BELARUS NEWS AND ANALYSIS
DATE:
03/03/2009
From a Belarus prison, U.S. lawyer's last battle
Emanuel Zeltser had a career dogged by fraud allegations. Then a case involving a supposed secret will ended with his closed-door trial and conviction. As his health falters, the U.S. wants him back.
By Bob Drogin
Reporting from New York -- One of post-Soviet Russia's most powerful oligarchs, Badri Patarkatsishvili, left a business empire worth billions of dollars when he died of a heart attack in England on Feb. 12 last year.
What he didn't leave, according to his family, was a will.
But two days later, an obscure New York lawyer named Emanuel Zeltser appeared at the wake and told the grieving widow that her late husband had signed a secret will, given him power of attorney, and named a half-cousin in Florida as executor.
The news stunned the family. So did the events that followed.
Over the next month, Zeltser and the half-cousin sought access to the mogul's investments around the globe. The family sued in U.S. federal court, accusing the two Americans of trying to loot the huge estate with forged documents.
Then Zeltser flew -- or was kidnapped -- to Belarus, a former Soviet republic. He was immediately arrested and charged with economic espionage and use of false official documents to defraud the estate. He denied the charges, but was sentenced in a closed-door trial to three years in prison, where he remains today.
How Zeltser landed in Penal Colony #15 in eastern Belarus involves more than a bare-knuckle legal battle. It is a startling tale of a hard-charging U.S. lawyer who has fought allegations of fraud and forgery in the past, and now is ensnared in a case that may cost him his life.
That has turned the situation into an official U.S. concern.
U.S. Secretary of State Hillary Rodham Clinton is "focused" on Zeltser, her spokesman said, and seeks his immediate release for medical treatment. Twelve members of Congress wrote to the president of Belarus to express their "grave concern." Amnesty International has called for his release on humanitarian grounds.
"This is worthy of Dostoevsky," said Zeltser's older brother, Mark, a concert pianist. "It has money, politics, everything!"
Much of Zeltser's life seems straight from a novel. He was born in Siberia in 1953 after his family was banished to a Soviet mining camp, and later attended school in Moldova, then a Soviet republic.
But records filed in U.S. courts indicate he never attended the state university law school, as he often claimed, and that his law degree and transcript were fake. He had majored in piano at a conservatory instead.
Zeltser clearly had moxie. In 1974, at the age of 21, he joined an early wave of Soviet Jews permitted to emigrate abroad.
Landing in Texas, he cleared tables at a Burger King. When his family followed him to America, he moved to New York to try his hand at business. He was sued at least three times for alleged fraud.
In the most serious case, a New Jersey jury concluded he had illegally seized a medical clinic from its owners. He was ordered to pay more than $2 million in damages.
By then, Zeltser had decided to become a lawyer.
"He said, 'Lawyers always say, 'I'll call you back' and never do so,' " explained his brother, Mark. "He said, 'I want to do that. Only lawyers can afford to do that.' "
Despite his lack of formal training, he passed the New York state bar and was admitted to practice in 1990, just as the Soviet Union was starting to crumble. He found a lucrative niche as Russian companies scrambled to adjust.
In 1993, he was retained by Inkombank, then Russia's second largest bank, in New York. But he sued the bank in U.S. court two years later, claiming he had been fired because he had uncovered fraud and theft.
Inkombank counter-sued Zeltser for allegedly using his position "to steal nearly $6 million from investment accounts." In an affidavit, the bank's chief U.S. attorney called Zeltser a "career con man" who "forges documents on a routine basis." Inkombank collapsed in 1998, and the lawsuits stalled.
The following year, Zeltser became a key source for reporters and FBI investigators seeking to unravel an alleged $10-billion money-laundering scheme by Russian mobsters at the Bank of New York. Zeltser portrayed himself as an expert on Russian organized crime. He gave written testimony to the House Committee on Banking and Financial Services, and his face popped up on CNN, Fox News and other media outlets.
The publicity backfired in 2000 when the New York Times reported that Zeltser had supplied a document on the bank fraud that proved to be a fake. Other evidence also collapsed.
Zeltser denounced all accusations against him as attempts by Russian gangsters and their allies to silence him. He faded from public view after that -- until early last year.
When the 52-year-old Patarkatsishvili died at his mansion in southeast England, Zeltser called Joseph Kay, a former business associate and half-cousin of the billionaire, in Florida.
The two Americans flew to London and informed the widow and her lawyers about Zeltser's documents. They demanded access to accounts and companies from the Caribbean to the Caucasus. Kay gained control of a TV station in the Republic of Georgia and then sold it, infuriating the family.
In response, the billionaire's widow, children and mother sued in U.S. District Court in Manhattan to stop the pair from seizing other assets. They called Zeltser's documents "invalid and fraudulent," noting that several "appear to be forgeries" since the magnate was not in New York the day he allegedly signed them.
Kay denies the charges. "Although the other side claims there is no will, there has always been a will," he said in a telephone interview.
In early March, Zeltser met several times in London with Boris Berezovsky, another Russian oligarch and former business partner of the dead man. Berezovsky backed the widow, but Zeltser proposed they work together instead.
He gave Berezovsky a draft agreement to secretly divide most of the assets between them, leaving only 15% for the family, according to papers filed in the U.S. court case. The Russian rejected the offer. On March 11, the two men dined at a Japanese restaurant. At one point, Zeltser stepped outside to smoke a cigarette and use his cellphone.
"Emanuel called me and said, 'I am coming to see you. I'm flying to Miami,' " recalled his older brother, Mark.
Zeltser instead left London after midnight on Berezovsky's private jet and landed at dawn in Minsk, capital of Belarus, where the dead oligarch supposedly owned an oil refinery. The trip proved a disaster.
The KGB, as Belarusian state security is still called, arrested Zeltser at the airport. Zeltser called Kay several days later and pleaded with him to come to Belarus.
"He sounded like someone was beating the hell out of him," Kay recalled. He refused to go.
Despite official appeals, the Belarus regime barred U.S. diplomats from observing the closed-door trial last summer, and declared the evidence secret.
It's unclear if Zeltser was kidnapped or tricked onto the plane, as his lawyers claim, or if he boarded willingly. In an affidavit that he dictated in prison, Zeltser seemed to suggest that he had been drugged.
He said Berezovsky "tried to convince me to travel" to Minsk during their dinner. "Then he offered me coffee." Zeltser said he next recalled waking up as the jet was "about to land in Minsk."
Zeltser's lawyers have accused Berezovsky and his British lawyers of orchestrating his arrest to gain control of the estate or to win consulting contracts in Belarus, among other supposed motives. All have denied any wrongdoing, and U.S. District Court Judge Richard J. Sullivan noted his "strong disapproval" of Zeltser's legal team last May for making such "unsupported allegations of misconduct."
However, the judge also suspended the family lawsuit against Zeltser pending his release from custody.
Zeltser has grown dangerously ill in the meantime.
Dr. Albert Benchabbat, an internist hired by Zeltser's brother, was allowed to examine him in June and again Jan. 6 in the penal camp infirmary. Zeltser suffers from severe diabetes, painful arthritis and unstable angina, and "had deteriorated significantly" since June, Benchabbat said in a telephone interview from Paris.
Prison staff had refused to give Zeltser prescription medicine sent from America, Benchabbat said, and he "could drop dead at any moment." He said Zeltser needs immediate transfer to a U.S. hospital for coronary bypass surgery and other urgent care.
"Refusal to transfer him to a U.S. hospital is a death sentence as far as I am concerned," Benchabbat said.
Belarusian authorities have shown no sign of leniency. A strained relationship with Washington isn't helping.
President Alexander G. Lukashenko's autocratic regime expelled 30 American diplomats, including the U.S. ambassador, last spring after Washington tightened economic and diplomatic sanctions to protest electoral fraud, official corruption and human rights abuses.
Only five U.S. diplomats remain in Minsk. A consular officer has visited Zeltser eight times, but getting permission takes weeks and KGB officers monitor every meeting.
"We have told the Belarusian authorities that it is absolutely essential to release Mr. Zeltser so his health problems can be addressed," Jonathan Moore, the acting U.S. ambassador in Minsk, said in a telephone interview. "His continued incarceration complicates an already difficult bilateral relationship."
Oleg Kravchenko, the senior Belarusian envoy in Washington, insisted that his government has acted responsibly. Zeltser was "given due legal process under our legislation" and "consular access has been provided repeatedly," he said. "This is what we have to do, and this is what we have done."
Zeltser's court-appointed lawyer in Minsk, Dmitry Goryachko, visits him twice a week. The lawyer is barred from bringing newspapers, books or medicine, and a KGB officer monitors every meeting. In a telephone interview hours after a recent visit, Goryachko said Zeltser suffers constant pain and severe mental stress.
"He is very depressed by just a single thought -- that his health condition is so weak that he won't survive until the end of his prison term," the lawyer said.
Source:
http://www.latimes.com/business/investing/la-na-prisoner4-2009mar04,0,5486880.story
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