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"Judge orders INS to release jailed Russian"

The Washington Post

July 24, 1997

By Pamela Constable

A Russian former banker, jailed by the Immigration and Naturalization Service since his arrest in Washington a year ago, was ordered released by a federal judge in Alexandria late Tuesday after a former INS prosecutor and a former Soviet KGB agent testified that they had serious doubts about the case against him.

Alexandre Konanykhine (Koh-nen-EE-kin), a onetime jet-setting financier whom Russian authorities have accused of embezzling $8 million from a Moscow bank, was allowed to return to his Northwest Washington apartment yesterday with an electronic monitor on his ankle until his immigration case is resolved.

In their testimony, former INS prosecutor Antoinette Rizzi and former KGB agent Yuri Shvets said they had previously raised questions about the legitimacy of Russian documents the INS used against Konanykhine. Their concerns, they said, were ignored by other officials in the INS Arlington office, including District Counsel Eloise Rosas.

Rizzi testified that Rosas had misled the court by denying that the INS intended to deport him to Russia. And Shvets testified that the INS had ignored his opinion that the Russian government's case against Konanykhine was actually a KGB scheme.

"Congress did not intend for foreign powers to pull the strings" of immigration procedures, U.S. District Judge T.S. Ellis III said tersely Tuesday night after listening to both witnesses. "I was repeatedly assured that there was no desire by the INS to deliver Mr. Konanykhine to Russia. . . . We're going to get to the bottom of this."

Immigration officials, in a statement released yesterday, said the INS has "complete confidence in its case against Mr. Konanykhine and strongly believes that all of its actions in this case have been proper and legitimate. The government has no reason to doubt the reliability of the documents presented in this case."

In an unusual joint operation between U.S. and Russian officials, Konanykhine was arrested in June 1996 at his Watergate apartment, charged with visa fraud and held without bond. At his deportation hearing the following month before an immigration judge in Arlington, INS prosecutors led by Rizzi used documents and witnesses from Russia to show that he had lied about his business visa and that he was a fugitive from Russian justice who should be deported.

At the time of the hearing, the INS testified that it was eager to cooperate with Russian authorities in a fledgling joint law enforcement effort, of which the request to return Konanykhine was an early example.

Konanykhine, now 30, testified during his hearing that he was the victim of a plot by former KGB agents and mobsters who had seized control of his financial enterprises. He said the Russian military prosecutor, in league with his enemies, sought to punish him for protesting to higher authorities.

The immigration judge ruled against Konanykhine, who had remained in custody ever since, filing numerous appeals against INS attempts to deport him. The federal court hearing this week was on his petition to be released.

Rizzi also testified yesterday that Rosas told her to alter affidavits used in the case against Konanykhine and had overruled her growing suspicions about the information supplied by Moscow. Rizzi, now practicing law in Falls Church, said she was forced to resign in October because of her opposition to the case.

"I am torn between both sides," Rizzi said, testifying under subpoena after INS officials said she was not authorized to discuss the case. "I have obligations . . . to be truthful with the court if I believe the court has been deceived."

In cross-examination, INS prosecutors suggested to Rizzi that she had been asked to resign because she had tax problems with the IRS, that she had a vendetta against her former boss and that she had improper contacts with Konanykhine's lawyers.

Shvets, a former Soviet agent who lives here under political asylum, also testified under subpoena. He said that the INS asked him to examine numerous Russian documents and that he saw many signs that they had been manipulated, as well as "strong indications" that the case against Konanykhine was a "classic KGB operation" to cover up larger financial crimes.

But when Shvets reported those findings to INS officials, he said, they showed no interest and told him not to file a written report. INS prosecutors, in cross-examination, suggested to Shvets that he had no real expertise in document analysis and that he had provided them with no specific examples of faulty Russian papers.

@CAPTION: Alexandre Konanykhine is accused of embezzling from a Moscow bank.

Banker In Moscow
Soviet Kgb
Arrest In Washington

More News...

Media About Alex

Washington Post:
Konanykhin, one of the first Russian millionaires after the fall of the commies, left in 1992 and was granted asylum here in 1999. He's built a very successful Web advertising business in New York City. He had been chosen "New York Businessman of the Year." "As such, you will be honored and presented with your award," NRCC chairman Thomas M. Reynolds (R-N.Y.) said, at a "special ceremony" April 1. " President Bush and Governor Arnold Schwarzenegger are our special invited guests.
Alex Konanykhin controlled Russia's largest commercial bank in the 1990s
Wall Street Journal:
Mr. Konanykhin was a whiz-kid physics student who became a pioneering Russian capitalist in early 1990s, building a banking and investment empire valued at an estimated $300 million all by his mid-20s. He was a member of President Boris Yeltsin's inner circle.
World Economic Forum:
How transparency can help the global economy to grow. By Alex Konanykhin. Countries around the world spend an estimated $9.4 trillion a year on procurement – 15% of global GDP. Indeed, UN figures estimate that public procurement can account for 15-30% of GDP for many countries. However, according to the UN’s Office on Drugs and Crime and the Organisation for Economic Co-operation and Development (OECD), 10-25% of the value of public contracts is lost to corruption.
The Baltimore Sun:
Business whiz kid.
Russian Bill Gates.
The Times:
By the time he was 25 he was one of the most important figures in post-Communist Russia. But in 1992, while on a business trip to Hungary, Alex Konanykhine was kidnapped.
The New York Times:
The Federal Bureau of Investigation notified Konanykhin that Russian organized crime figures had paid to have him killed.
CBS "60 Minutes":
Alex Konanykhin didn't only have KGB after him… He had the FBI, the Justice Department, even the CIA all on his case, as a favor to the Russians, part of a deal to allow the FBI to keep a bureau in Moscow.
Los Angeles Daily Journal:
Representing himself through much of the process, Konanykhin managed to convince an immigration judge of an alleged INS and KGB conspiracy and cover-up. Following the court's admonishment, the INS agreed to drop all charges and also pay $100,000..The judge also ordered an investigation of the Justice Department. In separate actions, Konanykhine subsequently won multimillion dollar libel judgments against two Russian newspapers. A $100 million lawsuit against the Justice Department is pending, alleging perjury, fraud, torture and witness tampering by U.S government officers on behalf of the Russian Mafia.
Profit Magazine:
Imagine you are a teenage physics genius who quickly amasses a $300 million empire of real estate and banking ventures, has dozens of cars, six hundred employees, several mansions and two hundred bodyguards—but you are nonetheless kidnapped by those you trusted, threatened with torture and death, and have your entire empire stolen from you one dark night in Budapest. You escape with your life by racing through Eastern-block countries and flying to New York on stashed-away passports—only to have the KGB and Russian Mafia hell-bent on your hide and the U.S. government jailing you and conspiring to serve you up into their clutches. All this before your 29th birthday. Sound like a Tom Clancy thriller? No. . . just a slice in the life of Alexander Konanykhine.