NASA Employee Just Got Busted For Using Covid Loan to Fund an Illegal Weed Grow
Tons of people spent their Covid stimulus checks on weed, but one NASA employee went way harder.
Published on July 28, 2023

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A NASA employee just got busted for using over $150,000 in Covid business loans to fund an illegal cannabis grow

Armen Hovanesian, a 32-year-old cost-control and budget-planning resource analyst for NASA's Jet Propulsion Laboratory, recently pleaded guilty to defrauding a government loan program. According to the plea agreement, Hovanesian submitted three different loan applications to the Economic Injury Disaster Loan Program (EIDL) in 2020. This Small Business Administration (SBA) program provided low-interest loans to small businesses, renters, and homeowners affected by the pandemic.

On his loan application, Hovanesian certified that he would “use all the proceeds” of these loans “solely as working capital to alleviate economic injury caused by disaster.” The SBA agreed to approve all three loans and wired the NASA employee a total of $151,900. But instead of using this money to expand his businesses, Hovanesian reportedly “applied those proceeds toward his own prohibited personal benefit to repay a personal real-estate debt and fund his illegal marijuana cultivation.”

The US Attorney's Major Frauds Section investigated the case, with support from the SBA Office of Inspector General, the NASA Office of Inspector General, and for some reason, the US Secret Service. After he was caught, the analyst admitted that he made “false and fraudulent statements in the loan applications concerning the gross revenues each of the businesses had generated in the preceding year as well as false and fraudulent statements concerning his intended use of loan proceeds.”

The plea deal did not clarify whether Hovanesian intended to sell the weed that he was growing, or if he simply planned to smoke it all himself. The feds did not charge him with any cannabis-related crimes, but did charge him with wire fraud for misusing federal funds. Once he pleads guilty to the charges in court, Hovanesian will face a statutory maximum sentence of 20 years in federal prison. 

Hovanesian wasn't the only American to take advantage of the government's poor oversight of Covid relief loans. Fraudsters quickly discovered how easy it was to apply for this free cash, and many used these funds to pay for Ferraris, Teslas, mansions, and expensive vacations. In 2021, the feds finally got wise to these scams and established a task force that has now charged hundreds of people, including Hovanesian, for defrauding federal Covid loan programs.

Thousands of other Americans spent their Covid stimulus money on weed as well, but without resorting to illegal scams. The anxiety, stress, and boredom brought on by the pandemic created a massive demand for legal weed, and the free government money gave them the funds to stock up. This huge spike in demand helped the US cannabis industry make record sales in 2020 and 2021, but sales slumped again once the feds turned off the money faucet and people returned to work again.

Chris Moore
Chris Moore is a New York-based writer who has written for Mass Appeal while also mixing records and producing electronic music.
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