The PARDON

“The president had obviously read and studied the petition,” Quinn told me. He excused himself from the dinner table and made his way to an empty room. He and the president knew each other well, as Quinn had served as Clinton’s White House counsel. The conversation lasted around twenty minutes. “It was a good, thorough discussion that was entirely about the merits [of the pardon], not about the politics,” Quinn remembers. As he listened to the president speak, the words seemed to course through him like a jolt of electricity. “I persuaded the president,” he thought. “I persuaded the president that this was a case that should have been handled civilly rather than criminally.” On that evening it was clear that Clinton was seriously considering pardoning Rich and Green. However, the president had one precondition, and that was why he had called Quinn. Rich and Green would have to agree to face a civil hearing and waive their rights to avail themselves of the statute of limitations. Quinn immediately accepted the president’s terms. Clinton wanted to have a written waiver “within one hour.”

Quinn looked at his watch. It was 9:30 P.M. He immediately called Robert Fink, Rich’s lawyer in New York, explained the situation, and asked him to write up a waiver for Rich and Green in accordance with the president’s request. Fink was surprised. He had no longer expected a presidential pardon to come through. “We had no indication,” Fink later told me. He immediately sat down at the table and typed up a waiver declaration for the president on his wife’s laptop. About thirty minutes later, Fink unplugged the laptop so that he could go into the next room and print the document. The screen immediately went black. Fink had not known that his wife had removed the battery from her laptop.

“Oh my God,” Fink exclaimed. “I lost it.” He had not even bothered to save the document. He hurriedly plugged in the laptop, rebooted, and began typing a much shorter letter. The hour that the president had given him had nearly run out. Fink printed the waiver and reread what he had written. “Specifically they will not raise the statute of limitations or any other defenses which arose as a result of their absense.” A spelling mistake! Fink had written “absense” instead of “absence.” There was no longer any time to correct the mistake—a fact that still bothers him to this day. He faxed the letter as quickly as possible and nervously awaited the transmission confirmation. Nothing happened. He faxed the letter again, and this time the fax went through. Fink took a deep breath. Marc Rich had nearly missed his opportunity for a presidential pardon because of something as mundane as a missing laptop battery.

“Nothing else can go wrong,” Fink thought to himself and went to bed. At 2:00 A.M. he got a second call from Quinn. Beth Nolan, Clinton’s White House counsel, had asked him if Rich had been involved in arms trading, as claimed by the FBI’s National Crime Information Center. The president wanted to know if the information was correct. Fink waved the idea aside and told Quinn, “No way. Rich wouldn’t know a bazooka from a BB gun.” Quinn called Beth Nolan back and told her that none of Rich’s lawyers had ever heard of any “arms trading charges.” Such accusations, he added, were nothing more than rumors that had first appeared in, of all places, Playboy.¹ After Nolan informed the president of the conversation, Clinton replied, “Take Jack’s word.” On the morning of January 20, 2001, President Bill Clinton granted Marc Rich and Pincus Green “a full and unconditional pardon.”

The Furor

Marc Rich was asleep in his Villa Rose in Meggen on the banks of Lake Lucerne when the telephone began to ring. It was Saturday, January 20, around 11:00 P.M. in Switzerland, 5:00 P.M. in Washington, D.C. Rich looked at his gold Rolex. “Who could that be?” he thought to himself. Robert Fink had news that would excuse his calling at such a late hour. “I bring very good news, Marc. President Clinton pardoned you,” Fink told him. It took a moment for Rich to realize what exactly Fink had just said. After seventeen years as a fugitive and life in exile, after seventeen years of pursuit by federal prosecutors, Rich was a free man. “I was extremely pleased,” Rich said to me. “Nobody had actually expected that.” I wanted to know what he had done to celebrate on that evening. “I didn’t celebrate,” he answered. “I went back to sleep.”

At about the same time, Sandy Weinberg was sitting in front of the television in his Tampa home halfheartedly watching the inauguration of George W. Bush in the middle of a Washington downpour. Weinberg, who as an assistant U.S. attorney had led Rich’s investigation, was a dyed-in-the-wool Democrat. He had actively supported Al Gore’s candidacy, and he was deeply frustrated over the election recount fiasco in his home state of Florida. He was in an even worse mood after he received a call from Michael Isikoff, a reporter for Newsweek. “Hi, Sandy. What do you think of the pardon?” the reporter asked. “Michael Milken got pardoned?” Weinberg asked with little sign of interest. “No, Marc Rich,” Isikoff answered. “I uttered a vulgarity,” Weinberg tells me. “ ‘This is outrageous,’ I thought. ‘This is just outrageous.’ ” In a staccato voice—one, two, three, four—he proceeds to list the four points that from his point of view made it impossible for the president to pardon Rich. “One, it was the biggest tax fraud. Two, he was a fugitive. Three, he renounced citizenship in order to avoid extradition. Four, he traded with the enemy Iran. You cannot pardon a person like that,” Weinberg says.

News of Rich’s pardon spread among politicians, journalists, and judicial officials. Their reactions were unanimously negative. Rich’s case had once more taken on “historic” proportions. According to an article in the conservative National Review, the pardon was “one of the most disgraceful chapters in the history of the Justice Department. Not the modern history, the entire history.”² For William Safire, a Pulitzer Prize–winning columnist for the New York Times, the pardon was “the most flagrant abuse of the presidential pardon in U.S. history.”³Vanity Fair even ventured to suggest that the pardon “may have damaged President Clinton’s reputation forever.”⁴ Those who were involved in Rich’s case were particularly disgruntled with the pardon. Rudy Giuliani was “flabbergasted.” “It took me about a day to actually absorb the fact that the President of the United States actually pardoned one of our most notorious fugitives,” he said. Howard Safir said he was “outraged because this sends a message to the criminals around the world that if you have influence, if you have money, and if you have access, you can put out a sign that says ‘Justice for Sale.’ ”⁵

Organizing a Pardon

Safir was right on one point. Access to the president was a decisive factor in Rich’s pardon. It was not only about getting the president’s ear but also about explaining Rich’s side of the story. The idea of seeking a presidential pardon first came up in early 2000, after U.S. Attorney Mary Jo White had again informed Rich’s lawyers that it was the “firm policy” of the Southern District of New York “not to negotiate dispositions of criminal charges with fugitives” (see chapter 13). Quinn told me that at that time he almost took the refusal as an affront. “It was like—you know—drop dead.” All attempts to have the case legally reassessed were thus doomed to failure.

“Why not try a pardon at the end of the Clinton term?” Michael Steinhardt first came up with the idea. Avner Azulay liked it. “What are the chances?” he asked Rich’s lawyers. Azulay remembers how they all just shook their heads. “Five percent, they said.” He then asked, “Do we have a five percent chance with another solution?” The lawyers were silent. “Then let’s go with the five percent,” Azulay said.

Rich agreed and gave his permission to seek a pardon. “I kept looking for solutions. I kept trying and nothing succeeded, so the pardon seemed to be a solution,” Rich told me. According to Azulay, one of Rich’s most trusted employees, the system was “blocked.” “The best lawyers created the biggest mess. They just created more aversion. Eventually, the thing developed into a legal monster. It became a political case,” Azulay explained. “There was no legal solution. That’s why it needed a political solution—an unconventional one.”

The Israeli Avner Azulay and the American Jack Quinn were the masterminds behind the application for a presidential pardon. They quickly put together a two-pronged strategy that—at least internally—was described as an “avenue of last resort.” One aspect was based on the facts; the second was personal in nature. Quinn would take care of the legal issues, write the petition, and present it to the president. Azulay would be responsible for the personal networking and would try to find as many dignitaries as possible who were willing to put in a good word for Rich and Green.

It is no stretch to say that without Quinn’s involvement, Clinton would never have pardoned Rich. Quinn had more contacts in Washington than almost anyone else—and he had a direct line to the president as a holdover from his days as Clinton’s White House counsel from 1995 to 1997. Prior to taking on his position in the White House, Quinn was Vice President Al Gore’s chief of staff—a position that made him Gore’s most important adviser. After leaving the Clinton administration, Quinn founded a public relations firm in Washington, D.C., and in late July 1999 Rich hired Quinn’s company to represent him. Quinn had been recommended to Rich by Gershon Kekst, the well-known New York communications consultant. Michael Steinhardt had asked his friend Kekst to see what he could do to help with Rich’s case. During our interview in his Madison Avenue office in Manhattan, I asked Steinhardt why he had been willing to help. “Over all these years Marc has never publicly defended himself against the most fallacious and terrible rumors. He never used the power of his wealth to carve his image,” Steinhardt explained. Kekst visited Rich in Switzerland and returned with a piece of advice for Steinhardt. “Marc should hire Jack Quinn,” he said. As would soon become clear, Quinn was an excellent choice and well worth the retainer of 55,000 per month his law firm was paid for some time.

Crucial Discretion

Avner Azulay, the second mastermind behind the pardon application, was a gifted negotiator and strategist with high-ranking contacts in Israel’s political establishment. The former Mossad officer, who had been responsible for Rich’s personal security and later went on to direct Rich’s humanitarian foundations in Israel, was the one who came up with the plan to directly petition the president for Rich’s pardon.

According to the Department of Justice, a presidential pardon is usually obtained in the following manner.⁶ The petition is first submitted to a special pardon attorney at the Department of Justice, who, after an initial examination, passes it on to the associate attorney general—the number three in the department—for further consideration. The attorney general then advises the president as to whether he should accept or refuse the petition. Rich’s lawyers had intended to follow this path in petitioning for Rich’s pardon. Azulay, however, had a fine nose for political and bureaucratic realities, something he had developed while working for Israel’s intelligence service. He recognized the risk in the lawyers’ plan. “If we do this, the story would immediately explode in the media,” Azulay told Rich’s lawyers. He advised, “We have to bypass the bureaucratic channel.” Rich had a bad reputation, and many even considered him “the biggest devil,” as Rich himself says. If it were to become widely known that he was seeking a presidential pardon, his people could no longer control what would happen next.

Rich’s lawyers decided that it was legally possible to go around the Department of Justice and take their petition directly to the president. “The pardon attorney doesn’t like it, the attorney general doesn’t like it, but it is legal,” they said. In late October 2000, only three months before Clinton’s final day in the White House, Rich’s lawyers made the definite decision to take this avenue of last resort. “I tell you we didn’t have a sophisticated plan. It was rather a cowboy mission,” Azulay assured me. Rich’s legal team, including the experienced New York attorney Bob Fink, began to put together a petition. Discretion was of the utmost importance. “We tried to keep a low profile,” Fink told me. “I was concerned that the petition would become public. If it did the press would start to attack.”

Rich’s team was able to keep its efforts out of the media spotlight. In late November the two-inch-thick petition was finally ready. Jack Quinn sent it to “the Honorable William Jefferson Clinton, President of the United States” on December 11. It contained a legal argument combined with a personal and emotional appeal. The legal argument maintained that Rich and Green had been “wrongfully indicted” and “unfairly singled out.”⁷ “This case was grossly overprosecuted,” Quinn emphasized during our telephone interview. All comparable cases in the past, he said, had been tried in civil instead of criminal courts. It was the same argument that Rich’s various lawyers had unsuccessfully made over the last sixteen years in order to come to some sort of arrangement with the Southern District of New York (see chapters 10 and 13).

Avner Azulay was responsible for the personal and emotional aspect of the petition, and his efforts to this effect were quite impressive. According to the first lines of the petition, “Mr. Rich and Mr. Green are extraordinary businessmen and philanthropists who have lived exemplary lives since the alleged offenses.” Rich’s charitable foundations had donated “over 100 million dollars to charitable, cultural and civic organizations.”⁸ Attached to the petition were letters from dozens of prominent figures offering testimony of Rich’s generosity. The petition was supported by several prominent Israelis, including Prime Minister Ehud Barak, Nobel Prize winner Shimon Peres, Foreign Minister Shlomo Ben-Ami, former director general of the Mossad Shabtai Shavit, mayor of Jerusalem (and later prime minister) Ehud Olmert, and several other Israeli and Jewish dignitaries such as Anti-Defamation League national director Abraham Foxman and U.S. Holocaust Memorial Museum Council chairman Rabbi Irving Greenberg. From Switzerland came letters from the well-known art collector Ernst Beyeler, Zurich mayor Josef Estermann, and top UBS banker Pierre de Weck. King Juan Carlos of Spain also put in a good word for his countryman Rich and in the process offered a form of official recognition for the important services that Rich had provided for Spain in the 1960s and 1970s (see chapter 6).

Ehud Barak’s Support

Azulay’s greatest tactical masterstroke was that he had been able to convince Ehud Barak to personally lobby President Clinton on Rich’s behalf. The timing could not have been better. On December 11—the same day that Clinton received Rich’s petition—Barak made a telephone call to the White House. According to the White House transcript, the call was made at 6:16 P.M. and lasted exactly nineteen minutes.⁹

“One last remark,” Barak said to President Clinton. “There is an American Jewish businessman living in Switzerland and making a lot of philanthropic contributions to Israeli institutions and activities like education, and he is a man called Marc Rich. He violated certain rules of the game in the United States and is living abroad. I just wanted to let you know that here he is highly appreciated for his support of so many philanthropic institutions and funds, and that if I can, I would like to make my recommendation to consider his case.”

Clinton responded, “I know about that case because I know his ex-wife. She wants to help him, too. If your ex-wife wants to help you, that’s good.”

“Oh,” Barak said. “I know his new wife only, an Italian woman, very young. Okay. So, Mr. President, thank you very much. We will be in touch.”

Azulay had known Ehud Barak well for quite some time. They had served in the same unit together—the Aman, Israel’s Directorate of Military Intelligence, which Barak had directed from 1983 to 1985. Barak, Israel’s most highly decorated soldier, was active in Lebanon at the same time as Azulay. In November 2000 Azulay asked Barak for his support in obtaining Rich’s pardon. “Ehud Barak knew this was an honest request and that I would not lie to him or ask or do anything which would compromise him,” Azulay explained. The former Mossad officer told Barak that Rich had supplied Israel with oil in its most difficult times (see chapter 8) and was thus of great importance to Israel’s national security. Azulay also explained how Rich had helped the Mossad (see chapter 15). After Barak had verified this information with the Mossad, he told Azulay, “This man had done nothing but good for this country. Why should I not support him?”

Financier of the Peace Process

Azulay proceeded in a similar manner with Shimon Peres, the former prime minister and foreign minister. He asked Peres to give President Clinton a call. “You remember,” Azulay reminded Peres, “you asked us for Marc Rich’s help in the peace process.” He was referring to the Oslo Accords of 1993–94, which had offered a major breakthrough in relations between Israel and the Palestinians when both parties agreed to officially recognize one another for the first time. The accords also envisaged a plan for Palestinian self-government. During the negotiation process, Peres approached Azulay, who at that time was already serving as the managing director of the philanthropic Marc Rich Foundation. Thanks to his work with the Mossad, Azulay was personally acquainted with both the Israeli and Palestinian participants. “Peres asked me, ‘What can you do to help this process?’ ” Azulay explained.

Azulay informed him that Rich had come up with the idea of financing a Palestinian investment bank in order to speed up the economic development of the Palestinian areas. He also suggested developing the border area shared by Israel, Jordan, and the Palestinian West Bank for tourism. Azulay discussed these plans in Jerusalem and Ramallah with the Palestinian economic expert Ahmed Qurei (who would later serve as “prime minister” of the Palestinian Authority). A group of Palestinians, including an economic adviser for Yasser Arafat, traveled to Zug to meet with Rich in 1994, a meeting that until now has remained a secret. “We discussed how Marc could help them,” Azulay said. A further suggestion was made that Rich assist in training programs for the Palestinian Authority. Rich was prepared to invest 1 million to help train executive members of staff in the areas of education and social welfare.

“I was willing to do anything they needed,” Rich told me. “ ‘Define your needs,’ I urged the Palestinians, ‘come back to me, and tell me what I can do.’ ” Yet he waited in vain for concrete suggestions to make their way back to him. He heard nothing more from the Palestinians, who in the meantime had succumbed to a bitter internal power struggle. Thus the Marc Rich Foundation developed its own series of plans for various projects, mainly in the area of establishing a public administration service to manage the international funds and donations as well as health services, which the foundation would later finance to the tune of several million dollars in cooperation with the World Bank.

It was these projects that prompted Foreign Minister Shlomo Ben-Ami to intercede on Rich’s behalf. Ben-Ami wrote a letter on official Foreign Ministry paper to President Clinton, stating that Rich’s foundation “was among the first private entities to support the Oslo Accords by sponsoring education and health programs in Gaza and the West Bank in cooperation with the Palestinian Authority. Many of these projects of people to people between Israelis and Palestinians would not have been possible without Marc Rich’s generous involvement.”¹⁰ Sidney Blumenthal, President Clinton’s brilliant senior adviser, was not far from the truth when he wrote in his book The Clinton Wars, “In short, Rich was a financier of the peace process.”¹¹

Azulay reminded Shimon Peres of this fact in December 2000. Peres played a central role in the Oslo Accords, and for his efforts he shared a Nobel Peace Prize with Yitzhak Rabin and Yasser Arafat. “If you could just say a few good words about the character of this man,” Azulay asked Peres. “Say that he is not the devil that he is painted to be in the media.” Peres did not have to think twice about putting in a good word for Rich. He had already lobbied the U.S. government on Rich’s behalf in the mid-1990s. He was enthusiastic about the idea of Israeli and Palestinian economic cooperation and wanted Rich to be able to move about more freely without running the risk of arrest.

So Peres called Clinton on the same day as Ehud Barak. It was December 11, 2000—the day that Clinton received the petition for Rich’s pardon. Peres also asked the president to pardon Rich and extricate him from the legal impasse his case had reached. According to an e-mail from Azulay to Jack Quinn, President Clinton “took note of his intervention.”¹² Rich’s importance to Israeli politicians is further illustrated by the fact that Barak spoke to Clinton about a possible pardon on two additional occasions.¹³ In a telephone call of January 8, 2001, Barak again stressed Rich’s importance to Israel’s security: “He helped Mossad on more than one case.” “It’s a bizarre case, and I am working on it,” Clinton answered. “I really appreciate it,” Barak said. On January 19, 2001, the same day that President Clinton finally attended to the presidential pardons, Barak called again and asked, “Might it move forward?” “I’m glad you asked me about that,” Clinton answered. “The question is not whether he should get [the pardon] or not but whether he should get it without coming back here.”

“He just told the truth,” Rich said when I asked him about Barak’s support. “He knew about me. I’ve met him. We talked about my case, and he knew I was a positive element for Israel. They appreciated what I was doing for and in Israel, so he decided to be positive.”

The Role of Denise Rich

As soon as the pardon had been made public, the media began their descent on a single individual: Denise Rich. She was the perfect subject for a story. She was a member of the international jet set who was worth hundreds of millions of dollars and owned a luxurious penthouse on Manhattan’s Fifth Avenue, an extrovert socialite who had once flooded her penthouse terrace to form an ice rink for one of her fabulous parties. She was a successful songwriter known throughout the music industry. She was also a woman who was prepared to stand up for her ex-husband, even though he had left her for another woman.

Denise’s involvement in Marc Rich’s pardon was particularly scandalous as she was one of the biggest and most loyal supporters of the Democratic Party, to which she had donated more than 1.1 million since 1992. The list of leading Democratic politicians whose campaigns she had supported reads like a roster of the U.S. Senate. Geraldine Ferraro, Edward Kennedy, Tom Harkin, Barbara Boxer, Charles Schumer, and Barbara Mikulski all received donations from Denise Rich. She was particularly close to Bill and Hillary Clinton, whose election campaigns she helped finance, and she donated 450,000 to Bill Clinton’s presidential library in Little Rock, Arkansas. Politicians and members of the media soon began to voice the opinion that Marc Rich’s ex-wife had managed to “buy” her ex-husband’s pardon.

The House Government Reform Committee, which was tasked with investigating the circumstances surrounding Rich’s pardon, described Denise as a “key figure in the effort to obtain a pardon.”¹⁴ In truth, Denise did enjoy a special relationship to the president as a result of her generous donations. During the Clinton administration, she visited the White House on no fewer than nineteen occasions, and President Clinton once even described her as one of his “closest friends.”¹⁵ In 1998, when the president appeared in public for the first time after the publication of independent counsel Kenneth Starr’s report on the Monica Lewinsky affair, it was at an event held in Denise’s penthouse. Clinton also appeared as a speaker at a fund-raiser for the G&P Foundation, a cancer research organization Denise founded after Gabrielle’s death. (The G stands for Gabrielle and the P for Philip, Gabrielle’s husband.)

A letter from Denise Rich dated December 6 was the first personal letter attached to the pardon petition. “I am writing as a friend and an admirer of yours,” Denise wrote to the president. “I support this application with all my heart.” Her letter, which Jack Quinn helped write, was a masterpiece. It appealed to the president’s emotions while referring to Clinton’s own bad experiences with aggressive prosecutors.

The pain and suffering caused by that unjust indictment battered more than my husband—it struck his daughters and me. We have lived with it for so many years. We live with it now. There is no reason why it should have gone on so long. Exile for seventeen years is enough. So much of what has been said about Marc as a result of the indictment and exile is just plain wrong, yet it has continued to damage Marc and his family. . . .

Because of the indictment, I have seen what happens when charges are falsely—even if just incorrectly—made against those closest to you, and what it feels like to see the press try and convict the accused without regard for the truth. I know the immense frustration that comes when the prosecutors will not discuss their charges, and when no one will look at the facts in a fair way. My husband and I could not return to the United Sates [sic] because, while the charges were untrue, no one would listen—all the prosecutors appeared to think about was the prospect of imprisoning Marc for the rest of his life. With a life sentence at stake, and press and media fueled by the US Attorney, we felt he had no choice but to remain out of the country.¹⁶

One week after President Clinton received the petition for Rich’s pardon, Denise also spoke directly to the president about the issue. On December 20 she was a guest at a dinner in Washington to honor the winners of the National Medal of Arts and the National Humanities Medal. During a quiet moment, Denise pulled the president to one side and told him that the pardon “would mean a lot to me.”¹⁷

It was rather surprising that Denise should make such an effort to stand up for her ex-husband. Her relationship to Marc Rich was virtually nonexistent at that point. The two had not spoken—let alone seen one another—for years after their bitter and nasty divorce. Denise not only resented the fact that he had left her for a younger woman, she also felt that Rich had wronged her financially. She still believed that he had cheated her by not matching the 40 million that she had contributed to the charitable foundation they had founded together in 1988—even though her claims were rejected by a Swiss court (see chapter 16). She was so angry with her ex-husband that she even made a financial contribution of 1,000 to the campaign of Rich’s nemesis, Rudolph W. Giuliani.

It had been Avner Azulay’s idea to include Denise Rich in Operation Avenue of Last Resort. He visited her in November 2000 and asked for her support. “He screwed me. He owes me money,” Denise replied. “I want the money he owes me for the foundation—40 million.” Azulay was shocked. He knew that Marc and Denise did not get along, but he had not expected such deep resentment. Azulay told Denise that it would look very strange if she, the mother of Rich’s children, did not stand up for her ex-husband. He promised her, “If you help us now, I will talk to Marc.” Only after a number of meetings and many long discussions did Denise finally agree to use her influence with the president to help her ex-husband.

What motivated Denise to throw her weight behind her ex-husband’s petition? I asked her this question during our conversation in her Manhattan penthouse. I was sitting next to her on a leather sofa taking notes and was having trouble keeping up with what she was saying. I could record our conversation if I liked, Denise said. “I have nothing to hide.” Danielle laughed and said, “That’s my mother. Everybody else is worried about themselves and she is worried about you.” Denise went on to explain that she had been willing to help because “my children asked me to support the pardon. They’re my children. How could I not?” Yes, but you had been so angry with him, I remarked. You had publicly accused him of destroying your family. Denise thought about this for a moment before saying, “Every divorce is bitter. He’s still the father of my children.” She then told me how Gabrielle’s death had changed her feelings about Marc Rich. “Gabrielle would have wanted that I forgive him. She would have wanted that I support him.”

A Delicate Financial Agreement

However, it is also true that Denise accepted Avner Azulay’s proposal to compensate her for the 40 million she thought Marc Rich owed her. According to an agreement, signed in January 2001 by all parties, shortly before President Clinton finally granted the pardon, Rich and Green would each contribute 500,000 per year to the G&P Foundation. (In order to prevent any possible misunderstandings, let me emphasize that Denise Rich herself was not the beneficiary, but rather the G&P Foundation was.) The foundation would use these funds to cooperate with the Gabrielle Rich Leukemia Research Centre at the Weizmann Institute of Science, which Marc Rich had established separately in Israel to support leukemia research. It was up to a committee of scientists designated by both sides to decide how the money could best be invested.

Denise acknowledged the existence of this agreement. “Gabrielle asked that we continue her foundation. It was my daughter’s last wish. She had started it, and she asked for it. She was working on her computer up until she died. I had asked [Marc Rich and Pincus Green] if they would help me, and they had said they would. It had nothing to do with the pardon.” In the wake of the public outrage that was sparked by Rich’s pardon, Denise decided to waive her right to her ex-husband’s money. “I didn’t want anything to hurt the foundation, so I decided to accept no money from them. I didn’t want the question of money to tarnish the foundation.” “She wanted it to be pure,” Danielle added.

It was certainly the right decision, as the outrage that followed in the wake of the pardon was tremendous. To this day, Denise Rich still finds herself caught up in the critics’ crossfire. The whole affair took on the stench of corruption as a result of Denise’s contributions to the Clintons’ and various other Democratic campaigns. Denise had to deny even more insidious charges on Barbara Walters’s ABC newsmagazine 20/20. “I never had a sexual relationship or anything else that’s improper,” Denise explained in her interview with Walters.

There was hardly a single journalist or politician who was prepared to believe that Rich’s pardon was completely aboveboard. Eight years later, Sandy Weinberg’s blood pressure still rises whenever he looks back on the affair. “They were circumventing the entire process. Nobody asked me about it. Nobody asked the Southern District about it. Not one person that had any knowledge about the case weighed in with the president. It’s a complete outrage.” I asked Weinberg if he believed corruption had played a role in the pardon. “I don’t want to speculate,” Weinberg told me. “I don’t know whether there was money involved, whether some corrupt purpose was involved. What I do know is that President Clinton was sold a bill of goods by Jack Quinn.”

Quinn was taken aback by the outrage he faced. “I considered myself astute politically, and I certainly considered President Clinton to be astute politically, but I think we were both surprised at the extent of the uproar that ensued.” I felt that the entire affair had made a much deeper impact on Quinn than he was prepared to admit in public, and I questioned him on this point during our interview. “It was among the most painful parts of my entire life,” Quinn confided to me. When I asked him what had bothered him most about the reaction to Rich’s pardon, Quinn answered, “Having my integrity questioned.”

The Role of Eric Holder

It was not only Bill Clinton, Jack Quinn, and Denise Rich who had to face public outrage over Rich’s pardon. Eric Holder soon found himself in the firing line as well. Holder served at the Department of Justice as deputy attorney general at the time of Rich’s pardon. He was considered a brilliant, independent, and thoughtful attorney who enjoyed a great amount of respect from both Democrats and Republicans. Quinn had met Holder while serving in the Clinton administration, and the two had been in contact ever since. Holder was one of the first people Quinn had approached regarding the Rich affair in November 1999—long before Michael Steinhardt first came up with the idea of applying for a presidential pardon. Quinn was still trying to convince the Southern District of New York to reevaluate Rich’s case. According to Quinn’s memos, Holder believed that the federal prosecutor’s refusal to meet with Rich’s lawyers was “ridiculous.” Shortly after their discussion, Quinn sent Holder a memorandum explaining his position. Holder replied that “we’re all sympathetic” and that the “equities [are] on your side.”¹⁸ However, Holder made it clear that he could not force the Southern District of New York to meet with Rich’s attorneys.

When Rich decided to petition for a presidential pardon in the late fall of 2000, Quinn asked Holder for advice as to how he should proceed. “Deputy Attorney General Holder advised that it should be submitted directly to the White House,” André A. Wicki, Rich’s attorney in Switzerland, told me. Holder would play a crucial role in Rich’s pardon on January 19, 2001—one day before Clinton would leave office—when he received a call from White House Counsel Beth Nolan. She wanted to know Holder’s position on a possible Rich pardon. When he was later called before the House Government Reform Committee hearings on February 8, 2001, Holder informed the assembled committee members of his opinion. “I ultimately told Ms. Nolan that I was now neutral, leaning toward favorable, if there were foreign policy benefits that would be reaped by granting the pardon.”¹⁹ In his testimony, Holder told the committee that it was Prime Minister Ehud Barak’s call to the president that had swayed him. He later claimed that he had been unaware that he was the only Justice Department official whose opinion President Clinton had sought while considering Rich’s pardon. The deputy attorney general did not seem to have been aware of the importance the president placed on his opinion. Nevertheless, many observers believed that Holder’s involvement in the affair spelled the end of his career in public service, and Holder seemed inclined to agree with them. He claimed he wanted to “climb into bed and pull the covers up over my head. I’m done. Public life is over for me.”²⁰ In the end Holder was accused of acting in his own interest. It was claimed that he was seeking the position of attorney general in a possible Al Gore administration and that he had been trying to seek the favor of Jack Quinn, Gore’s former chief of staff. (Holder was appointed attorney general by President Barack Obama in 2009.)

As a result of the tremendous public outrage, the Rich pardon was subject to an unprecedented amount of scrutiny. The powerful House Committee on Government Reform initiated an investigation and held hearings in spring 2001 to determine what had actually transpired and eventually published two reports consisting of over 1,500 pages.²¹ Hearings were also held by the Senate Judiciary Committee, and the Justice Department’s Southern District of New York even saw fit to open a criminal investigation. All of the accusations were thoroughly reexamined. Had corruption played a role? Had Denise Rich “bought” her ex-husband’s pardon? Was Marc Rich the true source of the money Denise had donated to the Clintons and the Democratic Party? Did Rich pay Denise for her support? Was Rich an arms dealer? Was Jack Quinn guilty of ethical misconduct? Did Clinton break the law by pardoning Rich?

Instead of the mountain they had hoped for, investigators were left with a molehill. The hearings determined that several White House advisers—including Beth Nolan—had in fact advised Clinton against issuing the pardon. Despite the combined efforts of the House of Representatives, the Senate, and the Department of Justice, the investigations were never able to come up with proof of bribery, arms dealing, or any other misdeed. Rich’s decision to directly petition the president may have been unusual, but it was by no means illegal. Clinton’s decision to pardon Rich without seeking extensive counsel from the Department of Justice was also well within the law. The wording of the U.S. Constitution is quite clear. It explicitly grants the president the “power to grant reprieves and pardons for offenses against the United States, except in cases of impeachment.”²²

President Clinton’s Motivation

Clinton sought to explain his decision to pardon Rich in an extensive op-ed article published in the New York Times in which he included many of the legal arguments that Rich’s legal team had sought to employ over the years (see chapters 10 and 13).²³ Clinton interpreted three of the most important arguments as follows:

I understood that the other oil companies that had structured transactions like those on which Mr. Rich and Mr. Green were indicted were instead sued civilly by the government; . . .

Two highly regarded tax experts, Bernard Wolfman of Harvard Law School and Martin Ginsburg of Georgetown University Law Center, reviewed the transactions in question and concluded that the companies “were correct in their U.S. income tax treatment of all the items in question, and [that] there was no unreported federal income or additional tax liability attributable to any of the [challenged] transactions”; . . .

The Justice Department in 1989 rejected the use of racketeering statutes in tax cases like this one.

These arguments may have been a good way of legally justifying the pardon, but I am not sure they are sufficient to explain Clinton’s decision to actually grant the pardon. The research and interviews I carried out in the course of writing this book have led me to believe that Denise Rich’s role in the pardon has been grossly overestimated. Of course Denise was helpful—after all, she was a friend and admirer of the Clintons. She was able to get the president’s attention—something that is always in short supply—and thus open a few doors for her ex-husband. Denise was not the deciding factor, though, and her hefty donations to the Clintons and the Democratic Party were not the reason Rich was pardoned.

Neither was Clinton’s decision to pardon Rich primarily a result of legal arguments. Instead, the president was swayed by the emotional and political aspects of Rich’s petition. On an emotional level, Clinton allowed himself to be convinced by Jack Quinn’s argument that Rich’s case had been “grossly overprosecuted” by aggressive federal prosecutors. The president had himself experienced the lengths to which fanatical investigators were prepared to go. Independent counsel Kenneth Starr was originally appointed to investigate the Clintons’ role in the Whitewater scandal, but Starr later widened his investigation and delved into the president’s affair with Monica Lewinsky. The president soon found himself facing impeachment proceedings as a result of the investigations. Although he remained in office, his reputation had suffered greatly in the aftermath.

The president felt that he had been the victim of aggressive, overzealous persecution—and Rich’s team had consciously used the president’s feeling of victimization in their petition. “The pardon petition was literally written to the president,” Bob Fink told me before popping open a can of Diet Dr Pepper. “It was written to him with the hope that he would personally read it and with the hope that he would recognize his own personal experiences.”

When it came to the political aspect of the petition, the support of Ehud Barak and Shimon Peres played a crucial role in the president’s decision—a belief that is shared by Jack Quinn and Avner Azulay, the two masterminds behind Rich’s pardon application. “Without the support of Barak and Peres, Clinton would not have granted the pardon—no doubt about it,” Azulay told me. “The entreaties of Prime Minister Barak weighed very heavily on the president’s mind,” Quinn explained. Clinton seemed to confirm their opinions in his autobiography: “Ehud Barak asked me three times to pardon Rich because of Rich’s services to Israel and his help with the Palestinians, and several other Israeli figures in both major parties urged his release.”²⁴

Marc Rich was indeed of great importance to the Israelis. Rich’s oil deliveries and assistance to the Mossad had contributed greatly to Israel’s national security. It is difficult to imagine a U.S. president who would have not have had difficulties ignoring the pleas of so many Israeli politicians and dignitaries. Israel is by far the closest ally of the United States in the Middle East. There is a further factor that could have influenced Clinton’s decision as well. On the day he issued the pardon, the Israelis and the Palestinians sat down for important peace talks in the Egyptian town of Taba. Clinton had lent his backing to the negotiations a month prior to this Taba Summit. Israel’s foreign minister, Shlomo Ben-Ami, who had also lobbied for Rich’s pardon, took part in the negotiations. The talks were Clinton’s last opportunity as an American president to help end the Israeli-Palestinian conflict. He almost got his wish, as both sides were willing to make great compromises in the pursuit of peace. Never before had the two sides come closer to a comprehensive peace treaty—and they have never come as close since.

Rationally Right vs. Morally Bad

Hardly any of Clinton’s other decisions in office were met with the same amount of extensive and prolonged criticism as his pardoning of Marc Rich. The decision raised hackles in nearly all corners of the nation, and the noise surrounding Holder’s confirmation as attorney general is proof that the controversy has not subsided. Yet hardly any politicians or journalists seem willing to seriously and impartially address the reasons for the pardon. Published reactions to the pardon reminded me of the old saying that journalists are like birds on a wire—if one flies away, they all fly away. The opinions were formed long ago: Marc Rich is a villain, and because he is a villain he should not have been pardoned. Seen from this perspective, it might just be true that only angels have a shot at grace. In the eyes of the public, Rich’s pardon was never really seen as rationally wrong—it was just morally bad. This type of criticism quickly gets bogged down at a moral level that does not allow for any form of counterargument.

In retrospect it is not only true that President Clinton enjoyed the unlimited and absolute power of pardon that is guaranteed by the U.S. Constitution. It is also important to take Clinton’s words at their face value despite all of the attacks on his reputation: “I may have made a mistake, at least in the way I allowed the case to come to my attention, but I made the decision based on the merits.”²⁵ As I have illustrated in this chapter, Clinton had very good reasons—both political and juridical—for pardoning Marc Rich.

Tax Bargain

On March 1, 2001, six weeks after Rich received his pardon, the New York Department of Taxation and Finance sent out the highest tax invoice it had ever issued, for 137,827,781.90. It was addressed to Marc Rich, Kleinnaumatt 9, CH-6045 Meggen, Switzerland. “It is now time for him to pay the piper,” announced state tax commissioner Arthur Roth.²⁶ The State of New York was demanding 26.9 million in back taxes for the years 1980 through 1982 plus 13.5 million in penalties and 97.4 million in accrued interest. The interest alone added up to 20,000 per day. The delinquent taxes were based on the approximately 100 million in oil profits that—from the State of New York’s point of view—Rich had failed to declare. Roth simultaneously froze 5 million in a Citibank account belonging to Rich. He revealed his sense of humor by commenting, “Marc Rich is to asset concealment what Babe Ruth was to baseball.” No one seriously believed that Rich would ever pay off his tax debts. For his part, Rich contested the state’s demands, claiming that he had already legally declared the profits in Switzerland.

The New York revenue authorities were therefore rather surprised when Rich signaled via his lawyer that he was prepared to pay part of the debt. Ever the trader, he suggested they negotiate a sum. The New York Department of Taxation and Finance declared its willingness to negotiate—under the condition that the talks should remain a secret. To outsiders, the affair seemed to take a rather strange turn. The tax authorities, who were usually quite eager to comment on the most trivial of developments concerning Rich’s case, suddenly insisted on discretion. Could they have been embarrassed by the fact that they were negotiating a deal with the “biggest tax fraudster in the history of the United States”? Were they afraid of the public debate that might ensue if their pragmatic stance were to become widely known? Whatever the case, Rich was able to reach a good deal with the tax authorities. A tax collector confirmed to me that in November 2003 Rich transferred approximately 3 million to the State of New York. No one at the New York Department of Taxation and Finance wished to officially comment on this sum for reasons of confidentiality. One of Rich’s lawyers said, “It would not be in Mr. Rich’s interest to violate an agreement [of confidentiality] he made with a government in the United States.” Naturally I wished to discuss the matter with Rich. “I paid even though the charge was completely unjustified,” Rich said. He confirmed the agreement with the New York tax authorities but did not wish to name the exact sum. “I’m respecting the confidentiality,” he explained. I asked him why he had paid anything at all, since he was of the opinion that he did not owe the State of New York any money whatsoever. “To get rid of it,” he replied. “It was the only way to get rid of it.”

“I’ll Never Go Back to the USA”

In the aftermath of the affair, Rich was able to see which way the wind was blowing, and it was a very cold wind indeed. The pardon was like a boomerang. He had hoped to be able to liberate himself from many of the false accusations. He had hoped he would be given the freedom to return unmolested to the United States. He had hoped his name would finally disappear from the headlines. The reality was the exact opposite of what he had hoped for. The reports were even more scathing than they had been before the pardon. The media and the politicians rehashed all of the same facts, rumors, and defamations. Rich, who had been left in relative peace in the years running up to the pardon, was again described as the “fugitive billionaire,” the “most wanted white-collar criminal in U.S. history,” the “unscrupulous trader” who “traded with the enemy.” In addition to all of these accusations, Rich was now seen as the man who was even capable of manipulating the most powerful man in the world: the president of the United States.

“I regret very much that Bill Clinton got in the line of fire for what he thought was the right thing to do,” Rich tells me in his office, “more so because I believe—independently of the pardon—that he was one of the best presidents the U.S. has had in recent history. Smart, able, eloquent and positive.” He thinks there was a targeted campaign. “The reactions were completely unjustified. Almost all of the negative reactions came from interested parties who felt that scandalizing Clinton’s decision would help their own, usually partisan agenda.” “Up to today the main allegation is that you essentially bought the pardon,” I say. “I didn’t,” he answers. “Did you give money to your ex-wife Denise in exchange for her help?” “No,” he says. “I would never give money to my ex-wife.”

At first, Rich thought that the pardon “gave me back the freedom to travel wherever I want.” He had asked for a pardon, according to Avner Azulay, mainly “so he could visit his daughter’s grave, he could visit his father’s grave, he could visit his family in New York.”²⁷ After the public outcry in the wake of the pardon, though, Rich decided to forgo travel to the United States. “The American law system is peculiar in this respect. It is not possible to get confirmation that all legal proceedings are finished,” he says. “They might still have an unpaid parking ticket of mine from thirty years ago and might make a big case out of it.” I ask him if he intends to return to the United States someday. “Never,” he says firmly. “They would look for some excuse to apprehend me. I don’t want to be exposed to that.”

Marc Rich had hoped the pardon would allow him to regain his reputation. Now he had again lost control over his own name. Once and for all.