A group of lawyers demanded the corruption investigation late last year after scrutinizing Hovannisian’s asset declarations and other financial documents. According to them, the minister used the loan in 2021 to buy a construction materials company which he then supposedly sold to his uncle. In 2023, the company secured a tax break from the Armenian government to import items worth 1.8 billion drams ($4.5 million).
An Armenian Finance Ministry spokeswoman rejected the corruption suspicions as baseless. She said that Hovannisian obtained the loan before joining the ministry in 2021.
Armenia’s Anti-Corruption Committee (ACC) refused in late December to open a criminal case demanded by the lawyers. A court of first instance upheld that decision earlier this year.
The Anti-Corruption Court of Appeals overturned the ruling on Thursday, saying that the ACC must launch a formal investigation to determine whether Hovannisian engaged in any corrupt practices. According to one of the lawyers, Ara Zohrabian, the court found indications that the minister abused his position to benefit the company in question.
Zohrabian suggested that Hovannisian may well remain the real owner of the company officially owned by his uncle. Even if that is not the case, “he has a vested interest in that company because that company still owes him 50 million drams ($128,000),” the lawyer told RFE/RL’s Armenian Service.
Neither the ACC nor Hovannisian reacted to the appeals court’s decision as of Friday evening.
A member of Prime Minister Nikol Pashinian’s Civil Contract party, Hovannisian served as deputy finance minister before being promoted to his current position in late 2022. He previously worked for the Manila-based Asian Development Bank.
Before the complaints lodged by the lawyers, Factor.am reported that Hovannisian failed to declare the interest-free loan to an anti-corruption body scrutinizing the assets of senior Armenian officials. The minister acknowledged “several typos” in his income declarations but denied misleading the body.