Former Yerevan Mayor Yervand Zakharyan has been charged with a real estate swindle that allowed for a parcel of land registered as a municipal green zone to be sold off to a private company.

The scheme, according to the Armenia’s Special Investigative Service (SIS), dates to December 2008 when Zakharyan served as mayor of the Armenian capital.

Zakharyan, and then Director of Yerevan’s Department of Architecture and Urban Development, Arsen Lalayants, issued a decision that removed 10,000 square meters of land from the Haghtanak (Victory) Park.

At the time, the change was made under the pretext of drafting a revised master plan for the park.

The land was later sold to the Golden Palace Hotel LLC at a price of16.5 drams per one square meter.

In May 2015, the company used the land as collateral to get a US$2.8 million loan from a commercial bank in Armenia.

The SIS says that as a result of subsequent changes to the loan contract between the bank and the company, the amount increased to 12 billion AMD, some seventy times the purchase price of the land.

Both Zakharyan and Lalayants have been charged with Article 308 of the Criminal Code – Abuse of Official Authority.

Zakharyan served as Yerevan mayor from 2003 to 2009.

The preliminary investigation continues.