Money Laudering Attempt Fails: Two Different Verdicts in Nayirit Cas

Money Laudering Attempt Fails: Two Different Verdicts in Nayirit Case
Kristine Aghalaryan

16:48, December 14, 2012

Through the efforts of the RA Ministry of Finance, yet a new case of
money laundering was prevented.

Both the police and the prosecutor’s office knew about the attempt but
did nothing. They knew who was behind the transaction. To expose it,
law enforcement should have questioned Vahan Melkonyan, former
Director of the Nayirit Factory, and Judge Ara Kubanyan. But law
enforcement never received instructions to do just that so they never
followed up.

On November 2, one judicial dispute against Nayirit was resolved. This
time, an off-shore company of unknown origin lost. At the same time,
two judges handed down two separate decisions regarding the dispute.

In 2009, Numard Trading took Nayirit to court, seeking a freeze of its
assets. At the heart of the matter was a supply contract agreed
between Esmaeil Motavalli Soufiani Trading and Nayirit Ransat CJSC.

In turns out that on October 3, 2002, Nayirit Ransat, the legal
predecessor of Nayirit Factory, and Esmaeil Motavalli Soufiani Trading
signed a supply contract for Natural rubber, also called India Rubber
or Caoutchouc. According to the contract, Nayirit was obligated to
supply the buyer with up to 2,700 tons of Chloroprene Rubber. The
price was set at the equivalent in AMD of 1 ton for $1,500. Three
months later, in January 2003, the same companies signed a contract
stating that Esmaeil Motavalli Soufiani Trading had engaged in
advertising of Nayirit products at various exhibitions and that the
value of the promotional, activities was 882 million AMD. The amount
was regarded as a down payment on the supply of products and Nayirit
was obligated to supply the Iranian firm 1,000 tons of chloroprene
rubber within 60 days of the contract signing.

According to Point 2.1 of the contract, the rubber would be delivered
to the purchased in Yerevan at 70 Bagratunyats Street.

In other words, the Iranian firm had to send trucks to the factory to
pick up the material. But the firm never sent the transport trucks and
never presented any demand at the time.

Years later, in 2008, Esmaeil Motavalli Soufiani Trading ceded its
demand rights to the unknown Numard Trading company. The latter did go
to the courts, arguing that Nayirit failed to meet its obligations and
must return the 882 million AMD plus interest of 5 billion AMD.

Defense lawyer for Nayirit responded by saying that the plaintiff
should have presented its demand for supply of the product to the
company in question within a reasonable time, but that it hadn’t. The
lawyer continued by saying, `It would seem that the plaintiff lost all
interest in the contract some seven years ago. Any contractual
obligation must be executed in reasonable time, otherwise a limitation
of action must be applied.’

Numard Trading presented a letter to the court according to which
Esmaeil Motavalli Soufiani Trading supposedly did get in touch with
the supplier in writing in 2006, requesting that it fulfill its
obligations. Karen Israyelyan, director of the factory at the time,
swears he never received any such letter. Israyelyan claims that all
correspondence addressed to the factory would get stamped with a
number and that this particular letter also includes a letter in the
stamp, thus implying that it got to the factory by other than `routine
procedure’ and at a later date.

At the time Shengavit Court Judge Ara Kubanyan sustained the suit and
ordered Nayirit to pay the 5 billion AMD. This was the decision
despite the fact that the plaintiff never showed up in court, thus
depriving the defendant of the chance to cross examine. Judge Kubanyan
never applied a limitation of actions based on the above mentioned
letter. Vahan Melkonyan. On behalf of Nayirit Factory, never appealed
the decision and the 5 billion was drawn up as a creditor debt.

What followed were accusations and counter accusations in the press
and criticism of the prime minister. It was only afterwards that Prime
Minister Tigran Sargsyan instructed the Ministry of Finance in May
2011 to investigate the credibility of the Numard Trading creditor

The investigative branch of the Ministry of Finance concluded that
Esmaeil Motavalli Soufiani Trading never produced any substantiating
documentation or contract regarding the promotional activities of
behalf of Nayirit.

Nayirit grabbed hold of the ministry’s investigation and took its case
to the Court of Appeals in March of 2012.

Last month, Shengavit Court Judge Ishkhan Barseghyan rejected the suit
in total, applying the limitation of actions. The court ordered Numard
Trading to pay 247 million AMD to the RA state coffers for various
unpaid court fees. It’s not clear how the money will be seized from
the shadowy company.

Numard Trading is registered offshore, in the Seychelles Islands.
There is no information about it on the internet. This means that it
was formed to resolve its issues with Nayirit.

Numard’s director is one Stephen John Kelly, a citizen of Great
Britain. His name can be found as a director and shareholder of many
other companies; most of them offshore as well.

Three individuals are listed in the case as authorized representatives
of the company and they gave Yerevan’s Ani Plaza Hotel as an address
for official court correspondence. Some mail is also delivered to a
post office box #76 at Republic Square. The company has no
representation at Ani Plaza and mail sent there has been returned.

(To be continued)

Photo: Left to right; Judge Ara Kubanyan, Nayirit former Director
Vahan Melkonyan

(Edik Baghdasaryan also contributed to the above investigative piece)