Prosecutors Back Energy Commission Claims On Corruption

YEREVAN (RFE/RL–Noyan Tapan)–Armenia’s chief prosecutor said on Wednesday that allegations of widespread corruption in the energy sector made by an ad hoc parliamentary commission have proved to be mostly truthful. The multi-partisan commission led by a senior deputy from the Armenian Revolutionary Federation–David Lokian–concluded last June that fraud–inefficiency and mismanagement registered in the energy sector since 1992 has cost Armenia about $200 million in total damages. The commission’s report was submitted to the prosecutor’s office.

Prosecutor-General Boris Nazarian told the parliament that an official investigation has found that "the vast majority of conclusions" made by the body "correspond to reality." Four criminal cases against 11 energy officials are nearing completion–Nazarian said. One of them–the director of a thermal power station in the city of Hrazdan–has been put under arrest. The head of an investigating team tasked with looking into the corruption allegations–Hector Sardarian–said the prosecution of higher-ranking officials is complicated by the lack of documentary evidence testifying to their responsibility for dubious energy deals of the early 1990s.

The 37-page report issued by the commission at the end of its six-month work accused energy officials and their powerful patrons of appropriating public funds set aside for imports of badly needed energy resources and making procurement deals on highly unfavorable terms. It alleged–for example–that 305,000 tons of procured fuel oil worth $25 million never reached Armenia between 1992 and 1995 as was claimed by the authorities.

The scandalous report was last June criticized "too categorical" by Vartan Movsisian–head of the State Committee on Energy. Hrant Bagratian–Armenia’s prime minister from 1993 to 1996–called it a "fairy-tale," saying that only "minor cases of fraud" could have taken place.

The Armenian energy ministry was on Wednesday more cautious than state prosecutors in its report to the National Assembly. The deputy minister of energy–Robert Nazarian–questioned the claim about $200 million damage to the country–saying that it "needs additional argumentation." He said 25 individuals have already been charged with abuse of power and embezzlement–while $1.7 million in stolen public funds has been returned to the state.

According to Nazarian–the materials on the facts revealed by the interim commission have been taken into consideration by relevant ministries and in some cases–by the government–reported the Noyan Tapan news agency.

A number of materials have been transferred to investigation bodies–criminal cases have been instituted–25 officials and financially responsible persons related to the cases have been charged on different articles – huge misappropriation–waste or theft of property through abuse of position–neglect–and forge.

$1,717,000 was returned to the state budget–including on the part of the 5th unit of the Thermal Power Plant. Robert Nazarian pointed out that relevant bodies of the executive power are taking measures to return the debts of some enterprises to the state budget. In particular–on account of the debt of the Rustavi Chemical Integrated Plant of Georgia CJSC. to Dvin Concern CJSC. in the amount of $6.2 million for the supplied gas–which will make it possible to repay the accumulated tax liabilities of Dvin Concern to the state budget to the tune of 1.9 billion drams.

Prosecutor General Boris Nazarian informed the deputies that on June 26 of this year–a criminal case was instituted in connection with the facts of abuse in the sphere of energy on part 4 of Article 90 of the Criminal Code of Armenia and part 2 of Article 182 of the Criminal Code of Armenia – huge theft and abuse of office entailing grave consequences. An investigatory group of 10 specialists has been formed. The group is headed by senior investigator of the Investigation Department of the Prosecutor General’s Office Hector Sardarian.

According to Nazarian–the criminal cases have not been completed yet–but a total of $1.8 million has already been transferred to the state budget under the investigated cases. The Prosecutor General’s Office requested 12 criminal cases from territorial prosecutors’ offices and courts. These cases have been examined and all the necessary materials have been attached to the main case. Charges have been brought against 11 people on the basis of the interim commission’s report. Among these people are former director of the Hrazdan Marat Martirossian who has been placed under arrest. The petitions of the investigator on choosing arrest as a preventive punishment against 6 people were rejected by the court of the first instance. Appeals have been filed in connection with these facts.

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