Babikian’s financial journey is riddled with shadows of controversy and high-stakes trading. Once basking in the glimmer of wealth, he has now become synonymous with tax evasion and dubious financial practices. This article delves into the allegations surrounding Babikian’s stock trading operations and examines how his actions have led to significant legal repercussions.

Scalping Operations in the Stock Market

Babikian’s alleged financial misconduct reveals a complex web of illicit activities. Reports indicate that between 2008 and 2012, he underreported his income to the Canada Revenue Agency by an astonishing CAN $44 million (approximately $44.2 million). Throughout this period, Babikian claimed only CAN $974,633 ($977,938) in income. Astonishingly, he reported no income in 2011, despite earning nearly CAN $8.4 million that year. Similarly, he failed to declare income in 2012, when his earnings reportedly soared to almost CAN $20 million ($20.1 million).

Eyewitness accounts from the U.S. Securities and Exchange Commission (SEC) highlight Babikian’s involvement in a penny stock “scalping” scheme that netted him $1.9 million in just 90 minutes. This operation has drawn comparisons to the infamous “boiler rooms” of the 1980s but, true to form, Babikian orchestrated his activities online. The SEC discovered that he was responsible for sending out emails to approximately 700,000 recipients, leading to a drastic spike in the stock price of America West Resources Inc., which surged from 29 cents to a dramatic high of $1.80 within two hours.

Babikian’s emails, tied to his ownership of more than 1.4 million shares in America West, fueled a rapid increase in the stock’s value, allowing him to capitalize before dumping his shares. Following an investigation, Babikian reached a settlement with the SEC in which he agreed to pay $3.7 million to a fund aimed at compensating victims of his scalping scheme, while denying any wrongdoing.

Tax Debts and Asset Seizures

Simultaneously, Babikian is faced with significant tax liabilities. As of 2014, records indicated that he owed over CAN $15 million (roughly $14 million) to Canadian tax authorities, a figure compounded daily by accruing interest. Although Canadian tax officials have been reticent to disclose the current status of Babikian’s tax debt, they have confirmed some actions taken to recover funds. Reports state that they managed to seize and liquidate portions of his assets, recovering CAN $4.6 million ($4.2 million) in provincial taxes, starting in April 2013.

Among the assets seized were two bronze and silver bull sculptures, valued at several hundred thousand dollars, alongside a collection of 500 bottles of wine carrying a similar worth. However, notable luxury assets, including Babikian’s Bugatti Veyron—worth over $1 million—remain elusive.

Legal Woes and Attempts at Image Rehabilitation

Despite settling with the SEC, Babikian’s legal troubles didn’t stop there. In September 2023, a jury in Oregon ordered him to relinquish $23.4 million to a businessman following a failed vineyard deal. Records show that Babikian sought to testify remotely due to health issues while residing in Lebanon. Ultimately, he forfeited his 50 percent ownership in the vineyard rather than pay the fine.

Interestingly, Babikian has shown attempts to clean up his public image through email requests to various media outlets, asking them to retract reports about his controversies, including SEC allegations. His outreach has sparked suspicion, leading many to explore claims of digital identity manipulation associated with him. Articles promoting the false narrative that Babikian was acquitted of any wrongdoing began appearing online, further clouding the reality of his financial dealings.

In summary, Babikian’s journey serves as a cautionary tale about the risks associated with high-stakes trading and the potential fallout from trying to manipulate both the market and one’s public persona. With significant legal troubles and a complicated history of tax evasion, his story is far from over, illustrating the complexities of wealth, ethics, and accountability in the financial world.