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    Created the largest bank in Russia by age of 25 before defecting to the United States in 1992 and starting from scratch.

"Clinton administration aids KGB in cover-up of Communist Party loot"

The Washington Weekly

August 25, 1997

When Alexandre Konanykhine tried to escape the Russian Mafia, he thought himself safe in the United States. What he didn't count on was that the Russian Mafia has contacts in the U.S. Justice Department who are more than willing to bend the law...

Evidence of Clinton administration complicity in a giant corruption scandal involving former KGB agents is surfacing in an ongoing court hearing just outside Washington, DC.

At the time of the collapse of the Soviet empire, the Soviet Communist Party, through its KGB agents, smuggled hundreds of millions of dollars out of the country to secret accounts, many in Switzerland.

Those KGB agents now hold positions in the new military and civilian intelligence services and are guarding the crime perpetrated against the people of Russia. So when a bank director whose bank had been used to launder the stolen money started blowing the whistle and even sent a letter to President Boris Yeltsin, he had to be neutralized. And where did the former KGB agents turn for help in neutralizing him? To the Clinton Administration, for the bank director, Alexandre Konanykhine, had fled to the United States.

So Russian military prosecutor, Lt. Colonel Alexander Volevodz asked the Clinton administration to extradite Konanykhine to Russia, where he could be dealt with. There was only one problem. Russia doesn't have an extradition treaty with the U.S., so the goal could not be achieved legally. That was no obstacle to the Clinton administration, however.

Hold on while we try to map out how the Clinton administration paid the KGB to operate in the United States, lied in court, and fired a whistle-blower to achieve its goal in this very complex case. What corrupt officials didn't count on, however, was a judge who does not like to be lied to...


Konanykhine claims that former KGB officers use the Russian Mafia as operatives and he calls Lt. Colonel Volevodz an "enforcer" for the Russian Mafia. Volevodz came to the U.S. to seek the return of Konanykhine to Russia. The Justice Department complied by arresting Konanykhine and his wife on alleged visa violations at the Watergate apartments where they resided. When Konanykhine applied to a U.S. Immigration Judge for political asylum, claiming that Russian mobsters were trying to have him killed, the Immigration and Naturalization Service of the U.S. Justice Department took the unusual step of hiring Volevodz to prepare a case against Konanykhine. In that process, Volevodz interviewed and allegedly intimidated witnesses, and was given authorities the American people would not normally expect given to agents of a foreign government. "The Department of Justice permitted KGB officers to conduct surveillance in Washington D.C., to make a search in the Watergate building, to copy secret US government files, and to spend their family vacations in the USA on the money of the US taxpayers," Konanykhine told the Washington Weekly last week.


But in buttressing its case against Konanykhine, the INS made a serious tactical mistake. It hired a consultant who knew exactly the game that Volevodz was playing. To analyze the "documentary evidence" of fraud committed by Konanykhine in Russia - used by Volevodz as a pretext for extradition - the INS hired Yuri Shvets, himself a former agent of the KGB foreign intelligence service who was given political asylum in the U.S. back in 1995. He had left the KGB before the collapse of the Soviet Union and immigrated to the U.S. in 1993. Shvets knew about the secret loot laundered by the KGB. As he would later testify in court, he had participated in the operation. At first, the INS had asked Shvets whether he would be willing to testify at the court hearing against Konanykhine. But when Shvets explained that the documents produced by Volevodz most likely were part of a cover-up to protect the KGB loot, he was told by INS assistant counsel Deborah Todd that his testimony would not be needed and that he should not write a report, because "If you write this report, we will have to attach it to our file."INS District Counsel Eloise Rosas had told Shvets that "The INS got instructions from the top to cooperate on this case."


But Antoinette Rizzi, the INS prosecutor who was actually handling the case, became concerned with the many troubling aspects of the case, including the fact that under U.S. law, aliens who are deported are returned to the country from which they entered the United States. In Konanykhine's case, that country is Antigua. Yet her superior insisted that he be delivered to the Russians.When Rizzi expressed her concerns to her superior Eloise Rosas, she was removed from the Konanykhine case and then relieved of all of her duties. Rizzi tried to blow the whistle to INS general counsel David Martin, to Michael Shaheen, director of the Office of Professional Responsibility at the Justice Department, to Michael Bromwich, inspector general at Justice, and others. She was eventually asked to resign, ostensibly because she failed her final background check due to some outstanding payments to the Internal Revenue Service.


The INS apparently made a good case in immigration court, because an immigration judge denied Konanykhine asylum and found him deportable. It was only during several appeals in federal court in Alexandria, Va., that the INS case against Konanykhine finally began to unravel. After hearing Yuri Shvets and Antoinette Rizzi, Judge T.S. Ellis, III said that he found their testimony "to be credible and somewhat disturbing," and suspected that he had been lied to by the INS. "It's my recollection that I was repeatedly assured that there was no desire to deliver Mr. Konanykhine to the Russians."Judge Ellis released Konanykhine from jail last month, allowing him to go home under house arrest pending his final adjustment of immigration status.After the judge's ruling, the INS dropped all charges against Konanykhine and agreed to pay $100,000 to his pro bono attorneys.Lt. Colonel Volevodz had to return to Russia without Konanykhine, who is now free to blow the whistle on the KGB cover-up and the role of the Clinton administration.Published in the Aug. 25, 1997 issue of The Washington Weekly

Copyright 1997 The Washington Weekly.

Russian Mafia
Russian Immigrant
Russian Banker
U.s. Justice Department

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.
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.
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.