Van Nuys businesses say they’re hurting after viral Dr. Oz video alleging health care fraud in area

The office of a Van Nuys real estate services agency was quiet on a recent work day, void of customers or calls.

That was unusual, said owner Edward Akhparian.

He wasn’t the only one who noticed the change.

Some neighboring business owners said they, too, took a hit after Dr. Mehmet Oz, a top federal health official in the Trump administration, posted a now-viral video in which he talked about alleged rampant health care fraud in Los Angeles County. In the video, Oz stood outside a small shopping center full of Armenian American businesses, including one that he identified as a hospice center.

Besides Akhparian’s office, other businesses located within that shopping center include an insurance firm, pharmacy and food market. The owners of some of those companies said business was down 20% to 30% for at least several days after Oz’s Jan. 27 video.

It’s unclear if customers and clients are staying away due to fears that the surrounding businesses are somehow associated with fraud.

Or if it’s out of concerns that federal immigration agents may soon have a surging presence in the area, as they did in Minnesota after President Donald Trump announced a crackdown on alleged fraud at day care centers run by Somali residents there.

Or there could be other reasons.

What is clear, the business owners said, is that they’re paying the price.

Akhparian, a broker, moved into the shopping center at Victory Boulevard and Mammoth Avenue in the mid-1980s. The co-owner of Trimax Elite Corp. and Trimax Credit Repair, companies that provide real estate services and credit consultancy, Akhparian said the lobby of his office usually has clients waiting to be seen. But the foot traffic has slowed, he said, as he led a reporter and photographer from the Southern California News Group through his empty office around noon on Monday.

“People aren’t coming,” he said. “People are scared.”

By the end of that work week, Akhparian’s situation had worsened.

“On a daily basis we usually get 15 to 20 clients,” he said on Friday. “Right now, it’s down to 4 or 5. It’s hard to make a living.”

Edgar Gabrielyan, owner and general manager of The 1 & Only Insurance Services, reported a similar loss in foot traffic. He posted a video on Facebook, saying Oz owed all Armenians an apology.

“He (Oz) just came and, like, cursed the shopping center, and he just walked away,” Gabrielyan said.

As a father, homeowner and small business owner, Gabrielyan spoke of his financial responsibilities — and not only to his own family, but to three employees and their families, whose livelihoods depend on the paychecks from him.

“I’m angry,” he said. “I’m frustrated.”

Akhparian and Gabrielyan said the shopping center’s parking lot is usually full. But on Monday, the lot — with three to four dozen parking spots — was about one-third empty.

They attributed the lighter foot traffic to the video that Oz, the administrator for the Centers for Medicare & Medicaid Services, posted on social media.

In it, Oz was driven around the neighborhood in a vehicle. He said 42 hospices are registered within a four-block stretch of that area, as he raised the possibility of fraud.

He then stood outside the shopping center and pointed toward a building unit on the second floor, identifying it as a hospice center and saying that $3.5 billion in fraud involving hospices and home health care businesses had been uncovered in Los Angeles.

Oz said “quite a bit” of the alleged fraudulent activities are run by “the Russian Armenian mafia.”

“You notice the lettering and language behind me is of that dialect,” he said as the camera zoomed in on a sign for a bakery selling lavash, a popular flatbread in Armenian culture.

The video drew swift condemnation from local community members and some elected officials from California, with many, such as Rep. Laura Friedman, accusing Oz of ethnic profiling. Friedman is a Democrat from Glendale, home to a large Armenian population.

Also critical was Los Angeles City Councilmember Adrin Nazarian, whose family members survived the Armenian genocide. The council member called Oz’s video “blatant racism.”

“Why the focus on Armenian and Cyrillic languages?” Nazarian said in a video uploaded to YouTube. “Why zoom in on Armenian businesses? Couldn’t the point about one fraud case have been made without dragging an entire community into it.

“Us Armenians know exactly what this is when we see it; it’s propaganda,” Nazarian added.

Oz, who is of Turkish descent, was born in the U.S., but his dual citizenship and his previous service in the Turkish military were used as attack points by his opponents during his failed run for a Pennsylvania U.S. Senate seat in 2022. His opponents criticize his ties to Turkey since the Turkish government does not recognize the Armenian genocide that took place in the early 1900s.

Gov. Gavin Newsom‘s office has filed a civil rights complaint with the U.S. Department of Health and Human Services and called for an investigation following Oz’s video. In its letter, Newsom’s office accused Oz of spewing “baseless and racially charged allegations targeting the Armenian community.”

Responding to the announcement by the governor’s office that it was reviewing reports that Oz had targeted the Armenian American community, Oz said on X: “If there were a real defense for California’s fraud crisis, we’d hear it. CMS (Centers for Medicare & Medicaid Services) and law enforcement will keep doing the actual work: going after fraudsters, period.”

Neither the Centers for Medicare & Medicaid Services nor the U.S. Department of Health and Human Services, which oversees Oz’s agency, responded to a request for additional comment for this article.

To be sure, California has had its share of health care fraud, but Newsom and other elected officials insist the state was addressing the problem long before the Trump administration got involved.

Following a 2020 Los Angeles Times investigation about fraud among hospice providers, Newsom signed a bill that, since 2022, has placed a moratorium on new hospice licenses in the state. That ban is in effect through the end of this year.

In addition, the California Department of Public Health revoked the licenses of more than 280 hospices over the past two years and has identified about 300 more hospices under review for possible license revocation, according to the governor’s office.

On Thursday, California Attorney General Rob Bonta announced the arrests of seven people accused of hospice fraud in Monterey County. The case, he said, demonstrates that claims that California isn’t doing anything to address fraud are untrue.

“Fighting fraud is part of our regular, ongoing work, and over time we have built real expertise in identifying abuse, holding bad actors accountable, and recovering taxpayer dollars,” Bonta said in a statement. “To suggest otherwise is just wrong.”

Meanwhile, back at the shopping center in Van Nuys, while some customers have stayed away after the Oz video, others have gone out of their way to support a small food market that opened in that location late last year.

Anna Khachatryan made a point of driving from nearby Burbank, where she lives, to shop at Sherman Way Marketplace earlier this week.

Khachatryan, who is Armenian American, and her husband walked out of there with ice cream and a pack of lavash. She said she wanted to support the business, whose owner told KABC Channel 7 in the days right after the Oz video came out that his store had seen about a 30% drop in customer traffic in a single day. (The store owner, who also owns the bakery whose business sign was featured in Oz’s video, declined further comment on Thursday.)

And what about the other business owners?

Akhparian, of Trimax, is still upset that Oz used the term “Russian Armenian mafia” while filming a video that showed his business and others in the shopping center, calling the association unfounded.

“Mafia? What mafia? Where’s my gun?” Akhparian asked while patting himself down and feigning to be in search of a weapon.

“I’m not a mafia,” he said. “It bothers me a lot.”

Staff writer Jason Henry contributed to this report.