-Caveat Lector-
"Secrecy became paramount.
The lawyers fretted about rumors that the Securities and Exchange
Commission had heard about the pardon request.
By Jan. 9, only 11 days were left. "I think we've benefited
from being under the press radar," Quinn e-mailed his fellow
lawyers, hoping for the best."
******************
Sunday, February 18, 2001
SUNDAY REPORT
Clinton Pardon of Rich a Saga of Power, Money and Influence Strategy
The fugitive financier used his former wife, Israeli VIPs and
others to press his case with the White House.
By ERIC LICHTBLAU and DAVAN MAHARAJ
Los Angeles Times Staff Writers
WASHINGTON--President Clinton's pardon of Marc Rich is a saga of
secrecy, tenacity, sleight of hand and pressure from Rich's
ex-wife and one of her friends, who together have steered
millions of dollars to Bill and Hillary Rodham Clinton's causes
and those of fellow Democrats.
Whether it is a story of bribery as well or illegal gifts from
abroad is the subject of congressional inquiries and a criminal
investigation by the FBI and the U.S. attorney's office in New
York.
Behind the pardon is a tale of intrigue, unintentional humor and
celebrity involving, among others, two former Israeli prime
ministers, a onetime operative for the Mossad, a stubborn U.S.
attorney and a misunderstood desire to find a rabbi in the White
House. Interviews in Israel and a review of e-mails and documents
in the hands of investigators as well as testimony before
congressional committees show that Rich, 65, perhaps the
wealthiest fugitive in the world, mounted an immense effort to
persuade the Justice Department and then the president to cut a
deal and let him come home.
Justice resisted, but Clinton agreed. What the president got in
the deal was a pledge that Rich would waive a
statute-of-limitations defense should an agency, such as the
Internal Revenue Service or the Energy Department, sue him for
civil fraud. But experts say such a suit is unlikely.
Moreover, Rich runs businesses valued at $30 billion and would
not be likely to feel the pain of any financial judgment against
him.
In an Op-Ed article for today's New York Times, Clinton said it
was "utterly false" to suggest he granted the pardon for
donations. He said he did it because Rich's case should have
been a civil rather than criminal matter, because the pardon was
supported by a deputy attorney general and other lawyers "and
importantly" because present and former high-ranking Israeli
officials and American Jewish leaders wanted it.
Many things about the Rich pardon are still a mystery. So far,
however, this is the story of the deal that Bill Clinton did not
refuse. It is marked by ongoing protest and bitterness, best
symbolized, perhaps, by the fact that, as of late Saturday, a
full 28 days after Clinton granted Rich his pardon, federal
officials still had not removed his wanted poster from their
international crime alert Web site. --- The saga began in the
fall of 1999. Rich was No. 6 on the government's list of most
wanted fugitives. The mug shot on his wanted poster showed his
thinning black hair. He had been on the lam, albeit a posh one,
for 16 years, ever since his 1983 indictment by a grand jury on
more than 50 counts of wire fraud, racketeering, trading with the
enemy and evading more than $48 million in income taxes.
The government accused him of conspiring with Iran in 1980 to
purchase over 6 million barrels of oil, in violation of a trade
embargo imposed by the United States because Iran was holding 52
Americans hostage in the U.S. Embassy in Tehran. Payments for
the oil, federal agents said, were made fraudulently through
American banks and by the illegal use of American
telecommunications facilities.
At the time of the indictment, Rich was living in Zug,
Switzerland, a bucolic little burg south of Zurich. He refused
to return to the United States and surrender to U.S.
authorities for trial.
Switzerland refused to extradite him.
He had strong ties to the United States, however. His father, a
Holocaust refugee from Belgium, made burlap bags in New York.
Young Rich dropped out of New York University to make a fortune
as a broker in commodities. He married Denise Eisenberg, the
daughter of Holocaust survivors. With the indictment imminent,
Rich, his wife and his trusted partner, Pincus Green, decamped to
Zug, where they lived in magnificent exile, protected by security
guards from Israel, while Rich ran enterprises that brokered oil,
gold, sugar, grain, aluminum and nickel. He even sold copper to
the U.S. mint until lawmakers found out about it.
Despite these ties, Rich steered clear of the United States.
Just leaving Switzerland was risky. U.S. marshals nearly nabbed
him on quick trips to London and Helsinki. He shunned reporters
and was known to duck out bathroom windows to escape them. In
addition to his holdings in Zug, he bought a seaside estate on
the Spanish coast and renounced being an American in favor of
dual citizenship in Switzerland and Spain.
By then, Rich had made large charitable contributions in both
countries that made it unlikely he would ever be extradited.
Marriage in exile went badly. Denise Rich told New York magazine
that her husband had taken up with another woman. The Riches
divorced bitterly. Denise Rich returned to New York and resumed
songwriting, which she had pursued in fits and starts since
college. She wrote hit songs for artists including Bette Midler
and Aretha Franklin.
In 1993, she was introduced to President Clinton.
After the Kenneth W. Starr report was released in 1998, Clinton
made one of his first public appearances at her apartment for a
fund-raiser. It netted $3 million by one account, $4 million by
another. --- Back in Zug, Marc Rich had been putting out feelers.
William A. Wilson, who was President Reagan's friend and
ambassador to the Vatican, began asking questions about his case.
The State Department warned him off. In 1995, the department
balked again, according to the New York Times, when the Israelis
asked that the United States allow Rich to travel more freely
without fear of being arrested.
He had not been able to attend the funeral of his father, and by
now one of his daughters, in her late 20s and in New York with
her mother, was dying of leukemia. Prosecutors who had indicted
under former U.S. Atty. Rudolph W. Giuliani, now the mayor of
New York, rebuffed his efforts to see her.
By the end of 1999, Rich wanted it all to end.
His lawyers insisted he had a strong defense. He claimed he was
a victim of anti-Semitism and Giuliani's overzealous prosecution.
If so, why not return with Green and stand trial?
"Considering the amount of publicity the affair has received so
far and the amount of attention we would get if we took this
step, it would be very risky for us," he told an Israeli magazine
that October in a rare interview. "And I do not want to take
this risk." Instead, the congressional records show, Rich wanted
to work out a deal with Mary Jo White, who had succeeded Giuliani
as U.S. attorney.
He hired Jack Quinn, a lawyer and Washington lobbyist who had
been Vice President Al Gore's counsel, then his chief of staff.
In 1994, Quinn was drafted by Clinton to be his White House
counsel. Quinn had served for two years, then returned to the
powerhouse law firm of Arnold & Porter. For $400,000, Quinn
began working the phones.
He told everyone he knew that Rich's defense had merit. Then he
called Eric H. Holder Jr., who was Atty. Gen. Janet Reno's top
deputy, and asked a favor. Could Holder set up a meeting between
him and Mary Jo White's people in New York?
Although Marc Rich's case was notorious in New York City, Holder
had never heard of him. He asked an aide to set up the meeting.
White's office would not budge. They were not interested.
The U.S. attorney herself was blunt. "Impossible," White wrote
in a letter to Quinn several weeks later. "It is our firm policy
not to negotiate dispositions of criminal charges with
fugitives."
There was only one option: a presidential pardon.
Quinn had nearly unparalleled access to Clinton and the
decision-makers who surrounded him. He and Rich's other lawyers
and advocates began writing letters to allies. They culled lists
of potential advocates and plotted strategy. Who would make the
strongest cases for their client?
They sought advice from Denise Rich, who agreed to help--for the
sake of her children, she said. By now she had made nearly $1.4
million in various political contributions to Democrats,
including Bill and Hillary Clinton. Among her gifts were
$450,000 for the Clinton library, $10,000 for Clinton's legal
defense fund and a pair of coffee tables and chairs worth $7,375.
They collected photographs of Rich, like ones taken a few months
earlier showing him with former Israeli Prime Minister Shimon
Peres, a Swiss ambassador and other luminaries at a reception in
Rich's honor at the Tel Aviv museum. It helped that Rich had
embraced Israel with his heart--and his checkbook.
The Riches had been doling out money to Jewish causes "from
before the establishment of the state [of Israel], first by my
father and later on by me," he told Israel's Haaretz newspaper in
late 1999. "I am a Jew, and Jews are important to me. I always
thought the state of Israel was very important to Jews and to the
whole world in general. I always wanted to help."
When Jerusalem's Sha'arei Tzedek Hospital needed medical
equipment, Rich donated $1.1 million. When the Israel Museum
wanted to open a new wing, Rich obliged with an additional $1.4
million. And when Israel's leaders needed money to help
integrate new immigrants or to pay for young Jews to visit the
country, Rich willingly picked up the tab.
Over two decades, Rich had, by some estimates, donated more than
$30 million to various causes in Israel.
Now the people who came forward to help him could have filled
several pages of Who's Who in Israel. They included Peres,
former Prime Minister Ehud Barak, Foreign Minister Shlomo
Ben-Ami, Justice Minister Yossi Beilin and a host of other high
government officials on the left. Jerusalem Mayor Ehug Olmert
topped a list of rightist politicians who supported a pardon.
Even Zubin Mehta, maestro of the Israel Philharmonic Orchestra,
weighed in on Rich's behalf.
Quinn and his team collected letters attesting to Rich's generous
contributions. With cany sleight of hand, in some cases the team
neglected to mention that the letters would be included in a
thick book to be sent to the White House to help seek a pardon.
Shulamit Aloni, a former culture minister, said she knew nothing
about Rich, even though his charitable foundations routinely
funded her pet projects involving the opera, theater and women's
rights. She said she was asked by a Rich representative to write
about "all the beautiful things" his foundations had done.
"If I knew the letter was going to be used this way," she said,
"I would have forbidden it."
Barak's support was knowing and fulsome. He telephoned Clinton
and spoke effectively on Rich's behalf. Afterward, Clinton
acknowledged to Geraldo Rivera, host of CNBC's "Rivera Live,"
just how effective the support from Israel had been.
"Israel," he declared, "did influence me profoundly."
Quinn engaged in another sleight of hand. When he forwarded
Rich's formal request for a pardon, he bypassed the Justice
Department and sent it straight to the White House. A Justice
Department review is not required--but is considered standard
practice.
Rich's lawyers were dogged. E-mails churned across the Atlantic
at a furious pace, from Quinn and Rich's other advocates in the
United States to Avner Azulay, managing director of his
foundation in Israel. A former senior agent with Israel's
intelligence agency, the Mossad, Azulay was well connected.
His involvement, along with that of Shabtai Shavit, a former head
of the Mossad, who supported Rich's pardon, raised speculation
that Rich had aided the Mossad at some invisible point in his
past.
Azulay stayed in daily contact with Rich by phone and mail.
They met once a month, usually in Switzerland. Rich visited
Israel only once a year. He stayed at the plush King David Hotel
because he had no residence there.
"Would it still be useful to have another VIP place an additional
call to Potus [the president of the United States] to support the
petition?"
Azulay e-mailed on Dec. 19. "I could try asking the Speaker of
the Kensset (Parlement) [sic] Avram Burg who was the guest
speaker at the Marc Rich Annual Seminar which opened tonight."
The strategy debate intensified.
Could they somehow approach Giuliani about the case? Bad idea.
Other names were tossed about. Sen. Charles E. Schumer
(D-N.Y.).
Presidential advisor Vernon E. Jordan Jr. Nobel Prize winner
and Holocaust survivor Eli Wiesel. The attorneys contacted some;
others they let slide.
Wiesel, for instance, said he was contacted but declined to help.
"Wonder if you can inquire whether there is a possibility of
persuading Mrs. Rabin to make a call to POTUS," attorney Robert
Fink e-mailed Azulay on Dec. 30, regarding slain Israeli prime
minister Yitzhak Rabin's wife.
"Bob, having Leah Rabin call is not a bad idea," Azulay replied
the next day. "The problem is how do we contact her? She died
last November--on the 5th anniversary of her husband's murder."
--- Quinn prepared the presentation book of accolades and
support. It was thicker than a big-city phone book. He laid out
the legal framework for Rich's appeal in a carefully crafted
letter to Clinton with supporting documents--a package that
former prosecutors in New York would describe as fiction.
It went to the White House.
Fink told Azulay in a Jan. 2 e-mail that the team needed to find
a rabbi in the White House counsel's office to shepherd the
package.
"I don't understand this comment about the rabbi," Azulay said in
reply. "Our book is full of rabbis."
So Fink explained. "By rabbi, I meant someone who is in favor of
the pardon and working for it to be granted. Sorry about the
lack of clarity, it is just common usage here." Quinn still held
out hope for a rabbi in the Justice Department as well--perhaps
Holder, the Reno deputy whom he had approached earlier about
setting up a meeting with White, the U.S. attorney in New York.
In early January, he sent Holder a copy of his request to Clinton
for a pardon, along with a short but telling note. "I hope you
can say you agree with this letter. Your saying positive things,
I'm told, would make this happen."
Quinn also spoke with Beth Nolan, who now held his old job as
White House counsel. He argued that Rich was not really a
fugitive because he already had gone to Switzerland before his
indictment was handed up and had simply never returned.
"She responded that this is still a tough case--that the
perception will nevertheless be that MR [Marc Rich] is in some
'sense' a fugitive," according to an e-mail circulated among
Rich's lawyers.
Quinn left it to Rich's ex-wife, Denise, to write a
tug-at-the-heart letter directly to Clinton. Deftly, it also
appealed to Clinton's sense of being unjustly prosecuted during
his impeachment.
"I am writing as a friend and an admirer of yours to add my voice
to the chorus of those who urge you to grant my former husband,
Marc Rich, a pardon for the offenses unjustly alleged and so
aggressively pursued," she wrote. There was no mention of
political contributions. She focused on "the pain and suffering"
the case had caused.
"Exile for 17 years is enough," she wrote.
By Jan. 1, barely three weeks were left in Clinton's presidency.
If word got out now, the pardon might be doomed.
Secrecy became paramount.
The lawyers fretted about rumors that the Securities and Exchange
Commission had heard about the pardon request.
By Jan. 9, only 11 days were left. "I think we've benefited
from being under the press radar," Quinn e-mailed his fellow
lawyers, hoping for the best.
The next day, the Rich team heard about a significant
development.
The word came from Denise Rich, who was in Aspen, Colo., with her
friend Beth Dozoretz. A fellow socialite, Dozoretz was finance
chairwoman of the Democratic National Committee in 1999 and
raised millions of dollars for Clinton's party. It was Dozoretz
who had persuaded Denise Rich to contribute to the Clinton
library.
Aware that she was a good friend of the Clintons, Quinn had
encouraged Dozoretz to make sure the president knew that Rich's
petition for a pardon had been sent to the White House. Quinn
said she had done so, then talked to the president about it
again. Now Denise Rich was reporting the results of that
conversation to Azulay in Israel, and he was e-mailing Quinn in
Washington:
Clinton had "said he was impressed by [Quinn's] letter and that
he wants to do it and is doing all possible to turn around the WH
[White House] counsels." Later Dozoretz reportedly denied the
reference to White House lawyers. --- Was it a done deal?
Not quite.
Less than a week later, on Jan. 16, Quinn e-mailed his team that
"it would be useful if [Denise Rich] made another call to P [the
president].
He offered talking points.
"Message shd [sic] be simple: 'I'm not calling to argue the
merits.
Jack [Quinn] has done that and we believe a pardon is defensible
and justified. I'm calling to impress upon you that MR [Marc
Rich] and our whole family has paid a dear price over 18 years
for a prosecution that shd never have been brought."
On Jan. 18, two days before Clinton left office, Quinn wrote him
a last, hand-delivered letter to "clarify" two potential
obstacles to a deal and "propose a potential solution to any
concerns you might have."
First, Quinn repeated his mantra that Rich was not a
fugitive--and thus his pardon would not be setting "an unwise
precedent" for other fugitives abroad.
Second, he said that, while a pardon would end the criminal cases
against Rich and Pincus Green, his partner, they were fully
prepared to accept any civil liabilities arising from U.S.
policy violations.
Now the phone calls and e-mails were frenetic.
Holder, the deputy attorney general, got a call from Beth Nolan,
the White House counsel, wanting to know where he stood on the
pardon.
Holder was preoccupied with a host of eleventh-hour issues,
including security for the next day's inauguration.
"Neutral, leaning toward favorable," he told her.
He was struck by the fact that such foreign policy heavyweights
as Barak had weighed in on Rich's behalf--and if it would help
American relations with Israel, he would not object. "In
hindsight," he later told Congress, "obviously some bells should
have gone off, some lights should have gone on. . . . I wish
there were things I would have done differently."
Quinn had a final telephone conversation with Clinton on the
matter.
They spoke on the night of Jan. 19.
"I could tell that President Clinton had obviously read and
studied the pardon petition," Quinn told Congress. "He grasped
the essence of my argument about this case being one that should
have been handled civilly, not criminally, and he discussed with
me whether the passage of time would permit
statute-of-limitations defenses in such a criminal proceeding.
"I told him that I would happily give him a letter waiving those
defenses, and he insisted that I provide one to him within the
hour."
Quinn did.
It was after midnight on Jan. 20--the day Clinton would
relinquish office, and Roger Adams, the Justice Department pardon
attorney, who usually reviews all clemency requests, got an
unusual phone call from the White House counsel's office. It had
more names of people being considered for pardons.
Marc Rich and Pincus Green were on the list, but it did not say
who they were. "There would be little information about the two
men," Adams said the White House told him, "because they had been
'living abroad' for several years."
Only as his staff began their research did Adams discover what
this meant: Rich and Green were wanted fugitives.
Adams said he called Holder at home to alert him, and Holder said
he was familiar with the matter.
It was too late.
In the morning, Clinton released his pardon list. Buried among
the 176 names of those whose crimes were forgiven or whose
sentences were commuted were Rich and his partner, Green. ---
Lichtblau reported from Washington and Maharaj from Jerusalem.
Times researchers Janet Lundblad and Penny Love assisted with
this story.
=================================================================
Kadosh, Kadosh, Kadosh, YHVH, TZEVAOT
FROM THE DESK OF:
*Michael Spitzer* <[EMAIL PROTECTED]>
~~~~~~~~~~~~~~~
The Best Way To Destroy Enemies Is To Change Them To Friends
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