A project to refurbish the hospital
In 2013, Babayan won an $820,000 job as a subcontractor on a project to refurbish the hospital. He supervised 17 employees, prosecutors said.
The Orange County district attorney's office has not released the name of the hospital. The only developmental hospital in Costa Mesa is the Fairview Developmental Center on Harbor Boulevard, according to the California Department of Developmental Service website.
During the job, Babayan threatened to fire his employees if they didn't turn over a portion of their paychecks to him.
According to prosecutors, he falsified payroll documents reporting that he had paid his workers the full amount, for which the general contractor reimbursed him.
About six months into the job, Babayan told the general contractor that his portion of the work would cost $2.3 million instead of the $820,000 originally quoted. Babayan lost the job, and his employees, too, were out of work.
Some of the employees contacted the district attorney's office about their wages, and law enforcement began investigating with help from the state labor commissioner's office.