A money laundering investigation waged against two former government ministers who are outspoken government critics has sparked fresh controversy about treatment of the opposition in the run-up to Armenia's May 12 parliamentary vote. Government investigators have denied all allegations of wrongdoing or political motivation for their actions.

On May 5, the National Security Service (NSS) searched the home and office of former Foreign Minister (1996-98) Alexander Arzumanian and the apartment of former Deputy Prime Minister and Deputy Defense Minister (1992-2000) Vahan Shirkhanian in connection with a money laundering investigation. No charges have yet been brought against either man.

The NSS alleges that during an April 24-April 26 visit to Moscow Arzumanian and Shirkhanian arranged with Russian citizen Levon Grigory Markos, who is wanted for forgery by Armenian prosecutors, to launder funds "of doubtful origin" by depositing them in bank accounts in Armenia. Investigators claim that $180,000 was transferred on April 27 from Moscow to an account at the Convers Bank in Yerevan held in the names of "nine henchmen," who acted as covers for Arzumanian and Shirkhanian.

Former Deputy Prime Minister Shirkhanian told EurasiaNet that the sum was indeed transferred to him, but not for the purpose alleged. Rather, Shirkhanian said that he traveled to Moscow to ask for "financial support from my friends" for his daughter's wedding and to finance his newly created non-governmental organization, the Shanghai Club of Armenia, which is designed to promote ties between Armenia, China and India.

The former minister charges that the search is intended to stir up fear among voters and is a continuation of the intimidation tactics that characterized earlier explosions at Prosperous Armenia Party offices and attempted shootings of Republican Party of Armenia members. [For details, see the Eurasia Insight archive.]

Both Shirkhanian and former Foreign Minister Arzumanian are well known for their harsh stance against the government. Neither is taking part in the elections. Since 2006, Arzumanian has been calling for a civil disobedience movement and for Armenians not to take part in the elections, arguing that such actions are the only way ito get rid of the criminal officialsi in power.

iThese officials both tap into peopleis conversations and watch their bank accounts to keep their places in power,i former Deputy Prime Minister Shirkhanian said, referring to a recorded conversation between opposition Country of Law leader Artur Baghdasarian and a senior British diplomat about alleged election violations that was termed an act of treason by President Robert Kocharian. [For details, see the Eurasia Insight archive.]

Shirkhanian says that his daughter and her fiance were held for 10 hours at the National Security Service for questioning on the case on May 4. His apartment was searched for weapons, precious stones and money the following day. Police left with $28,000 in cash, a home computer and various documents, he said.

Former Foreign Minister Arzumanian agreed with Shirkhanianis assessment. "This is a message to all opposition forces not to dare to take to the streets, not to struggle, but to accept the already decided outcome of the election," he told EurasiaNet.

The National Security Service questioned Arzumanian because he had traveled to and from Moscow on the same flight with Shirkhanian, he claimed. The former foreign minister dismisses the agencyis search of his office as "nonsense," but takes issue with National Security Service agents allegedly "terroriz[ing]" his 10-year-old son, and "forc[ing] him to open the door" of Arzumanian's apartment.

"This is the most elementary violation of human rights," commented Arzumanian's wife, Melissa Brown, a US citizen.

Items confiscated from Arzumanianis apartment, Brown said, include $55,400 in cash, which the ex-foreign minister describes as his savings from past speaking honoraria, two computers and, peculiarly, a receipt for a package that Arzumanianis son received from the US in 2005.

Former Foreign Minister Arzumanian believes that the search has more to do with his political positions than with possible money laundering.

"I haven't had any [such] economic or financial activities in my life," he said. "Yes, I witness money laundering and fight against it, but the money launderers are the authorities alone, headed by [Prime Minister] Serzh [Sarkisian] and [President Robert] Kocharian."

At a May 7 press conference, Parliamentary Speaker Tigran Torosian, a member of the Republican Party of Armenia, told reporters that he was "sure that these searches are not connected with the elections."

What steps will be taken next in the investigation of Shirkhanian and Arzumanian are not clear. If prosecuted for money laundering and found guilty, the pair could face a prison sentence of six to 12 years with loss of property.

Meanwhile, associates and friends are also being questioned. On May 7, a search was also made in the apartment of Artyom Khachatrian, a friend of former Foreign Minister Arzumanian. Under the pen name "Gagik Sarkisian," Khachatrian has authored a book that strongly criticizes the government for alleged criminal ties. Khachatrian told EurasiaNet that he had earlier been warned by the NSS that he would be arrested if he continued to publish his writings. The writer said that he was kept for eight hours at the National Security Service for questioning after his apartment was searched.

The same day, four activists from Arzumanianis Civil Disobedience non-governmental organization were also interrogated by the National Security Service.

NSS spokesperson Artsvi Baghramian has defended the Serviceis investigation of the two former ministers for money laundering, telling EurasiaNet that there were iserious groundsi for the decision. Baghramian did not comment on the additional interrogations, but stated that individuals connected with Arzumanian and Shirkhanian will be invited to the NSS to "talk and give information."

Editor's Note: Gayane Abrahamyan is a reporter for the independent online ArmeniaNow weekly in Yerevan.