{"id":26032,"date":"2025-06-20T01:07:31","date_gmt":"2025-06-19T21:07:31","guid":{"rendered":"https:\/\/ampop.am\/?p=26032"},"modified":"2025-06-20T01:07:01","modified_gmt":"2025-06-19T21:07:01","slug":"north-south-road-corridor-corruption-cases","status":"publish","type":"post","link":"https:\/\/ampop.am\/en\/north-south-road-corridor-corruption-cases\/","title":{"rendered":"Seven Years, No Verdict: The Ongoing Failures of the North-South Corruption Cases"},"content":{"rendered":"

Seven years have passed since the criminal probe into large-scale corruption in the North\u2013South Road Corridor project began. Centered on the 2009\u20132018 implementation phase, the investigation\u2014like the highway it scrutinizes\u2014remains stalled, with no end in sight.<\/p>\n

Experts are increasingly voicing concern that the case may eventually collapse. They warn that the proceedings already sent to court, having been separated from the main investigation, are at risk of being dropped due to statutes of limitations.<\/p>\n

One of the few visible \u201cachievements\u201d of recent years has been the referral of two case episodes to court. However, even those trials have yet to reach a conclusion. To date, no one has been held accountable for the misappropriation of billions of drams.<\/p>\n

Ampop Media<\/strong><\/em> has sought to understand why the case has remained stalled for seven years, and what risks may arise from its prolonged delay.<\/p>\n

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Archive photo<\/strong><\/em><\/figcaption><\/figure>\n

An \u201cUnprecedented\u201d Investigation Going Nowhere<\/h3>\n

In September 2018, Armenia\u2019s Prosecutor General\u2019s Office announced the launch of a criminal investigation into apparent large-scale abuses within one of the country\u2019s biggest infrastructure projects. According to law enforcement, between 2009 and 2018, government officials involved in the North\u2013South project caused 23.5 billion AMD (around USD 60 million) in damages to the state. Notably, this figure was cited as a preliminary estimate. Officials have not clarified what the final amount of damages might be.<\/p>\n

The Investigative Committee of Armenia, which is overseeing the case, considers the North\u2013South investigation to be \u201cunprecedented\u201d in scale. Hundreds of individuals have been questioned, dozens\u2014including former high-ranking officials\u2014have been charged, and 14 suspects are currently wanted. Among them is Lyova Sargsyan, brother of Armenia\u2019s third president, Serzh Sargsyan.<\/p>\n

The case, initiated in 2018, focuses on irregularities identified in Tranche 1 (Yerevan\u2013Ashtarak and Yerevan\u2013Artashat sections) and Tranche 2 (Ashtarak\u2013Talin section) of the highway, which were commissioned in 2016. The Investigative Committee has not disclosed which specific episodes are being examined.<\/p>\n

Already in 2018, the Prosecutor General\u2019s Office had stated that government officials involved in the roadworks between 2009 and 2018 had included inefficient and unjustified tasks in project contracts. According to law enforcement, these officials agreed to extend construction and consultancy deadlines without providing justification or seeking compensation for losses incurred.<\/p>\n

The Prosecutor General also reported that in some cases, payments in consultancy contracts exceeded legally allowed maximums\u2014sometimes by double. Moreover, the services provided included redundant and unnecessary work. Authorities also noted that the Yerevan\u2013Ashtarak and Yerevan\u2013Artashat roads were delivered with obvious flaws in the concrete surface, as construction standards for materials\u2014particularly the composition and quality of cement\u2014had been violated.<\/p>\n

Only Two Episodes Have Reached Court Over Seven Years<\/h3>\n

In the seven years since the investigation began, only two episodes from the North\u2013South criminal case have been sent to court. The first involves Gurgen Sargsyan, who served as Armenia\u2019s Minister of Transport and Communication from 2008 to 2010, and Sedrak Arustamyan, the director of \u201cMulti Group\u201d company and a close associate of businessman Gagik Tsarukyan. The second case centers around Lyova Sargsyan, brother of Armenia\u2019s third president, Serzh Sargsyan.<\/p>\n

The first case bundles together 13 separate criminal episodes related to bribery, patronage, tax evasion, and money laundering.<\/p>\n

Seven individuals are currently standing trial in this case, including Gurgen Sargsyan and Sedrak Arustamyan. They are accused of engaging in fictitious business activity and evading large amounts of taxes. Arustamyan, 58, who is also involved in other criminal cases, faces additional charges of laundering particularly large sums of money.<\/p>\n

According to the Prosecutor General\u2019s Office, Sargsyan, Arustamyan, and businessman Suren Avagyan received payments from the Armenian branch of \u201cSinohydro Corporation,\u201d a contractor in the North\u2013South project, for services that were never rendered\u2014evading nearly 2.7 billion AMD in taxes. Law enforcement authorities claim the abuses were carried out in coordination with the Chinese company.<\/p>\n

After the launch of the criminal proceedings, Sedrak Arustamyan transferred 1 billion AMD to the Investigative Committee\u2019s deposit account in 2020 as a guarantee toward possible damage recovery, according to official reports.<\/p>\n

Representatives of \u201cSinohydro Corporation\u201d are also implicated in the case. However, their names are not listed in the materials of the trial currently underway in the Yerevan Court of General Jurisdiction, which legal experts say could indicate that they, too, are on the wanted list.<\/p>\n

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\nAccording to the Investigative Committee, Lyova Sargsyan\u2014who at the time held the position of Ambassador-at-Large\u2014used his influence in the selection process of subcontractors for the North\u2013South project. In 2014, he allegedly demanded, through an intermediary, 50% of the anticipated profits\u2014over USD 140,000 (around 59,710,000 AMD)\u2014from the director of one of the companies selected to install lighting systems along the road. Case files indicate that the money laundering scheme was carried out with the participation of representatives from the subcontractor company \u201cPoli-Transport.\u201d<\/p>\n

Suren and Gevorg Vardanyan, owners of \u201cPoli-Transport,\u201d are also wanted by law enforcement.<\/p>\n

In this case, only two defendants are currently on trial: businessmen Sergey Avetisyan and Antoun Andre Kourtian.<\/p>\n

In effect, over the past seven years, neither the pre-trial investigation nor the judicial process has produced tangible results. Despite the scale of corruption involved in the North\u2013South project, no high-ranking official has been held accountable to date, and several defendants remain abroad and under international search.<\/p>\n

Why the Investigation Remains Stalled<\/h3>\n

While the North\u2013South criminal case remains effectively deadlocked\u2014with no one yet held accountable for large-scale corruption\u2014government officials frequently boast about the amounts of money and property recovered by the state through other anti-corruption cases.<\/p>\n

In a statement issued in May, Prosecutor General Anna Vardapetyan announced that approximately USD 247.7 million had been recovered by the state in 2023 and 2024 alone, \u201cincluding through the application of the asset forfeiture mechanism targeting illicit property.\u201d Between 2018 and 2022, another USD 290 million had been recovered. In total, according to Vardapetyan, assets and funds worth around USD 1.5 billion remain subject to seizure in ongoing illicit enrichment proceedings.<\/p>\n

Against this backdrop, why has there been no visible progress in the North\u2013South case? Why have both the investigation and the trials dragged on for years?<\/p>\n

\u201cIt\u2019s a large and complex case with multiple episodes,\u201d explains Beniamin Harutyunyan, Head of the First Division of the General Department for Economic Crimes and Smuggling at the Investigative Committee. He notes that 14 individuals involved in the case are still wanted. However, Harutyunyan does not specify who these individuals are.<\/p>\n

\u201cThe bulk of the investigation has already been completed. A large volume of documents has been seized within the framework of the criminal proceedings,\u201d Harutyunyan adds.<\/p>\n

Research conducted by the NGO \u201cProtection of Rights Without Borders\u201d suggests that delays in corruption cases are also caused by excessive caseloads for judges.<\/p>\n

\u201cThe reasonable timeframe for examining cases at the Anti-Corruption Court is affected by the growing workload of judges, including cases related to petty corruption,\u201d said Araks Melkonyan, president of the NGO Protection of Rights Without Borders, in an interview with Ampop Media<\/strong><\/em>.<\/p>\n

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Araks Melkonyan, PRWB NGO<\/strong><\/em><\/figcaption><\/figure>\n

According to the organization\u2019s monitoring, a significant portion of cases handled by the court involve low-level corruption\u2014such as bribery cases involving amounts as small as 20,000 AMD (around USD 50).<\/p>\n

Melkonyan notes that the courts even lack enough hearing rooms to schedule sessions in a timely manner. As a result, she says, delays in court proceedings have become routine.<\/p>\n

\u201cThis naturally impacts the duration of proceedings and the overall effectiveness of justice,\u201d Melkonyan explains. \u201cWhat\u2019s more, although it was originally planned that the Anti-Corruption Court of Armenia would operate in regions outside of Yerevan, it has been functioning exclusively in the capital shortly after its establishment.\u201d<\/p>\n

Varuzhan Hoktanyan, Program Director at Transparency International Armenia, agrees with Melkonyan. However, he believes that in the case of the North\u2013South investigation, the prolonged delays may also stem from less objective reasons. Hoktanyan does not rule out the possibility that investigators could have made deals with some of the accused.<\/p>\n

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Varuzhan Hoktanyan, Transparency International Armenia<\/strong><\/em><\/figcaption><\/figure>\n

\u201cThere could be deals,\u201d he says. \u201cBecause we don\u2019t live in a country where investigators or prosecutors are fully principled or ethical, and where they never cut deals with defendants or suspects.\u201d<\/p>\n

Hoktanyan also raises concerns about investigators\u2019 qualifications:
\u201cThis is a highly complex case, and it\u2019s possible that the investigators involved are simply unqualified or overwhelmed. After all, this isn\u2019t the only case they\u2019re working on.\u201d<\/p>\n

Experts warn that these prolonged timelines could result in certain offenses exceeding their statutes of limitations, effectively nullifying any possibility of legal accountability\u2014even if guilt is established.<\/p>\n

\u201cThe only thing that is more or less certain at this point is that the longer this drags on, the more likely it is that limitation periods will expire,\u201d Melkonyan says.<\/p>\n

For instance, under Armenia\u2019s former Criminal Code\u2014under which the North\u2013South defendants are charged\u2014the statute of limitations for large-scale money laundering expires 15 years after the offense was committed. This means that if a crime was committed in 2009, the accused could walk free even if the charges are upheld in 2024.<\/p>\n

In fact, some of the cases already referred to court are, according to legal observers, on the verge of being closed on these very grounds.<\/p>\n

A study conducted by Protection of Rights Without Borders reveals that many criminal proceedings are launched or transferred to court when they are already close to expiring. In such cases, Melkonyan explains, the court is legally obligated to terminate the proceedings if the defendant files a motion citing the statute of limitations.<\/p>\n

To evaluate the effectiveness and timing of pre-trial investigations, Melkonyan adds, it\u2019s important to consider the scope of the case, the number of episodes and individuals involved, the timeframe of the alleged offenses, and the availability of evidence.<\/p>\n

She and other experts also point to the selective nature of anti-corruption enforcement in Armenia and the application of double standards.<\/p>\n

When approached by Ampop Media<\/strong><\/em>, Beniamin Harutyunyan, the head of the investigative group handling the North\u2013South case, declined to respond to criticism directed at his team.<\/p>\n

He insisted that \u201cthe investigative body carries out its powers as prescribed by the Code of Criminal Procedure. Therefore, I do not find it appropriate to comment on any complaints or criticism.\u201d<\/p>\n

Project team: Maria Khachatryan, Van Simon, Karine Darbinyan, Suren Deheryan<\/em><\/strong><\/p>\n

We thank our colleague Artak Khulyan for generously sharing his valuable expertise on the topic.<\/strong><\/em><\/p>\n

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