The Department of State Interests Protection of the Central Military Prosecutor’s Office examined the lawfulness of the process of alienation of the “Lake Van Paradise” restaurant complex and the adjacent 2.56 ha land plot located in the recreation area of the Kasakh gorge in Ashtarak community, Aragatsotn region.

The examination established that, based on a report submitted by the Minister of Defence of the Republic of Armenia, without conducting a property valuation in accordance with the prescribed procedure, the Government of the Republic of Armenia, by Decision No. 337-A of 18 March 2004, authorised the alienation, through direct sale, of the buildings and structures of the state-owned recreation area to a private individual, setting the sale price at USD 500,000. Meanwhile, the same property had already been valued at USD 500,000 in 1997, whereafter the complex had been expanded, developed and improved. Moreover, approximately one year after the alienation, under a real estate mortgage agreement dated 26 April 2005, the liquidation value of the same property was set at USD 700,000.

The examination also established that, without any legal or contractual basis, a leasehold right over the 2.56 ha land plot was registered in the name of a private individual, which subsequently served as the basis for the latter to acquire ownership of the land plot free of charge, with a cadastral value of AMD 115,814,400.

Having identified apparent elements of a criminal offence in the course of exercising its powers to protect state interests, the prosecutor submitted a report of a crime to the Anti-Corruption Committee, and criminal proceedings were initiated.

The Military Prosecutor’s Office filed a claim with the court to protect state interests, which was admitted for proceedings.