A Fugitive's Secret Talks With the Feds
Marc Rich's elaborate attempts to cut a deal
Like a back-roads minstrel show, the Clinton pardon saga just keeps rolling along. Last week, there were new donor records from the Clinton library foundation, testimony from a few more Clinton aides, and some innuendoes about the lengths Marc Rich's ex-wife might have gone to in trying to win the fugitive financier a pardon for his tax-and-racketeering beef with the feds. A newly released E-mail message from Rich aide Avner Azulay suggested that Denise Rich embark on a "personal mission to No. 1 with a well-prepared script."
But a part of the script that has gotten little attention is Rich's secret efforts over many years to resolve the criminal complaint against him through a series of meetings with federal prosecutors. Former White House Counsel Jack Quinn has testified that New York prosecutors had refused to give Rich a fair hearing for more than a decade. But U.S. News has learned that federal prosecutors engaged in lengthy negotiations with Rich's lawyers, even meeting with Rich and his partner, Pincus Green, at the elegant Hotel Dolder Waldhaus in Switzerland in the summer of 1992. According to a former prosecutor, the talks collapsed when Rich and Green demanded that no jail time be included in any deal. The meeting shows that once Rich fled the country after his indictment in 1983, his lawyers were, as the former prosecutor put it, "hot and heavy to settle the case."
Snitching. Rich's attorneys also came up with a bizarre scheme to ingratiate themselves with the New York prosecutors, law-enforcement sources told U.S. News. In the summer of 1991, Rich's lawyers told Richard Bennett, the U.S. attorney in Baltimore, that their client would be willing to help arrange for the arrest of another fugitive, Tom J. Billman, in exchange for a favorable word on their client's behalf to the prosecutors in New York. Billman was wanted for bilking a Maryland savings and loan of $25 million during the 1980s. Bennett, now in private practice, said he wondered: "I'm not really sure how it works, one fugitive giving information as to another." But he said he told the lawyers, "Certainly, if Rich can find Billman, I'd be happy to tell the authorities that Rich had assisted."
In November 1991, Bennett's assistant, Joyce McDonald, called the U.S. attorney in New York, Otto Obermaier, and relayed the offer. Bennett says he even wrote a letter to Obermaier confirming Rich's role in the Billman case, to be used in the event of Rich's capture and trial.
Rich then hired detectives from Investigative Group International to track Billman down. He also employed Azulay, then his Israeli chief of security, in the manhunt. Sources say that two of Rich's attorneys came to Obermaier in February 1992. The lawyers said their client had made efforts to help capture Billman at the government's request and was "hot on Billman's trail." They asked Obermaier if he would consider a joint plea bargain that would protect Rich and Green from any jail time. The lawyers said "money could be part of any package," says a former prosecutor. And the lawyers also raised the possibility that a strike at the Ravenswood Aluminum plant in West Virginia, owned in part by Marc Rich, "could be made to go away."
Obermaier balked at any deal that didn't include jail time, yet he didn't shut the door completely. He told Rich's attorneys that "bringing Billman in would be a plus, but he didn't want them to think it would be a big plus," according to this prosecutorial source. Investigators at the U.S. Marshals Service, charged with catching Rich, were outraged at the Rich offer. Says one former investigator, "Rich's lawyers were offering to trade a queen for a pawn." Billman was captured by the marshals in 1993--without Rich's help, officials insist. He is serving a 30-year sentence.
The Billman case wasn't the only time the United States dealt with Rich while he was in exile in Switzerland. In 1989, Rich contributed $400,000 to a legal settlement paid to victims of the Ras Burqa incident, a 1985 shooting of Israeli tourists by an Egyptian policeman. The State Department got involved in the matter since one of the victims, 6-year-old Tali Griffel, was a U.S. citizen. Griffel's lawyer, Leonard Garment, who was also representing Rich, arranged for him to donate some of his fortune to supplement the settlement offered by the Egyptian government. Despite internal debate within the State Department about whether to accept money from the fugitive, officials decided to go ahead. According to Abe Sofaer, then a State Department legal adviser, "We saw no impropriety to having Marc Rich contribute to the settlement."
With Gary Cohen
This story appears in the March 12, 2001 print edition of U.S. News & World Report.