The King of Oil: The Secret Lives of Marc Rich

reporters at the press conference was that he had had a first-class opportunity the previous year to have Marc Rich arrested, and didn’t.

 

     

 

     

“I NEVER BROKE
the
LAW”
     

    R
ich’s voice is even quieter than usual. “I don’t think he’s straight,” he says and throws me a stern look. He is dressed in his usual attire for our meetings—dark suit, white shirt, red tie, and a gold Rolex sparkling on his left wrist. At seventy-four, Rich still exhibits the handsome features that made him such a good-looking man in his younger years. One can see a strong resemblance to Rudolph Valentino, the tragic star of the silent film era, in Rich’s earlier photographs. Rich is an acute observer and a man of few words with a soft voice and a barely noticeable lisp. He is always precise and to the point. There is something catlike about him, beyond his apparent nine lives. He cautiously keeps his distance and waits, ready to jump. He might be ready to flee—or attack. I had asked him his opinion of Rudolph W. Giuliani, his nemesis. “I don’t think he’s straight. I think he’s only interested in himself. That’s it,” Rich says. It is the first time the commodities trader has spoken openly about his case. Rich does not attempt to outmaneuver or avoid my questions. On the contrary—and rather surprisingly for someone who for the last twenty-five years has been labeled one of the greatest tax fraudsters—Rich maintains his innocence. Of course he tried to minimize his taxes, he admits. Of course he funneledhis profits to Switzerland, where the tax burden is substantially lower than in the United States. Of course his companies practiced “transfer pricing.” Every international company does. Rich makes an effort not to sound too apologetic when stressing his innocence. “I never crossed the border of legality. Everything I did was perfectly in order. I never broke the law. I did nothing wrong.”
“A Scapegoat Was Needed”
     
    For the first time ever, Marc Rich is willing to discuss his international trading activities. “The trading with the enemy charge was clearly the most inflammatory part of the indictment. The truth is far different,” Rich explains. “I was doing business with Iran for a Swiss company, and it was completely legal. Marc Rich + Co., a Swiss corporation, had historically purchased oil from the National Iranian Oil Company before the overthrow of the shah and the seizure of American hostages. We then resold the oil on the world market. Like all other foreign-based oil companies, including those which were subsidiaries of U.S. companies, Marc Rich + Co. continued to do oil business with the National Iranian Oil Company after the Iranian revolution took place.”
    If he was indeed innocent, as he claims, I interject, why was he branded the greatest tax fraudster and an enemy of the state? Rich tilts his head to one side, and the red birthmark on his left cheek seems to glow brighter than usual. “I believe it was a combination of political problems and that a scapegoat was needed at the time,” Rich says. “I was an easy target, one individual, very successful, making a lot of money, and Jewish. I stood outside of the establishment.”
    He is convinced that he was “singled out” for precisely these reasons. It was easier for prosecutors, he thinks, to go after him rather than to sift through the hundreds of public companies with their anonymous stockholders that often employed similar practices. After Richard Nixon introduced price regulations for crude oil in 1973, oil resellers seemed to sprout up everywhere. Prior to the Arab oil embargo, there were onlytwelve oil resellers in the United States. By 1978 there were five hundred companies in the business. “I was singled out by individuals. Individuals with a clear personal interest in self-promotion,” Rich believes. “Mr. Giuliani escalated the case because he saw a chance to achieve more publicity for himself,” he maintains. “Personal interests and feelings on their side got into the way of a fair solution.”
    Marc Rich seems almost bashful as he tells me this. I am reminded of how one of his friends once explained that Rich was actually a very reserved person—a virtual introvert—who preferred to sit quietly in the corner at social events. He would just smoke his cigar and observe other people. In all truth, Rich—contrary to his public image as an ice-cold, unscrupulous businessman—is the