‘A crime has been committed. Now are we hoping to make a deal that would cover up the theft?’
Of the hundreds of Armenians approved for compensation from the AXA fund, a Syrian named Zaven Haleblian stood apart. He was awarded $574,425, more than any other individual, according to a settlement database later provided to authorities, court records and filings with the State Bar of California. Yet as the French board soon learned, Haleblian had never heard of the AXA settlement, let alone applied for it.
With the files and bank records, the French board and Yeghiayan started working together to unravel where the money went in the AXA settlement. The Glendale lawyer tracked down Haleblian in Aleppo and arranged for him to be questioned under oath in the U.S. During a deposition, he expressed shock that checks had been issued in his name. He said he had never heard of the supposed ancestors — members of the Funduklian family — listed for him in the settlement database.
Another area Yeghiayan and the French board investigated was a secret bank account. Kabateck and Geragos had provided the French board and later the judge with a Pacific Western Bank statement showing that of the original $11 million to pay claims and administrative costs, just $346,050.62 was left over.
But after the French board got access to the settlement financial records, Geragos and Kabateck disclosed to the judge a second account at Comerica Bank containing an additional $2.5 million.
The lawyers said then that they too had been in the dark about its existence and pointed the finger at Kartalian, the settlement administrator. In a declaration they submitted on his behalf, Kartalian said he had moved the money to secure a better interest rate and had not informed the attorneys.
Further investigation turned up more questionable recipients who were awarded hundreds of thousands of dollars.
Five checks totaling more than $400,000 were made out in the name of Ashot Mkhitarian, an Armenian Christian supposedly living in Baghdad, according to court and financial records. Contacted by Yeghiayan and his associates, the Armenian and Iraqi governments were unable to confirm his existence, and a person dispatched to the address listed in the claims database found a Sunni Muslim neighborhood where no one had heard of Mkhitarian, according to accounts in court records, a hearing transcript and research turned over to authorities. Bank records showed some of the checks in Mkhitarian’s name were converted into cashier’s checks in Southern California.
Additionally, the settlement administrator, Kartalian, had issued more than $300,000 in checks to his own relatives, including his wife and mother-in-law.
When the board and Yeghiayan tried to look at the underlying records for Kartalian’s relatives to verify they were entitled to payments, those files were missing. There were also no files for the Syrian, the Iraqi or dozens of others who had been sent large checks. The absent files represented about $2 million in awards, according to an analysis presented to the court. The files were never located.
Asked under oath whether he had an explanation for the missing files, Kartalian replied, “I don’t,” according to a deposition transcript. He was not questioned about his relatives’ eligibility for payment.
In a recent review of AXA files archived in more than 50 bankers boxes at the Loyola Law School library, The Times uncovered additional irregularities. Applications that evaluators had described as valid were stamped “DENIED” while other claims they deemed flimsy were stamped “APPROVED.”
A suburban Atlanta woman, June Howard, applied for payment under 17 different policies she claimed were held by relatives of an Armenian grandfather who immigrated to the U.S. before the genocide.
Evaluators were dubious, with one writing of her application to collect on the policy of a man named Bedros Bozian: “Many different documents were provided by the claimant, however, none of the documents displayed any kind of link between the insured and the claimant.”
Nevertheless, that claim was approved for payment, as were 26 other claims for Howard and other family members. All told, the family was awarded nearly $100,000.
Howard died in 2019. Family members initially agreed to an interview but stopped responding to emails after receiving a list of questions.
Geragos and Kabateck said they were not to blame for problems in the claims process. It was the French board and “their fund administrator” who were in charge, they told the judge.
“We had nothing to do with that process at all,” Kabateck said at a 2011 hearing.
What many of these irregularities had in common was the involvement of Berj Boyajian, a Beverly Hills lawyer. Studying the bank records, the board and Yeghiayan saw Boyajian’s signature again and again on the backs of AXA checks made out to other people. Settlement checks totaling $312,000 had ended up in his law firm’s accounts, court filings and canceled checks show.
Boyajian was no stranger to the Armenian genocide litigation. He had served on the New York Life claims board, had a law practice in the same building as the AXA settlement claims office, and was acquainted with several evaluators, including a niece and relatives of close friends.
But he had no official role in the AXA case, and how and why he became enmeshed in the claims money would be a subject of dispute.
Questioned under oath, the person who would be expected to have firsthand information about what Boyajian was doing, the settlement administrator Kartalian, described Boyajian as a consultant with no role in claims decisions.
He could not explain how Boyajian had gotten hold of the checks or the master list of claimants, a confidential database that even Yeghiayan couldn’t obtain, according to deposition testimony and an account Yeghiayan gave in court.
Boyajian had endorsed about $90,000 in checks issued to the wife and mother-in-law of Kartalian, along with a $23,805 check made out to the sister of one of his best friends, former state legislator Walter Karabian, according to court filings.
In the case of Haleblian, the Syrian resident who had not applied for settlement money, it turned out that Boyajian was a childhood friend and the half-million dollars in checks had ended up in an L.A. bank account Boyajian had opened in Haleblian’s name without his knowledge, according to Haleblian’s deposition.
After questions were raised with the court, Boyajian hired a criminal defense attorney. Subpoenaed to testify under oath, he invoked his 5th Amendment right against self-incrimination and refused to answer lawyers’ queries.
He later told the State Bar that he believed he had a right to certain settlement funds because he had reached a side deal with Geragos and Kabateck to help coordinate the AXA claims. In exchange, he said, they agreed to let him direct 25% of the charity money to causes he selected. Emails turned over to law enforcement show the lawyers discussing the deal. Kabateck’s law partner said he never agreed to it.
Boyajian claimed to the State Bar that he fished some of the checks out of mail returned to the claims office and deposited them in his law firm account so they wouldn’t become “stale” and “uncashable.”
In an interview last year at his mansion overlooking Trousdale Estates, Boyajian said he had no motive to embezzle from the settlement. Gesturing to his opulent home and swimming pool, he said, “I am not a poor guy and I don’t need $100,000 or $200,000 to steal from anybody.”
He could not explain the Syrian’s checks, but admitted one error, transferring $150,000 in settlement funds to a highend downtown jeweler. As Boyajian told it, the jeweler was a friend who needed a bridge loan to buy a diamond for a ring that a customer, L.A. lawyer Tom Girardi, wanted to give his wife, Erika. Boyajian said the amount was eventually paid back.
Kabateck’s law partner blamed Boyajian for many of the problems in the settlement, including the missing files, which, he said, “Boyajian likely removed … in an attempt to hide his fraud.” Boyajian denied that, saying in a recent interview that Kabateck was seeking to rewrite history and “is lying through his teeth.”
Boyajian called his own behavior “stupid.” He could not offer a firm description of the role he was supposed to play in the settlement, remarking at one point, “I really don’t know what my function was.”
What is clear is that he had a long-standing relationship with a permissive banker.
Avedis “Avo” Markarian had been Boyajian’s personal banker for decades at a series of institutions and was working at Pacific Western in downtown L.A. at the time of the AXA settlement.
Interviewed outside his Pasadena home, the banker said that Boyajian brought him stacks of checks for processing, and that because of their long relationship, he did not review them closely before sending them to a check processing facility in Santa Fe Springs.
Markarian left the bank before Pacific Western’s role in the AXA irregularities came into focus. He said he was terminated for reasons unconnected to the case, but acknowledged it changed how he did business. “I am more cautious,” he said.
Geragos and Kabateck had initially rejected the idea of auditing the claims. But after the French board went to the judge, the attorneys said they too wanted to get to the bottom of the problems. Geragos told the judge the following year that Boyajian’s attorney had reached out and said his client was prepared to repay some of the money. About $700,000 was eventually returned. Boyajian said he had passed the rest of the money on to the rightful claimants.
In his Glendale office, Yeghiayan took a dim view of Boyajian’s repayments.
“A crime has been committed. Now are we hoping to make a deal that would cover up the theft?” Yeghiayan steamed to his attorney in an email.
By that point, the man who started the entire legal endeavor had himself come under scrutiny. Geragos and Kabateck had sued Yeghiayan and his wife, also a lawyer.
They accused the couple of “a shameful scheme to personally loot” charity money from the genocide settlements. Nearly $300,000 distributed to their genocide education nonprofit had been redirected to their daughter, Yeghiayan himself or their law firm. That amount included $11,000 that went toward his children’s law school tuition.
Yeghiayan and his wife saw the suit as retaliation for his whistleblowing, as she later testified. The couple defended the payouts, saying that the charity did important work and that the payments, which the nonprofit’s board approved, were appropriate because their family had labored for free for years before the AXA settlement provided retroactive compensation.
Judicial officers at the State Bar later offered some backing for that claim, finding evidence the charity had “many legitimate activities.” A panel of State Bar judges ruled it was “undisputed” that Yeghiayan had lent the nonprofit money and that his wife and children “did considerable work … and incurred expenses.”
Yeghiayan returned $31,000 and settled the lawsuit in 2013. He felt that the accusations
tainted his reputation in the Armenian community. Yeghiayan’s widow, Rita Mahdessian, did not return messages seeking comment.
The terms of the settlement limited what Yeghiayan could say and do about problems in the AXA settlement. An expansive nondisparagement clause barred public statements about Geragos, Kabateck and their employees.
But Yeghiayan was undeterred. With a handful of young assistants in his Glendale office, he assembled a dossier of emails, bank records and court filings and prepared a 20page memo of his allegations against Geragos, Kabateck, Boyajian and others that he titled “AXA Fraud — A Chronological Narrative,” according to a copy of the materials turned over to law enforcement and reviewed by The Times.
Emails suggest Yeghiayan made a series of approaches to the U.S. attorney’s office and the FBI, beginning in 2012. Spokespeople at both agencies declined to comment, citing a policy of not confirming or denying investigations.
Representatives for both Kabateck and Geragos noted that there have been no criminal charges against them or findings of wrongdoing on their part.
Ben Meiselas, a partner at Geragos & Geragos law firm, called the newspaper’s questions about the case “all defamatory, wrong, bizarre.”
“These recycled conspiracy theories have been rejected on multiple occasions by both inside and outside counsel for the State Bar, both local and state authorities and the presiding Federal Judge,” Meiselas wrote in an email.
It’s not clear whether federal authorities even considered Yeghiayan’s allegations. Yeghiayan told his lawyer in a 2013 email that the FBI had gotten back to him with disappointing news. The agent said that “no investigation will be forthcoming ” unless the judge herself formally referred the matter to the U.S. Justice Department.