Las Vegas Sun

March 29, 2024

Making of a novel, Kazakhstan-style

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A one-time Las Vegas resident is sitting in prison in Kazakhstan for a crime that he says he didn't commit.

The story of Menachem "Mark" Seidenfeld has all the makings of a novel, with law enforcement corruption, a 3,000-mile train ride in a Russian prison car, whispered extortion, shadows of the Las Vegas gaming industry and a knowing glance shared by a Nevada congresswoman and Kazakhstan's president.

Seidenfeld, 38, has been jailed for more than 15 months, extradited from Russia to Kazakhstan and facing trial at a date uncertain. He told the Sun that he has lost faith in Kazakh justice, and that his hope now rides on the ability of American officials to impress upon prosecutors and police in the former Soviet republic that they're watching his case closely for signs of subterfuge.

The stakes are high. Seidenfeld's arrest has implications for both the businessman and Kazakhstan's dream to develop Las Vegas-style gaming. A dream that may be dashed if gaming executives get cold feet about putting their chips on a country where a U.S. businessman says he's been wrongly incarcerated, for a price.

The story begins five years ago, when Seidenfeld, a New York native who had done business in Eastern Europe for 15 years, moved to Almaty, Kazakhstan, to work as chief executive of telecommunications company Arna Inc. The company was owned by three principal investors, Belgian investment company GIMV, the European Bank for Reconstruction and Development, and a Kazakh investor named Murat Zhunussov.

In December 2002, one year into his stint as Arna chief executive, Seidenfeld fired Zhunussov as a company consultant, although the investor remained a shareholder. Never, Seidenfeld said, did he envision Zhunussov's rancor.

By 2004, the bank was looking to liquidate its stake in the company. Zhunussov was interested, but Seidenfeld found several investors willing to pay more than the Kazakh investor, who finally had to raise $5 million to beat the highest bidder. The bad blood between the men all boils down to this moment, Seidenfeld said.

"Basically, I did not allow Mr. Zhunussov to buy the company at a cut-rate price," Seidenfeld said. "He feels I am directly responsible for his overpaying the company, for not letting him rig it."

Zhunussov bought Arna in March 2004. He fired Seidenfeld, who left the country shortly afterward and lived in Las Vegas from April to July 2004, when he was hired to work for the Moscow company Golden Telecom.

Seidenfeld was more than a year into his career with Golden Telecom when the company sent him on a business trip to Blagoveshchensk, a remote Russian city closer to Mongolia than Moscow.

Seidenfeld was arrested at the Blagoveshchensk airport on Dec. 7, 2005, by Russian police. For the first time, he learned that Kazakh police were investigating him for embezzlement - an investigation Seidenfeld says Kazakh police have opened at the behest of the well-connected Zhunussov.

Seidenfeld spent 11 months in a detention center in Blagoveshchensk, which sits across the Amur River from China. He fought extradition until it seemed inevitable.

In October he became the first American to be extradited from Russia to Kazakhstan.

On a map, the trip from Blagoveshchensk to Almaty, Kazakhstan, where Arna is headquartered, measures just over 2,000 miles. But Seidenfeld's prisoner transport train traveled about 3,000 miles, with stops at seven detention centers.

The boxcar cells were 3 1/2 feet wide and 7 feet long, stuffed with three-tiered bunks. Inside, Seidenfeld was isolated from other inmates, but not out of altruism.

"If I was in there with the general population there is no guarantee I would have gotten out in one piece."

Plus, he said, some train guards were more sadistic than others.

Seidenfeld's Russian fiancee, Natiya Sardjveladze, tailed his prison train, hiring attorneys at each stop to check that he was OK.

The trip took 32 days.

Seidenfeld is still in Kazakh custody. The investigation against him is in its third year. It amounts to a single accusation of theft: that he took roughly $43,000 from Arna in cash.

There are several people who dispute this allegation. Seidenfeld has the simplest explanation: He took the cash to buy equipment, which has been accounted for in three audits of the company.

This evidence hasn't exonerated Seidenfeld because of what he and his attorneys say is happening under the surface: bribery.

Shortly after his arrest, Seidenfeld's attorney was visited in Blagoveshchensk by Nyrlan Bekov, an attorney for Zhunussov, who spoke of Seidenfeld's future.

Derek Bloom, a former Golden Telecom attorney who now works on Seidenfeld's case for free from Washington, D.C., repeated Bekov's threat: "He said, 'When you get to Almaty, you're going to be convicted and sentenced to 10 years in jail, and there's nothing you can do to stop that, because we can control the courts in Kazakhstan, and beyond the financial police, we can influence the judge.' "

Unless, of course, there could be an arrangement. Seidenfeld's attorneys said Zhunussov has asked for somewhere between $2.5 million and $5 million to guarantee Seidenfeld's freedom.

"Mr. Zhunussov has been just brazen in his threats," Bloom said. "It's very clear that what we have here is the use of the Kazakh and Russian legal system to extort money. This case is going to go to court, where it's going to be decided not on the basis of evidence that shows this guy's innocent, but on the basis of instructions."

Seidenfeld's father, who lives in New York and speaks no Russian, flew to Blagoveshchensk to see his son and could spend only an hour with him. But not alone. Seidenfeld's sister, who lives in New Jersey, said all she can do is pray.

Seidenfeld said he feels a certain sick serenity now that he has given up hope.

It's the U.S. Embassy in Kazakhstan that has let him down, Seidenfeld said. He wants embassy officials to tell Kazakh authorities that his trial can't be rigged, but consular officers aren't allowed to become legally involved with cases. They can give him a list of lawyers, but they're barred from recommending one. They can visit him to make sure he isn't being discriminated against as an American and they can bring him books and vitamins, but they can't intervene.

"In the first couple of months, when I was still actually expecting something from them, the feeling of being let down was rather large," Seidenfeld said. "At this point, it's something I don't dwell on anymore. It's a lesson that I have learned.

"Other Americans should take a lesson from this."

The U.S. ambassador to Kazakhstan, John Ordway, wouldn't talk by telephone for this article. He prefers to do his interviews in person, in Kazakhstan, a spokeswoman said.

The embassy's Web site details what one can expect if arrested:

"Ultimately only Kazakhstani officials have the authority to resolve a dispute in Kazakhstan ... The U.S. Embassy cannot, however, become involved in private legal disputes, such as between you and your Kazakhstani business partner."

Now Seidenfeld's greatest ally may be his most distant: Rep. Shelley Berkley, D-Nev., his congresswoman when he lived in Las Vegas.

Nevada and Kazakhstan share certain sympathies. The former Soviet republic was Russia's answer to the Nevada Test Site. In June, Kazakhstan Ambassador Kanat Saudabayev flew to Las Vegas as Berkley's guest. The pair co-hosted a symposium at the Atomic Testing Museum, partially titled, "Shared Legacy, Shared Lessons."

Seidenfeld's attorneys tapped Berkley for help about a year ago, and since then, the congresswoman has been seeking assurances from Kazakh political pals that her constituent will be treated fairly.

"We believe that this is motivated on the part of (Seidenfeld's) former partner by greed and avarice, and that for a price, he'd be willing to drop the charges," Berkley said. "This is obviously a very prominent man who has access to some very formidable people in Kazakhstan. The counterbalance is that they have an American congresswoman who is relentless."

Saudabayev has since assured Berkley that he has spoken with the chairman of the Supreme Court in Kazakhstan.

However, Kazakhstan's interest in developing Las Vegas-style gaming may be worth more to Seidenfeld than Berkley's nuclear bond with the ambassador.

The effect of Seidenfeld's case is obvious, Berkley said: "There would be no interfacing of Kazakhstan and Las Vegas gaming if this gentleman was not treated appropriately."

It's not just because Berkley could bully them out of town, but because an American businessman might think twice about investing in a country where justice seems to be for sale.

When Kazakhstan President Nursultan Nazarbayev visited the White House in September, Berkley sat next to him and, through translators, underscored her interest in Seidenfeld's situation.

Nazarbayev just nodded. But much like the threats Zhunussov's attorney called agreements, what was said wasn't as important as what was understood.

"He knew what we were saying," Berkley said. "There was no mistaking my words."

In recent days, word has come from Kazakhstan that Zhunussov has instructed Arna employees to destroy evidence, and Seidenfeld's trial, which was set to start this month, has been postponed indefinitely because the police have suddenly decided to reopen their investigation.

Nobody thinks this is a good sign.

"Everything entirely depends on consequences," Seidenfeld said. "If the establishment here doesn't feel there are any consequences, they will take his money and convict me of anything."

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