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"Russian banker wins political asylum"

Legal Times

March, 1, 1999

By Karen Alexander

Branded a criminal by Russian military prosecutors and the U.S. Immigration and Naturalization Service, former Russian banker Alexandre Konanykhine won political asylum last week from the same judge who had ordered him deported more than two years ago.

Konanykhine's wife, Elena Gratcheva, was also awarded political asylum by the judge.

Konanykhine, who made a fortune in post-Communist Russia as the head of the All-Russian Exchange Bank, claimed he was fleeing from the Russian mob when he and Gratcheva entered the United States in 1992. He said an organized crime group associated with the KGB had stolen his business and assets at gunpoint in Budapest, Hungary.

Russian prosecutors pursued Konanykhine in the United States, claiming that he had stolen $8 million from his own bank. The couple were arrested in June 1996 for alleged visa violations and filed for political asylum.

Gratcheva was released on bond, but Konanykhine was jailed in Virginia for more than a year because he was considered a flight risk.

U.S. Immigration Judge John Bryant originally denied the couple's asylum petitions and ordered Konanykhine deported. The couple appealed.

But in July 1997, a former INS attorney who originally prosecuted the case against Konanykhine and a former KGB agent who had analyzed documents in the case for the stepped forward. They testified that INS officials had misled the court about their reasons for detaining Konanykhine and had ignored suggestions that some of the evidence against him was flawed. (See "Did KGB Dupe INS?" July 28, 1997, Page 8.)

The former KGB agent testified that he had told INS officials he believed Russian prosecutors had built a phony case against Konanykhine.

The former INS prosecutor alleged that Konanykhine had been detained because INS attorneys had promised Russian prosecutors that he would be held in custody until he could be returned to Russia. The United States does not have an extradition treaty with Russia.

After a hearing in federal district court in Alexandria, Va., Judge T.S. Ellis III freed Konanykhine and ordered a Justice Department inquiry into the conduct of the INS attorneys on the case.

Out of jail, Konanykhine still faced deportation proceedings by the INS, which had vowed to continue pressing for his expulsion. (See "Russian Freed, INS Faces Ethics Probe", Sept.1, 1997, Page 12.)

The Board of Immigration Appeals had planned to hear the case in 1997, but on the eve of that hearing, INS lawyers agreed to have the asylum issue remanded to an immigration judge in light of the new evidence.

Bryant's ruling last week totally reversed his original finding. He declared that Konanykhine and Gratcheva have a well-founded fear of persecution on account of their political opinion if they are returned to Russia. "Furthermore, it is apparent that the men who seek to harm them cannot be controlled by the Russian authorities," Bryant wrote.

The judge found that the Russian prosecutor's case against Konanykhine had been engineered in order to secure his return to Russia and punish him for exposing corruption among Russian government and business officials. Konanykhine has spoken out about corruption in his former country in interviews, in letters to Russia officials, and on his personal Web site.

Bryant also concluded that Konanykhine would face persecution if he were returned to Russia and imprisoned, a finding based in part on evidence of "subhuman" conditions in Russian prisons.

The INS can appeal Bryant's decision to the Board of Immigration Appeals. The agency is reviewing the judge's decision, says spokesman Donald Mueller.

Konanykhine says he feels confident now, even if the INS decides to appeal.

"I am in very good shape now. After three years long, the struggle appears to be over. I believe the decision is airtight," Konanykhine says. "You can imagine how you would feel if you faced … accusations from two governments, from [a superpower and] one former superpower. It's quite annoying."

Says Konanykhine's immigration attorney, Michael Maggio of D.C.'s Maggio & Kattar: "This was an immensely satisfying case on a number of levels."

Maggio says the case could have a far-reaching impact on other immigration cases stemming from the former Soviet Union.

"The Russian legal system was very much on trial. There are a whole lot of other cases out there by Russians who say they fear persecution rather than prosecution" if they are returned to Russia, he says.

Findings of the probe into the conduct of INS attorneys in the case have not been reported to Judge Ellis, Maggio says.

Political Asylum
Russian Immigrant
Russian Banker

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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.