The King of Oil: The Secret Lives of Marc Rich
Page 31
19. A. Craig Copetas, Metal Men: How Marc Rich Defrauded the Country, Evaded the Law, and Became the World’s Most Sought-After Corporate Criminal (New York: Putnam, 1985), 115.
20. International Monetary Fund, www.imf.org.
21. Official excerpt from the Zug tax records dated August 12, 1983.
9: The Case
1. The interview with Morris “Sandy” Weinberg took place on March 12, 2008.
2. Marc Rich + Co. AG was a Swiss corporation that did not have to file U.S. corporate income tax returns. Marc Rich International was a Swiss subsidiary of Marc Rich + Co. AG and did business in the United States. It had its principal offices in Zug, Switzerland, and New York, and it filed U.S. corporate income tax returns.
3. They served ten months.
4. Evan Thomas, The Man to See: Edward Bennett Williams—Ultimate Insider, Legendary Trial Lawyer (New York: Simon & Schuster, 1991), 14.
5. Interview with Avner Azulay.
6. Thomas, The Man to See, 415–17.
7. Ibid.
8. Letter from Marc Rich to Ruth H. Van Heuven, U.S. Consul General, Zurich, October 27, 1992.
9. “Take Jack’s Word,” 26.
10. Thomas, The Man to See, 415–17.
11. Rich’s Netherland Antilles affiliate Richco contributed at least 75 million in purchase money through an irrevocable letter of credit and an undisclosed amount of cash.
12. Quoted in “Dinkins Among 14 Arrested in Protest of Police Shooting,” New York Times, March 16, 1999.
13. Thomas, The Man to See, 416.
14. Leonard Garment, Crazy Rhythm (New York: Da Capo, 2001), 394.
15. Article 273 of the Swiss penal code.
16. “Marc Rich Asset Freeze May Halt Its U.S. Business,” Wall Street Journal, August 1, 1983.
17. U.S. Court of Appeals for the Second Circuit, 84-6033, 6075 at 7.
18. Diplomatic note, handed over by the Embassy of Switzerland, on September 21, 1983.
19. The superseding indictment of March 1984 lists sixty-five counts. Indictment, U.S. v. Marc Rich, Pincus Green, et al., March 6, 1984, S 83 Cr. 579.
20. Quoted in “Marc Rich Indicted in Vast Tax Evasion Case,” New York Times, September 20, 1983.
21. Indictment, count 7, p. 3.
22. Ibid, count 50, pp. 45–46.
23. Controversial Pardon, 109.
24. 15 U.S.C. § 751 et seq.
25. Indictment, page 7. The average world market price of crude oil was around 37 in 1980.
26. Indictment, e.g., counts 7, 9, 10, 11, and 22.
27. Indictment, page 11.
28. Request for Assistance Under the Swiss Federal Law on International Assistance in Penal Matters in the Investigation of Marc Rich et al.: “They also engineered fraudulent transactions whereby 30 million in offshore losses incurred by [Marc Rich + Co. ] AG in Zug were fraudulently billed to International, so that [Marc Rich International] could claim the losses as deductions from taxable income” (5).
29. John Dean, “Why an Investigation of the Marc Rich Pardon Is Imminent,” FindLaw.com, February 2, 2001.
30. Gerard E. Lynch, “RICO: The Crime of Being a Criminal,” Columbia Law Review 87, no. 4 (May 1987).
31. Indictment, counts 35–40.
32. “Rich Is Poorer,” Time, October 22, 1984.
33. Ibid.
10: Rudy Giuliani’s Failures
1. Securities Industry Association, Foreign Activity in U.S. Securities 8, no. 2 (April 10, 1984): 4.
2. IMAC, Art. 3, Par. 3. “A request shall not be granted if the subject of the proceeding is an offence which appears to be aimed at reducing fiscal duties or taxes or which violates regulations concerning currency, trade or economic policy. However, a request for judicial assistance under the third part of this act may be granted if the subject of the proceeding is a duty or tax fraud.” Unofficial translation by the Swiss Federal Office of Justice, www.bj.admin.ch/bj/en.
3. Extradition treaty of May 14, 1900, II.4, II.6; indictment, count 7, p. 3: “. . . and to obtain money and property by false and fraudulent pretenses, representations and promises.”
4. “Aussergerichtlicher Vergleich im Fall Marc Rich,” NZZ, October 12, 1984.
5. “Die Bananenrepublik zeigt ihre Zähne,” Die Weltwoche, September 29, 1983.
6. Translation of the French note delivered on September 25, 1984, by the Office for Police Matters to the Embassy of the United States.
7. Annual Report of the Swiss Federal Council, 1984, 132.
8. Quoted in Thataway, 10.
9. “Exporting American Taxes,” Economist, October 1, 1983.
10. Quoted in A. V. Lowe, “Extraterritorial Jurisdiction: An Annotated Collection of Legal Materials,” American Journal of International Law 78, no. 2 (April, 1984): 547–49.
11. Harold G. Maier, “Interest Balancing and Extraterritorial Jurisdiction,” American Journal of Comparative Law 31, no. 4 (Autumn 1983): 579–97; 595, 579 quoted.
12. Ibid., 595–96.
13. A. D. Neale and M. L. Stephens, International Business and National Jurisdiction (Oxford: Clarendon Press, 1988), 194.
14. Thataway, 11.
15. Ibid., 13.
16. Quoted in “All the Fugitive’s Men in Israel,” Los Angeles Times, February 25, 2001.
17. Thataway, 32.
18. Ibid., 37.
19. The Supreme Court wrote in 1895, “The principle that there is a presumption of innocence in favor of the accused is the undoubted law, axiomatic and elementary, and its enforcement lies at the foundation of the administration of our criminal law.” Coffin v. United States, 156 U.S. 432; 15 S. Ct. 394.
20. Quoted in The Strange Case of Marc Rich: Contracting with Tax Fugitives at Large in the Alps: Hearings Before the Government Information, Justice, and Agriculture Subcommittee of the Committee on Government Operations, 102nd Congress, 1st and 2nd sessions, 1991–92 (Washington: GPO, 1993), 8.
21. United States Attorneys’ Manual, USAM 6-4.210.
22. United States Attorneys’ Manual, USAM 9-110.415.
23. The analysis can be retrieved via www.law.wayne.edu/McIntyre/text/in_the_news/marc_rich.pdf; 23–24 quoted.
24. “Marc Rich’s Road to Riches,” Time, October 3, 1983.
25. Exec. Order No. 12205, 45 Fed. Reg. 24099 (1980). The charges against the companies—but not against Rich and Green—were later dropped.
26. United Press International, September 28, 1981. See note 9 to chapter 8 above.
27. Controversial Pardon, 486–87.
28. Ibid., 45.
29. Letter from Jack Quinn to President Bill Clinton, January 5, 2001.
30. Letter to U.S. Attorney Mary Jo White, December 1, 1999.
31. Gordon Crovitz, “RICO’s Broken Commandments,” Wall Street Journal, January 26, 1989.
32. Letter to U.S. Attorney Otto G. Obermaier, November 6, 1990.
33. Hermann Lübbe, Politischer Moralismus: Der Triumph der Gesinnung über die Urteilskraft (Berlin: Siedler, 1987).
34. Howard Safir on Larry King Live, CNN, February 16, 2001.
35. Quoted in Controversial Pardon, 5.
36. Michael Levi, Regulating Fraud (London: Tavistock, 1987), 113.
11: “I Never Broke the Law”
1. Thataway, 27.
12: The Hunt for Marc Rich
1. Ethan Avram Nadelmann, Cops Across Borders: The Internationalization of U.S. Criminal Law Enforcement (University Park, Penn.: Pennsylvania State University Press, 1993), 168–69.
2. United States v. Alvarez-Machain, 504 U.S. 655 (1992).
3. Thataway, 20.
4. The interview with Ken Hill took place on March 11, 2008.
5. Jeppesen Sanderson officially says it didn’t cooperate.
6. Maureen Orth, “The Face of Scandal,” Vanity Fair, June 2001.
7. For more information about the relationship between Avner Azulay and Ehud Barak see chapter 18, “The Pardon.”
8. A. Craig Copetas, “Th
e Sovereign Republic of Marc Rich,” Regardie’s, February 1990.
9. Wall Street Journal, January 29, 2001.
10. “Take Jack’s Word,” 27.
11. Pat Dawson, “The Double Life of Marc Rich,” February 12, 2001, www.msnbc.msn.com/id/3071886.
12. Quoted in “The Rich List,” Observer, May 13, 2001.
13. Editorial, Regardie’s, August 1985.
14. Answers to Questions Submitted to the Department of Justice by the Subcommittee on Government Information, Justice, and Agriculture Regarding Marc Rich and Pincus Green, 1992, 26.
15. Quoted in “Investigator Tells House Committee That Politics Let Tax Fugitive Go Free,” American Metal Market, March 6, 1992.
16. Thataway, 34.
17. Published as Thataway.
18. Parliamentary Motion of June 19, 1992.
19. Howard Safir on Larry King Live, CNN, February 8, 2001.
20. Thataway, 13–17, 37.
13: Clandestine Talks
1. Web site of Zuckerman Spaeder, Sandy Weinberg’s law firm: www.zuckerman.com/morris_weinberg.
2. Memorandum from Leonard Garment to Otto G. Obermaier, November 6, 1990.
3. Quoted in “Plotting a Pardon,” New York Times, April 11, 2001.
4. Letter from Jack Quinn to Mary Jo White, December 1, 1999.
5. Letter from Bernard Wolfman to Gerard E. Lynch, December 7, 1990.
6. Letter from Laurence A. Urgenson to Patrick Fitzgerald, June 3, 1994.
7. Letter from Patrick Fitzgerald to Laurence Urgenson, June 27, 1994.
8. Letter from Mary Jo White to Jack Quinn, February 2, 2000.
9. Leonard Garment, “Representing Marc Rich in a Vindictive Time,” in Liber Amicorum Marc Rich (Lucerne, 2004), 73.
14: The Secrets of Success
1. “Why Marc Rich Is Richer Than Ever,” Fortune, August 1, 1988.
2. Financial Times, September 1, 1988.
3. “Take Jack’s Word,” 9–16.
4. A. Craig Copetas, Metal Men: How Marc Rich Defrauded the Country, Evaded the Law, and Became the World’s Most Sought-After Corporate Criminal (New York: Putnam, 1985), 115–19.
5. “The Lifestyle of Rich,” Fortune, December 22, 1986.
6. Ayn Rand, Answers: The Best of Her Q&A, ed. Robert Mayhew (New York: New American Library, 2005), 124.
7. Ayn Rand, The Virtue of Selfishness (1964); Rand, Answers, 109.
8. Cf. “Capitalist Heroes,” Wall Street Journal, October 12, 2007.
9. Copetas, Metal Men, 115.
10. “Jamaica Eyes Alumina Contracts,” American Metal Market, March 8, 1989.
11. “Jamaica’s Manley Ends Attack,” American Metal Market, July 6, 1989.
12. Figures from U.S. Geological Survey, http://minerals.usgs.gov/ds/2005/140/aluminum.pdf.
13. “Jamaica Alumina Output Hikes Hit Snags,” Metals Week, March 23, 1987.
14. Inter Press Service News Agency (IPS), “Jamaica: Rejoicing over New IMF Pact, But . . .,” July 28, 1989, and “Jamaica: Government Blamed for Alumina Plant Closure,” February 8, 1985.
15. Associated Press, June 26, 1979.
16. E. S. Reddy, “A Review of United Nations Action for an Oil Embargo Against South Africa,” United Nations Centre Against Apartheid, 1981, available at www.anc.org.za/un/reddy/oilembargo.html.
17. HR 4868. President Ronald Reagan attempted to veto the bill but was overridden by Congress.
18. The actual prices were staggered, as is usual in the industry. For comparison: The official OPEC price in 1979 was between 13.34 and 16.75. The international price, paid on the spot market, was 25.
19. Quoted in “Oil Fuels Apartheid,” ANC Statement, March 1985, available at www.anc.org.za/ancdocs/pr/1980s/pr850300.html.
20. Twenty-two billion South African rands between 1973 and 1984. Richard Hengeveld and Jaap Rodenburg, eds., Embargo: Apartheid’s Oil Secrets Revealed (Amsterdam: Amsterdam University Press, 1995), 230; IPS, “Oil Embargo Shows the Heavy Price of Economic Sanctions,” August 2, 1985.
21. Hengeveld and Rodenburg, Embargo, 274.
22. Ibid., 145.
23. IPS, “Oil Embargo Shows the Heavy Price of Economic Sanctions,” August 2, 1985.
15: Surprising Services
1. Quoted in “To Honor Their Lives,” February 1, 2005, www.peacenow.org/resources/publications.asp?rid = & cid = 228.
2. Leonard Garment, Crazy Rhythm (New York: Da Capo, 2001), 376–80.
3. Ibid.
4. Quoted in “A Fugitive’s Secret Talks with the Feds,” U.S. News & World Report, March 12, 2001.
5. Garment, Crazy Rhythm, 376–80.
6. Controversial Pardon, 1056.
7. Quoted in “Plotting a Pardon,” New York Times, April 11, 2001.
8. The 9/11 Commission Report: Final Report of the National Commission on Terrorist Attacks upon the United States (New York: Norton, 2004), 12.
9. Letter from Shabtai Shavit to President Bill Clinton, November 28, 2000.
10. “The Rich List,” Observer, May 13, 2001.
11. Yossi Melman, “The Story of Iranian Oil and Israeli Pipes,” Haaretz.com, October 21, 2007.
16: The Private Life of the Riches
1. “Songwriter Who Doubles as Friend of Bill,” New York Times, October 11, 2000.
2. Petition for Pardon for Marc Rich and Pincus Green, December 11, 2000, 30.
3. 750 million Swiss francs. The Swiss franc /U.S. dollar exchange rate was around 1.5:1 in April 1992.
4. 5 million Swiss francs at the time.
5. Schweizer Illustrierte, May 19, 1993.
6. 50 million Swiss francs at the time.
7. Denise Joy Rich v. Alexander R. Hackel, et al. New York State Supreme Court, New York County, Case No. 100710-1993.
8. 215 million Swiss francs. The Swiss franc /U.S. dollar exchange rate was around 1.30:1 in December 1990.
17: The End of the King of Oil
1. Figures from International Monetary Fund.
2. “Marc Rich + Co. Executive to Quit over Disagreement,” Wall Street Journal, June 4, 1992.
3. Quoted in “Take Jack’s Word,” 30.
4. “When a Fugitive Marc Rich Flouted U.S. Sanctions,” Wall Street Journal, February 23, 2001.
5. The report is available at www.iic-offp.org/documents.htm.
6. “A Definition of Richness,” Financial Times, August 10, 1992.
7. Petition for Pardon for Marc Rich and Pincus Green, December 11, 2000, 4.
18: The Pardon
1. “King of the World,” Playboy, February 1, 1994.
2. “Opposed to Holder Without Apology,” National Review Online, November 25, 2008.
3. “Isn’t It Rich?,” New York Times, February 1, 2001.
4. Vanity Fair, June 2001.
5. On Larry King Live, CNN, February 8, 2001
6. Clemency Regulations, 28 C.F.R. § 1.1.
7. Petition for Pardon for Marc Rich and Pincus Green, December 11, 2000, 8, 28.
8. Ibid., 4.
9. White House Transcripts. Verbatim notes of non-redacted portions of transcripts of Clinton/Barak conversations.
10. Letter from Shlomo Ben-Ami to William Jefferson Clinton, November 26, 2000.
11. Sidney Blumenthal, The Clinton Wars (New York: Farrar, Straus and Giroux, 2003), 783.
12. E-mail from Avner Azulay to Jack Quinn, December 25, 2000.
13. White House Transcripts. Verbatim notes of non-redacted portions of transcripts of Clinton/Barak conversations.
14. “Take Jack’s Word,” 74–83.
15. “Songwriter Who Doubles as Friend of Bill,” New York Times, October 11, 2000.