Maxwell, The Outsider

by Tom Bower

  By mid-morning in Tenerife, Claverie had fulfilled part of his task. Contrary to the pathologists' requests and contrary to Jewish law, Maxwell's body was being embalmed. During the night the lawyer had asked the pathologists to re-examine their initial conclusion that death was by natural causes. In telephone calls, Claverie questioned the possibility of 'accident' being included in the pathologists' report. Maxwell's life had been insured for £20 million but only in the event of an accident.

  The rush to clear formalities was being completed. At Los Rodeos airport, loaders were attempting to fit his empty coffin on to the Gulfstream jet for its flight to Israel. After several hours, they conceded that the owner's air-conditioned 200-kilo oak casket, with viewing window, sold by the island's undertaker, was too big for the plane. Hours would now be lost while a Challenger jet was chartered in Geneva. Special clearance would be given for its flight into Israeli airspace.

  Forty-eight hours had now passed since the first report to Maxwell headquarters. The shock had been digested and the reports from Tenerife were now receiving closer scrutiny. British pathologists volunteered that the cause of death entered on the death certificate, 'respiratory cardiac arrest', was 'meaningless'. It was a mode, not the cause, of death. Signs such as myocardial infarct or coronary thrombosis would be required to indicate a heart attack and that had not been mentioned.

  Having deliberately praised the local authorities for their co-operation to remove any obstacle to the swift completion of formalities to move the corpse to Israel, the Maxwell family now cast doubt on the Spanish pathologists' conclusions about the cause of death.

  After constant communications between the sons in London and Betty, Philip and his youngest daughter Ghislaine who had arrived on the island, the family claimed that the heart attack could have occurred after Robert Maxwell fell into the water and therefore his death was an accident. The time and cause of death were still unknown, confirmed Isabel Oliva: 'As far as I'm concerned, the investigations carry on.' To fuel the mystery, Maxwell's private doctor Dr Joseph Joseph suggested that the death was 'suspicious'. Since Dr Joseph made his judgement from Wimpole Street in London, he only succeeded in multiplying the unease about the conflicting medical and other expert evidence.

  At 2 a.m. on Friday morning, 8 November, the embalming was completed. The coffin was loaded on to the Challenger. At 3.30 a.m., Betty Maxwell boarded the airplane. Throughout her whole stay on the island, no one had seen her shed a tear.

  Maxwell's body arrived at Tel Aviv airport before noon and was driven to Jerusalem. ‘I was born Jewish and I shall die Jewish,' Maxwell said in 1986 but few had believed him. During Saturday, Dr Ian West, one of Britain's leading pathologists, arrived in Israel. Sent by the insurance companies, he was hired to complete another autopsy by Sunday morning. He worked under a handicap. Maxwell's heart was in Spain and the remaining organs were too damaged to permit any meaningful investigation.

  Not far from the frustrated pathologist, a Palestinian grave-digger was confirming on his portable telephone his latest instructions that the grave should be wider and longer than normal. Released by West, the dissected cadaver was moved to Israel's Hall of the Nation and placed upon a plinth, covered by a shroud.

  There lay the owner of $250 million worth of Israeli assets which included a leading newspaper, Jerusalem's two football clubs, industrial investments and, most important of all, the private telephone number of President Gorbachov whose help he had sought to hasten the emigration of Soviet Jews to Israel.

  At 2.30 in the afternoon, the first of four hundred mourners arrived in the hall to pass by the body and, over the next hour, pay their respects to the family who stood in a half circle.

  Neman could reflect that Maxwell would have smiled with pleasure at the spectacle. Unlike in England, he was remembered in Israel for his successes and his ability to overcome his failures. 'Robert Maxwell was a folk hero in Israel. A Holocaust survivor who made good,' said one mourner. Israel, he continued, 'is the only solution for the Jews. Maxwell's return was the symbol to Diaspora Jews to return to your own people.' Those sentiments would puzzle the British who had accepted his declarations of patriotism at face value. But for those standing around the shrouded corpse in Jerusalem there was no mystery. Maxwell, despite his efforts, had been rejected by the British because, despite his best efforts, he remained a Jew. Only in Israel did he find acceptance and peace.

  The first to speak was President Chaim Herzog, first in Hebrew but then in English because none of the family understood. His eulogy was resounding: 'He scaled the heights. Kings and barons besieged his doorstep. He was a figure of almost mythological stature. An actor of the world stage, bestriding the globe as Shakespeare says, like a colossus.' Most people in Britain would be puzzled by Herzog's praise. Searching for a hidden connection, most would be convinced that Maxwell was being rewarded for his services to Mossad. None could believe or understand that the hidden agenda was simply Maxwell's uncompromised relationship with his fellow countrymen.

  Herzog was followed by Maxwell's eldest son Philip, unable to disguise his emotions: 'Dear Dad . . . soldier, publisher and patriot. Warrior and globe trotter. Father of nine children and grandfather of eight. We love you, we need you, we miss you . . . May you rest in peace.'

  Sam Pisar said Kaddish, the Jewish prayer; and then the mourners moved outside. Rabbi Shear-Yashuv Cohen of Haifa who, according to the laws of the Cohens, cannot enter a building containing a dead body because of the danger of impurity, gave the final blessing: 'Robert Maxwell started his life as an Orthodox Jew and has now travelled the full circle and returns to his origins.' United by the common bond of surviving two millennia of persecution, Cohen praised their brother who, having survived prejudice and malice, had returned home. The outsider had become an insider.

  It was approaching sunset when the cavalcade drove through closed roads, passing the Damascus Gate, towards the Mount of Olives overlooking the traditional site of the Garden of Gethsemane. On the site most coveted by Jews, where it is said those buried will be the first to hear the call of the Messiah at the Day of Judgment, the mourners collected. Cynics would add, Trust Cap'n Bob. Making sure that he would be first in the line.'

  A pink light from the horizon reflected on the Dome of the Rock as the Jewish ceremony began, mingled with Moslem laments from the Old City. Not so long before, Maxwell, overlooking the cemetery from the royal suite in the King David Hotel, was playing his power games. How he would have enjoyed seeing all the nation's most powerful - the president, the prime minister Yitzhak Shamir, Cabinet ministers Ariel Sharon, Moshe Arens and Ehoud Olmert and Shimon Peres - all gathered as if it were a state funeral - an honour which would be mocked in Britain. Hence his final rejection of that country.

  Olmert, who months earlier had sat with Maxwell in Holborn watching the World Cup, delivered the graveside farewell:

  'He once said to me, "After all, I have not done so badly for a young Jewish boy from the shtetl [ghetto].'" Looking down at the grave, Olmert continued, 'Indeed, Bob Maxwell, you have not done badly at all. May your soul rest in peace in this ancient ground which finally became yours.' The sentiment was echoed by his widow: 'Now the circle closes. He has returned to his roots.'

  There was no grace for the dead in England. The following day, Monday 11 November, Kevin and Ian Maxwell were still struggling to keep their empire intact. There was no respite. MCC's shares continued to fall.

  At 2 o'clock that afternoon, a press conference was called by Matthew Evans. Guarded by security men and watched by over one hundred journalists, Evans read a six-page statement written by his author, Seymour Hersh. In a convoluted narrative, Hersh stated that he had obtained solid evidence from a private detective which linked the Daily Mirror with Mossad's kidnap of Vanunu. Hersh's statement concluded that he had fulfilled his obligation 'to tell the truth and all the truth'. Within hours, British journalists had established that Hersh and Evans, who had paid the 'detective' £1,290 in Amsterdam,
were the victims of a hoaxer. All their allegations against Maxwell had collapsed within twenty-four hours of his burial.

  By then it was irrelevant. Maxwell's reputation was being shredded in the City. On 19 November, MCC's shares fell to 46p and would fall another lOp the following day. In real terms, they were worth about 5 per cent of their value when he had boasted about his ambitions to become a £3-£5 billion corporation. The family's own paper fortune was sliced by £500 million.

  There was talk of £1 billion of private debts and of £594 million to be repaid by the end of the year. The Fraud Squad's investigations had been leaked and the family's fortune was reportedly near to collapse. Alarmists were mentioning the possibility of bankruptcy as the shares fell further to 31p. Holding on by their fingertips, the family's only hope was that the thirty banks could recover their money either if MCC was saved or if its assets were carefully sold off. That required calm and patience.

  Amid reliable accounts that everything was for sale, even the Daily Mirror, and of the family's need for a mere £5 million cash to stave off collapse, Robert Pirie, Maxwell's banker from Rothschild Inc. in New York, flew to London to give his advice. Four years earlier, with Pine's help, Maxwell had bought Macmillan. Pirie refused to comment during his brief stay.

  Every moment had been critical since 5 November, but the climax of the tumultuous weeks since Maxwell's death was the meeting of over ninety bankers on Monday 25 November. Those assembled tried to bring order to their competing bids for the empire's remains. At length, spokesmen for Coopers & Lybrand and Bankers Trust described how the Maxwell family possessed assets to cover their debts. According to the representative of Bankers Trust, the family's assets were worth nearly £200 million more than its debts. The debts on that Monday were stated to be £850 million. Some of the bankers remained sceptical but even they were apparently willing to believe the good news that their loans would be repaid. After all, to admit at that stage that they were mistaken in lending to Maxwell would be embarrassing. More embarrassing still was their knowledge that millions had been lent without properly inquiring into the companies' accounts and without heeding the track record of the borrower.

  Searching for self-justification, they allowed themselves to be encouraged by the pledges from both of Maxwell's sons that independent auditors would, for the first time, be allowed to scrutinise the internal accounts of the private companies. The credibility of Robert Maxwell's glowing reports and expressions of confidence about the future, such masterpieces of design and content, had passed. There was the indisputable sense that the final rites had been delivered to the independents of the Maxwell empire.

  For the first time, on 27 November, MCC postponed publication of its results. 'Now Bob has gone, we need to find out the truth,' said a banker.

  Over the last weekend of November, the investigation into the Maxwells' finances discovered unexpected discrepancies. The first inkling of their surprises was the early morning announcement on Monday 3 December that dealings in the shares of both MCC and Mirror Group would be suspended. MCC at 35p and the Mirror Group at 125p.

  During the course of the day the reasons began to emerge. The definitive estimates of the private companies' debts had now increased from £850 million to over £1 billion. To address that problem, the family announced sales of £50 million worth of assets.

  The impact of this announcement however was deadened by the discovery that not only had the £149.3 million surplus in the Mirror pension fund disappeared, but also that a large proportion of the pension funds' shares, estimated to be worth a further £150 million, had been used by Maxwell as collateral for loans. The authorisation for Maxwell to use that money was unclear. Nor could anyone clarify whether the money was taken before or after Mirror Group shares were sold to the public. It had however become apparent that the trustees had invested at least 10 per cent of the pension funds in MCC and the Mirror Group which was contrary to the spirit of managing a pension fund. Once again, Maxwell had found a way to exploit Britain's rickety regulations and indolent regulators.

  On Wednesday 4 December, Scotland Yard's Fraud Squad began to investigate whether any other directors, including Kevin and Ian Maxwell, knew about Maxwell's unauthorised use of £300 million. 'Clearly we didn't know everything,' said Kevin Maxwell defensively. 'Clearly he had a style of business where you probably had a need to know rather than a sharing of information all the time.' Twenty-one years earlier the two DTI inspectors had described Robert Maxwell's business methods more succinctly.

  Exactly one month had passed since the brothers had assumed control. On that anniversary, both resigned as directors of both public companies. Ostensibly, they pleaded a conflict of interest between their duties as directors of public companies and their interest to protect their private companies. But their attempts to protect themselves could only be symbolic. Their father's prophecy that 'my children won't inherit a penny' had been proven correct. They had inherited debts worth hundreds of millions of pounds. The front page of the 'newspaper he saved' was plastered with four words 'Millions Missing from Mirror’. The following day, the Mirror's headline claimed that its owner had stolen £526 million. Maxwell the saviour and the larger-than-life personality, had been transformed into a gigantic fraudster.

  On the morning of Thursday 5 December, the family finally admitted defeat and confessed that the empire was bankrupt. The administrators who had been waiting in the wings were allowed in to perform their gruesome task. The curtain had fallen forever on an astonishing era.

  Maxwell could not have intended to bequeath a debt-ridden conglomerate, at the mercy of those whom he despised, as his memorial. But, by the nature of the man, it could never have been different. Certainly, by normal criteria he was dishonest, but it is questionable whether he consciously intended to be dishonest. In his own terms, Maxwell could probably not distinguish right from wrong, for everything which he did was, by definition, right. When the smoke has passed and the dishonesty is forgotten, he will be remembered in equal measures for his failures and success, but most of all for his success in overcoming failures which would have crushed other mortals forever.

  Among the several privileges of the rich is their freedom to indulge in fantasy and frivolity without accounting to their critics. There are many mortals of Maxwell's kind who have sought in their lifetime to ensure a secure place in posterity. Maxwell was unusual in many ways, but not least because he sought to write his own epitaph in his lifetime and then enjoy his self-assessment for many years to come.

  His great dream of a permanent world-wide communications group bearing his name is dead. His wish to be of political consequence was unfulfillable because there was no philosophy to sustain his influence. When asked to choose his own epitaph, Maxwell replied that he hoped he would leave the world a slightly better place. Whether he succeeded is controversial. Certainly there are those who benefited from his generosity and equally there are those who suffered, but not physically. Only their egos were bruised.

  Whatever his weaknesses and regardless of his sins, his achievements were sufficiently credible for him to be able to expect a special place in the history of post-war Britain. If he was tortured by the public humiliation and disbelieving of the criticism he attracted, it is understandable. The impressive breadth of his commercial activities was eclipsed only by the intensity of his family bonds. The public image was of a larger-than-life, occasionally laughing bully whose public successes, crushing failures and flashes of generosity elude most of mankind and create unpalatable suspicions. What greater accolade could he expect than the attention which the poor Jew made good attracted and continues to enjoy beyond his three score and ten.

  Now nature has taken its course and Maxwell has travelled to the next world, his parting message to those left behind is, 'You haven't understood me.' Resounding from the earth is the reply, 'But did you understand yourself?'

  'For all is vanity. All go unto one place; all are of the dust, and all turn to dust again. W
ho knoweth the spirit of man that goeth upward, and the spirit of the beast that goeth downward to the earth? Wherefore I perceive that there is nothing better, than that a man should rejoice in his own works; for that is his portion; for who shall bring him to see what shall be after him?'

  Ecclesiastes 3: 19-22

  Sources

  The principal sources for this book were interviews with over three hundred and fifty people, access to a wealth of private papers, the three reports issued by the Department of Trade and Industry about the status of Mr Maxwell's private and public business affairs between 1971 and 1973, the annual reports of Pergamon and BPC/BPCC and the voluminous newspaper and magazine coverage since 1951. Mr Maxwell consistently challenged many of the conclusions of the DTI reports but they are quoted as they contain the evidence given by the people involved at the time.

  During May and June 1973, I spent considerable time with Mr Maxwell filming a long profile for BBC television. It was a critical period in Mr Maxwell's career and during those weeks we discussed at great length his ambitions, values and attitude to most of the criticisms which had been levelled at him. Nearly two hours of interview were recorded on film and the many other hours of conversation with him were noted. I retained those records and have drawn upon them for this book. Mr Maxwell also gave me access at that time to his huge collection of scrap books and some papers which were pertinent to his business affairs. These have also been very valuable.

  In making the film, I asked Mr Maxwell to refer me to people who he thought could contribute to presenting a full account of his life. Most of them agreed to be filmed and their interviews, both on and off camera, have also been used. The most important were Mrs Elizabeth Maxwell, Richard Crossman, Walter Coutts and Philip Okill.