Konanykhin Hearing Begins

Moscow Times ^ | Thursday, Jan. 15, 2004 | Valeria Korchagina

[RussianConservative]

The U.S. District Court in Alexandria, Virginia, began hearing an extradition case Wednesday against Alexander Konanykhin, a Russian businessman wanted in Moscow on fraud charges dating from the early 1990s.

Konanykhin, a one-time business partner of jailed former Yukos CEO Mikhail Khodorkovsky, was arrested late on the night of Dec. 24 by Homeland Security officers as he and his wife, Yelena Gracheva, tried to drive to Canada in an apparent move to avoid deportation to Russia. Russian prosecutors have alleged that Konanykhin embezzled $8 million in state funds.

Konanykhin, 37, one of Russia's first post-Soviet millionaires and until 1995 vice president of Khodorkovsky's Bank Menatep, has lived in the United States since the mid-1990s.

In 1996 Konanykhin managed to avoid deportation on charges that he violated visa rules, and he was awarded political refugee status in 1999 after a judge concluded he would be in extreme danger from the authorities if he returned to Russia.

By the mid-1990s Konanykhin's financial dealings had also attracted the attention of the U.S. Central Intelligence Agency. He reportedly had run offshore banking operations from the United States for his Russian partners, through the Antigua-registered European Union Bank. According to The Washington Post, some $12 million left Russia via its accounts before it closed in 1996.

But on Nov. 20, the U.S. Justice Department overturned the decision by the Immigration and Naturalization Service and issued a deportation order for Konanykhin.

He narrowly escaped being put on the next flight to Moscow after a judge in Alexandria became suspicious at the speed of the intended deportation. Instead, Konanykhin was held in Arlington jail, awaiting a court hearing.

"I think it will all turn into a political case, which I stand no chance of winning," Konanykhin told NTV television by telephone from jail, shortly before appearing in court on Wednesday. "Nobody is going to consider what is just, but there will be huge pressure to turn the case into something like the 1930s show trials."

Konanykhin's lawyer, Michael Maggio, said he was surprised by the whole nature of the situation. "I never heard of a person who wanted to leave the U.S. after receiving a deportation order being prevented from doing so," he told NTV in a voice-over interview.

But in an e-mail last November, Konanykhin told The Moscow Times that the deportation order specified he could leave the United States for Russia, but not for any other country.

In comments carried by NTV on Tuesday, Konanykhin said his deportation case had turned into a "crazy race" after Khodorkovsky's arrest on Oct. 25.

Yet Gracheva this week maintained that U.S. law enforcement is more eager to send her husband to Russia, than Russia is to acquire him.

According to Gracheva, after his arrest Konanykhin was brought to the Russian Embassy in Washington, but embassy staff refused to accept custody of him.

Gracheva told NTV: "[Representatives of the] American side screamed at the Russian side, 'We have agreements!' The Russian consul replied, 'Yes, I understand, but since you have them anyway, they are not going to disappear.'"

Deputy Consul Vadim Savelyev told NTV that that were no prior agreements to deport Konanykhin, nor were documents prepared for the procedure. Konanykhin appears not to have a valid Russian passport.

The results of the Virginia court hearing were not available at press time late Wednesday.