Eight Plead Guilty to Money Laundering : Courts: Defendants were arrested in 1989 in jewelry district and charged with processing drug money. Five will get prison terms, three will get probation, attorney says.

Eight Los Angeles residents have pleaded guilty in federal court to participating in a ring that laundered $500 million in illicit drug money through a Downtown Los Angeles jewelry company.

The defendants were arrested during a raid in 1989. The lead defendant, Wanis Koyomejian of Northridge, who faced 14 felony counts, acknowledged culpability for three felonies: conspiracy to launder money, money laundering and conspiracy to aid and abet in possession of cocaine with intent to distribute.

Koyomejian, 51, has agreed to a 23-year prison term, according to his attorney, Steve Cochran of Century City. Cochran said four other defendants agreed to prison terms and three defendants received probation as part of a “package deal” with the government.

Federal prosecutors Steven D. Clymer and Richard G. Rathmann confirmed that eight defendants had pleaded guilty but would not discuss the proposed sentences. A formal statement released by the U.S. attorney’s office said Koyomejian faces a maximum possible sentence of life imprisonment and a fine of $8.25 million.

“We reached what we believed to be very favorable dispositions for the government,” Clymer said in an interview.

Cochran maintained that some of the defendants “had a plausible chance for acquittal” during trial. But the defendants decided it would be better to resolve the case with plea agreements rather than run the risk of being convicted on all charges and facing very lengthy sentences, Cochran said. He said the defendants who had the most serious involvement are expected to receive the stiffest sentences.

The defense lawyer also said that under the plea agreement, Koyomejian and members of his family agreed to waive claims to about $8 million to $10 million in assets, consisting of real estate and merchandise that was seized by the government. He said the government had agreed to remove a lien from the family’s house in Northridge.

Koyomejian is scheduled to be sentenced by U.S. District Judge Consuelo B. Marshall on Dec. 6 and the other defendants are to be sentenced over the next four months, according to Rathmann.

Koyomejian, who had been free on $2 million bail, surrendered to federal authorities this week as part of the plea agreement.

The other defendants who pleaded guilty to conspiracy and money-laundering charges are Koyomejian’s sons, Simon Kouyoumjian and Raffi Kouyoumjian, Salim Chalhoub, Ohanes Khawaloujian, Ohanes Khawaloujian, Rita Sorfazian and Dalida Avakian. They each face sentences of up to 25 years in prison and fines of up to $4.25 million.

The pleas mark the resolution of the second major case stemming from “Operation Polar Cap,” one of the largest money-laundering investigations in U.S. history.

In February, 1989, federal agents raided several businesses in Los Angeles’ jewelry district and arrested more than two dozen people. At the time, government officials said Downtown jewelers had used their businesses as fronts for laundering nearly $1 billion in drug proceeds under the guise of legitimate gold bullion transactions. About 640 pounds of cocaine was seized in the raids.

Complaints filed in U.S. District Court charged that in 1987, 1988 and 1989 jewelers involved in the ring quietly collected carton after carton of drug money packed like bricks and shipped by armored car from a web of contracts in Los Angeles, New York City and Houston.

The cash, which the merchants falsely reported as legitimate profits, was counted on high-speed machines and transported by couriers to various Los Angeles banks. From there, the illicit money was wired to contacts in Montevideo, Uruguay, and Panama City, Panama, and used again to export more cocaine to the United States.

The government divided the arrestees into two groups for prosecution. In 1990, after a seven-month trial in the so-called “Andonian case,” a federal jury convicted five defendants and acquitted four. Three others pleaded guilty, and charges against four were dismissed.

Evidence introduced at trial showed that the laundering operation, spearheaded by Nazareth and Vahe Andonian of La Crescenta and Raul Viva of Argentina, had funneled more than $300 million in drug proceeds through the Andonians’ jewelry business at 220 W. 5th St.

U.S. District Judge William D. Keller sentenced those three and the fourth lead defendant to 505-year prison terms. “The scale of the laundering operation is without parallel, both to the amount of money and planning that went into this,” Keller said.

But Rathmann said that “the level of sophistication in the Koyomejian case, in many respects, dwarfed the Andonian case.” Koyomejian was the owner of Ropex Corp., which had two ninth-floor suites in the Jewelry Mart Building at 550 S. Hill St.

The government conducted extensive electronic surveillance on Koyomejian and the others. In a novel move, federal agents tapped into the closed-circuit security systems at Ropex’s office. A federal prosecutor later told a judge that he had spent months watching Koyomejian spend entire days counting money. “That may be hard to believe, but in a billion-dollar money-laundering operation, that takes a lot of time,” the prosecutor said.

The defense temporarily won a major victory in March, 1990, when Judge Marshall ruled that prosecutors could not introduce hundreds of hours of video surveillance tapes in the Koyomejian case. But in October, 1991, the U.S. 9th Circuit Court of Appeals, citing federal statutes on electronic surveillance, overturned that decision.

One defendant in the Koyomejian case pleaded guilty earlier and is awaiting sentencing. And a 10th defendant did not agree to a deal and is scheduled to go to trial in November.