Russian Oligarch Fridman, Corporation Sued for Racketeering, Fraud That Used U.S. Banks and Exchanges

'Defendants' Tentacles Reach Into and Injure Numerous Americans'



Jun 09, 2006, 01:00 ET from IPOC International Growth Fund, Ltd.

    NEW YORK, June 9 /PRNewswire/ -- Russian corporation Alfa Group
 Consortium and its U.S. entity, Alfa Capital Markets, Inc., are a criminal
 enterprise that has used U.S. banks and stock exchanges as an integral part
 of their theft schemes, costing American taxpayers and stockholders
 hundreds of millions of dollars, IPOC International Growth Fund, Ltd.,
 alleges in a federal racketeering lawsuit filed late Thursday.
     The suit alleges that Alfa, one of the largest business conglomerates
 in the Russian Federation -- along with Russian oligarch Mikhail Fridman
 and U.S. citizen Leonid Rozhetskin -- engaged in a vast international money
 laundering and fraud scheme in an attempt to take control of the Russian
 cellular industry. "By doing so, defendants' conduct has had a substantial
 effect on the United States and its citizens, and much of the criminal
 conduct occurred in the United States," the suit, filed in U.S. District
 Court for the Southern District of New York, said.
     The criminal enterprise affected Americans, U.S.-based investors and
 U.S. interests in numerous ways, the complaint alleges, involving the
 evasion of U.S. taxes, insider trading of shares on U.S. stock markets, and
 wiring payments through New York banks. The Alfa Group Consortium received
 support from the Overseas Private Investment Corporation, a U.S. government
 development agency, to provide a significant portion of funding for one of
 Alfa's related businesses.
     "The complaint alleges that the racketeering and other wrongs cited in
 this case hurt U.S. investors, U.S. taxpayers and U.S. financial markets,"
 said W. Gordon Dobie, an attorney with Winston & Strawn LLP, which filed
 the case for IPOC International Growth Fund, Ltd. "It's my opinion that the
 defendants should be called to account in court for their conduct."
     A Daisy Chain of Nine Shell Companies
     The suit details how Alfa, in a series of sham transactions over a
 10-day period, knowingly and fraudulently colluded to steal IPOC's 25.1
 percent stake in Russia's third largest mobile telecom company, MegaFon.
 IPOC had originally signed two options agreements to buy the stake from LV
 Finance, had paid for the shares and at all junctures honored the terms of
 the agreements. At the final stage, IPOC discovered that LV Finance, acting
 through its chairman Leonid Rozhetskin, had negotiated a purported sale of
 LV Finance's interest in MegaFon to Mikhail Fridman's Alfa Group, involving
 a complex web of nine offshore companies. Both companies are alleged to
 have been aware of IPOC's prior ownership rights, but rode roughshod over
 the agreement and fraudulently colluded to sell the same stake twice. They
 "bought" and "sold" the $50 million stake, and yet there is no evidence of
 money having changed hands throughout this daisy chain of sham
 transactions.
     "What was a legitimate business opportunity for IPOC evolved into a
 vehicle for Rozhetskin's and Mikhail Fridman's theft and misappropriation,"
 the suit alleges.
     Scheme Concealed Wrongdoing
     The suit alleges that at the center of the enterprise was Fridman, a
 major VimpelCom shareholder, who used associates working directly for him
 and for VimpelCom, to transfer the assets in the summer of 2003. The scheme
 involved wiring payments through New York banks, taking the proceeds, and
 then transferring those proceeds to various off-shore companies "to conceal
 wrongdoing from IPOC, American taxing authorities, and others."
     The suit states that Rozhetskin acted "as a point person to obtain
 additional cellular phone assets" and worked closely with Fridman to assist
 with the sham transactions. He later relied on New York banks to launder
 the theft of $50 million, the money IPOC paid for the stake.
     The complaint also alleges that Rozhetskin and Fridman were assisted by
 Hans Bodmer, who served as escrow agent and sent instructions to IPOC to
 wire money through banks in New York for the benefit of the defendants.
 Bodmer recently plead guilty to criminal conspiracy to launder money and
 conspiracy to violate the U.S. Foreign Corrupt Practices Act in connection
 with an unrelated scheme to bribe foreign leaders.
     Insider Dealing and Manipulation of VimpelCom Tax Inquiry
     The suit also alleges that Fridman and the Alfa Group attempted to
 manipulate VimpelCom's share price for their own gain, in their position as
 major VimpelCom shareholders. On Dec. 8, 2004, the suit said, VimpelCom, a
 New York Stock Exchange Company, disclosed the Russian tax authorities were
 investigating the company for back taxes carrying potential for heavy fines
 and penalties.
     The news coincided with the auction of a $10 billion subsidiary of
 Russian conglomerate Yukos to satisfy back-dated tax obligations. Yukos
 later went through an unprecedented bankruptcy filing in the United States.
     The suit claims that manipulation was insider dealing that advanced the
 defendants' goal of obtaining control and consolidation of the
 telecommunications market in Russia, furthering the ability to raise prices
 for cellular services through a near-monopoly or oligopoly.
     Notes to Editors
     * IPOC International Growth Fund, Ltd. is an open-ended mutual fund
       company based in Bermuda.
 
     * The suit, based on claims under the Racketeer Influenced and Corrupt
       Organizations (RICO) Act, charges that Fridman conspired with Rozhetskin
       to steal IPOC's interest through money laundering, bribery, wire fraud
       and other criminal wrongdoings.  Other defendants are Alfa Capital
       Markets, Inc., a U.S. corporation; Alfa Telecom (n/k/a) Altimo; and Hans
       Bodmer.
 
     * Alfa Group Consortium is an association of various companies controlled
       by Fridman.  It controls major international corporations traded in the
       United States, including VimpelCom (NYSE) Russia's second largest mobile
       telecoms company, Golden Telecom (NASDAQ) and Turkcell (NYSE).
 
     * For more information about IPOC, go to http://www.ipocfund.com.  A copy
       of the lawsuit is being posted on this Web site June 9.
 
 
 
                       The Many Ties to the United States
     As the lawsuit states, "... defendants' tentacles reach into and injure
 numerous Americans...." The investors, taxpayers and financial markets of
 the United States have been harmed.
     The below sets out the individuals and firms referred to in the
 lawsuit, and provides some further information:
     The Defendants:
     Leonard Rozhetskin: "Defendant Leonard Rozhetskin is a former director
 and principal shareholder of LV Finance Group Limited ("LVFG"). He is a
 United States taxpayer and citizen, owns property in the District, and
 lived in the District for more than a decade ... featured on the cover of
 the Russian edition of Forbes with the title: 'The Most Dangerous Shark in
 Our Waters.'... Rozhetskin resides in the United States...."[pg.6]"
     Mikhail Fridman: "Defendant Mikhail Fridman currently serves as
 Chairman of the Board of Directors of co-conspirator Alfa Bank and as
 Chairman of the Board of Directors of Defendant Consortium Alfa Group.
 Fridman further served on the Board of VimpelCom, a NYSE company, and has
 control over Golden Telecom, a NASDAQ company ... purchased the United
 States trading firm owned by American, Mark Rich, the one time commodities
 baron pardoned by President Clinton with much controversy. Fridman purports
 to have become a philanthropist in the United States" and is a member of
 the Board of the Council on Foreign Relations based in New York. [pgs. 6-7]
     Pyotr Aven: "Defendant Pyotr Aven also has been a major participant in
 the scheme and worked directly with Rozhetskin and Fridman in the
 misappropriation and theft of IPOC monies. Aven is a director of Golden
 Telecom, a NASDAQ company, which regularly files with the United States
 Securities Exchange Commission. He is a controversial figure: As observed
 by the United States District Court for the District of Columbia, a Russian
 'corruption task force informed [the government] that Aven was engaged in
 various misdeeds, including drug trafficking. See OAO Alfa Bank v. Center
 for Public Integrity, Civ. Action No. 00-2208 (JDB), Mem. Op., Sept. 22,
 2005 at 11 n.26." [pg. 8]
     Hans Bodmer: "Defendant Hans Bodmer ... assisted Rozhetskin and Fridman
 with the Sonic Duo/MegaFon theft scheme ... worked with his co-conspirators
 to send instructions to IPOC to wire money through banks in New York for
 the benefit of the Defendants. Bodmer is no stranger to criminal
 prosecution in the United States, having recently pled guilty to the
 criminal conspiracy to launder money and conspiracy to violate the United
 States Foreign Corrupt Practices Act in connection with the scheme to bribe
 foreign leaders (along with Victor Kozeny, who is currently being
 extradited to New York from the Bahamas). Case No: 01: 05-CR-00518-RCC-ALL
 (S.D.N.Y.)." [pg. 9]
     * Publicly Listed U.S. Corporations Affiliated with Defendants:
     Vimpel-Communications, VimpelCom and Golden Telecom, Inc. "...
 Defendant Fridman has successfully obtained hundreds of millions of dollars
 from American investors through the sale of interests in his Russian
 telecommunications empire -- which includes New York Stock Exchange company
 Vimpel-Communications, also known as VimpelCom, and Golden Telecom, Inc.,
 ("Golden Telecom"), a NASDAQ company. [pg. 3]"
     Vimpel-Communications/VimpelCom Web site is
 http://www.vimpelcom.com/index.wbp
     Golden Telecom, Inc. Web site is http://www.goldentelecom.com/?id=12
     Alfa Capital Markets (USA), Inc: "Alfa Capital Markets (USA), Inc.
 ("Alfa Capital Markets") is a member of the Alfa Group and is a corporation
 organized under the laws of the United States with its principal place of
 business and office in New York City. Upon information and belief, Alfa
 Capital Markets was used to structure the laundering of the proceeds of the
 Fridman M.C. Enterprise for investment in the United States, such as the
 recent acquisition of Golden Telecom, Inc., a publicly held American
 company, controlled by the Alfa Group. On information and belief, Alfa
 Capital Markets' accounts were used to fund the misappropriation of
 plaintiffs' property." [pg. 9]
     The Alfa Capital Markets (USA), Inc. Web site is
 http://www.alfabank.com/usa/
     A Wide Variety of U.S. Ties:
 
     * The U.S. Banking System and the U.S. Treasury:
     "... goal of cheating the American government of taxes due and owing
 ....": Rozhetskin knew the assets were unlawfully taken when he made use of
 the United States to transfer the assets in interstate commerce. Further,
 Rozhetskin's actions were in furtherance of his goal of cheating the
 American government of taxes due and owing on the transactions." [pg. 18]
     "... money laundering and wire fraud that affected interstate and
 foreign commerce." "Defendants conspired to steal IPOC's money and
 property, and to conceal their wrongdoing and the true ownership of the
 proceeds through a series of sham transactions and transfer the stolen
 assets in interstate and foreign commerce with the intent of carrying on
 and furthering their unlawful activity. By doing so, Defendants engaged in
 money laundering and wire fraud that affected interstate and foreign
 commerce." [pg. 20]
     "... substantial effect on the United States and its citizens....":
 "Their actions included assisting Rozhetskin in an international money
 laundering scheme by which Rozhetskin, using the United States banking
 systems as an integral part of his theft scheme, took the proceeds of his
 criminal conduct, and then transferred them to various off-shore companies
 as part of an attempt to conceal wrongdoing from IPOC, American taxing
 authorities, and others. By doing so, Defendants' conduct has had a
 substantial effect on the United States and its citizens, and much of the
 criminal conduct occurred in the United States." [pg. 21]
     "... (Rozhetskin) defrauded the United States of taxes and his
 return.": "Although Rozhetskin claimed to have sold LVFG and 25% stake in
 MegaFon for hundreds of millions of dollars, he defrauded the United States
 of taxes monies. He failed to pay taxes on monies received from IPOC and
 from Fridman and his shell companies as part of their money
 laundering/fraud scheme. Defendant Rozhetskin did so while relying upon New
 York banks to launder the theft of Plaintiffs' money." [pg. 23]
     "... tax fraud against the United States.": "Defendant Rozhetskin was
 aided by co-Defendants who participated in a variety of sham transactions
 using hold companies to collectively assist Rozhetskin in his tax fraud
 against the United States." [pg. 23]
     * U.S. Lobbying Firm and Corporation:
     Barbour Griffith and Rogers: "The Alfa Group conducts such significant
 and varied business in the United States that it has actually found it to
 be in its interest to spend millions of dollars courting the American
 political elite through Washington D.C. based lobbying firm of Barbour
 Griffith and Rogers, LLC which lobbies Congress and others in Washington on
 its behalf." [pgs. 7-8]
     "In addition to using his lobbying firm, Alfa Group has retained Edward
 Rogers' Washington D.C. based "investigative" firm, Diligence, Inc. --
 which has criminally misappropriated IPOC information as described further
 below ....[pg. 8]
     "Having chosen to spend millions of dollars to influence the United
 States Congress and others, and having received millions of dollars from
 the American government and private citizens, it should not fairly be heard
 to complain of being called to task now in an American courtroom." [pg. 8]
     Diligence, Inc.: "Defendants have also paid U.S.-based Diligence, Inc.
 to steal IPOC property in Bermuda. Indeed, at the Fridman M.C. Enterprise's
 direction Diligence bribed officials of an accounting firm and/or otherwise
 misappropriated IPOC property. More specifically, Diligence, Inc. describes
 itself on its web site and in its press releases as a company comprised of
 former Central Intelligence Agency ("CIA") and British MI5 operatives that
 'specialize in obtaining non-public or hard-to-get information on
 corporations.' See http://www.diligencecorp.com. Diligence, Inc. is owned
 in part by Edward Rogers who has also been paid millions by defendants to
 lobby Congress and consult for Alfa." [pg. 24]
     "In violation of 18 U.S.C. section 912 and at Defendant Alfa's
 instructions, Diligence, Inc. posed as United States Agents acting under
 the authority of the United States to misappropriate IPOC information from
 an accounting firm. Defendants further violated 18 U.S.C. section 913 by
 searching IPOC property while falsely representing, through Diligence,
 Inc., to be agents of the United States. By doing so, Defendants have had
 an effect on the United States."[pg. 24]
     * U.S.-related Investigations:
     Norex Case: "In fact, the Second Circuit Court of Appeals recently
 reversed a District Court decision which had dismissed RICO claims against
 these Defendants based upon a RICO conspiracy to defraud Norex, its
 Canadian partner, of its ownership interest in another company. Discovery
 is now proceeding in that case. [pg. 5]
     The ruling is available at
 http://www.norexpetroleum.com/norex_vs_alfa/us_court_of_appeals_ruling/eng.pdf
     Oil for Food Program: "The United Nations in New York, through former
 Federal Reserve Board Chairman, Paul Volcker, has named Defendant Alfa
 Group for criminal wrongdoing and cited its $2.3 million in illegal
 kickbacks and bribes to Saddam Hussein in the Oil for Food Program. See
 Independent Inquiry Committee into The United Nations Oil-For Food
 Programme ("Volcker Report") at 44-66 (Oct. 27, 2005),
 http://www.iicc-offp.org/story27oct05.htm;
 http://www.timesonline.co.uk/article/03-1846855,00.html (noting an Alfa
 payment of $2.3 million). In light of the Volcker report and other
 activities in this Country, Alfa has found it to be in its interest to
 retain its own politically connected Washington D.C. lobbying firm to
 protect its interest as discussed further below." [pg. 5]
     Center for Public Integrity Case: "Recently, Mikhail Fridman along with
 Pyotr Aven availed themselves of American courts as a plaintiff in
 litigation brought in September 2005. Fridman and Aven lost that case on
 the merits at summary judgment. See OAO Alfa Bank v. Center for Public
 Integrity, 387 F. Supp. 2d 20 (D.D.C. 2005)." [pg. 7]
     The opening paragraph of the court ruling states:
 
        Plaintiffs are two Russian businessmen and their companies who have
        sued the defendants, a public interest organization and its reporters,
        for defamation for publishing an article alleging that plaintiffs have
        connections to organized crime and have engaged in narcotics
        trafficking.  Defendants have filed a motion for summary judgment in
        which they argue, among other things, that plaintiffs are limited
        public figures, and that the evidence demonstrates as a matter of law
        that defendants did not publish the piece with actual malice. The Court
        agrees. Although defendants' actions are not beyond reproach, they do
        not rise to the level of actual malice that the Constitution demands in
        order to preserve a vibrant exchange of ideas on issues of public
        concern. For this reason, the Court grants defendants' motion for
        summary judgment on all plaintiffs' claims.
 
     The ruling is available at
 www.dcd.uscourts.gov/opinions/2005/Bates/2000-CV-2208~12:14:20~9-27-2005-a.pdf
     * U.S. Government Agency Funded Investment Firm:
     The Great Circle Fund: The Alfa Group "[i]s also the regional manager
 for a US/OPIC sponsored investment firm called 'The Great Circle Fund.' The
 Alfa Group makes use of this United State agency's (OPIC's) support to
 provide a significant portion of the funding to meet its investment
 objectives." [pg. 7]
     Per the Overseas Private Investment Corporation (OPIC) Web site, it was
 "established as a development agency of the U.S. government in 1971. OPIC
 helps U.S. businesses invest overseas, fosters economic development in new
 and emerging markets, complements the private sector in managing the risks
 associated with foreign direct investment, and supports U.S. foreign
 policy. OPIC evaluates all project applications on the basis of their
 contribution to economic development to ensure successful implementation of
 the organization's core developmental mission, and prioritizes the
 allocation of scarce resources to projects on the basis of their
 developmental benefits."
     The Great Circle Capital Web site http://www.greatcirclecapital.com/
 for the Great Circle Fund LP states that "Great Circle Capital has
 appointed Moscow-based Alfa Capital as the regional manager and Brussel's
 based probel (sic) Capital Management as investment advisor. A substantial
 portion of the fund's capital is provided by the Overseas Private
 Investment Corporation (OPIC), an independent, developmental US government
 agency."
     * Defendants Used U.S. Banks for Transfers. Some Examples Follow:
     Barclays Bank in New York and Credit Suisse First Boston: "On April 11,
 2001, IPOC wired $5,065,000 from its bank in Bermuda to Barclays Bank in
 New York for further transfer to the Credit Suisse First Boston account of
 Rozhetskin." [pg. 16]
     Barclays Bank in New York and Chase Manhattan: "Using a number of
 intermediaries and at Rozhetskin's requirement, such money was wired from
 IPOC's account in Bermuda through Barclays Bank in New York and Chase
 Manhattan to Rozhetskin and his designees in November 2001." [pg. 16]
     Bank of New York and Credit Suisse First Boston. "[o]n December 20,
 2001, IPOC through intermediaries wired an additional $3,070,000 to
 Rozhetskin and his designees through the Bank of New York located at One
 Wall Street in New York to Credit Suisse First Boston." [pg. 17]
     "... using the American banks as a vehicle for the fraud scheme. ...":
 "Plaintiff IPOC made all such payments and others through the United States
 without knowledge that Defendants Rozhetskin, Bodmer, Fridman, Alfa Group,
 Alfa Capital and Alfa Telecom were all conspiring whereby Rozhetskin, using
 the American banks as a vehicle for the fraud scheme, would obtain IPOC's
 cash, while Fridman through a labyrinth of associates and individuals would
 obtain effective control over Plaintiffs' interest in Sonic Duo/MegaFon."
 [pg. 17]
     "... use of the United States to transfer assets in interstate
 commerce": "Rozhetskin knew the assets were unlawfully taken when he made
 use of the United States to transfer the assets in interstate commerce.
 Further, Rozhetskin's actions were in furtherance of his goal of cheating
 the American government of taxes due and owing on the transactions." [pg.
 18]
 
 

SOURCE IPOC International Growth Fund, Ltd.
    NEW YORK, June 9 /PRNewswire/ -- Russian corporation Alfa Group
 Consortium and its U.S. entity, Alfa Capital Markets, Inc., are a criminal
 enterprise that has used U.S. banks and stock exchanges as an integral part
 of their theft schemes, costing American taxpayers and stockholders
 hundreds of millions of dollars, IPOC International Growth Fund, Ltd.,
 alleges in a federal racketeering lawsuit filed late Thursday.
     The suit alleges that Alfa, one of the largest business conglomerates
 in the Russian Federation -- along with Russian oligarch Mikhail Fridman
 and U.S. citizen Leonid Rozhetskin -- engaged in a vast international money
 laundering and fraud scheme in an attempt to take control of the Russian
 cellular industry. "By doing so, defendants' conduct has had a substantial
 effect on the United States and its citizens, and much of the criminal
 conduct occurred in the United States," the suit, filed in U.S. District
 Court for the Southern District of New York, said.
     The criminal enterprise affected Americans, U.S.-based investors and
 U.S. interests in numerous ways, the complaint alleges, involving the
 evasion of U.S. taxes, insider trading of shares on U.S. stock markets, and
 wiring payments through New York banks. The Alfa Group Consortium received
 support from the Overseas Private Investment Corporation, a U.S. government
 development agency, to provide a significant portion of funding for one of
 Alfa's related businesses.
     "The complaint alleges that the racketeering and other wrongs cited in
 this case hurt U.S. investors, U.S. taxpayers and U.S. financial markets,"
 said W. Gordon Dobie, an attorney with Winston & Strawn LLP, which filed
 the case for IPOC International Growth Fund, Ltd. "It's my opinion that the
 defendants should be called to account in court for their conduct."
     A Daisy Chain of Nine Shell Companies
     The suit details how Alfa, in a series of sham transactions over a
 10-day period, knowingly and fraudulently colluded to steal IPOC's 25.1
 percent stake in Russia's third largest mobile telecom company, MegaFon.
 IPOC had originally signed two options agreements to buy the stake from LV
 Finance, had paid for the shares and at all junctures honored the terms of
 the agreements. At the final stage, IPOC discovered that LV Finance, acting
 through its chairman Leonid Rozhetskin, had negotiated a purported sale of
 LV Finance's interest in MegaFon to Mikhail Fridman's Alfa Group, involving
 a complex web of nine offshore companies. Both companies are alleged to
 have been aware of IPOC's prior ownership rights, but rode roughshod over
 the agreement and fraudulently colluded to sell the same stake twice. They
 "bought" and "sold" the $50 million stake, and yet there is no evidence of
 money having changed hands throughout this daisy chain of sham
 transactions.
     "What was a legitimate business opportunity for IPOC evolved into a
 vehicle for Rozhetskin's and Mikhail Fridman's theft and misappropriation,"
 the suit alleges.
     Scheme Concealed Wrongdoing
     The suit alleges that at the center of the enterprise was Fridman, a
 major VimpelCom shareholder, who used associates working directly for him
 and for VimpelCom, to transfer the assets in the summer of 2003. The scheme
 involved wiring payments through New York banks, taking the proceeds, and
 then transferring those proceeds to various off-shore companies "to conceal
 wrongdoing from IPOC, American taxing authorities, and others."
     The suit states that Rozhetskin acted "as a point person to obtain
 additional cellular phone assets" and worked closely with Fridman to assist
 with the sham transactions. He later relied on New York banks to launder
 the theft of $50 million, the money IPOC paid for the stake.
     The complaint also alleges that Rozhetskin and Fridman were assisted by
 Hans Bodmer, who served as escrow agent and sent instructions to IPOC to
 wire money through banks in New York for the benefit of the defendants.
 Bodmer recently plead guilty to criminal conspiracy to launder money and
 conspiracy to violate the U.S. Foreign Corrupt Practices Act in connection
 with an unrelated scheme to bribe foreign leaders.
     Insider Dealing and Manipulation of VimpelCom Tax Inquiry
     The suit also alleges that Fridman and the Alfa Group attempted to
 manipulate VimpelCom's share price for their own gain, in their position as
 major VimpelCom shareholders. On Dec. 8, 2004, the suit said, VimpelCom, a
 New York Stock Exchange Company, disclosed the Russian tax authorities were
 investigating the company for back taxes carrying potential for heavy fines
 and penalties.
     The news coincided with the auction of a $10 billion subsidiary of
 Russian conglomerate Yukos to satisfy back-dated tax obligations. Yukos
 later went through an unprecedented bankruptcy filing in the United States.
     The suit claims that manipulation was insider dealing that advanced the
 defendants' goal of obtaining control and consolidation of the
 telecommunications market in Russia, furthering the ability to raise prices
 for cellular services through a near-monopoly or oligopoly.
     Notes to Editors
     * IPOC International Growth Fund, Ltd. is an open-ended mutual fund
       company based in Bermuda.
 
     * The suit, based on claims under the Racketeer Influenced and Corrupt
       Organizations (RICO) Act, charges that Fridman conspired with Rozhetskin
       to steal IPOC's interest through money laundering, bribery, wire fraud
       and other criminal wrongdoings.  Other defendants are Alfa Capital
       Markets, Inc., a U.S. corporation; Alfa Telecom (n/k/a) Altimo; and Hans
       Bodmer.
 
     * Alfa Group Consortium is an association of various companies controlled
       by Fridman.  It controls major international corporations traded in the
       United States, including VimpelCom (NYSE) Russia's second largest mobile
       telecoms company, Golden Telecom (NASDAQ) and Turkcell (NYSE).
 
     * For more information about IPOC, go to http://www.ipocfund.com.  A copy
       of the lawsuit is being posted on this Web site June 9.
 
 
 
                       The Many Ties to the United States
     As the lawsuit states, "... defendants' tentacles reach into and injure
 numerous Americans...." The investors, taxpayers and financial markets of
 the United States have been harmed.
     The below sets out the individuals and firms referred to in the
 lawsuit, and provides some further information:
     The Defendants:
     Leonard Rozhetskin: "Defendant Leonard Rozhetskin is a former director
 and principal shareholder of LV Finance Group Limited ("LVFG"). He is a
 United States taxpayer and citizen, owns property in the District, and
 lived in the District for more than a decade ... featured on the cover of
 the Russian edition of Forbes with the title: 'The Most Dangerous Shark in
 Our Waters.'... Rozhetskin resides in the United States...."[pg.6]"
     Mikhail Fridman: "Defendant Mikhail Fridman currently serves as
 Chairman of the Board of Directors of co-conspirator Alfa Bank and as
 Chairman of the Board of Directors of Defendant Consortium Alfa Group.
 Fridman further served on the Board of VimpelCom, a NYSE company, and has
 control over Golden Telecom, a NASDAQ company ... purchased the United
 States trading firm owned by American, Mark Rich, the one time commodities
 baron pardoned by President Clinton with much controversy. Fridman purports
 to have become a philanthropist in the United States" and is a member of
 the Board of the Council on Foreign Relations based in New York. [pgs. 6-7]
     Pyotr Aven: "Defendant Pyotr Aven also has been a major participant in
 the scheme and worked directly with Rozhetskin and Fridman in the
 misappropriation and theft of IPOC monies. Aven is a director of Golden
 Telecom, a NASDAQ company, which regularly files with the United States
 Securities Exchange Commission. He is a controversial figure: As observed
 by the United States District Court for the District of Columbia, a Russian
 'corruption task force informed [the government] that Aven was engaged in
 various misdeeds, including drug trafficking. See OAO Alfa Bank v. Center
 for Public Integrity, Civ. Action No. 00-2208 (JDB), Mem. Op., Sept. 22,
 2005 at 11 n.26." [pg. 8]
     Hans Bodmer: "Defendant Hans Bodmer ... assisted Rozhetskin and Fridman
 with the Sonic Duo/MegaFon theft scheme ... worked with his co-conspirators
 to send instructions to IPOC to wire money through banks in New York for
 the benefit of the Defendants. Bodmer is no stranger to criminal
 prosecution in the United States, having recently pled guilty to the
 criminal conspiracy to launder money and conspiracy to violate the United
 States Foreign Corrupt Practices Act in connection with the scheme to bribe
 foreign leaders (along with Victor Kozeny, who is currently being
 extradited to New York from the Bahamas). Case No: 01: 05-CR-00518-RCC-ALL
 (S.D.N.Y.)." [pg. 9]
     * Publicly Listed U.S. Corporations Affiliated with Defendants:
     Vimpel-Communications, VimpelCom and Golden Telecom, Inc. "...
 Defendant Fridman has successfully obtained hundreds of millions of dollars
 from American investors through the sale of interests in his Russian
 telecommunications empire -- which includes New York Stock Exchange company
 Vimpel-Communications, also known as VimpelCom, and Golden Telecom, Inc.,
 ("Golden Telecom"), a NASDAQ company. [pg. 3]"
     Vimpel-Communications/VimpelCom Web site is
 http://www.vimpelcom.com/index.wbp
     Golden Telecom, Inc. Web site is http://www.goldentelecom.com/?id=12
     Alfa Capital Markets (USA), Inc: "Alfa Capital Markets (USA), Inc.
 ("Alfa Capital Markets") is a member of the Alfa Group and is a corporation
 organized under the laws of the United States with its principal place of
 business and office in New York City. Upon information and belief, Alfa
 Capital Markets was used to structure the laundering of the proceeds of the
 Fridman M.C. Enterprise for investment in the United States, such as the
 recent acquisition of Golden Telecom, Inc., a publicly held American
 company, controlled by the Alfa Group. On information and belief, Alfa
 Capital Markets' accounts were used to fund the misappropriation of
 plaintiffs' property." [pg. 9]
     The Alfa Capital Markets (USA), Inc. Web site is
 http://www.alfabank.com/usa/
     A Wide Variety of U.S. Ties:
 
     * The U.S. Banking System and the U.S. Treasury:
     "... goal of cheating the American government of taxes due and owing
 ....": Rozhetskin knew the assets were unlawfully taken when he made use of
 the United States to transfer the assets in interstate commerce. Further,
 Rozhetskin's actions were in furtherance of his goal of cheating the
 American government of taxes due and owing on the transactions." [pg. 18]
     "... money laundering and wire fraud that affected interstate and
 foreign commerce." "Defendants conspired to steal IPOC's money and
 property, and to conceal their wrongdoing and the true ownership of the
 proceeds through a series of sham transactions and transfer the stolen
 assets in interstate and foreign commerce with the intent of carrying on
 and furthering their unlawful activity. By doing so, Defendants engaged in
 money laundering and wire fraud that affected interstate and foreign
 commerce." [pg. 20]
     "... substantial effect on the United States and its citizens....":
 "Their actions included assisting Rozhetskin in an international money
 laundering scheme by which Rozhetskin, using the United States banking
 systems as an integral part of his theft scheme, took the proceeds of his
 criminal conduct, and then transferred them to various off-shore companies
 as part of an attempt to conceal wrongdoing from IPOC, American taxing
 authorities, and others. By doing so, Defendants' conduct has had a
 substantial effect on the United States and its citizens, and much of the
 criminal conduct occurred in the United States." [pg. 21]
     "... (Rozhetskin) defrauded the United States of taxes and his
 return.": "Although Rozhetskin claimed to have sold LVFG and 25% stake in
 MegaFon for hundreds of millions of dollars, he defrauded the United States
 of taxes monies. He failed to pay taxes on monies received from IPOC and
 from Fridman and his shell companies as part of their money
 laundering/fraud scheme. Defendant Rozhetskin did so while relying upon New
 York banks to launder the theft of Plaintiffs' money." [pg. 23]
     "... tax fraud against the United States.": "Defendant Rozhetskin was
 aided by co-Defendants who participated in a variety of sham transactions
 using hold companies to collectively assist Rozhetskin in his tax fraud
 against the United States." [pg. 23]
     * U.S. Lobbying Firm and Corporation:
     Barbour Griffith and Rogers: "The Alfa Group conducts such significant
 and varied business in the United States that it has actually found it to
 be in its interest to spend millions of dollars courting the American
 political elite through Washington D.C. based lobbying firm of Barbour
 Griffith and Rogers, LLC which lobbies Congress and others in Washington on
 its behalf." [pgs. 7-8]
     "In addition to using his lobbying firm, Alfa Group has retained Edward
 Rogers' Washington D.C. based "investigative" firm, Diligence, Inc. --
 which has criminally misappropriated IPOC information as described further
 below ....[pg. 8]
     "Having chosen to spend millions of dollars to influence the United
 States Congress and others, and having received millions of dollars from
 the American government and private citizens, it should not fairly be heard
 to complain of being called to task now in an American courtroom." [pg. 8]
     Diligence, Inc.: "Defendants have also paid U.S.-based Diligence, Inc.
 to steal IPOC property in Bermuda. Indeed, at the Fridman M.C. Enterprise's
 direction Diligence bribed officials of an accounting firm and/or otherwise
 misappropriated IPOC property. More specifically, Diligence, Inc. describes
 itself on its web site and in its press releases as a company comprised of
 former Central Intelligence Agency ("CIA") and British MI5 operatives that
 'specialize in obtaining non-public or hard-to-get information on
 corporations.' See http://www.diligencecorp.com. Diligence, Inc. is owned
 in part by Edward Rogers who has also been paid millions by defendants to
 lobby Congress and consult for Alfa." [pg. 24]
     "In violation of 18 U.S.C. section 912 and at Defendant Alfa's
 instructions, Diligence, Inc. posed as United States Agents acting under
 the authority of the United States to misappropriate IPOC information from
 an accounting firm. Defendants further violated 18 U.S.C. section 913 by
 searching IPOC property while falsely representing, through Diligence,
 Inc., to be agents of the United States. By doing so, Defendants have had
 an effect on the United States."[pg. 24]
     * U.S.-related Investigations:
     Norex Case: "In fact, the Second Circuit Court of Appeals recently
 reversed a District Court decision which had dismissed RICO claims against
 these Defendants based upon a RICO conspiracy to defraud Norex, its
 Canadian partner, of its ownership interest in another company. Discovery
 is now proceeding in that case. [pg. 5]
     The ruling is available at
 http://www.norexpetroleum.com/norex_vs_alfa/us_court_of_appeals_ruling/eng.pdf
     Oil for Food Program: "The United Nations in New York, through former
 Federal Reserve Board Chairman, Paul Volcker, has named Defendant Alfa
 Group for criminal wrongdoing and cited its $2.3 million in illegal
 kickbacks and bribes to Saddam Hussein in the Oil for Food Program. See
 Independent Inquiry Committee into The United Nations Oil-For Food
 Programme ("Volcker Report") at 44-66 (Oct. 27, 2005),
 http://www.iicc-offp.org/story27oct05.htm;
 http://www.timesonline.co.uk/article/03-1846855,00.html (noting an Alfa
 payment of $2.3 million). In light of the Volcker report and other
 activities in this Country, Alfa has found it to be in its interest to
 retain its own politically connected Washington D.C. lobbying firm to
 protect its interest as discussed further below." [pg. 5]
     Center for Public Integrity Case: "Recently, Mikhail Fridman along with
 Pyotr Aven availed themselves of American courts as a plaintiff in
 litigation brought in September 2005. Fridman and Aven lost that case on
 the merits at summary judgment. See OAO Alfa Bank v. Center for Public
 Integrity, 387 F. Supp. 2d 20 (D.D.C. 2005)." [pg. 7]
     The opening paragraph of the court ruling states:
 
        Plaintiffs are two Russian businessmen and their companies who have
        sued the defendants, a public interest organization and its reporters,
        for defamation for publishing an article alleging that plaintiffs have
        connections to organized crime and have engaged in narcotics
        trafficking.  Defendants have filed a motion for summary judgment in
        which they argue, among other things, that plaintiffs are limited
        public figures, and that the evidence demonstrates as a matter of law
        that defendants did not publish the piece with actual malice. The Court
        agrees. Although defendants' actions are not beyond reproach, they do
        not rise to the level of actual malice that the Constitution demands in
        order to preserve a vibrant exchange of ideas on issues of public
        concern. For this reason, the Court grants defendants' motion for
        summary judgment on all plaintiffs' claims.
 
     The ruling is available at
 www.dcd.uscourts.gov/opinions/2005/Bates/2000-CV-2208~12:14:20~9-27-2005-a.pdf
     * U.S. Government Agency Funded Investment Firm:
     The Great Circle Fund: The Alfa Group "[i]s also the regional manager
 for a US/OPIC sponsored investment firm called 'The Great Circle Fund.' The
 Alfa Group makes use of this United State agency's (OPIC's) support to
 provide a significant portion of the funding to meet its investment
 objectives." [pg. 7]
     Per the Overseas Private Investment Corporation (OPIC) Web site, it was
 "established as a development agency of the U.S. government in 1971. OPIC
 helps U.S. businesses invest overseas, fosters economic development in new
 and emerging markets, complements the private sector in managing the risks
 associated with foreign direct investment, and supports U.S. foreign
 policy. OPIC evaluates all project applications on the basis of their
 contribution to economic development to ensure successful implementation of
 the organization's core developmental mission, and prioritizes the
 allocation of scarce resources to projects on the basis of their
 developmental benefits."
     The Great Circle Capital Web site http://www.greatcirclecapital.com/
 for the Great Circle Fund LP states that "Great Circle Capital has
 appointed Moscow-based Alfa Capital as the regional manager and Brussel's
 based probel (sic) Capital Management as investment advisor. A substantial
 portion of the fund's capital is provided by the Overseas Private
 Investment Corporation (OPIC), an independent, developmental US government
 agency."
     * Defendants Used U.S. Banks for Transfers. Some Examples Follow:
     Barclays Bank in New York and Credit Suisse First Boston: "On April 11,
 2001, IPOC wired $5,065,000 from its bank in Bermuda to Barclays Bank in
 New York for further transfer to the Credit Suisse First Boston account of
 Rozhetskin." [pg. 16]
     Barclays Bank in New York and Chase Manhattan: "Using a number of
 intermediaries and at Rozhetskin's requirement, such money was wired from
 IPOC's account in Bermuda through Barclays Bank in New York and Chase
 Manhattan to Rozhetskin and his designees in November 2001." [pg. 16]
     Bank of New York and Credit Suisse First Boston. "[o]n December 20,
 2001, IPOC through intermediaries wired an additional $3,070,000 to
 Rozhetskin and his designees through the Bank of New York located at One
 Wall Street in New York to Credit Suisse First Boston." [pg. 17]
     "... using the American banks as a vehicle for the fraud scheme. ...":
 "Plaintiff IPOC made all such payments and others through the United States
 without knowledge that Defendants Rozhetskin, Bodmer, Fridman, Alfa Group,
 Alfa Capital and Alfa Telecom were all conspiring whereby Rozhetskin, using
 the American banks as a vehicle for the fraud scheme, would obtain IPOC's
 cash, while Fridman through a labyrinth of associates and individuals would
 obtain effective control over Plaintiffs' interest in Sonic Duo/MegaFon."
 [pg. 17]
     "... use of the United States to transfer assets in interstate
 commerce": "Rozhetskin knew the assets were unlawfully taken when he made
 use of the United States to transfer the assets in interstate commerce.
 Further, Rozhetskin's actions were in furtherance of his goal of cheating
 the American government of taxes due and owing on the transactions." [pg.
 18]
 
 SOURCE IPOC International Growth Fund, Ltd.