Alex Konanykhin
Encyclopedia
Alex Konanykhin is a Russian entrepreneur, former banker, former oligarch
and past member of Russian President Boris Yeltsin
’s inner circle.
In 1999, Konanykhin and Gratcheva were granted political asylum
in the United States, the first citizens of post-Soviet Russia
to be given this status. His asylum was later reversed in 2004, but reinstated in 2007.
’s economic reforms (perestroika
). Within a few years, he became the head of a $30 Million construction enterprise.
In 1989, he financed Boris Yeltsin
's bid for a position on the Russian Supreme Soviet
. Konanykhin was later rewarded by Yeltsin for his support with the former state residence of Mikhail Gorbachev
and a private security detail.
and settled in the United States
.
, and afterwards, in Canada with Prime Minister Brian Mulroney
.
In September 1992, he was removed from his post as president of REB, under allegations of embezzling $8.1 million. Konanykhin fled to New York where he delivered protest letters to senior Moscow officials and members of the press warning of the looming “mafiocracy.” "I am addressing this letter,” he wrote on September 6, 1992, “to warn you of a serious political danger -- the seizure of large commercial organizations by mafia-opposition circles that will stop at nothing to achieve their ends." When there were no responses to his letters, he contacted President Yeltsin directly. This prompted an investigation by the Moscow-based military prosecutor’s office, and Konanykhin soon also found himself under investigation. The prosecutor, Alexandre Volvodez, now charged that Konanykhin had illegally wired $8.1 million from the Russian Exchange Bank to overseas accounts, and demanded his extradition to Russia.
As hearings in American federal court would later show, during this time the FBI had opened a division in Moscow; because American prosecutors and FBI officials were anxious to develop a relationship with Russian law enforcement officials, they had agreed to assist Volvodez in his request for Konanykhin’s deportation. But because Russia and the United States do not have an extradition treaty, Justice Department officials agreed to try to deport him for violating immigration laws under a minor visa violation. The allegation was later proven false and dismissed during Konanykhin’s first granting of asylum in 1999.
agents along with Russian federal prosecutors arrested Konanykhin and Gratcheva at their Watergate
apartment in Washington, D.C. The couple were taken to Arlington, Virginia and charged in federal immigration court with violating the conditions of their temporary U.S. visas. Between July 19 and August 2 of 1996 hearings were held in the courtroom of Judge John M. Bryant to determine if, as Konanykhin claimed, his deportation was being masterminded by Russian army prosecutor Volvodez for political reasons, and that Konanykhin’s life was consequently in danger. The trial touched upon issues as to whether the secret police had taken over the Russian banking industry, and also if the United States government had been fooled into going after Konanykhin.
In court Konanykhin testified he was being targeted by Volvodez and the Russians because of his anti-corruption campaign, and his lawyers argued that he had transferred money to private accounts only to prevent it from being stolen. Appearing as witnesses at the trial were FBI agents who testified that the Russian mafia had previously taken out a contract on Konanykhin’s life. Also appearing were former INS
prosecutor, Antoinette Rizzi, who had previously been in charge of the government’s case against Konanykhin, and former KGB agent Yuri Shvets. Both Rizzi and Shvets testified that they had serious doubts about the charges filed against Konanykhin by Volvodez and the American government.
On August 26, 1996 in Federal Court in Arlington, Virginia, a settlement agreement between Konanykhin and the district director of the Immigration and Naturalization Service, which was endorsed by U.S. District Judge T.S. Ellis III, was reached. Judge Ellis, who had stated he found the testimonies of Yuri Shvets and Antoinette Rizzi in Konanykhin’s immigration case “credible and somewhat disturbing,” ordered the INS to pay $100,000 of Konanykhin’s legal fees to pro bono counsel at Arent Fox
Kintner Plotkin & Kahn. The settlement also ordered Assistant U.S. Attorney Robert Spencer to confirm within 30 days that there would be an internal probe by the Department of Justice
into the conduct of INS lawyers at the hearing.
which had reported him involved in various criminal acts. The suit claimed that the information was erroneous and published with "reckless disregard for its truth or actual malice.” An Arlington County Circuit Court jury recommended Konanykhin should be awarded $33.5 million. Soon thereafter the same court awarded Konanykhin an additional $3 million in a libel case against the Russian financial journal Kommersant
.
On February 23, 1999 in Federal Immigration court Judge Bryant granted political asylum to Konanykhin and Gratcheva, saying the former banker faced persecution and possible death if returned to Russia to face embezzlement charges. In his decision Judge Bryant wrote that testimony from several experts had convinced him that Konanykhin was being targeted for prosecution for political reasons.
Temporarily freed from his trials with the Russian and American governments, Konanykhin and Gratcheva went on to develop a $100 million Internet startup in New York called KMGi, among other businesses. But then on November 20, 2003 the Board of Immigration Appeals revoked Konanykhin’s political asylum and ordered him returned to Russia. The ruling came less than a month (October 25, 2003) after the arrest of Mikhail Khodorkovsky
, Konanykhin’s former banking rival in Russia and business partner during his exile. Konanykhin had served as vice president for the international development of Khodorkovsky's bank, Menatep
.
. Konanykhin and Gratcheva were saved from deportation at the last minute by a series of emergency hearings in Federal Court. On January 26, 2004 Judge T. S. Ellis III delivered his ruling, which found the arrest unlawful, and allowed the couple to stay in the United States temporarily, until appeals in their immigration case were exhausted. For the second time the Department of Justice was ordered to pay compensation to Konanykhin for unlawful arrest. Then on September 18, 2007 in a federal courtroom in Alexandria, Virginia, Konanykhin was granted asylum for the second time.
(an advertising agency) and Publicity Guaranteed (a public relations firm), and The Syndicated News, an online marketplace. In 2004, Konanykhin was named “New York Businessman of the Year” by the Republican National Committee
. In 2010, he established WikiExperts.us, a business centered around creating Wikipedia articles for companies, which represents a classic example of a conflict of interest. WikiExperts also offers a "24/7 monitoring and repair service", claiming, "Your Wikipedia presence is completely safe, if you entrust it to us".
Russian oligarchs
Business oligarch is a near-synonym of the term "business magnate", borrowed by the English speaking and western media from Russian parlance to describe the huge, fast-acquired wealth of some businessmen of the former Soviet republics during privatization in Russia and other post-Soviet states in...
and past member of Russian President Boris Yeltsin
Boris Yeltsin
Boris Nikolayevich Yeltsin was the first President of the Russian Federation, serving from 1991 to 1999.Originally a supporter of Mikhail Gorbachev, Yeltsin emerged under the perestroika reforms as one of Gorbachev's most powerful political opponents. On 29 May 1990 he was elected the chairman of...
’s inner circle.
In 1999, Konanykhin and Gratcheva were granted political asylum
Right of asylum
Right of asylum is an ancient juridical notion, under which a person persecuted for political opinions or religious beliefs in his or her own country may be protected by another sovereign authority, a foreign country, or church sanctuaries...
in the United States, the first citizens of post-Soviet Russia
Russian Soviet Federative Socialist Republic
The Russian Soviet Federative Socialist Republic , commonly referred to as Soviet Russia, Bolshevik Russia, or simply Russia, was the largest, most populous and economically developed republic in the former Soviet Union....
to be given this status. His asylum was later reversed in 2004, but reinstated in 2007.
Early life
Konanykhin studied at the Department of Space at the Moscow Institute of Physics and Technology to pursue a career in rocket science. In 1986, he was expelled from MIPT for running a small business during his summer vacation. After his expulsion, he took advantage of the loosening business climate during Mikhail GorbachevMikhail Gorbachev
Mikhail Sergeyevich Gorbachev is a former Soviet statesman, having served as General Secretary of the Communist Party of the Soviet Union from 1985 until 1991, and as the last head of state of the USSR, having served from 1988 until its dissolution in 1991...
’s economic reforms (perestroika
Perestroika
Perestroika was a political movement within the Communist Party of the Soviet Union during 1980s, widely associated with the Soviet leader Mikhail Gorbachev...
). Within a few years, he became the head of a $30 Million construction enterprise.
In 1989, he financed Boris Yeltsin
Boris Yeltsin
Boris Nikolayevich Yeltsin was the first President of the Russian Federation, serving from 1991 to 1999.Originally a supporter of Mikhail Gorbachev, Yeltsin emerged under the perestroika reforms as one of Gorbachev's most powerful political opponents. On 29 May 1990 he was elected the chairman of...
's bid for a position on the Russian Supreme Soviet
Supreme Soviet of Russia
The Supreme Soviet of the Russian SFSR , later Supreme Soviet of the Russian Federation was the supreme government institution of the Russian SFSR in 1938–1990; in 1990–1993 it was a permanent parliament, elected by the Congress of People's Deputies of the Russian Federation.The Supreme Soviet of...
. Konanykhin was later rewarded by Yeltsin for his support with the former state residence of Mikhail Gorbachev
Mikhail Gorbachev
Mikhail Sergeyevich Gorbachev is a former Soviet statesman, having served as General Secretary of the Communist Party of the Soviet Union from 1985 until 1991, and as the last head of state of the USSR, having served from 1988 until its dissolution in 1991...
and a private security detail.
Career in Russia
By the early 1990’s in Russia, Konanykhin amassed a $300 million banking and real estate empire. After a conflict with REB shareholders, he was removed from his post as president of the council. He fled RussiaRussia
Russia or , officially known as both Russia and the Russian Federation , is a country in northern Eurasia. It is a federal semi-presidential republic, comprising 83 federal subjects...
and settled in the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
.
Embezzlement and flight from Russian authorities
In 1991, Konanykhin founded the Russian Exchange Bank, which became the first institution to receive a currency-trading license from Yeltsin’s government. In 1992, he was one of the delegates to accompany Yeltsin to Washington, D.C., where they met with President George H. W. BushGeorge H. W. Bush
George Herbert Walker Bush is an American politician who served as the 41st President of the United States . He had previously served as the 43rd Vice President of the United States , a congressman, an ambassador, and Director of Central Intelligence.Bush was born in Milton, Massachusetts, to...
, and afterwards, in Canada with Prime Minister Brian Mulroney
Brian Mulroney
Martin Brian Mulroney, was the 18th Prime Minister of Canada from September 17, 1984, to June 25, 1993 and was leader of the Progressive Conservative Party of Canada from 1983 to 1993. His tenure as Prime Minister was marked by the introduction of major economic reforms, such as the Canada-U.S...
.
In September 1992, he was removed from his post as president of REB, under allegations of embezzling $8.1 million. Konanykhin fled to New York where he delivered protest letters to senior Moscow officials and members of the press warning of the looming “mafiocracy.” "I am addressing this letter,” he wrote on September 6, 1992, “to warn you of a serious political danger -- the seizure of large commercial organizations by mafia-opposition circles that will stop at nothing to achieve their ends." When there were no responses to his letters, he contacted President Yeltsin directly. This prompted an investigation by the Moscow-based military prosecutor’s office, and Konanykhin soon also found himself under investigation. The prosecutor, Alexandre Volvodez, now charged that Konanykhin had illegally wired $8.1 million from the Russian Exchange Bank to overseas accounts, and demanded his extradition to Russia.
As hearings in American federal court would later show, during this time the FBI had opened a division in Moscow; because American prosecutors and FBI officials were anxious to develop a relationship with Russian law enforcement officials, they had agreed to assist Volvodez in his request for Konanykhin’s deportation. But because Russia and the United States do not have an extradition treaty, Justice Department officials agreed to try to deport him for violating immigration laws under a minor visa violation. The allegation was later proven false and dismissed during Konanykhin’s first granting of asylum in 1999.
Arrest by US immigration
On June 27, 1996 INSImmigration and Naturalization Service
The United States Immigration and Naturalization Service , now referred to as Legacy INS, ceased to exist under that name on March 1, 2003, when most of its functions were transferred from the Department of Justice to three new components within the newly created Department of Homeland Security, as...
agents along with Russian federal prosecutors arrested Konanykhin and Gratcheva at their Watergate
Watergate complex
The Watergate complex is a group of five buildings next to the John F. Kennedy Center for the Performing Arts in the Foggy Bottom neighborhood of Washington, D.C. in the United States. The site contains an office building, three apartment buildings, and a hotel-office building...
apartment in Washington, D.C. The couple were taken to Arlington, Virginia and charged in federal immigration court with violating the conditions of their temporary U.S. visas. Between July 19 and August 2 of 1996 hearings were held in the courtroom of Judge John M. Bryant to determine if, as Konanykhin claimed, his deportation was being masterminded by Russian army prosecutor Volvodez for political reasons, and that Konanykhin’s life was consequently in danger. The trial touched upon issues as to whether the secret police had taken over the Russian banking industry, and also if the United States government had been fooled into going after Konanykhin.
In court Konanykhin testified he was being targeted by Volvodez and the Russians because of his anti-corruption campaign, and his lawyers argued that he had transferred money to private accounts only to prevent it from being stolen. Appearing as witnesses at the trial were FBI agents who testified that the Russian mafia had previously taken out a contract on Konanykhin’s life. Also appearing were former INS
Immigration and Naturalization Service
The United States Immigration and Naturalization Service , now referred to as Legacy INS, ceased to exist under that name on March 1, 2003, when most of its functions were transferred from the Department of Justice to three new components within the newly created Department of Homeland Security, as...
prosecutor, Antoinette Rizzi, who had previously been in charge of the government’s case against Konanykhin, and former KGB agent Yuri Shvets. Both Rizzi and Shvets testified that they had serious doubts about the charges filed against Konanykhin by Volvodez and the American government.
On August 26, 1996 in Federal Court in Arlington, Virginia, a settlement agreement between Konanykhin and the district director of the Immigration and Naturalization Service, which was endorsed by U.S. District Judge T.S. Ellis III, was reached. Judge Ellis, who had stated he found the testimonies of Yuri Shvets and Antoinette Rizzi in Konanykhin’s immigration case “credible and somewhat disturbing,” ordered the INS to pay $100,000 of Konanykhin’s legal fees to pro bono counsel at Arent Fox
Arent Fox
Arent Fox LLP is a law firm and lobbying group based in Washington, D.C.. The firm also has offices in New York City and Los Angeles, California. In 2007, the National Law Journal ranked the firm as the 137th largest in the United States based on number of attorneys...
Kintner Plotkin & Kahn. The settlement also ordered Assistant U.S. Attorney Robert Spencer to confirm within 30 days that there would be an internal probe by the Department of Justice
United States Department of Justice
The United States Department of Justice , is the United States federal executive department responsible for the enforcement of the law and administration of justice, equivalent to the justice or interior ministries of other countries.The Department is led by the Attorney General, who is nominated...
into the conduct of INS lawyers at the hearing.
Libel lawsuits and political asylum
In a lawsuit filed in February, 1997 with the Arlington County Circuit Court, Konanykhin alleged defamation against the daily Russian newspaper IzvestiaIzvestia
Izvestia is a long-running high-circulation daily newspaper in Russia. The word "izvestiya" in Russian means "delivered messages", derived from the verb izveshchat . In the context of newspapers it is usually translated as "news" or "reports".-Origin:The newspaper began as the News of the...
which had reported him involved in various criminal acts. The suit claimed that the information was erroneous and published with "reckless disregard for its truth or actual malice.” An Arlington County Circuit Court jury recommended Konanykhin should be awarded $33.5 million. Soon thereafter the same court awarded Konanykhin an additional $3 million in a libel case against the Russian financial journal Kommersant
Kommersant
Kommersant is a commerce-oriented newspaper published in Russia. , the circulation was 131,000.- History :The newspaper was initially published in 1909, and it was closed down following the Bolshevik seizure of power and the introduction of censorship in 1917.In 1989, with the onset of press...
.
On February 23, 1999 in Federal Immigration court Judge Bryant granted political asylum to Konanykhin and Gratcheva, saying the former banker faced persecution and possible death if returned to Russia to face embezzlement charges. In his decision Judge Bryant wrote that testimony from several experts had convinced him that Konanykhin was being targeted for prosecution for political reasons.
Temporarily freed from his trials with the Russian and American governments, Konanykhin and Gratcheva went on to develop a $100 million Internet startup in New York called KMGi, among other businesses. But then on November 20, 2003 the Board of Immigration Appeals revoked Konanykhin’s political asylum and ordered him returned to Russia. The ruling came less than a month (October 25, 2003) after the arrest of Mikhail Khodorkovsky
Mikhail Khodorkovsky
Mikhail Borisovich Khodorkovsky is a Russian prisoner, considered by some - such as Amnesty International - to have been imprisoned for political reasons, jailed until 2016 and a former Russian oligarch and businessman...
, Konanykhin’s former banking rival in Russia and business partner during his exile. Konanykhin had served as vice president for the international development of Khodorkovsky's bank, Menatep
Bank Menatep
Bank Menatep was a US$29 billion holding company created by Mikhail Khodorkovsky, that had indirect controlling interest in Yukos Oil Company. It was involved in the US$4.8 billion diversion of International Monetary Fund funds.-Scandal:...
.
Attempted flight to Canada
Konanykhin and Gratcheva fled to the Canadian border to evade immigration authorities. There, on December 18, 2003, they were arrested by several Department of Homeland Security agents at the Peace BridgePeace Bridge
The Peace Bridge is an international bridge between Canada and the United States at the east end of Lake Erie at the source of the Niagara River, about upriver of Niagara Falls. It connects the City of Buffalo, New York, in the United States to the Town of Fort Erie, Ontario, in Canada...
. Konanykhin and Gratcheva were saved from deportation at the last minute by a series of emergency hearings in Federal Court. On January 26, 2004 Judge T. S. Ellis III delivered his ruling, which found the arrest unlawful, and allowed the couple to stay in the United States temporarily, until appeals in their immigration case were exhausted. For the second time the Department of Justice was ordered to pay compensation to Konanykhin for unlawful arrest. Then on September 18, 2007 in a federal courtroom in Alexandria, Virginia, Konanykhin was granted asylum for the second time.
Career in America
He and his second wife, Elena Gratcheva, established the Internet firms, KMGiKMGI (advertising agency)
KMGi is an advertising agency specializing in multimedia advertising and online content creation. It was one of the first companies to create animated, TV-style ads for the Internet. KMGi was founded in New York City by Alex Konanykhin, Nikolai Mentchokov, and Elena Gratcheva in 1997...
(an advertising agency) and Publicity Guaranteed (a public relations firm), and The Syndicated News, an online marketplace. In 2004, Konanykhin was named “New York Businessman of the Year” by the Republican National Committee
Republican National Committee
The Republican National Committee is an American political committee that provides national leadership for the Republican Party of the United States. It is responsible for developing and promoting the Republican political platform, as well as coordinating fundraising and election strategy. It is...
. In 2010, he established WikiExperts.us, a business centered around creating Wikipedia articles for companies, which represents a classic example of a conflict of interest. WikiExperts also offers a "24/7 monitoring and repair service", claiming, "Your Wikipedia presence is completely safe, if you entrust it to us".
Published works
- Defiance: How to Succeed in Business Despite Being Hounded by the FBI, the KGB, the INS, the Department of Homeland Security, the Department of Justice, Interpol, and Mafia Hitmen Renaissance Publishing, 2006. ISBN 978-0-9727377-0-8
In popular culture
- Brian HaigBrian HaigBrian Haig is an American thriller author and Fox News military analyst.-Early life and family:Haig's father was former U.S. Secretary of State Alexander Haig ; his mother is Patricia . He has a brother Alexander and a sister Barbara.-Military life:Haig graduated from West Point in 1975 and was...
's book, The Hunted (ISBN 0-446-19559-6), is a novel based on the life of Konanykhin and his wife. The book is dedicated to Konanykhin's wife Elena.