• CEO, TransparentBusiness
    TransparentBusiness SaaS platform was designated by Citigroup as the Top People Management Solution
  • International Entrepreneur
    Created the largest bank in Russia by age of 25 before defecting to the United States in 1992 and starting from scratch.

"Russian fights deportation in tale of money, the mob"

The Associated Press. USA Today

December 2, 1996

By Harry Dunphy

WASHINGTON -- It's a tale worthy of a spy novel, the judge said.

Millionaire Russian Alexandre Konanykhine sits in a U.S. federal prison in northern Virginia, fighting deportation because he fears the mafia will kill him if he goes home.

His wife, Elena Gratcheva, lives with her cat and a few pieces of furniture in the couple's $300,000 Washington condo near the Potomac, visiting her husband once a week.

The case has raised questions about how extensively organized crime controls business in Russia, and how much of a threat corruption poses to Russia's democracy.

Michael Maggio, Konanykhine's attorney, calls it "the wildest case I have ever handled in 18 years."

Four months ago, Konanykhine, 30, lived a Russian yuppie's wildest dream. He had a well-paying job, an office near the White House and an apartment in the exclusive Watergate complex.

Now he's accused by Russian authorities of embezzling $8 million from the Moscow bank he founded. A U.S. appeals court, probably next year, is expected to decide whether he should be extradited.

Konanykhine says he will be killed if he returns, in part because he campaigned against organized crime in Russia. Indeed, an FBI agent testified at a hearing that Russian criminals in New York took out a "contract" on Konanykhine and that Russian gangs once tried to kidnap him.

But Immigration and Naturalization Service prosecutor Eloise Rosas said at a July hearing that allowing Konanykhine to stay in the USA would be a "travesty of justice," considering that he's a "fugitive from justice, a draft dodger, a tax evader and a deadbeat dad."

An immigration judge who denied Konanykhine's request in September for political asylum has twice referred to possible Tom Clancy story lines. Russia and the United States have no extradition treaty, so the judge ordered the couple deported.

In an appeal, Maggio argued that the INS case relied too heavily on "questionable and sometimes fabricated evidence."

Konanykhine dropped out of college in the mid-1980s to become an entrepreneur and built a banking, stock, real estate and currency and commodity trading empire that he said was worth $300 million.

At the deportation hearing, he testified that he had achieved such prominence that he was selected to travel with Russian President Boris Yeltsin on his first official visit to the United States in the summer of 1992.

But when KGB agents he hired to protect him from Russian organized crime demanded more money, he said he fled first to Hungary, then to the USA. Here, he set up a subsidiary of one of his Russian firms. Konanykhine said he also began an anti-corruption campaign, writing letters to Russian officials and eventually a personal appeal to Yeltsin. Prosecutor Alexandre Volevodz replied, asking for details, then began investigating.

Russian authorities charge that Konanykhine also had been embezzling from his bank. But Konanykhine contends that he wired money to private accounts merely to prevent it from being stolen and says his former Moscow employees are out to get him.

Konanykhine said by telephone recently he sees little hope in winning his appeal.

"This case," he said, "is bigger than just me."

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Immigration
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Russian Banker
Testified
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Banker In Moscow

More News...

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.
CNN:
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.
The Sun:
Alex Konanykhin fled Russia in 1992 and won asylum in the US after the collapse of the Soviet Union. The entrepreneur had set up 100 different companies in Russia and had an estimated net worth of $300million by the time he was 25. He is regarded as one of the first Russian millionaires after the fall of the Iron Curtain. One of the newly open country's leading lights, he even met with US President George HW Bush in 1991 on a joint visit with Russian leader Boris Yeltsin. However, he was then kidnapped in 1992 while visiting Budapest and all of his business assets were seized in Russia. … Being hunted by the Russian state, Konanykhin won asylum in the US in 1997 and set up a new life - but the shadow of the Kremlin continued to loom over him.He went on to rebuild a business empire and set up multimillion dollar firms such as TransparentBusiness in the US.
The Deal:
... a New York-based software startup called TransparentBusiness Inc. has drawn backing from Fortune 500 executives through a relatively new type of securities offering called 506(c) as part of an effort to raise $10 million this year ... Alex Konanykhin, CEO of TransparentBusiness, said he decided to reach out directly to accredited investors by purchasing ads in financial publications. One particularly bold ad includes the figure, 90,000%, with a question mark next to it. Konanykhin said the ad speaks to the large market opportunity for his company's software, which helps governments eliminate fraud by verifying billable hours charged by outside contractors. ... One of the investors, Ken Arredondo, told The Deal he invested in TransparentBusiness and agreed to serve on its board of directors because of the company's strong management team and the huge market opportunity to increase transparency of outsourced contracts worldwide. He believes in the company's product and said it's unique. "It's a Saas-based, easy-to-use tool," he said. "There are a lot of technology players out there that are a lot bigger, but none of them have what they have. There will be competition, but they have the product now. They have first-mover advantage."
The Baltimore Sun:
Business whiz kid.
WJLA TV / ABC:
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.
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.