By Hillel Aron
By Joseph Tsidulko
By Patrick Range McDonald
By David Futch
By Hillel Aron
By Dennis Romero
By Jill Stewart
By Dennis Romero
According to several sources, the FBI opened an investigation into recycling fraud in 1998, but the probe was stalled until the Antonyan murder jolted officials into action. What they found was an industry rife with suspicion, accusation and fear. Complained Joe Massey, head of the L.A.-based Coalition of Independent Recyclers, ”We are all guilty by association.“ Added a recycling-center operator who asked not to be named, ”This is a gigantic issue that remains smoldering and never ignites.“
Sarkis Antonyan got into THE business in 1996 with the purchase of High Tech Recycling in Eagle Rock. As became his pattern, he kept his own name out of the picture; state records show the business was registered to his mother.
Antonyan cut a memorable figure in the recycling business, an industry marked by close regulation and narrow profit margins. ”He was flashy,“ said one source. ”He flashed his money around and tried to impress people with it.“
Another source recalled meeting Antonyan at his recycling center. ”He arrived in a black Mercedes. Four weeks later, he showed up in an old Datsun. He just wanted to make an impression. He probably just borrowed the car from a friend.“
One source from the recycling industry said he took the time to get to know Antonyan, and said he came to like him. ”Sam always had a smile on his face. He was a sharp kid and could argue his point.“ But the source said Antonyan’s scams caught up with him. ”His downfall was that he was overtly weaselly. He took ripping people off way too far and way too many times.“
These sources are among several quoted in this story who agreed to discuss Antonyan and his business activities only on condition they not be named. They had good reasons to request anonymity: They feared loss of business if other recyclers or state officials knew they had divulged knowledge of illegal activity, and they feared retribution, possibly by Antonyan‘s killer, who is still at large. We present their comments because of their inside knowledge of the industry, and because they had direct contact with him.
These sources say Antonyan was the leader of a fistful of Armenians in the L.A. area who moved into recycling during the middle 1990s and promptly generated suspicion on the part of established recyclers. ”The Armenians got into the business several years ago and bilked the state out of hundreds of thousands of dollars,“ said one recycler. The fraud spurred increased scrutiny by the state and unfair pricing practices, he said. ”They’re ruining the business for the rest of us.“
Members of Antonyan‘s family dispute that account, asserting that he never engaged in illegal activity, but simply had trouble keeping the detailed forms required to ensure that state dollars were spent solely on California containers. Massey agrees that honest operators often have trouble keeping complete records, and said he believes officials have overstated the amount of graft involved. ”In a program that is $450 million a year, there are bound to be some questionable activities, but whether it’s organized or not is a different story.“
Asked if he believed Armenians were responsible for widespread fraud in the recycling business, Massey said, ”I‘ve heard allegations to that effect. But I think it’s inappropriate to accuse an entire ethnic group because of all the allegations and convictions the Department of Conservation has had.
“Too many times I have heard comments by people in the recycling industry to division inspectors that are unsubstantiated,” Massey said. “Investigations are run all the time, and they can go on forever, and that doesn‘t mean they will find anything.”
But the industry veterans who spoke to the Weekly said they know the truth of the matter firsthand. “Until his death, Sarkis denied he was involved in fraud,” said a former associate who befriended Antonyan. “He kept saying that he was the victim, that he wasn’t up to anything, that he made mistakes but wasn‘t doing anything suspicious. But I know for sure he was bringing in out-of-state cans.”
Moreover, the arrival of Antonyan and his cohorts transformed the recycling industry, introducing cons and schemes -- and outright intimidation -- on a scale unseen before.
“I don’t know about organized crime, but they‘re working together,” said one source. “The Armenians came in, and they found a system they thought they could beat. They offer my guys money all the time” as bribes for accepting bogus mater-ials. Refusal to do business will sometimes result in personal threats, this recycler said. “Everybody knows about it,” he said. “All the recyclers in L.A. know it. The police know it. The FBI knows.”
According to state records, Antonyan operated three sites under the High Tech license over the course of several years, and bought into and then sold two other recycling centers -- Tiger Recycling, on Pico Boulevard, and Eagle Recycling, three blocks down from High Tech. Those two were registered to Sarkis’ sister Yelena, who is a schoolteacher in Glendale. A fourth, Lucky Recycling, was registered to Sarkis‘ wife. The licenses for all four centers were revoked by the state at various times for failure to document the sources of the cans and bottles that were being recycled. No charges were ever filed against Antonyan or members of his family, but they were assessed $10,000 in fines.