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Nightmare in Boomtown

By: Jonathan GreenWed Dec 19, 2007 at 8:24 AM
Nightmare in Boomtown

Mark Seidenfeld was just another American cashing in on the post-Soviet boom. Then one bad deal in Kazakhstan sent his life into a spiral of extortion, siberian prison, and frontier justice. A cautionary tale.

Nightmare in Boomtown


Nightmare in Boomtown


Dark Days: Seidenfeld enters the courtroom to await a verdict.

In the end, Seidenfeld was helped by the U.S. government, but not in a way anyone might have expected. His supporters had been stunned by the apparent reluctance of U.S. ambassador to Kazakhstan John Ordway to help an American citizen in distress. The ambassador had met with the Kazakh general prosecutor, but nothing had come of it. Beyond that, he sent Seidenfeld a few magazines and some energy bars in prison. And with that, apparently, his work was complete: "We have done everything possible," Ordway told Seidenfeld's supporters in a letter. He refused to give an interview to a reporter from the Las Vegas Sun, saying he didn't "do telephone interviews." When Fast Company offered to fly me to the capital, Astana, to visit him personally, he refused that, too.

A former State Department consultant, speaking on condition of anonymity, hinted at why: The United States sees Kazakhstan as a play-at-your-own-risk market. "I know a ton of people who have made a ton of money in Kazakhstan, but none of them have been straight arrows all the way through," she says. "It's a Wild West atmosphere. You can't come in with U.S. or U.K. rules and live for five or six years and make money and not understand how business is done. It probably is an open-and-shut case of injustice, but it's not like this person didn't know the risk. These small-venture people, when they have success, are playing complicated games. And when they run out of options, they say, 'I am an American.'"

Help came from Nevada, of all places. For three months in 2004, after being fired from Arna but before returning to Moscow to work for Golden Telecom, Seidenfeld had lived in Las Vegas. This was enough to make him a constituent of congresswoman Shelley Berkley, who took up his cause and began pressuring Kazakh secretary of state Kanat Saudabayev. The Kazakhs were exploring the idea of getting into the casino business and had sought investment from Vegas. Berkley made it clear that any potential deals could be affected if her constituent didn't get a fair trial. "A poor adjudication would have provocative consequences for the future of investment in Kazakhstan," Berkley told me. She scheduled a trip to Kazakhstan to coincide with the trial, and she and Senate majority leader Harry Reid sent a letter to Ordway urging him to monitor the case closely. When President Nazarbayev visited the White House, Berkley mentioned the case to him.

On July 11, Judge Keikebasova returned a not-guilty verdict. Natiya broke down in tears. The judge excoriated the prosecution for 45 minutes, slamming the credibility of their witnesses and saying Seidenfeld was entitled to "moral compensation."

Seidenfeld largely credits Berkley with his acquittal. "The pressure must have trickled down," he says. "The message came down from on high that this was to be a fair trial, to be done objectively and honestly, with no games. At that point, law-enforcement agencies in Kazakhstan lost confidence in their ability to put away an innocent person." That Berkley's involvement in the case could also benefit her other, more-powerful constituents--the casinos--went without question. And in the weeks after the trial, rumors circulated in the diplomatic community that the Kazakhs had gone easy on Seidenfeld in the interest of trying to make the Giffen trial in Manhattan go quietly away. But if Seidenfeld had become a pawn, he didn't seem to mind.

In the courtroom, Natiya and Seidenfeld ran to each other and embraced, a year and a half after he left their Moscow apartment for Siberia. But Seidenfeld's ordeal didn't seem to have planted any doubts about the future. "I'm looking forward to getting back to business," he said.

Seidenfeld still had to face an appeal by the prosecution: no double-jeopardy rule in Kazakhstan. But a month after the original trial, the court's decision was upheld. Just as Seidenfeld was heaving a sigh of relief, though, prosecutors dredged up yet another charge--that he had failed to disclose a $1.2 million company debt to KazakhTelecom. There seemed to be no escape. Seidenfeld decided that he had to flee, so he packed himself into a Mercedes at midnight September 10 and drove to Kyrgyzstan. From Bishkek, he caught a last-minute flight to Istanbul, then connected to JFK. At 4 p.m. on a bright, end-of-summer afternoon, he arrived back on American soil, slightly disheveled and with dark hemispheres under his eyes--but free. He plans to return to his job in Moscow at Golden Telecom.

Back in Almaty, Murat Zhunussov is carrying on business as usual. He is trying to sell Arna (now renamed Ducat) for more than $50 million.

Jonathan Green is a freelance writer based in Pittsburgh. This is his first story for Fast Company.

From Issue 120 | November 2007

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