Vadim Shubaderov, a 35-year-old businessman, thought he had stumbled on the perfect opportunity when he met a charismatic pair of identical twins in Brooklyn.
The brothers, Johnny and Robert Petrosyants, were successful bar operators who routinely dropped thousands of dollars at a Russian restaurant in the Flatiron district, were driven around in a Mercedes-Benz and, most impressively, counted the new Brooklyn borough president, Eric Adams, as a good friend. When the twins invited Mr. Shubaderov to invest in a catering company in 2014, he plunked down $350,000, virtually his entire life savings.
“They wined and dined me,” said Mr. Shubaderov. “They built up an image of super successful entrepreneurs with deep political connections.”
He never saw his money again.
Time and again over the past decade, the Petrosyants brothers have boasted of their friendship with Mr. Adams, New York City’s mayor, while courting partners like Mr. Shubaderov for a range of ventures. The relationship has helped them gloss over something less savory: Both pleaded guilty in 2014 to financial crimes related to insurance claims.
By all accounts, Mr. Adams has maintained an exceptionally close relationship with the brothers, dining regularly at restaurants they have opened, buying an apartment near their homes in Fort Lee, N.J., attending parties with them — even introducing them to his mother before she died.
The brothers, for their part, have generated tens of thousands of dollars for Mr. Adams’s campaigns by holding fund-raising events and enlisting friends to solicit contributions. The mayor, who declined to be interviewed, has repeatedly defended the friendship, saying he does not believe in judging people on their worst mistake.
But a New York Times investigation has found that the Petrosyantses’ dubious business practices did not end with their felony convictions in federal court. Interviews with more than 30 people who know the twins or have had dealings with them, and a review of thousands of pages of court filings, corporate documents and other records reveal them to be aggressive operators who have engaged in a continuing pattern of questionable dealings in the years since Mr. Adams befriended them.
In the past eight years, the Petrosyantses have been accused in lawsuits of diverting funds intended for one project to another and of breaking agreements with investors, landlords and lenders, all while socializing with Mr. Adams and trading on the relationship to attract new opportunities.
They appear to have taken pains to obscure their roles in a string of restaurants and other ventures, identifying themselves as owners to customers and employees and in some documents but not others, including paperwork filed with the New York State Liquor Authority, which bars felons from owning businesses that serve alcohol.
Companies they have been associated with owe at least $1.7 million in unpaid taxes, penalties and interest, and they have been accused of failing to pay another $1.5 million in rent, largely during the coronavirus pandemic.
Some of those firms took out $1.8 million in federal loans intended to preserve jobs during the pandemic, but interviews with people familiar with the businesses raise questions about the accuracy of employment figures stated in the loan applications — which are now under review by federal investigators, officials said.
And in 2019, they recruited Frank Carone, who is now Mr. Adams’s chief of staff, and others to finance the acquisition of a debt-ridden laboratory in Texas. The venture ultimately collapsed, costing Mr. Carone and the other backers significant money.
There is no indication that Mr. Adams has ever done business with the brothers or has any insight into their practices. But his close friendship with them underscores his penchant for surrounding himself with people who have troubled pasts and ignoring any ethical questions that such relationships might pose, even if his friends might have something to gain.
“That’s why people buy time with presidents and mayors,” said John Kaehny, executive director of the watchdog group Reinvent Albany. “It’s because they want to be associated with their power, and it is brand-building. It is validation.”
As Mr. Adams has ascended, the Petrosyantses — 41-year-old Armenians from Turkmenistan — have risen, too. Having immigrated to the United States as teenagers in 1996, they now operate five restaurants and have described plans for two more. Mr. Adams, 62, has spent many evenings at their showpiece, Osteria La Baia on West 52nd Street, visiting 14 times in June alone. Often, he was ushered in after other customers had gone home.
In an interview, Robert Petrosyants said he did not believe that he or his brother had done anything wrong since their convictions, although he acknowledged that others might chafe at their practices in the rough-and-tumble restaurant business. Far from being helped, he said, the brothers’ business interests had been negatively affected by Mr. Adams’s election as mayor, which he said cost them a lease for a planned venue because of reporting on the federal indictments that “crushed our world” years ago.
“Obviously when he became a mayor, he got so much attention,” Mr. Petrosyants said. “But to me, he’s my friend, Eric. He’s our friendly friend, Eric, my mentor, my, you know, the guy that I look up to.”
Mr. Adams, who was a state senator when he met the twins about a decade ago at a Brooklyn restaurant they ran at the time, has said he became a mentor to them after their convictions. He is closer to Johnny, whose legal name is Zhan and who friends say is the more outgoing of the twins, while Robert is quieter and more businesslike.
The mayor’s spokesman, Maxwell Young, said that Mr. Adams knew nothing of the twins’ dealings and did not discuss their businesses with them.
“The mayor does not judge people based on allegations reported in the papers, and he will not do so here,” Mr. Young said. “As a general matter, of course, the mayor expects all businesses to comply with all rules and regulations.”
But people who have had dealings with the brothers said that they have not always played by the rules.
“They go show you, ‘Oh, this is my restaurant. That is my restaurant. And this is my business. And I know this guy, and I know that guy, and I’m friends with the mayor,’” said Dr. Steven Ripa, a Brooklyn dentist who, like Mr. Shubaderov, claimed in a lawsuit that the twins had cheated him out of hundreds of thousands of dollars. “Then they start going into business with somebody, and they just screw them over.”
The scheme that led to the twins’ felony convictions involved shell companies created in the names of foreign exchange students, prosecutors said.
The brothers used the firms to bill auto insurers for hundreds of thousands of dollars in false and inflated medical claims, according to an indictment filed in federal court in Brooklyn.
Standing before a judge in February 2014, they pleaded guilty to making false reports at a check-cashing business and agreed to forfeit their share of $667,000 in ill-gotten gains. But, they said, they did not have the money.
“Who has the money here?” the judge asked.
“Lawyers,” Johnny Petrosyants replied.
Even so, the brothers started another business soon after, an Italian restaurant in Brooklyn called Forno Rosso. More accusations of wrongdoing quickly followed.
It started with the investment by Mr. Shubaderov, who came to suspect that the brothers had used some of the $350,000 he gave them for the catering business, which never materialized, to open Forno Rosso instead. Incensed, he went to the restaurant and threatened one of the twins — he is not sure which — with a lawsuit.
“He just laughed in my face while sipping his expensive whiskey,” Mr. Shubaderov said.
Banking records disclosed in the suit he subsequently filed appear to partially support his suspicions, showing $200,000 moving to companies controlled by the twins and a close associate, including one firm that Robert Petrosyants had used in the insurance scheme. Some of it went toward repaying a loan they took out for Forno Rosso.
Robert Petrosyants said he did not recall meeting Mr. Shubaderov and that none of his money was used for Forno Rosso, but he otherwise declined to comment, citing Mr. Shubaderov’s ongoing suit.
When Forno Rosso opened in November 2014, Mr. Adams, Brooklyn’s borough president at the time, put it on his public schedule and attended the event, holding a red ribbon for Johnny Petrosyants to cut.
When the pandemic struck in 2020, Forno Rosso, like other restaurants, shut down for months and then reopened only for takeout and delivery.
In April 2020 and February 2021, it secured two federal Paycheck Protection Program loans totaling $550,000, agreeing to use the money to keep 31 people employed. But Forno Rosso’s staffing never reached that level because the restaurant did not fully reopen for in-person dining, according to two people familiar with the restaurant, who spoke on condition of anonymity to discuss sensitive business matters. (Robert Petrosyants disputed the statements.)
Both loans were ultimately forgiven, but the federal Small Business Administration has since directed its inspector general to review them, officials said. The inspector general was also investigating loans to two other restaurants operated by the brothers that claimed to employ exactly 31 people apiece and received another $724,000, officials said.
Robert Petrosyants said the information on the loan applications was accurate and that the money went to employee wages.
It was not used to pay some of Forno Rosso’s other bills. In October 2021, the owners of the restaurant’s landlord company, Clocktower Properties, sued to recover what it said was $500,000 in unpaid rent, utilities and other costs.
Robert Petrosyants said the restaurant had stopped paying rent because the landlord refused to reduce it when the pandemic hit, a statement the landlord disputed. With the lease expiring and unlikely to be renewed, Akiva Ofshtein, a lawyer, friend and associate of the twins who was listed as the restaurant’s sole owner, did not pay state sales and withholding taxes.
Mr. Ofshtein said he was working with the state to pay off the back taxes owed on Forno Rosso and two other restaurants. He added that the totals were “extremely inflated” because, he said, New York charges unreasonable amounts of interest and penalties.
State officials seized Forno Rosso’s equipment and furniture in March and sold it, recouping about $23,000 of the unpaid taxes, penalties and interest, which now total more than $330,000.
But the Petrosyants brothers had already moved on to a larger, more upscale restaurant, a business that Forno Rosso’s former landlord has argued in a lawsuit was opened with the federal loan money.
“Instead of using the funds for the allocated purposes,” said Clocktower’s lawyer, Scott Loffredo, “they opened up a new flashy restaurant in Manhattan called Osteria La Baia.”
A trail of allegations
The obfuscation surrounding Forno Rosso continued at their new venture.
The official owner of La Baia was Marianna Shahmuradyan, Robert Petrosyants’ domestic partner and the mother of his three children — who, in a 2014 letter to the judge in the brothers’ criminal case, said she was a stay-at-home mother who had never worked. Since then, Robert Petrosyants told The Times, she had become the legitimate owner of four restaurants employing nearly 200 people, while his role was to build and manage the businesses and find investors.
State regulators require liquor license applicants to disclose stakeholders and funding sources, but Ms. Shahmuradyan’s application for La Baia omitted mention of Alexander Orlov, a Russian restaurant magnate described in another document as its primary investor.
A co-founder of Bulldozer Group, a Dubai firm that operates upscale restaurants in Eastern Europe and the Middle East, Mr. Orlov visited New York in summer 2017, posting a picture on Instagram of himself with the twins and La Baia’s landlord.
“Soon we’ll start our new project- restaurant in NYC!” the caption said, with the tag “#partners.” A short time later, the landlord announced that Bulldozer had signed the lease for La Baia’s West 52nd Street space.
Mr. Orlov was described in a Russian news article in 2011 as a member of the ruling United Russia party and a member of committees on Moscow landmarks and school lunches.
In September 2020, after Ms. Shahmuradyan listed herself on a liquor license application as the only funding source for La Baia, a consultant working for the restaurant invited Mr. Orlov for a final walk-through “as the main investor on the project,” according to a letter provided in support of a United States visa application for Mr. Orlov.
Mr. Orlov declined to be interviewed. Through a spokeswoman, he first said that he was no longer involved with La Baia and then claimed that he had never been.
Robert Petrosyants told The Times that Bulldozer had invested “a lot of money” in La Baia, but Mr. Orlov pulled out during the pandemic, leaving when the restaurant was 85 percent complete.
“Marianna took over and finished whatever had to be finished,” he said, adding that La Baia and Mr. Orlov had continuing financial arrangements but declining to describe them.
Across at least 10 different restaurants over the past decade, the twins and their associates have left a trail of allegations from investors, regulators and landlords, records and interviews show.
They have left their names off official documents in nearly every venture since their convictions, controlling restaurants opened in the names of others.
In one instance, state officials sought to cancel the liquor license at one of their restaurants after accusing the owner of ceding control of the license to the twins. The administrative charge was ultimately dismissed, but the license was canceled on other grounds.
Robert Petrosyants said he was only a manager at various restaurants and had been misidentified as an owner on a lease guarantee for Forno Rosso, though records show he has borrowed money using restaurant proceeds as collateral. This summer, he obtained a certificate from the state permitting him to apply for a liquor license despite his conviction.
Aside from the allegations surrounding Forno Rosso and La Baia, the twins were accused of starting at least one other restaurant, Wallabout Seafood & Co. in the Fort Greene section of Brooklyn, with misappropriated money.
“I trusted them. I thought we were friends,” testified the investor, Steven Ripa, the dentist who said he spent $340,000 to build the restaurant before learning the brothers had cut him out of it, in a deposition. “I could not imagine that I would be cheated.”
Robert Petrosyants declined to comment on the suit except to note that some of the claims had been dismissed. One, for breach of contract, is pending.
Among the seafood restaurant’s first customers was Bill de Blasio, New York’s mayor at the time. Mr. Adams also frequented Wallabout, dining on shellfish at his regular table in an upstairs alcove by a window, according to two former employees of the restaurant.
In another instance, after the twins opened a hot dog shop called Links on Manhattan’s Lower East Side in 2012, records and interviews show, they sold beer and wine using the liquor license of a hookah bar owner who had moved away, an apparent violation of state law. They had inherited the space, and the hookah bar operator’s license, from a friend, Diamond Iseni, who, federal prosecutors have said, led an Albanian organized crime operation and once threatened a man by holding a fork to his eye. Robert Petrosyants said that Mr. Iseni had asked the twins to look after the place before going to prison on money laundering charges. He emphatically denied selling alcohol from the restaurant.
‘We made a mistake’
Mr. Iseni was not the only associate of the twins to have been accused or convicted of felonies related to organized crime.
One of their closest friends and business partners, Daniel Kandhorov, was charged in 2000 with paying a Russian gang to burn down a deli that was competing with his family’s shop in Queens. Mr. Kandhorov was acquitted after his lawyer attacked the credibility of the gang members testifying against him. He did not respond to requests for comment. Two weeks ago, on Thanksgiving Day, Mr. Adams and the Petrosyants brothers attended the wedding of Mr. Kandhorov’s son at a Queens catering hall.
Before opening Forno Rosso in 2014, the brothers borrowed money from Stanley Greenberg, a New Jersey man who pleaded guilty in federal court to laundering gambling proceeds for a Russian-American organized crime ring. In a brief interview, Mr. Greenberg said he had fallen in with the wrong people amid a difficult divorce. He added that the loan was not fully repaid.
And in 2019, they found another business opportunity through another associate, Vladislav Tartakovsky, who pleaded guilty in 2003 to federal criminal charges related to a fraudulent investment scheme involving cleanup of the World Trade Center site.
Mr. Tartakovsky, who did not respond to a request for comment, had been approached for a loan by the owner of a Texas medical lab who had problems collecting on patient claims. Mr. Tartakovsky referred the lab owner to Johnny Petrosyants.
Despite their 2014 convictions in a medical-billing fraud case, the twins again flirted with running a business that relied on insurance claims. They even pulled in Mr. Carone, Mr. Adams’s current chief of staff at City Hall.
By October 2019, the brothers had recruited Mr. Carone and others to finance the $1 million acquisition of the Dallas-based company, Choice Clinical Laboratory, which specialized in testing blood and urine from nursing homes, according to two people familiar with the deal.
To run the new lab company, called Greenleaves, the Petrosyantses tapped a New Jersey doctor, Alexandr Zaitsev, who had been accused in lawsuits of submitting fraudulent claims to insurance companies. Some of the suits have been settled; at least one, a $4.5 million fraud suit by Geico, is pending in federal court.
Robert Petrosyants said he and his brother had no ownership stake in the lab company but did entertain ideas for generating income from it. None panned out, he said, and the venture slid into bankruptcy despite receiving a $558,000 federal pandemic loan in 2020.
Robert Petrosyants blamed the problems on the company’s debt and mismanagement by Dr. Zaitsev, who did not respond to requests for comment. The company’s backers, including Mr. Carone, lost a significant amount of money.
By mid-2021, the twins were more focused on La Baia, which opened the same month Mr. Adams won the mayoral race. About a week after his victory, he posed for photos outside the restaurant near a car filled with flowers, and praised its food to The New York Post.
Business seemed to be going well by April, when Robert’s partner, Ms. Shahmuradyan, bought a $1.6 million home on two acres in Saddle River, N.J., records show. Mr. Petrosyants was not on the deed or the mortgage.
Still, the attention Mr. Adams has garnered for the twins and their restaurants has brought problems as well, Robert Petrosyants said. News articles focused on their decade-old criminal convictions, he said, have felt unfair since they have never sought favors or government contracts.
“Yes, we made a mistake. We paid dearly for it,” he said, adding: “New York is all about second chances, but I guess in my case, it doesn’t exist.”
Dana Rubinstein contributed reporting.