Sports

/

ArcaMax

Man used Jackie Robinson contracts to steal millions from investors. Then he fled to Russia seeking asylum.

Steve Henson, Los Angeles Times on

Published in Baseball

The first contract Jackie Robinson signed along with Brooklyn Dodgers president Branch Rickey on Oct. 23, 1945, was an agreement to play for the Montreal Royals, the Dodgers' top farm club. The deal called for a $3,500 signing bonus and $600 per month for the 1946 season.

Less than two years later, on April 11, 1947, Robinson signed his first major league contract along with Rickey and National League president Ford Frick. He would be paid $5,000 for the season.

What happened next is well-documented and annually celebrated.

Five days after signing, Robinson made history by becoming the first Black player to play Major League Baseball, breaking the color barrier. The Dodgers second baseman was the Rookie of the Year, and two years later the National League Most Valuable Player. He batted .313 over 11 seasons and was inducted into the Hall of Fame in 1962, and his No. 42 was retired across baseball in 1997.

But what became of the contracts? Sports memorabilia can fetch millions these days, and experts say the original player's contracts of one Jack Roosevelt Robinson could possess monetary value that might surpass Shohei Ohtani's 50/50 home run ball, Freddie Freeman's World Series Game 1 walk-off grand slam ball, or any of the high-end stuff worn or swatted by Babe Ruth that is auctioned for seven figures.

After decades of uncertainty, Robinson's contracts from 1945 and 1947 are safely under lock and key, held by the U.S. Marshals Service since 2019 as part of an investment fraud investigation and prosecution.

Mykalai Kontilai, a broadcast executive who in 2013 launched a sports memorabilia business called Collector's Coffee by purchasing and showcasing the two Robinson contracts, pleaded guilty last month to one count of mail fraud. He was sentenced last week to 51 months in prison and ordered to pay $6.1 million in restitution to investors he swindled.

Those investors, called "the Holders" in court documents, provided Kontilai with loans, using the Robinson contracts as collateral, and Kontilai raised more than $23 million before defaulting on the loans.

Kontilai, 55, obstructed the investigation by forging documents transmitted to the Securities and Exchange Commission and lied under oath to the SEC. While under investigation but prior to charging, he fled to Russia and unsuccessfully claimed asylum as a whistleblower of American corruption. He ultimately was arrested on an Interpol Red Notice in Germany in 2023. He was extradited back to the U.S. in May to face the pending charges.

Kontilai was found guilty of misappropriating funds — reportedly buying a Cadillac, paying for private school tuition and rent on luxury homes throughout the country — while purposely misleading investigators and failing to pay taxes on proceeds from the scheme.

"Collectors Coffee and Kontilai, its CEO, repeatedly lied to investors to raise money for the company — money which Kontilai routinely stole to fund his lavish lifestyle," Gurbir S. Grewal, director of the SEC's Division of Enforcement, said in a statement last year. "Investors should be able to trust those to whom they give their hard-earned money, and not worry that those people will lie, cheat, and steal."

The Robinson contracts remain in limbo, however, although there soon could be a resolution, with the philanthropic Jackie Robinson Foundation and the Holders sharing the spoils.

"I hope they could do that," said David Kohler, president of high-end sports memorabilia house SCP Auctions in Orange County. "The proceeds would go to pay back people who were scammed. That seems like that's the right thing to do."

Kohler offered a ballpark number on what the contracts might fetch at auction. He also identified an interested party that could afford to make a strong bid.

"I'd say they'd probably go for $5 million and up at auction," he said. "They reach beyond the game of baseball. They are important 20th Century American artifacts central to the civil rights movement.

"I sometimes wonder when it comes to historical items, why don't the teams buy them? They'd be worth more to their team than to collectors."

Indeed, the Dodgers attempted to take possession of the contracts, asserting in a January 2019 letter to Collection's Coffee that, "[t]he property is owned by the Dodgers and is not property of [Collector's Coffee, Inc.]."

 

Later that year, however, the Dodgers relinquished their ownership claim to the Jackie Robinson Foundation.

According to court filings, the potential settlement is contingent on a written agreement that would see the Jackie Robinson Foundation get the 1947 Brooklyn Dodgers contract and relinquish its claim to the 1945 Montreal Royals contract, which would go to the Holders.

In addition to the Holders getting the 1945 contract, they also would receive an undisclosed amount of the value of the 1947 contract from the foundation. The SEC also would receive a small portion. Kohler said the Dodgers contract is more valuable than the Royals contract.

When the distribution is approved by the court, it could conclude an extraordinary journey the contracts took from the desk of Rickey in the 1940s to auctions that the Holders hope could generate enough money to cover their losses resulting from Kontilai's fraud.

Long before sports memorabilia became a million-dollar business, Rickey and Dodgers owner Walter O'Malley provided the contracts to the James A. Kelly Institute for Local Historical Studies in Brooklyn for an exhibition in 1952. And the contracts remained in the institute's basement for decades along with nearly 4 million other documents chronicling Brooklyn's growth.

The New York Daily News in 1974 reported on the institute moving to St. Francis College in Brooklyn Heights, mentioning that among the historical documents were the "bill of sale for Coney Island in 1654" and Robinson's original contracts.

Another Daily News story in 1979 addressed the contracts, yet still the Dodgers made no effort to lay claim to them. The institute was under the direction of St. Francis professor Arthur J. Konop, who before dying in 2009 left a letter with a key to a safe deposit box that said, "My kids will know what to do with this."

Three years later, Arthur's wife and son sold the contracts to Gotta Have It Collectibles for $750,000. Odette Konop signed a letter that warranted title and stated, "My Husband possessed these contracts in a safe deposit box at our home for over 45 years. ... He has cared for them and protected them over half his life to the time of his passing."

Gotta Have It only owned the contracts for a year before selling them for $2 million in 2013 to Kontilai, who used them as collateral for $6 million in loans to the Holders.

Kontilai used the contracts to boost his fledgling memorabilia and auction business, holding events at Philadelphia's Constitution Center and New York's Times Square to publicize his acquisitions. He got a respected expert in American historic documents, Seth Kaller, to assign a valuation of $36 million to the contracts, then immediately went on a spending spree with the investors' money.

When the SEC began investigating Kontilai in 2017, he allegedly forged documents, lied under oath and obstructed the investigation. It took three years, but he was charged with an 18-count indictment in Nevada that included securities and wire fraud, money laundering and failure to file tax returns. He also faced charges in Colorado, but those charges were dropped when he pleaded guilty to one count of wire fraud.

Joining the fray for at least partial ownership of the contracts is the public, nonprofit Jackie Robinson Foundation, launched in 1973 by Robinson's widow, Rachel Robinson, to perpetuate the memory of her husband. The foundation administers scholarship and leadership development programs for college students and was central to creating the Jackie Robinson Museum, which opened in 2022 in New York City and focuses more on his impact off the field than his accomplishments on it.

"Even if you come in with the idea to see the baseball story and learn more about that, you have to walk through that room that talks about his commitment to economic opportunity and civil rights and social justice," Della Britton, president and chief executive of the Jackie Robinson Foundation, told The Times in 2022.

In one room, Robinson's life tasks are displayed in large capital letters: SOLDIER, CAMPAIGNER, PUBLIC SERVANT, ACTIVIST, FUNDRAISER, ORGANIZER, PROTESTOR, ENTREPRENEUR, CITIZEN and more.

Also in the room are the framed contracts signed by Robinson and Rickey from 1945 and 1947. But they are only copies, with the originals still hidden away, this time under the watchful eyes of federal authorities until a court approves their new ownership and an auction likely determines their monetary value.

____


©2024 Los Angeles Times. Visit latimes.com. Distributed by Tribune Content Agency, LLC.

 

Comments

blog comments powered by Disqus