From Russia With Diamonds

In 1995, Golden ADA Inc., a San Francisco diamond-importing firm, collapsed, unveiling an international trail of theft and betrayal that embarrassed San Francisco luminaries involved with the company. Now, newly unsealed court files show that high-level m

By August, Golden shows a net worth of negative $45 million. Kopp gives notice he wants to leave, but can't find a law firm to take over the handful of lawsuits against Golden ADA he is juggling. (Finally he turns everything over to an associate of his firm.) Immendorf decides Sept. 1 will be his last day on the job.

Kozlenok is still around, though, spending his nights at 999 Brannan, burning up the fax lines to Russia and Cyprus and knocking back shots of vodka while he watches Christopher Walken movies on an array of giant TV screens scattered about the office suites. (Supposedly, Kozlenok is fascinated by Walken, whom he believes he strongly resembles.)

And in mid-August, yet another in the strange cast of Golden ADA characters arrives. Rajiv Gosain, a financial consultant from New Delhi, India, is introduced to the Golden menagerie by Andre Chernukhin. Gosain produces a resume showing that he earned an engineering degree from Massachusetts Institute of Technology in 1983 and an M.B.A. from the Wharton School of Finance in 1986. (In an interview, Gosain now says his only degree is from a small-time technical college.) A sharp-tongued rogue who sports shoulder-length black hair and a British accent, Gosain claims to have met Chernukhin while the two were "renegotiating the sovereign debt of India to Russia."

On Aug. 31, a federal grand jury serves subpoenas on Golden's accountants. The day the subpoenas arrive, the Kozlenoks fly the Golden Gulfstream to Mexico City and then Costa Rica; Gosain and Chernukhin ride along. Accounts of what transpired over the next two weeks differ. None of the accounts, however, is particularly uplifting. The Kozlenoks claim that Gosain threatened them with FBI prosecution and deportation -- and worse -- if Andre did not sign ownership of the company over to Gosain. Whenever Gosain is questioned under oath about what transpired, he asserts his right not to incriminate himself.

At any rate, by the end of September Gosain purports to be the sole shareholder in Golden ADA, although he paid nothing for its shares. Gosain and Chernukhin are the sole members of Golden's new board of directors. Gosain is the only corporate officer. He moves straight into the Kozlenoks' abandoned Happy Valley Road compound.

RICO Lawsuits For Fun and Profit. Fall 1995.
Ensconced at 999 Brannan as the new lord of Golden ADA, Rajiv Gosain shows he can engage in suspicious behavior with the worst of the Golden crew. He meets with Ashot Shagirian and, Shagirian claims in a court declaration, blackmails him into paying Gosain $500,000 as insurance on the life of his brother, David, who has fled the country. Meanwhile, under the watchful gaze of Andre Chernukhin, Gosain begins wiring almost every loose penny of Golden ADA cash to overseas accounts. He also writes to the Russian government, demanding more rough diamonds.

And in September, something happens that would seem to mean one thing, but because it involves Golden ADA, means something else altogether.

The Committee on Precious Metals and Gems, through its Los Angeles-based attorneys, files a federal Racketeer Influenced and Corrupt Organizations (RICO) lawsuit in San Francisco, alleging that Andre Kozlenok stole more than $150 million from that Russian agency and, therefore, the Russian government.

Regardless of its factual merits -- and an abundance of documentation in court files indicates the Committee knew about many of the activities it is now suing over -- the racketeering lawsuit has interesting legal ramifications. The RICO action freezes all pending lawsuits against Golden, and, according to court documents that surfaced in those lawsuits, has the effect of allowing Gosain free rein to manipulate the remainder of Golden ADA's assets over the next two years -- in collaboration with Russian bureaucrats connected to the Committee.

Early in October, Gosain transports $17 million of the $20 million in diamonds left in Golden's vaults to Geneva, Switzerland. Gosain later sells the remaining $3 million in Europe. According to bills of lading found in court records, most of the "Swiss goods" are sold off piecemeal, the income fed into numbered bank accounts around the world. Gosain siphons money from these accounts to pay the monstrous legal fees of a whole classroom full of lawyers hired to protect his personal interests.

What appears to be out-and-out looting continues. Gosain and Chernukhin sign a Golden ADA contract to pay Gosain $100,000 a month. Gosain, Chernukhin, and San Francisco attorney Dennis M. Sullivan draft an agreement to sell Golden to an offshore subsidiary of Chernukhin's Ecoprom. The Cyprus-based shell corporation would be owned by Chernukhin, Gosain, and the Committee, which would guarantee to send 10,000 carats of diamonds, worth roughly $10 million, each month to Golden for polishing.

But the agreement never goes into effect.
On Nov. 7, 1995, the IRS slaps a $63 million lien on Golden ADA, seizing its 999 Brannan St. headquarters, the Gulfstream jet, and the firm's attack helicopter. Federal agents appropriate millions in gem polishing equipment and mounds of diamonds. The news media -- local, national, and international -- have fun reporting on the intrigue of Golden ADA, and the involvement of Kopp and Immendorf in the cratered firm.

The finger of criminal blame, however, remains pointed at 35-year-old Andre Kozlenok, a non-English-speaking Russian immigrant, a former owner of Golden ADA, a fugitive.

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1 comments
gleinmaxwell
gleinmaxwell

I am Dow Patten, an employment law attorney in San Francisco, working as a senior attorney in smith Patten. Who represents state, federal, and local government employees, as well as private employees in employment matters?

 
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