A Burbank resident has admitted to evading more than $11.2 million in federal taxes and fraudulently collecting Medicare payments by using a third party to hide his involvement with his blood-testing business, according to the U.S. Department of Justice.
Armen Muradyan, 60, pleaded guilty on Thursday to conspiracy to commit health care fraud, wire fraud, and tax evasion. Authorities said Muradyan owned Genex Laboratories Inc., a blood testing lab based in Burbank that received millions of dollars in Medicare reimbursements. Because Medicare had banned Muradyan from submitting claims directly, he arranged for a long-time friend identified as “L.S.” to pose as the owner of Genex.
Muradyan offered L.S. $2,000 per month for his participation and instructed him to submit Medicare enrollment papers on behalf of Genex. Bank accounts were opened in L.S.’s name but controlled by Muradyan. L.S.'s role was limited to collecting payments and occasionally signing documents at Muradyan’s direction, while Muradyan used proceeds from the scheme for personal expenses such as mortgage payments.
From 2015 through 2020, Muradyan directed L.S. to report Genex’s financial activity on L.S.’s own tax returns using documents showing minimal profit or losses for the company, resulting in little or no reported income tax liability. During this period, Muradyan did not report any of Genex’s financial activity on his own tax returns and claimed an average annual income of $40,000 despite receiving millions in Medicare funds.
Muradyan also failed to file tax returns from 2021 through 2023. In total, prosecutors said he failed to report approximately $23.9 million in taxable income, resulting in more than $11.2 million owed in federal taxes.
In July 2020, authorities said Muradyan submitted a fraudulent application for an Economic Injury Disaster Loan (EIDL) funded by taxpayers. He falsely claimed that another company he controlled employed multiple people and generated $800,000 in income during 2019 when it had neither employees nor revenue. The U.S. Small Business Administration wired nearly $100,000 into an account controlled by Muradyan, who then used the money for personal expenses not allowed under EIDL terms.
“Muradyan admitted he acted with the intent to deceive and cheat the SBA,” according to court documents.
United States District Judge John A. Kronstadt set sentencing for December 11. The charges carry statutory maximum sentences of up to 20 years for wire fraud, up to 10 years for health care fraud conspiracy, and up to five years for tax evasion. Muradyan is currently free on a $2.6 million bond.
The investigation was conducted by IRS Criminal Investigation, the FBI, and the Department of Health and Human Services Office of Inspector General.
Assistant United States Attorney Mark Aveis of the Major Frauds Section and Trial Attorney Mahana K. Weidler of the Justice Department’s Tax Division are prosecuting the case.
Anyone with information about COVID-19-related fraud can contact the National Center for Disaster Fraud Hotline at (866) 720-5721 or file a complaint online at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
