NW, 3rd Floor
Washington, DC 20530
Telephone: (202) 320-0539
Facsimile: (202) 514-0152
E-mail: Christopher. Fenton@usdoj.gov

Attorneys for Plaintiff
UNITED STATES OF AMERICA

UNITED STATES DISTRICT COURT
FOR THE CENTRAL DISTRICT OF CALIFORNIA
UNITED STATES OF AMERICA, No. CR 20-579 (A) -SVW

Plaintiff, PLEA AGREEMENT FOR DEFENDANT
EDVARD PARONYAN

Vv.

RICHARD AYVAZYAN,
aka “Richard Avazian” and
“Tuliia Zhadko,”
MARIETTA TERABELIAN,
aka “Marietta Abelian” and
“Viktoria Kauichko,”
ARTUR AYVAZYAN,
aka “Arthur Ayvazyan,” and
TAMARA DADYAN,
MANUK GRIGORYAN,
aka “Mike Grigoryan,” and
“Anton Kudiumov, ”
ARMAN HAYRAPETYAN,
EDVARD PARONYAN,
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 2 of 28   Page ID #:3733
fab’

aka “Edvard Paronian” and
“Edward Paronyan,” and
VAHE DADYAN,
Defendants,

Defendant.

1, This constitutes the plea agreement between EDVARD PARONYAN
(“defendant”) and the United States Attorney’s Office for the Central
District of California and the United States Department of Justice,
Criminal Division, Fraud Section (collectively referred to herein as
the “United States”), in the above-captioned case. This agreement is
limited to the United States and cannot bind any other federal,
state, local, or foreign prosecuting, enforcement, administrative, or
regulatory authorities.

DEFENDANT’ S OBLIGATIONS

2. Defendant agrees to:
a. At the earliest opportunity requested by the United
States and provided by the Court, appear and plead guilty to counts
one and twenty-six of the first superseding indictment in United

States v. Richard Ayvazyan et al., CR No. 20-579(A), which charge

defendant with conspiracy to commit bank and wire fraud, in violation
of 18 U.S.C. § 1349, and conspiracy to commit money laundering, in
violation of 18 U.S.C. § 1956(h).

b. Agree that all court appearances, except his
sentencing hearing, may proceed by video-teleconference (“VTC”) or
telephone, if VTC is not reasonably available, so long as such
appearances are authorized by Order of the Chief Judge 20-097 or
another order, rule, or statute. Defendant understands that, under
the United States Constitution, the United States Code, and the
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Oo)

Federal Rules of Criminal Procedure (including Rules 11 and 43), he
may have the right to be physically present at these hearings.
Defendant understands that right and, after consulting with counsel,
voluntarily agrees to waive it and to proceed remotely. Defense
counsel also joins in this consent, agreement, and waiver.
Specifically, this agreement includes, but is not limited to, the
following:
i. Defendant consents under Federal Rules of
Criminal Procedure 5(f) and 10(c) and Section 15002(b) of the CARES
Act to proceed with his initial appearance and arraignment by VTC or
telephone, if VTC is not reasonably available.
ii. Defendant consents under Section 15002(b) of the
CARES Act to proceed with his waiver of indictment, under Federal
Rule of Criminal Procedure 7(b), by VTC or telephone, if VTC is not
reasonably available.
iii. Defendant consents under Section 15002(b) of the
CARES Act to proceed with his change of plea hearing by VTC or
telephone, if VTC is not reasonably available.
iv. Defendant consents under 18 U.S.C. § 3148 and
Section 15002(b) of the CARES Act to proceed with any hearing
regarding alleged violations of the conditions of pretrial release by
VTC or telephone, if VTC is not reasonably available.
c. Not contest facts agreed to in this agreement.
d. Abide by all agreements regarding sentencing contained
in this agreement.
e. Appear for all court appearances, surrender as ordered
for service of sentence, obey all conditions of any bond, and obey
any other ongoing court order in this matter.
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 4 of 28   Page ID #:3735
1 f. Not commit any crime; however, offenses that would be
2 |}excluded for sentencing purposes under United States Sentencing

3 |)/Guidelines (“U.S.S.G.” or “Sentencing Guidelines”) § 4A1.2(c) are not
4 ||}within the scope of this agreement.

5 om Be truthful at all times with the United States

6 || Probation and Pretrial Services Office and the Court.

7 h. Pay the applicable special assessments at or before

8 ||} the time of sentencing unless defendant has demonstrated a lack of

9 |}ability to pay such assessments.
10 1. At or before the time of sentencing, satisfy any and
11 |}all restitution/fine obligations based on ability to pay by
12 |}delivering a certified check or money order to the Fiscal Clerk of
13 ||the Court in the amount of $430,187, to be held until the date of
14 |}sentencing and, thereafter, applied to satisfy defendant’s

15 |} restitution/fine balance. Payments may be made to the Clerk, United
16 |} States District Court, Fiscal Department, 255 East Temple Street,

17 |} llth Floor, Los Angeles, California 90012.

18 j. Ability to pay shall be assessed based on the

19 |} Financial Disclosure Statement, referenced below, and all other
20 ||relevant information relating to ability to pay.
21 k. Defendant agrees that any and all restitution/fine
22 |!obligations ordered by the Court will be due in full and immediately.
23 || The government is not precluded from pursuing, in excess of any
24 |}payment schedule set by the Court, any and all available remedies by
25 |}which to satisfy defendant’s payment of the full financial
26 |}obligation, including referral to the Treasury Offset Program.
27 Ll. Complete the Financial Disclosure Statement on a form
28 || provided by the United States and, within 30 days of defendant’s
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 5 of 28   Page ID #:3736
Q).

entry of a guilty plea, deliver the signed and dated statement, along
with all of the documents requested therein, to the United States by
either email at usacac.FinLit@usdoj.gov (preferred) or mail to the
United States Financial Litigation Section at 300 N. Los Angeles St.,
Suite 7516, Los Angeles, CA 90012.

m. Authorize the United States to obtain a credit report
upon returning a signed copy of this plea agreement.

n. Consent to the United States inspecting and copying
all of defendant’s financial documents and financial information held
by the United States Probation and Pretrial Services Office.

3. Defendant further agrees:

a. To forfeit all right, title, and interest in and to
any and all monies, properties, and/or assets of any kind, derived
from or acquired as a result of the illegal activity to which
defendant is pleading guilty (collectively, the “Forfeitable
Assets”).

b. To the Court’s entry of an order of forfeiture at or
before sentencing with respect to the Forfeitable Assets and to the
forfeiture of the assets.

on To take whatever steps are necessary to pass to the
United States clear title to the Forfeitable Assets, including,
without limitation, the execution of a consent decree of forfeiture
and the completing of any other legal documents required for the
transfer of title to the United States.

d. Not to contest any administrative forfeiture
proceedings or civil judicial proceedings commenced against the
Forfeitable Assets. If defendant submitted a claim and/or petition
for remission for all or part of the Forfeitable Assets on behalf of
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 6 of 28   Page ID #:3737
himself or any other individual or entity, defendant shall and hereby
does withdraw any such claims or petitions, and further agrees to
waive any right he may have to seek remission or mitigation of the
forfeiture of the Forfeitable Assets.

e. Not to assist any other individual in any effort
falsely to contest the forfeiture of the Forfeitable Assets.

f. Not to claim that reasonable cause to seize the
Forfeitable Assets was lacking.

g. To prevent the transfer, sale, destruction, or loss of
any and all assets described above to the extent defendant has the
ability to do so.

h. To fill out and deliver to the United States a
completed financial statement listing defendant’s assets on a form
provided by the United States.

i. That forfeiture of Forfeitable Assets shall not be
counted toward satisfaction of any special assessment, fine,
restitution, costs, or other penalty the Court may impose.

THE UNITED STATES’ OBLIGATIONS

4, The United States agrees to:
a. Not contest facts agreed to in this agreement.
b. Abide by all agreements regarding sentencing contained

in this agreement.

er At the time of sentencing, move to dismiss the
remaining counts of the superseding indictment and move to dismiss
the underlying indictment as against defendant. Defendant agrees,
however, that at the time of sentencing the Court may consider any

dismissed charges in determining the applicable Sentencing Guidelines
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 7 of 28   Page ID #:3738
Q).

range, the propriety and extent of any departure from that range, and
the sentence to be imposed.

d. At the time of sentencing, provided that defendant
demonstrates an acceptance of responsibility for the offenses up to
and including the time of sentencing, recommend a two-level reduction
in the applicable Sentencing Guidelines offense level, pursuant to
U.S.S.G. § 3H1.1, and recommend and, if necessary, move for an
additional one-level reduction if available under that section.

En Recommend that defendant be sentenced to a term of
imprisonment no higher than the low end of the applicable Sentencing
Guidelines range, provided that the offense level used by the Court
to determine that range is 20 or higher and provided that the Court
does not depart downward in offense level or criminal history
category. For purposes of this agreement, the low end of the
Sentencing Guidelines range is that defined by the Sentencing Table
in U.S.S.G. Chapter 5, Part A.

NATURE OF THE OFFENSES

5. Defendant understands that for defendant to be guilty of
the crime charged in count one of the superseding indictment in

United States v. Richard Ayvazyan et al., CR No. 20-579(A), which

charges defendant with conspiracy to commit bank and wire fraud, in
violation of 18 U.S.C. § 1349, the following must be true: (1)
beginning in or around March 2020 and ending in or around August
2020, there was an agreement between two or more persons to commit at
least one of the following two crimes: (a) wire fraud, in violation
of 18 U.S.C. § 1343, and/or (b) bank fraud, in violation of 18 U.S.C.

§ 1344(2); and (2) defendant became a member of the conspiracy
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 8 of 28   Page ID #:3739
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knowing of at least one of its objects and intending to help
accomplish it.

In order for defendant to be guilty of the crime of wire fraud,
in violation of 18 U.S.C. § 1343, the following must be true: (1)
defendant knowingly participated in a scheme or plan to defraud, ora
scheme or plan for obtaining money or property by means of false or
fraudulent pretenses, representations, promises, or omitted facts.
Deceitful statements or half-truths may constitute false or
fraudulent representations; (2) the statements made or facts omitted
as part of the scheme were material, that is, they had a natural
tendency to influence, or were capable of influencing, a person to
part with money or property; (3) defendant acted with the intent to
defraud, that is, the intent to deceive and cheat; and (4) defendant
used, or caused to be used, an interstate wire communication to carry
out or attempt to carry out an essential part of the scheme.

In order for defendant to be guilty of the crime of bank fraud,
in violation of 18 U.S.C. § 1344(2), the following must be true: (1)
defendant knowingly carried out a scheme or plan to obtain money or
property from a financial institution by making false statements or
promises; (2) defendant knew that the statements or promises were
false; (3) the statements or promises were material, that is, they
had a natural tendency to influence, or were capable of influencing,
a financial institution to part with money or property; (4) defendant
acted with the intent to defraud; and (5) the financial institution
was federally insured.

Defendant understands that for defendant to be guilty of the
crime charged in count twenty-six of the superseding indictment in

United States v. Richard Ayvazyan et al., CR No. 20-579(A), which
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 9 of 28   Page ID #:3740
feb}

charges defendant with conspiracy to commit money laundering, in
violation of 18 U.S.C. § 1956(h), the following must be true: (1)
defendant agreed with one or more co-conspirators to knowingly
conduct a financial transaction involving property that represented
the proceeds of wire fraud and/or bank fraud; (2) defendant knew that
the property represented the proceeds of some form of unlawful
activity; and (3) defendant knew that the transaction was designed in
whole or in part to conceal or disguise the nature, location, source,
ownership, or control of the proceeds of such unlawful activity
(i.e., § 1956(a) (1) (B) (1)).

PENALTIES AND RESTITUTION

6. Defendant understands that the statutory maximum sentence
that the Court can impose for a violation of Title 18, United States
Code, Section 1349, is: 30 years’ imprisonment; a five-year period of
supervised release; a fine of $1,000,000 or twice the gross gain or
gross loss resulting from the offense, whichever is greatest; anda
mandatory special assessment of $100.

Defendant understands that the statutory maximum sentence that
the Court can impose for a violation of Title 18, United States Code,
Section 1956(h), is: 20 years’ imprisonment; a three-year period of
supervised release; a fine of $500,000 or twice the gross gain or
gross loss resulting from the offense, whichever is greatest; and a
mandatory special assessment of $100.

7. Defendant understands, therefore, that the total maximum
sentence for all offenses to which defendant is pleading guilty is:
50 years’ imprisonment; a five-year period of supervised release; a

fine of $1,500,000 or twice the gross gain or gross loss resulting
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 10 of 28   Page ID #:3741
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from the offenses, whichever is greatest; and a mandatory special
assessment of $200.

8. Defendant understands that defendant will be required to
pay full restitution to the victims of the offenses to which
defendant is pleading guilty. Defendant agrees that, in return for
the United States’ compliance with its obligations under this
agreement, the Court may order restitution to persons other than the
victims of the offenses to which defendant is pleading guilty and in
amounts greater than those alleged in the counts to which defendant
is pleading guilty. In particular, defendant agrees that the Court
may order restitution to any victim of any of the following for any
losses suffered by that victim as a result: (a) any relevant conduct,
as defined in U.S.S.G. § 1B1.3, in connection with the offenses to
which defendant is pleading guilty; and (b) any counts dismissed and
charges not prosecuted pursuant to this agreement as well as all
relevant conduct, as defined in U.S.S.G. § 1B1.3, in connection with
those counts and charges. The parties currently believe that the
applicable amount of restitution is approximately $430,187, but
recognize and agree that this amount could change based on facts that
come to the attention of the parties prior to sentencing.

9, Defendant understands that supervised release is a period
of time following imprisonment during which defendant will be subject
to various restrictions and requirements. Defendant understands that
if defendant violates one or more of the conditions of any supervised
release imposed, defendant may be returned to prison for all or part
of the term of supervised release authorized by statute for the

offense that resulted in the term of supervised release, which could
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 11 of 28   Page ID #:3742
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result in defendant serving a total term of imprisonment greater than
the statutory maximum stated above.

10. Defendant understands that, by pleading guilty, defendant
may be giving up valuable government benefits and valuable civic
rights, such as the right to vote, the right to possess a firearm,
the right to hold office, and the right to serve on a jury. Defendant
understands that he is pleading guilty to a felony and that it is a
federal crime for a convicted felon to possess a firearm or
ammunition. Defendant understands that the convictions in this case
may also subject defendant to various other collateral consequences,
including but not limited to revocation of probation, parole, or
supervised release in another case and suspension or revocation of a
professional license. Defendant understands that unanticipated
collateral consequences will not serve as grounds to withdraw
defendant’s guilty pleas.

11. Defendant and his counsel have discussed the fact that, and
defendant understands that, if defendant is not a United States
citizen, the convictions in this case make it practically inevitable
and a virtual certainty that defendant will be removed or deported
from the United States. Defendant may also be denied United States
citizenship and admission to the United States in the future.
Defendant understands that while there may be arguments that
defendant can raise in immigration proceedings to avoid or delay
removal, removal is presumptively mandatory and a virtual certainty
in this case. Defendant further understands that removal and
immigration consequences are the subject of a separate proceeding and
that no one, including his attorney or the Court, can predict to an
absolute certainty the effect of his convictions on his immigration
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 12 of 28   Page ID #:3743
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status. Defendant nevertheless affirms that he wants to plead guilty
regardless of any immigration consequences that his pleas may entail,
even if the consequence is automatic removal from the United States.

FACTUAL BASIS

12. Defendant admits that defendant is, in fact, guilty of the
offenses to which defendant is agreeing to plead guilty. Defendant
and the United States agree to the statement of facts provided below
and agree that this statement of facts is sufficient to support pleas
of guilty to the charges described in this agreement and to establish
the Sentencing Guidelines factors set forth in paragraph 14 below but
is not meant to be a complete recitation of all facts relevant to the
underlying criminal conduct or all facts known to either party that
relate to that conduct.

Beginning in or about March 2020 and continuing through in or
about August 2020, defendant, together with co-conspirators known and
unknown, including codefendants Richard Ayvazyan (“R. Ayvazyan”),
Marietta Terabelian, Artur Ayvazyan, Tamara Dadyan (“T. Dadyan”),
Manuk Grigoryan, Arman Hayrapetyan, and Vahe Dadyan (“V. Dadyan”)
(collectively, “co-conspirators”), engaged in a broad conspiracy to
fraudulently obtain disaster relief funds under the Paycheck
Protection Program (“PPP”) and Economic Injury Disaster Loan Program
(“EIDL”), two federal relief programs that were created through The
Coronavirus Aid, Relief, and Economic Security (“CARES”) Act, a
federal law that was enacted in or about March 2020 and that was
designed to provide emergency financial assistance to Americans
suffering economic harm as a result of the COVID-19 pandemic.

The PPP loan program authorized United States taxpayer funds in
forgivable loans to small businesses for job retention and certain
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 13 of 28   Page ID #:3744
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other qualifying expenses. In order to obtain a PPP loan, a
qualifying business was required to submit a PPP loan application
Signed by an authorized representative of the business. The PPP loan
application required the small business (through its authorized
representative) to acknowledge the program rules and make certain
affirmative certifications in order to be eligible to obtain the PPP
loan. One such certification required the applicant to affirm that
“[t]he [PPP loan] funds w[ould] be used to retain workers and
maintain payroll or make mortgage interest payments, lease payments,
and utility payments.” The applicant (through its authorized
representative) was also required to acknowledge that “I understand
that if the funds are used for unauthorized purposes, the federal
government may pursue criminal fraud charges.”

In the PPP loan application, the applicant was required to
state, among other things, its: (a) average monthly payroll expenses;
and (b) number of employees. These figures were used to calculate
the amount of money the small business was eligible to receive under
the PPP. In addition, the applicant was required to provide
documentation showing its payroll expenses. PPP loan proceeds were
required to be used by the business on certain permissible expenses,
namely, payroll costs, interest on mortgages, rent, and utilities.
The PPP allowed the interest and principal on the PPP loan to be
entirely forgiven if the business spent the loan proceeds on these
expenses within a designated period of time and used at least a
minimum amount of the PPP loan proceeds towards payroll expenses.

The EIDL program was a United States Small Business
Administration (“SBA”) program that provided low-interest financing
to small businesses, renters, and homeowners in regions affected by
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 14 of 28   Page ID #:3745
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declared disasters. The CARES Act authorized the SBA to provide EIDL
loans of up to $2 million to eligible small businesses experiencing
substantial financial disruption due to the COVID-19 pandemic. To
obtain an EIDL loan, a qualifying business was required to submit an
application to the SBA and provide information about the business’s
operations, such as the number of employees, gross revenues for the
12-month period preceding the disaster, and cost of goods sold in the
12-month period preceding the disaster.

The applicant was also required to certify that all of the
information in the application was true and correct to the best of
the applicant’s knowledge. EIDL loan applications were submitted
directly to the SBA and processed by the agency with support from a
government contractor. The amount of the loan, if the application
was approved, was determined based, in part, on the information
provided by the applicant about employment, revenue, and cost of
goods sold. EIDL loan funds could be used for payroll expenses, sick
leave, production costs, and business obligations, such as debts,
rent, and mortgage payments. If the applicant also obtained a loan
under the PPP, the EIDL loan funds could not be used for the same
purpose as the PPP loan funds.

To carry out the conspiracy, members of the conspiracy took the
following actions, among other things:

- They knowingly and with the intent to defraud used and caused
to be used, stolen, fictitious, and synthetic identities of
individuals and used and caused to be used stolen, fictitious,
synthetic, and sometimes real companies and business names to submit

fraudulent applications for PPP and EIDL loans.
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 15 of 28   Page ID #:3746
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- They made and caused to be made, false statements and
submitted false documents to the SBA and federally-insured financial
institutions in connection with the fraudulent applications for PPP
and BIDL loans, including electronically submitting and causing to be
submitted false documents that included false representations
regarding the number of employees to whom the companies had paid
wages, false and fictitious tax documents, payroll records, bank
records, and identification documents, as well as false
certifications that the loans would be used for permissible business
purposes.

- They deposited and directed other co-conspirators to deposit
fraudulently obtained PPP and EIDL proceeds into bank accounts that
they controlled and then laundered and used the fraudulently obtained
PPP and EIDL loan proceeds for their own personal benefit and for the
personal benefit of their co-conspirators, including for the
purchases of luxury homes, gold coins, diamonds, jewelry, luxury
watches, fine furnishings, and designer consumer goods and clothing.

As part of the conspiracy and with the intent to fraudulently
exploit the PPP and EIDL programs, defendant took the following
actions with respect to the following loans.

The $130,187 PPP Loan for Redline Auto Collision

On or about May 7, 2020, defendant, together with other co-
conspirators, knowingly submitted to Lender B, a federally insured
financial institution, an application in the name of Redline Auto
Collision Inc. (“Redline Auto Collision”), seeking a PPP loan in the
amount of $130,187, which application: (a) falsely represented that
Redline Auto Collision had 12 employees, including employees for whom
it had paid wages and payroll taxes, and average monthly payroll
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 16 of 28   Page ID #:3747
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expenses of $52,075; and (b) falsely certified Redline Auto Collision
would use the loan proceeds only for permissible business purposes.
On or about May 11, 2020, in reliance on the false and fraudulent
loan application submitted by defendant and his co-conspirators,
Lender B wired approximately $130,187 in fraudulent PPP loan proceeds
to a bank account controlled by defendant. Defendant then used a
portion of those proceeds not for legitimate business expenses, but
rather to pay personal expenses, including large credit card charges
to, among other vendors, Louis Vuitton, Neiman Marcus, and the
Bellagio Las Vegas.

The $150,000 EIDL Loan for Redline Auto Collision

On or about April 2, 2020, defendant, together with other co-
conspirators, submitted to the SBA an application in the name of
Redline Auto Collision seeking an EIDL loan in the amount of
approximately $150,000, which application falsely certified Redline
Auto Collision would use the loan proceeds for permissible business
purposes. On or about June 8, 2020, in reliance on the loan
application submitted by defendant and his co-conspirators, the SBA
wired approximately $149,900 in proceeds from the Redline Auto
Collision loan to a bank account controlled by defendant. Then on or
about June 17, 2020, defendant wired $150,000 of the fraudulently
obtained EIDL loan proceeds to an account controlled by co-
conspirator Terabelian for purposes of making a down payment on a
luxury home in Tarzana held in the name of co-conspirators R.
Ayvazyan and Terabelian. In so doing, defendant knowingly engaged in
a money laundering conspiracy, the object of which was to transfer
illicit proceeds of the PPP and EIDL fraud scheme to conceal the
nature, source, location, ownership and control of those proceeds and
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contribute to the purchase of a luxury home held in the name of co-
conspirators R. Ayvazyan and Terabelian.

The $150,000 FIDL Loan for RAC

On or about July 16, 2020, defendant submitted to the SBA an
application seeking an EIDL loan for “RAC” in the amount of
approximately $150,000 in the name of a close family relative, E.G.
“RAC” was an acronym for “Redline Auto Collision,” and did not
represent a separate business. Defendant falsely certified that
“RAC” had not received compensation from other sources as a result of
the COVID-19 pandemic, including loans, when, in truth, “Redline Auto
Collision” had already received a PPP loan and an EIDL loan.
Defendant also falsely certified that RAC would use all of the loan
proceeds for permissible business purposes. Defendant admits that
his use of the fictitious entity RAC to apply for an EIDL for which
he did not qualify constitutes the use of sophisticated means to
commit fraud. On or about August 4, 2020, in reliance on the
fraudulent application submitted by defendant, the SBA wired
approximately $150,000 in proceeds from the RAC loan to a bank
account controlled by defendant who then used at least some of the
fraudulently obtained proceeds for his own personal benefit, not for
permissible business purposes under the EIDL program.

Defendant agrees that the total loss caused by the above conduct
is $430,187.

SENTENCING FACTORS

13. Defendant understands that in determining defendant’s
sentence the Court is required to calculate the applicable Sentencing
Guidelines range and to consider that range, possible departures
under the Sentencing Guidelines, and the other sentencing factors set
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forth in 18 U.S.C. § 3553(a). Defendant understands that the
Sentencing Guidelines are advisory only, that defendant cannot have
any expectation of receiving a sentence within the calculated
Sentencing Guidelines range, and that after considering the
Sentencing Guidelines and the other § 3553(a) factors, the Court will
be free to exercise its discretion to impose any sentence it finds
appropriate up to the maximum set by statute for the crimes of
conviction.
14. Defendant and the United States agree to the following
applicable Sentencing Guidelines factors:
Base Offense Level: 21 U.S.S.G. § 2851.1 (a) (1
U.S.S.G. 8§ a he

(b) (1) (G), (b) ¢
Specific Offense

Characteristics
Conviction under § 1956 +2 U.S.S.G. § 2S1.1(b) (2) (B)
Acceptance of Responsibility: -3 U.S.S.G. § 3E1.1

The United States will agree to a two-level downward adjustment for
acceptance of responsibility (and, if applicable, move for an
additional one-level downward adjustment under U.S.S.G. § 3H1.1(b))
only if the conditions set forth in paragraph 4(d) are met and if
defendant has not committed, and refrains from committing, acts
constituting obstruction of justice within the meaning of U.S.S.G.

§ 3Cl1.1, as discussed below. Subject to paragraph 28 below, and with
the exception that defendant reserves the right to argue for -- and
the United States reserves the right to contest -- that an adjustment
for mitigating role under U.S.S.G. § 3Bl.2 applies, defendant and the
United States agree not to seek, argue, or suggest in any way, either
orally or in writing, that any other specific offense

characteristics, adjustments, or departures relating to the offense
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 19 of 28   Page ID #:3750
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level be imposed. Defendant agrees, however, that if, after signing
this agreement but prior to sentencing, defendant were to commit an
act, or the United States were to discover a previously undiscovered
act committed by defendant prior to signing this agreement, which
act, in the judgment of the United States, constituted obstruction of
justice within the meaning of U.S.S.G. § 3C1.1, the United States
would be free to seek the enhancement set forth in that section and
to argue that defendant is not entitled to a downward adjustment for
acceptance of responsibility under U.S.S.G. § 3EH1.1.

15. Defendant understands that there is no agreement as to
defendant’s criminal history or criminal history category.

16. Defendant and the United States reserve the right to argue
for a sentence outside the sentencing range established by the
Sentencing Guidelines based on the factors set forth in 18 U.S.C.

§ 3553(a) (1), (a) (2), (a) (3), (a) (6), and (a) (7).

WAIVER OF CONSTITUTIONAL RIGHTS

17. Defendant understands that by pleading guilty, defendant

gives up the following rights:

a. The right to persist in a plea of not guilty.

b. The right to a speedy and public trial by jury.

c. The right to be represented by counsel -- and if
necessary have the Court appoint counsel -- at trial. Defendant

understands, however, that, defendant retains the right to be

represented by counsel -- and if necessary have the Court appoint
counsel -- at every other stage of the proceeding.
d. The right to be presumed innocent and to have the

burden of proof placed on the government to prove defendant guilty
beyond a reasonable doubt.
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 20 of 28   Page ID #:3751
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e. The right to confront and cross-examine witnesses
against defendant.

£. The right to testify and to present evidence in
opposition to the charges, including the right to compel the
attendance of witnesses to testify.

g. The right not to be compelled to testify, and, if
defendant chose not to testify or present evidence, to have that
choice not be used against defendant.

h. Any and all rights to pursue any affirmative defenses,
Fourth Amendment or Fifth Amendment claims, and other pretrial
motions that have been filed or could be filed.

WAIVER OF APPEAL OF CONVICTION

18. Defendant understands that, with the exception of an appeal
based on a claim that defendant’s guilty pleas were involuntary, by
pleading guilty defendant is waiving and giving up any right to
appeal defendant’s convictions on the offenses to which defendant is
pleading guilty. Defendant understands that this waiver includes,
but is not limited to, arguments that the statutes to which defendant
is pleading guilty are unconstitutional, and any and all claims that
the statement of facts provided herein is insufficient to support
defendant’s pleas of guilty.

LIMITED MUTUAL WAIVER OF APPEAL OF SENTENCE

19, Defendant agrees that, provided the Court imposes a total
term of imprisonment on all counts of conviction of no more than 51
months, defendant gives up the right to appeal all of the following:
{a) the procedures and calculations used to determine and impose any
portion of the sentence; (b) the term of imprisonment imposed by the
Court; (c) the fine imposed by the Court, provided it is within the
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 21 of 28   Page ID #:3752
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statutory maximum; (d) to the extent permitted by law, the
constitutionality or legality of defendant’s sentence, provided it is
within the statutory maximum; (e) the amount and terms of any
restitution order, provided it requires payment of no more than
$430,187; (f) the term of probation or supervised release imposed by
the Court, provided it is within the statutory maximum; and (g) any
of the following conditions of probation or supervised release
imposed by the Court: the conditions set forth in Second Amended
General Order 20-04 of this Court; the drug testing conditions
mandated by 18 U.S.C. §§ 3563(a) (5) and 3583(d); and the alcohol and
drug use conditions authorized by 18 U.S.C. § 3563(b) (7).

20. The United States agrees that, provided (a) all portions of
the sentence are at or below the statutory maximum specified above
and (b) the Court imposes a term of imprisonment of no less than 41
months, the United States gives up its right to appeal any portion of
the sentence, with the exception that the United States reserves the
right to appeal the following: (a) the amount of restitution ordered
if that amount is less than $430,187.

21. Defendant also gives up any right to bring a post-
conviction collateral attack on the convictions or sentence,
including any order of restitution, except a post-conviction
collateral attack based on a claim of ineffective assistance of
counsel, a claim of newly discovered evidence, or an explicitly
retroactive change in the applicable Sentencing Guidelines,
sentencing statutes, or statutes of conviction. Defendant
understands that this waiver includes, but is not limited to,
arguments that the statutes to which defendant is pleading guilty are
unconstitutional, and any and all claims that the statement of facts
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 22 of 28   Page ID #:3753
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provided herein is insufficient to support defendant’s pleas of
guilty.

RESULT OF WITHDRAWAL OF GUILTY PLEA

22. Defendant agrees that if, after entering guilty pleas
pursuant to this agreement, defendant seeks to withdraw and succeeds
in withdrawing defendant’s guilty pleas on any basis other than a
claim and finding that entry into this plea agreement was
involuntary, then (a) the United States will be relieved of all of
its obligations under this agreement; and (b) should the United
States choose to pursue any charge that was either dismissed or not
filed as a result of this agreement, then (i) any applicable statute
of limitations will be tolled between the date of defendant’s signing
of this agreement and the filing commencing any such action; and
(ii) defendant waives and gives up all defenses based on the statute
of limitations, any claim of pre-indictment delay, or any speedy
trial claim with respect to any such action, except to the extent
that such defenses existed as of the date of defendant’s signing this
agreement.

RESULT OF VACATUR, REVERSAL OR SET-ASIDE

23. Defendant agrees that if any count of conviction is
vacated, reversed, or set aside, the United States may: (a) ask the
Court to resentence defendant on any remaining counts of conviction,
with both the United States and defendant being released from any
stipulations regarding sentencing contained in this agreement,

(ob) ask the Court to void the entire plea agreement and vacate
defendant’s guilty pleas on any remaining counts of conviction, with
both the United States and defendant being released from all their
obligations under this agreement, or (c) leave defendant’s remaining
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 23 of 28   Page ID #:3754
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convictions, sentence, and plea agreement intact. Defendant agrees
that the choice among these three options rests in the exclusive
discretion of the United States.

EFFECTIVE DATE OF AGREEMENT

24, This agreement is effective upon signature and execution of
all required certifications by defendant, defendant’s counsel, and an
Assistant United States Attorney.

BREACH OF AGREEMENT

25. Defendant agrees that if defendant, at any time after the
Signature of this agreement and execution of all required
certifications by defendant, defendant’s counsel, and an Assistant
United States Attorney, knowingly violates or fails to perform any of
defendant’s obligations under this agreement (“a breach”), the United
States may declare this agreement breached. All of defendant’s
obligations are material, a single breach of this agreement is
sufficient for the United States to declare a breach, and defendant
shall not be deemed to have cured a breach without the express
agreement of the United States in writing. If the United States
declares this agreement breached, and the Court finds such a breach
to have occurred, then: (a) if defendant has previously entered
guilty pleas pursuant to this agreement, defendant will not be able
to withdraw the guilty pleas, and (b) the United States will be
relieved of all its obligations under this agreement.

26. Following the Court’s finding of a knowing breach of this
agreement by defendant, should the United States choose to pursue any
charge that was either dismissed or not filed as a result of this

agreement, then:
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 24 of 28   Page ID #:3755
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a. Defendant agrees that any applicable statute of
limitations is tolled between the date of defendant’s signing of this
agreement and the filing commencing any such action.

b. Defendant waives and gives up all defenses based on
the statute of limitations, any claim of pre-indictment delay, or any
speedy trial claim with respect to any such action, except to the
extent that such defenses existed as of the date of defendant’s
signing this agreement.

er Defendant agrees that: (i) any statements made by
defendant, under oath, at the guilty plea hearing (if such a hearing
occurred prior to the breach); (ii) the agreed to factual basis
statement in this agreement; and (iii) any evidence derived from such
statements, shall be admissible against defendant in any such action
against defendant, and defendant waives and gives up any claim under
the United States Constitution, any statute, Rule 410 of the Federal
Rules of Evidence, Rule 11(f£) of the Federal Rules of Criminal
Procedure, or any other federal rule, that the statements or any
evidence derived from the statements should be suppressed or are
inadmissible.

COURT AND UNITED STATES PROBATION AND PRETRIAL SERVICES

OFFICE NOT PARTIES

27. Defendant understands that the Court and the United States
Probation and Pretrial Services Office are not parties to this
agreement and need not accept any of the United States’ sentencing
recommendations or the parties’ agreements to facts or sentencing
factors.

28. Defendant understands that both defendant and the United
States are free to: (a) supplement the facts by supplying relevant
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 25 of 28   Page ID #:3756
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information to the United States Probation and Pretrial Services
Office and the Court, (b) correct any and all factual misstatements
relating to the Court’s Sentencing Guidelines calculations and
determination of sentence, and (c) argue on appeal and collateral
review that the Court’s Sentencing Guidelines calculations and the
sentence it chooses to impose are not error, although each party
agrees to maintain its view that the calculations in paragraph 14 are
consistent with the facts of this case. While this paragraph permits
both the United States and defendant to submit full and complete
factual information to the United States Probation and Pretrial
Services Office and the Court, even if that factual information may
be viewed as inconsistent with the facts agreed to in this agreement,
this paragraph does not affect defendant’s and the United States’
obligations not to contest the facts agreed to in this agreement.

29. Defendant understands that even if the Court ignores any
sentencing recommendation, finds facts or reaches conclusions
different from those agreed to, and/or imposes any sentence up to the
Maximum established by statute, defendant cannot, for that reason,
withdraw defendant’s guilty pleas, and defendant will remain bound to
fulfill all defendant’s obligations under this agreement. Defendant
understands that no one -- not the prosecutor, defendant’s attorney,
or the Court -- can make a binding prediction or promise regarding
the sentence defendant will receive, except that it will be within
the statutory maximum.

NO ADDITIONAL AGREEMENTS

30. Defendant understands that, except as set forth herein,
there are no promises, understandings, or agreements between the
United States and defendant or defendant’s attorney, and that no
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 26 of 28   Page ID #:3757
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additional promise, understanding, or agreement may be entered into
unless in a writing signed by all parties or on the record in court.

PLEA AGREEMENT PART OF THE GUILTY PLEA HEARING

31. The parties agree that this agreement will be considered
part of the record of defendant’s guilty plea hearing as if the
entire agreement had been read into the record of the proceeding.
AGREED AND ACCEPTED
UNITED STATES ATTORNEY’S OFFICE
FOR THE CENTRAL DISTRICT OF
CALIFORNIA

TRACY L. WILKISON
Acting United States Attorney

><a
— —a Catherine Ahn May 26, 2021

SCOTT PAREPY — Date
BRIAN FAERSTEIN
Assistant United States Attorneys

CHRISTOPHER FENTON
Trial Attorney, DOJ Fraud Section

a S26 2/

EDVARD PARONYAN Date
Defendant

s/rx (v(
MICHAEL G. FREEDMAN Date [ |

Attorney for Defendant EDVARD
PARONYAN

CERTIFICATION OF DEFENDANT

I have read this agreement in its entirety. I have had enough

time to review and consider this agreement, and I have carefully and
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 27 of 28   Page ID #:3758
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thoroughly discussed every part of it with my attorney. I understand
the terms of this agreement, and I voluntarily agree to those terms.
I have discussed the evidence with my attorney, and my attorney has
advised me of my rights, of possible pretrial motions that might be
filed, of possible defenses that might be asserted either prior to or
at trial, of the sentencing factors set forth in 18 U.S.C. § 3553(a),
of relevant Sentencing Guidelines provisions, and of the consequences
of entering into this agreement. No promises, inducements, or
representations of any kind have been made to me other than those
contained in this agreement. No one has threatened or forced me in
any way to enter into this agreement. I am satisfied with the
representation of my attorney in this matter, and I am pleading
guilty because I am guilty of the charges and wish to take advantage

of the promises set forth in this agreement, and not for any other

reason.

Sa S-2 602 |
EDVARD PARON Date

Defendant

CERTIFICATION OF DEFENDANT’ S ATTORNEY

I am EDVARD PARONYAN’s attorney. I have carefully and
thoroughly discussed every part of this agreement with my client.
Further, I have fully advised my client of his rights, of possible
pretrial motions that might be filed, of possible defenses that might
be asserted either prior to or at trial, of the sentencing factors
set forth in 18 U.S.C. § 3553(a), of relevant Sentencing Guidelines
provisions, and of the consequences of entering into this agreement.

To my knowledge: no promises, inducements, or representations of any
Case 2:20-cr-00579-SVW   Document 368   Filed 05/26/21   Page 28 of 28   Page ID #:3759
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kind have been made to my client other than those contained in this
agreement; no one has threatened or forced my client in any way to
enter into this agreement; my client’s decision to enter into this
agreement is an informed and voluntary one; and the factual basis set
forth in this agreement is sufficient to support my client’s entry of

guilty pleas pursuant to this agreement.

/ S[e4 /e

MICHAENY G. \KREEDMAN Date -
Attorney for Defendant EDVARD
PARONYAN


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