Posted by: Dr Churchill | March 22, 2022

Russian New Yorkers in vogue…

Foreign money has fueled a billionaires row of residential buildings overlooking Central Park, including the Plaza, left, and the Time Warner Center in the background.
Foreign money has fueled a billionaires row of residential buildings overlooking Central Park, including the Plaza, left, and the Time Warner Center in the background.Credit…Todd Heisler/The New York Times

In March 2009, a bookish-looking Russian senator stepped to the podium at the Brookings Institution in Washington. The occasion was the inauguration of a new think tank devoted to United States-Russia cooperation on financial and energy security, and the speaker, Andrey Vavilov, had donated money.

Mr. Vavilov was introduced as a brave individual who had toiled for years under adverse circumstances in Russia, a onetime deputy finance minister and former proprietor of an oil company. His talk, delivered in Russian, focused on the intricacies of the energy markets.

Behind the trappings of Brookings and his professorial demeanor, though, were some more ambiguous elements of Mr. Vavilov’s career.

At the Finance Ministry during the presidency of Boris N. Yeltsin, he helped develop a market-based economy that would ultimately mint vast riches for insiders. He also wielded enormous power over state revenue and expenditures, including decisions over which banks would garner coveted government deposits. A parliamentary anticorruption committee later investigated allegations against him of favoritism and abuse of power — charges that he denied but that would shadow him for a decade.

He had become extraordinarily wealthy during the early years of Vladimir V. Putin’s presidency, when the oil company he had acquired for $25 million was taken over in 2003 by a state-controlled enterprise for $600 million. It was widely alleged that the purchase price was excessive, and that money was funneled to politicians in the form of kickbacks.

Andrey Vavilov 
Andrey Vavilov Credit…Illustration by Michael Hoeweler

Six years later, as Mr. Vavilov helped inaugurate one new venture in Washington, his personal fortune was bringing another piece of business to fruition in New York. A shell company tied to Mr. Vavilov was poised to buy a penthouse at the Time Warner Centerfor $37.5 million.

Mr. Vavilov’s purchase — all 8,275 square feet of it, with his-and-her master bathrooms and 360-degree city views — is an opulent example of how the flight of wealth accrued in the chaotic capitalism of post-Soviet Russia has been a powerful force behind the luxury condominium boom reordering New York City’s skyline. (Read a summary of this article in Russian.)

In the decade and a half since Mr. Putin came to power, Russians have socked away hundreds of billions of dollars overseas. Even as the Kremlin was promoting what it called a “deoffshorization” campaign to repatriate Russian capital, an estimated $150 billion left the country last year. Unless Mr. Putin can effectively lock the door, that flow may intensify if Russia’s economy and currency continue to founder.

For many wealthy Russians, a New York condo serves as a double parachute — a safe-deposit box of sorts, and a soft landing spot should the climate back home turn inhospitable or dangerous — even if that apartment sits dark and vacant for most of the year. In the process, the Russians, while not quite as ubiquitous as they are in, say, some of the tonier districts of London, have become the face of a sharpening debate about the impact of New York’s pied-à-terre economy.

In an interview with New York magazine in September 2013, the departing mayor, Michael R. Bloomberg, described the wealthy foreigners as “a godsend” whose spending bolsters the city’s economy and provides revenue to take care of poorer New Yorkers. “Wouldn’t it be great if we could get all the Russian billionaires to move here?” the mayor said, and certainly many of his fellow citizens would agree. But to many others, the Russians, with their reputation for ostentatious wealth, are emblematic of a dangerously expanding gap between the city’s haves and have-nots.

The archetype of the condo boom is the Time Warner Center. Marketed during the real estate malaise that followed the terrorist attacks of Sept. 11, 2001, the towers were heavily promoted to an international clientele. The Russians have come buying.

Many of the apartments were purchased through shell companies, but a New York Times investigation identified at least 20 that have been owned by Russians or citizens of other former Soviet republics who, in all, invested more than $200 million in Time Warner Center condos.

“This building has so many Russians, it’s unbelievable,” said Stratos Costalas, a real estate broker with Oxford Property Group who has sold apartments in the building.

There is evidence of even more Russian owners, but their identities are so carefully concealed that The Times was unable to definitively identify them.

For example, even the longtime renters of Apartment 63B in the south tower do not know the names of their landlords, though they believe they are Russian. Records show that the legal owner is a company called Daloa Group Holdings, but from there the trail goes cold.

Many of the Russians whom The Times was able to identify at the Time Warner Center were players in the epic deals of the Yeltsin era that privatized vast, hulking state companies and created the country’s most powerful oligarchs. And quite a few of their stories circle through that of Mr. Vavilov.

Mr. Vavilov did not respond to requests for an interview for this article. Nor did he speak up publicly a few years ago when a mysterious media blitz of charges and countercharges broke out involving a longtime adversary, a financier and former Russian lawmaker named Ashot Egiazaryan, who was seeking political asylum in the United States.

It turns out that Mr. Vavilov was at the center of the byzantine affair. Seed money for the media campaign came from bags of cash Mr. Vavilov had lying around his Moscow home, according to a deposition from a subsequent defamation lawsuit in New York. Mr. Vavilov was neither plaintiff nor defendant in the litigation, but by the time it was over in 2014, he had quietly spent more than $1 million in legal fees.

Andrey Vavilov, a former Russian senator and deputy finance minister, at the Mandarin Oriental hotel in the Time Warner Center in 2007. A company tied to Mr. Vavilov bought a penthouse in the building for $37.5 million.
Andrey Vavilov, a former Russian senator and deputy finance minister, at the Mandarin Oriental hotel in the Time Warner Center in 2007. A company tied to Mr. Vavilov bought a penthouse in the building for $37.5 million.Credit…Ruth Fremson/The New York Times

Mr. Vavilov, 54, looks every bit the ivory tower economist, with closely cropped graying hair and wire-rimmed glasses. He has a Ph.D. from the Central Economics and Mathematics Institute in Moscow and is a visiting senior scholar in the economics department at Pennsylvania State University.

Yet along with that academician’s image, cultivated on his personal website and in public appearances, comes a penchant for audacious gestures and an expansive appetite for luxury.

He once placed billboards around Moscow announcing his love for his wife, an actress and dancer named Mariana Tsaregradskaya. In addition to the New York penthouse and a home in Moscow, they have had residences in Monaco and Beverly Hills. He has owned an Airbus jet, according to court papers, and the couple have been known to fly to the Little Nell, a luxury hotel in Aspen, Colo., for ski holidays. In 2004, the Russian news agency RBC reported that Ms. Tsaregradskaya had purchased two diamonds — of 55 and 59.5 carats — previously displayed in museums. The tab was $60 million.

If the path was circuitous, it was quite by design that the couple ended up with one of the showiest condos in New York.

Originally, they had hoped to settle at the Plaza, the venerable hotel that was undergoing a partial conversion to condos. Based on a model, they signed contracts in February 2007 for two penthouses — a triplex for $39.5 million through the shell company Penthouse 2009 Inc. and a duplex for $14 million under the name Penthouse 2011 Inc. The two condos shared a wall and could be connected through a bedroom and living room.

Mr. Vavilov stated “in no uncertain terms that he wished to own the largest and most expensive apartment at the Plaza,” according to documents filed in a subsequent lawsuit over the sale.

In January 2008, with construction underway, the couple visited the interior designer Howard Slatkin at his Upper East Side apartment filled with custom fabrics, art and antiques. He advised them that redecorating their condo in a similar motif would cost about $1,500 a square foot, according to court records. Admiring the décor — which a 2013 article in The Times described as “Italian palazzo meets Russian princess” — they engaged Mr. Slatkin’s company for several projects.

One was to redecorate the Airbus jet. Another was the redesign of what was to be the couple’s interim residence while the apartments at the Plaza were under construction — Apartment 70B in the Time Warner Center’s north tower. The couple had purchased the 3,000-square-foot condo in 2007 for $13 million through another shell corporation — TW70B Inc. The decoration of 70B was to be a test before Mr. Slatkin set out on the largest and final project — decorating the Plaza penthouses that were to be their permanent New York residence.

In late June, the couple conducted a walk-through of the Plaza penthouses before closing. It was during this visit that Ms. Tsaregradskaya expressed her displeasure, complaining that the apartments were not large enough, among other things. Several weeks later, the couple refused to close, alleging that the apartments’ design and construction did not measure up to what had been advertised. The developer said it would keep their $10.7 million security deposit.

In a lawsuit filed in August 2008, the corporations Penthouse 2009 Inc. and Penthouse 2011 Inc. complained that the apartments at the Plaza resembled attics, with low ceilings, unsightly air conditioning units and inferior bathroom tile. Their lawyer, in a news release, accused the developer of a bait and switch.

“My client was led to believe that it would receive one of the most luxurious apartments in New York history; it got far less than what it bargained for,” the lawyer, Y. David Scharf, said.

The suit was ultimately settled. Mr. Vavilov and Ms. Tsaregradskaya later had a falling out with Mr. Slatkin as well, and an arbitrator directed him to repay more than $3 million.

A Time Warner penthouse, shown in a real estate listing, that was purchased by a company tied to Mr. Vavilov. Russians and citizens of other former Soviet republics have paid a total of more than $200 million for Time Warner condos.
A Time Warner penthouse, shown in a real estate listing, that was purchased by a company tied to Mr. Vavilov. Russians and citizens of other former Soviet republics have paid a total of more than $200 million for Time Warner condos.

In May 2009, deeming the Plaza not up to their standards, the couple entered into a $37.5 million contract for PH78 at the Time Warner Center, property records show.

The buyer was registered under the name Southerndown.

In February 1997, a bomb exploded in an empty Saab 9000 parked in front of Russia’s Finance Ministry, not far from the Kremlin. The car belonged to Mr. Vavilov, at that time a deputy finance minister.

No one was ever arrested, and the blast was never explained. But in the brutal political infighting of that time, Mr. Vavilov was a man with a certain number of enemies, a man surrounded by suspicion.

Mr. Vavilov had joined the Finance Ministry in 1992, one of a handful of idealistic free-market economists embracing a capitalist model in the early days of the Russian Federation. He was only 31, but was already regarded as a leading expert in finance. The year before, he had cut short a fellowship at the Peterson Institute for International Economics in Washington to return home and help shape the parameters of a market-based system for the young republic.

Andrey Vavilov, left, and other Russian officials at the opening of an auto plant in 1993. Mr. Vavilov, who joined the Finance Ministry the year before, helped shape a new market-based system for the Russian Federation.
Andrey Vavilov, left, and other Russian officials at the opening of an auto plant in 1993. Mr. Vavilov, who joined the Finance Ministry the year before, helped shape a new market-based system for the Russian Federation.

At the center of those reforms was the auctioning of pieces of the old Soviet industrial complex. A principal component of that process — and one of the most vociferously assailed as a corrupt ceding of prized assets to a handful of insiders — was a program begun in 1995 called Loans for Shares, in which favored banks received stakes in state enterprises in return for loans to the cash-starved government.

Mr. Vavilov’s primary portfolio as deputy finance minister, though, lay elsewhere.

As the person responsible for all government expenditures and revenues in foreign currencies, Mr. Vavilov shouldered enormous responsibility for the day-to-day execution of financial transactions. He also managed debt issues as Russia sought to renegotiate billions of dollars in loans to international creditors held over from the Soviet Union, as well as to collect on debts owed to it by former client states.

Where he wielded the greatest power, though, was in selecting banks that would win government deposits. With the oligarchic bank owners vying for these assets, Mr. Vavilov was in a position not only to distribute the cash and high-yield government notes, but also to shape the terms in an emerging market with few regulations.

Although he played little direct role in the privatization process, this access to money was essential for banks in the competition to acquire the gems of the former Soviet state.

“He decided how much deposits to place in which banks, coincident at the same time with privatization,” said one person knowledgeable about Mr. Vavilov’s time in office who spoke on condition of anonymity for fear of repercussions.

In 2001, after the recently elevated Mr. Putin began recentralizing industry, vowing to eliminate “as a class” the Yeltsin-era oligarchs, the Russian Parliament began investigating a host of the former president’s ministers. The review included a detailed look at Mr. Vavilov’s tenure at the Finance Ministry.

Among the issues under scrutiny was a 1996 agreement that had permitted Ukraine to pay a natural gas debt to Russia with construction materials. Of $450 million in materials supposed to have been shipped to the Russian Defense Ministry to pay off the loan, only $123 million worth arrived, investigators said.

A Russian general was tried and sent to prison. At trial, he argued that he was being made the fall guy for high-ranking ministers, and he pointed the finger at Mr. Vavilov as the signatory on the arrangement.

Mr. Vavilov denied wrongdoing, and the case against him was dropped.

Another case, though, would shadow Mr. Vavilov for years, nourishing suspicions that he had promoted the interests of favored banks. It involved allegations that he had mishandled about $230 million distributed in 1997 for the manufacture of Russian MIG jets destined for India.

Soon after Mr. Vavilov left the Finance Ministry in spring 1997, the chairman of Russia’s Central Bank alleged that the money, instead of being transferred directly to the jet manufacturer’s account, had been diverted through accounts at several banks in the form of government bonds known for their particularly beneficial terms to bankers.

Mr. Vavilov denied wrongdoing, saying the money had been deposited in the manufacturer’s account and had been spent appropriately. The case against him was closed, but the allegations festered until 2007, when it was reopened and the Russian Supreme Court upheld charges of fraud and abuse of office, clearing the way for Mr. Vavilov’s arrest.

By then, however, he had become a senator, complicating the case because the position confers parliamentary immunity. The statute of limitations eventually expired, and the case was dropped in 2008.

“You never know what’s going on, who is guilty or not, but they made a very good public case against him,” said Bernard Sucher, an American who worked for 20 years in Russian banking.

Mr. Vavilov later said he was the victim of a smear campaign by his enemies. And in his 2010 book, “The Russian Public Debt and Financial Meltdowns,” he said he had argued strongly against the Loans for Shares auctions, which he called “a privatization for oligarchs of the Russian ‘crown jewels.’”

Contact the Reporters

Contact the reporters on this story.

He invoked the story of Alexander Hamilton, the Treasury secretary in the early days of the American republic who died in a duel with Aaron Burr.

“Because of my tough position I became the subject of a hysterical and dirty campaign in the mass media that was controlled by the oligarchs,” Mr. Vavilov wrote. “Duels in modern times are not permitted, and there is no place for heroism in the spirit of Alexander Hamilton. The only possible response to the insinuations in the mass media was my decision to resign at the beginning of 1997.”

Unexplained in his book was his decision, upon leaving government, to become president of an affiliate of Uneximbank, which had been founded by one of the authors — and chief beneficiaries — of Loans for Shares, Vladimir Potanin. In 1995, in one of the program’s most notorious auctions, Mr. Potanin’s bank won virtual control of the mining giant Norilsk Nickel.

Despite Mr. Vavilov’s close association with the Yeltsin administration, much of his wealth was acquired later, as Mr. Putin’s government was consolidating the nation’s oil industry in one state-affiliated super company, Rosneft.

In 2000, Mr. Vavilov had acquired a small oil company, Severnaya Neft, or Northern Oil, for $25 million. When Rosneft purchased Severnaya Neft in 2003 for $600 million, the deal was widely criticized as having been larded with kickbacks for Kremlin insiders.

In a now-legendary confrontation at the Kremlin, Mikhail B. Khodorkovsky, chairman of the oil giant Yukos, challenged Mr. Putin about the purchase. Many people believed that it was Mr. Putin’s anger over the very public encounter that sparked his campaign against Mr. Khodorkovsky, who would be stripped of his company, prosecuted and imprisoned.

In an interview with The Times in 2007, Mr. Vavilov said of Severnaya Neft, “It was a big achievement for me from all points of view. When I bought the company nobody even took it seriously. It became one of the fastest-growing companies in the country.”

Even so, Mr. Vavilov’s critics look back over his career and see a classic transformation story of that Russian era.

“The issue with Vavilov is that he was one of the reformers who switched to the oligarchic side,” said Anders Aslund, a Swedish economist who is a senior fellow at the Peterson Institute.

At the Time Warner Center, Mr. Vavilov and Ms. Tsaregradskaya needed little introduction, particularly in the ultraexpensive top floors, where a number of the Russian owners were linked through a tangled — one might even say Dostoevskian — web of relationships and business deals.

Before buying at the Time Warner Center, Mr. Vavilov had visited the unit of Oleg Baybakov, whose family members have owned three Time Warner Center apartments at various times. Mr. Baybakov made part of his fortune as an executive of Norilsk Nickel, the mining company acquired for a fraction of its value in the Loans for Shares program. In fact, he is one of several Time Warner owners with ties to the Norilsk deal, in which one of the winning partners was Mikhail Prokhorov, now a visible figure in New York as principal owner of the Brooklyn Nets basketball team.

Oleg Baybakov, left, and Maxim Finskiy in 2010.
Oleg Baybakov, left, and Maxim Finskiy in 2010.

Mr. Baybakov is primarily known in New York through his daughter, Maria Baibakova, a young socialite and art-scene fixture. Before helping foster his daughter’s art career, however, Mr. Baybakov had sought to establish her in the restaurant business. After plans for a downtown restaurant called Fum fell apart, Mr. Baybakov’s restaurant company sued his business partner to recoup his investment and collect $75,000 left in escrow.

When advised by one of the lawyers that the legal fees might exceed the amount in escrow, Mr. Baybakov said he did not care. “I will spend 10 times more and sue you,” he told the lawyer, according to a deposition. In the end, Mr. Baybakov failed to show up for trial, and so did his ex-wife, also a partner in the business. “She also apparently evinced a disregard for the court’s process,” said Justice Louis B. York of State Supreme Court, dismissing the case, according to court records.

The Baybakovs sold one of their Time Warner apartments, 74A in the north tower, to a shell company called Ff Property Management for $11 million in 2008. The Times traced the shell company to Maxim Finskiy, also a former Norilsk Nickel executive and a partner with Mr. Prokhorov in another mining company. The apartment was sold for $18 million last November.

If Mr. Prokhorov was a big winner in the Norilsk deal, the loser was Vitaly Malkin, whose Rossiyskiy Kredit Bank submitted a higher bid but was shut out on technical grounds. At the time, though, another deal was on the horizon that would benefit him — an agreement to finance Angola’s $5 billion debt that generated controversy because of payments to Angolan officials and to middlemen, including Mr. Malkin. At the Russian Foreign Ministry, it was Mr. Vavilov who signed off on the deal.

Mr. Malkin’s lawyer called his client’s $48.8 million payment a dividend, explaining that he had held shares in a company that served as an intermediary in the deal.

Vitaly Malkin

In 2010, a limited liability company traced to Mr. Malkin’s family paid $15.65 million for Apartment 74B, a duplex, in the Time Warner Center’s south tower.

A member of an administrative council of Mr. Malkin’s bank, Vasily Anisimov, has a connection to the Time Warner Center as well. A penthouse there was purchased in 2004 for $9.8 million through a trust for the benefit of Mr. Anisimov’s daughter, Anna Anisimova, then a student at New York University.

Mr. Anisimov made his fortune in aluminum in the 1990s. He remains influential in Russia, where he has been an associate of Arkady Rotenberg, a longtime friend of Mr. Putin who was among those sanctioned by the United States after Russia’s annexation of Crimea.

Possibly Mr. Vavilov’s longest-standing associate in the Time Warner Center is Konstantin Kagalovsky. In 1991, the two were members of a group of five who holed up in a dacha outside Moscow to develop an economic platform for the emerging republic. Mr. Kagalovsky went on to become Russia’s representative to the International Monetary Fund and later vice chairman of Mr. Khodorkovsky’s company, Yukos.

In 1999, Mr. Kagalovsky’s wife, Natasha Gurfinkel Kagalovsky, was enmeshed in an international money-laundering investigation focused on her employer, the Bank of New York. The bank ultimately suspended Ms. Kagalovsky, who had authority over Russian accounts as head of the bank’s Eastern European division. She denied wrongdoing, and no charges were filed against her. She later sued the bank, saying that she had been wrongfully suspended, and received a settlement.

Through records and interviews, The Times established that the Kagalovskys, through a shell company, are owners at the Time Warner Center.

Mr. Kagalovsky, who did not respond to questions for this article, has become another of the Time Warner Russians embroiled in recent litigation in New York.

In a lawsuit in State Supreme Court, he was found to have wrongfully wrested control of a Ukrainian television network from his partner, Vladimir Gusinski. The judge ruled in 2012 that Mr. Kagalovsky and his associates had secretly transferred ownership of the company to entities he controlled.

In his decision, the judge wrote that Mr. Kagalovsky and a company executive had agreed that if Mr. Gusinski refused to step down, Mr. Kagalovsky would take over the company using “the traditional Russian and Ukrainian method.”

Mr. Vavilov was preparing to export his own Russian rivalry to America when he invited a Washington operative to his Moscow home in January 2011.

Ashot Egiazaryan, a financier and former Russian lawmaker, was the subject of a negative campaign financed by Mr. Vavilov.

Mr. Vavilov had recently learned that Mr. Egiazaryan, the financier and former lawmaker, had taken up residence in Beverly Hills after fleeing Russia, where he was facing fraud charges.

While Mr. Vavilov hated Mr. Egiazaryan, according to a deposition from one figure in the later legal case, the precise genesis of that antagonism is not clear. It might have been related to Mr. Vavilov’s former oil company, Severnaya Neft, in which Mr. Egiazaryan’s cousin had once been an investor. Or it might have been related to the longstanding allegations about the murky MIG case, which included claims that money had disappeared in Unikombank, where Mr. Egiazaryan was a major shareholder.

Now, tensions had escalated to such a degree that Mr. Vavilov wanted the operative, Rinat Akhmetshin, director of a Washington think tank called the International Eurasian Institute, to help derail Mr. Egiazaryan’s application for asylum in the United States.

“I remember there was money in like $100 bills bags,” Mr. Akhmetshin would later testify, recounting how Mr. Vavilov pulled out $70,000 or $80,000 and handed it over — the first payment in a media campaign to discredit Mr. Egiazaryan.

For help, Mr. Akhmetshin turned to Peter Zalmayev, who runs the Eurasia Democracy Initiative, which describes itself as devoted to promoting democracy and the rule of law in former Soviet states.

Mr. Zalmayev later acknowledged in a deposition that he had been paid $100,000 but had not disclosed that he was working at the behest of Mr. Vavilov when he approached groups including the American Jewish Committee and the National Conference on Soviet Jewry. Both ultimately signed anti-Egiazaryan letters to the State Department and the Homeland Security secretary.

Mr. Zalmayev’s strategy largely relied on painting Mr. Egiazaryan as anti-Semitic because of his connection to the Liberal Democratic Party of Russia, headed by an ultranationalist. By March 2011, Mr. Zalmayev had persuaded The Jewish Journal, a widely read newspaper in California, to publish an opinion article he wrote.

“Jewish groups in America and Russia have repeatedly condemned the L.D.P.R. and its leader as anti-Semitic,” the article said, adding, “The U.S. government must likewise put anti-Semites worldwide on notice: You are not welcome in this country.”

Mr. Zalmayev also acknowledged paying $7,000 to a Russian-language radio host in Boston, whose byline was used on an article, partly drafted by Mr. Zalmayev, expressing opposition to Mr. Egiazaryan’s asylum application. And he donated $2,000 to Lev Ponomarev, a human rights activist in Russia, who had signed letters to members of Congress, also partly drafted by Mr. Zalmayev.

Mr. Ponomarev later rescinded the letters as a “grave mistake” and returned the money, but not before a staff member of the United States Helsinki Commission, a federal agency, raised questions in an email exchange with Mr. Zalmayev.

“Who’s orchestrating this?” wrote the staff member, Kyle Parker, after Mr. Zalmayev contacted him to suggest that Mr. Egiazaryan warranted attention for placement on a “no entry” list.

Mr. Egiazaryan mounted his own public relations campaign, denying the charges of anti-Semitism and saying he had fled Russia after death threats against him and his family.

The case against Mr. Egiazaryan back home involved claims that he defrauded two business partners of $48 million. In a recent interview with The Times, Mr. Egiazaryan said the fraud charges were drummed up by politically connected rivals as part of a corporate raid stripping him of his interest in a joint venture with the city of Moscow to renovate a Stalin-era hotel near Red Square. “All the accusations are built on fabricated documents,” Mr. Egiazaryan said.

On Feb. 7, 2011, The Associated Press published an article portraying Mr. Egiazaryan as a victim of persecution in Russia. Within days, Mr. Egiazaryan hired BGR Gabara, a London unit of BGR Group, an influential Washington lobbying and public relations firm.

The firm’s fee was $77,000 a month, plus expenses, to develop a “global media strategy” for Mr. Egiazaryan that portrayed him in a favorable light, including a Washington program in “support of Mr. Egiazaryan’s application to settle in the U.S.”

By fall, BGR had scored a coup, helping to place an opinion article in The Wall Street Journal Europe, ostensibly written by Mr. Egiazaryan, expressing support for the anticorruption activist Aleksei Navalny.

A notation with The Journal article did not mention the criminal case, saying merely that Mr. Egiazaryan was living in the United States for his personal safety.

On April 19, 2011, Mr. Egiazaryan filed suit against Mr. Zalmayev in federal court in Manhattan, charging that he had led a malicious disinformation campaign against him. Mr. Zalmayev countersued, and, in the end, the legal confrontation essentially ended in a draw.

Mr. Egiazaryan’s lawyers had contended that one of their client’s rivals in the hotel deal was behind Mr. Zalmayev’s campaign, suggesting that Mr. Vavilov was merely a front. But documents produced in the discovery process and reviewed by The Times, show that in addition to financing the media campaign against Mr. Egiazaryan, Mr. Vavilov was covering Mr. Zalmayev’s legal costs. As of July 2012, nearly two years before the case ended, Mr. Vavilov had run through more than $1.14 million in legal fees.

At one hearing, the federal magistrate, Gabriel Gorenstein, complained of the lack of monetary restraint on both sides. “It’s mysterious to me as to why this litigation has ballooned to what it is now,” he said in a hearing. Mr. Vavilov, he later wrote, “obviously has no interest in the integrity of the United States asylum petitioning process. Rather, he apparently harbors an independent interest in harming Egiazaryan.”

Mr. Egiazaryan remains in the United States. The Justice Department would neither confirm nor deny Russian news media reports that the United States had turned down an extradition request.

Acquaintances say Mr. Vavilov, who resigned from the Russian senate in 2010, lives as a private citizen of Russia, a status that makes him less susceptible to government interference. “He has no political connection,” said Sergei Guriev, former director of the New Economic School in Moscow, where Mr. Vavilov has donated money and sits on the board.

Among Mr. Vavilov’s enterprises is a Russian company, SuperOx, which is developing high-temperature superconductors to improve magnetic levitation technology for high-speed trains.

His foundation has donated more than $1 million to Penn State, where he is a visiting scholar. He appears to relish that connection, displaying a football signed by Joe Paterno, the longtime coach, in his Time Warner pied-à-terre, according to someone who visited there.

The penthouse was recently put on the market for $68 million.

There are signs that Mr. Vavilov may be turning away from the United States.

He has taken a leave of absence this year from Penn State. “I think important Russians, just in general, it’s the case that people whose business interests are in Russia now, they feel very uncomfortable being seen as close to America,” said Barry Ickes, an economics professor there who has worked closely with Mr. Vavilov.

In an interview with the magazine Elle Man Russia, which was posted in English in October on his company’s Facebook page, Mr. Vavilov expressed disenchantment with the American people, characterizing them as overly strict and hypercompetitive.

“As for me (born in the Soviet Union and grown up further in Russia), in United States was built a cruel system, a cruel community, and people who are cruel to each other,” he said.


Dr Churchill


This article above was republished from the New York Times of February 15th of 2015 edition as it was written by Stephanie Saul and Louise Story

Leave a Reply

Please log in using one of these methods to post your comment: Logo

You are commenting using your account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s


%d bloggers like this: