An Armenian law-enforcement agency has brought fraud and embezzlement charges against a top executive of a Spanish company that had won a $280 million contract to rebuild major highways in Armenia.
The Investigative Committee has also issued an arrest warrant for the “director” of the company, Corsan Corviam Construccion, not publicly identified by it. It claims that he colluded with a senior French engineer to inflate the cost of road construction and pocket $1.8 million.
Corsan was contracted by the former Armenian government in 2012 to work on more than 90 kilometers of roads as part of a $1.5 billion project to upgrade Armenia’s highways stretching to neighboring Georgia and Iran. The Asian Development Bank (ABA) had lent Yerevan $500 million for the ambitious project.
The first two reconstructed highways connecting Yerevan to the towns of Ararat and Ashtarak were inaugurated in late 2015. Corsan was due to rebuild the remaining 40-kilometer-long road within the next three years.
However, work on the Ashtarak-Talin road fell behind schedule already by the summer of 2016, prompting strong criticism from then Prime Minister Hovik Abrahamian. Corsan has still not completed it despite repeated warnings from both the former and current governments. Government officials said recently that the construction firm has pulled out of the country.
A senior Investigative Committee official, Kamo Sahakian, told RFE/RL’s Armenian service on Wednesday that the Spanish executive is one of five persons indicted in the ongoing criminal investigation into alleged financial abuses committed during the roadworks. He said two of them have been arrested on corresponding charges.
Investigators have questioned more than a thousand people as part of the probe, Sahakian said, adding many more interrogations are planned by them.
The Investigative Committee has so far declined to name any of the suspects in the case. It is thus not clear whether the indicted executive is Francisco Garcia, Corsan’s chairman who signed the 2012 contract with then Armenian Transport Minister Manuk Vartanian.
Corsan has not yet reacted to the accusations.