The United States government plans to auction off a multimillion-dollar mansion in Los Angeles that was seized from the family of a former Armenian politician who is accused of using the property to launder bribes.
The federal Justice Department on Monday announced a civil forfeiture settlement against the 11-bedroom, 27-bathroom French chateau-style mansion in Holmby Hills, one of Los Angeles’ most exclusive neighborhoods.
The 33,652-square-foot home — just a stone’s throw from the Playboy Mansion — belonged to the sons of Armenia’s former finance minister, Gagik Khachatryan.
Under the agreement, the US will sell the property “at the highest attainable market value.” The home was previously listed for sale in 2022 for $63.5 million. It was later relisted for just under $40 million.
The government said it would retain 85% of the net proceeds from the sale, and the balance would be given to Khachatryan’s sons and the corporation they own.
A lawyer representing Gagik’s sons, Artem and Gurgen Khachatryan, released a statement saying his clients “have agreed to resolve the existing claims without admitting any wrongdoing.”
The brothers continue to deny any wrongdoing in connection with the purchase and ownership of the property, attorney Ephraim Wernick said.
He described the case as “politically motivated” and “based on false allegations”.
“The Khachatryan family sincerely hopes that this distraction will finally end, and the Khachatryan family will now have the peace of mind they deserve,” Wernick said.
This story with the mansion began in 2011. According to the government, at that time a trust benefiting Khachatryan’s sons bought the property for $14.4 million with funds provided by a prominent Armenian businessman.
At the time, Khachatryan was the most senior official in charge of taxes and customs in the Republic of Armenia.
Khachatryan’s sons said the money was provided as a loan by businessman Sedrak Arustamyan. According to the government, the loan was repeatedly extended without being repaid to cover the payment of bribes.
The brothers had invested in real estate in the L.A. area before, and the mansion on South Mapleton Drive was the fourth property they had purchased and were developing, Wernick said.
Soon after purchasing the home — which was previously owned by Lions Gate Entertainment executive Jon Feltheimer — the family demolished the property and hired Richard Landry, a mega-mansion architect who has built trophy estates for celebrities like Mark Wahlberg, Tom Brady, and Wayne Gretzky.
According to documents filed in court, Khachatryan’s sons told Landry’s design team that they wanted their children to attend school in L.A. and instructed the team to envision the home as their family residence.
According to prosecutors, the alleged bribery scheme came to light when Khachatryan left office in 2016 and authorities discovered that Arustamyan’s companies owed millions of dollars in taxes. In 2019, Khachatryan was charged with abuse of power and embezzlement. His sons and Arustamyan were charged in 2020.
Vernik said the brothers and their father “are in constant discussions with the Armenian government to resolve this case and hope it will be dismissed.”
The Holmby Hills property hit the market on April 7, 2022, with real estate agency Hilton & Hyland touting its “immaculate architecture, manicured landscaping and the chance to completely customize the interiors.” Re-enlisted last year At $20 million less than the 2022 asking price.
“Unfortunately this lawsuit has put a dent on the property itself,” Wernick said. “Hopefully this resolution will remove some of the uncertainty about the property.”
The Altman Brothers’ listing describes “Le Château de Mapleton” as “a stunning property of architectural excellence, poised to become a timeless masterpiece.”
The home includes a lounge, billiards room, poker room, movie theater, gym, wine lounge, two-story library, steam room, massage room, salon, spa lounge, multiple bars, indoor and outdoor pools and a garage for eight or more cars, the real estate agency said.
The agency did not immediately respond to a request for comment.
L.A.’s “mansion tax,” which went into effect last year, could mean the government takes a loss on the sale.
The transfer tax, formally known as Measure ULA, imposes a 4% fee on all property sales over $5 million and a 5.5% fee on sales over $10 million, with the proceeds going to fund affordable housing and initiatives for the homeless.
Vernik said the brothers have agreed to share proceeds from a future sale of the property with the Republic of Armenia.
“This has been a long case, but the brothers are very happy with the outcome and we can now put this matter behind us,” Wernick said.
