Former Minister to Face Corruption Charges

YEREVAN (RFE/RL)–State prosecutors investigating alleged fraud and other abuses in Armenia’s energy sector are about to bring a criminal case against Sebouh Tashjian–a US citizen of Armenian descent and a key minister in the administration of ex-president Levon Ter-Petrosyan.

Senior sources revealed to RFE/RL on Tuesday that the prosecutor-general’s office will formally charge Tashjian later this week with taking arbitrary decisions that led to "particularly large [financial] abuses."

Tashjian worked as a senior "state minister" responsible for power generation and distribution from 1993-95–at the height of a severe energy crisis that crippled the country for several consecutive years. He stayed in Armenia until 1998–advising successive governmen’s on energy matters. Sources said the authorities in Yerevan are likely to seek his extradition from the US where is thought to be residing now.

Sources also said the accusations against Tashjian will stem from a loan agreement he had negotiated with the European Bank for Reconstruction and Development in 1995. Under that agreement–the EBRD allocated $57.4 million for the construction of a new fifth unit of Armenia’s largest thermal power plant located in the central town of Hrazdan. The Armenian government–for its part–pledged to contribute $25.5 million to the project–a decision which prosecutors claim was unilaterally taken by Tashjian and amounted to an "abuse of power."

The EBRD loan proved highly insufficient for the construction of the Unit Five. Analysts believe that the former government miscalculated the total cost of the project. Some say this was done deliberately to create opportunities for corruption.

But it is not clear yet whether Tashjian will be accused of personally misappropriating public funds. The prosecutors have already leveled such charges against some Hrazdan plant executives. Three of them are currently under arrest pending the investigation.

The arrests are part of an official inquiry into corruption allegations against top energy officials who served in the Ter-Petrosyan administration. Some of them continue to hold senior government posts and are unlikely to face prosecution.

An ad hoc commission of the Armenian parliament investigating the allegations concluded in July 2000 that fraud and inefficiency in the energy sector in the 1990s has cost Armenia more than $200 million in losses. However–the prosecutor’s office has found the figure grossly exaggerated and claims to have uncovered only $5 million worth of embezzlement as yet.

Former prime minister Hrant Bagratian and other close associates of Ter-Petrosyan have dismissed the findings of the parliamentary inquiry–saying that it is politically motivated and not backed up with evidence.

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