Marc Rich

Marc Rich
Marc Rich
Born	Marcell David Reich; Template:Birth date; Antwerp, Belgium
Died	June 26, 2013 (aged 78)
Occupation(s)	Commodities trader, financier, entrepreneur
Known for	Founding Glencore; controversial presidential pardon by Bill Clinton

Marc Rich (originally named Marcell David Reich; born December 18, 1934 – died June 26, 2013) was a global commodities trader, financier, and entrepreneur. He established the commodities firm Glencore and faced federal indictments in the United States on charges including tax evasion, wire fraud, racketeering, and conducting oil transactions with Iran amid the Iran hostage crisis. At the time of these charges, Rich fled to Switzerland and never returned to the U.S. He was granted a highly debated presidential pardon by Bill Clinton on his final day in office; notably, Rich’s former wife Denise had contributed substantial amounts to the Democratic Party.

Early life

Born into a Jewish family in Antwerp, Belgium in 1934, Rich’s family escaped Nazi persecution in 1941 by emigrating to the United States. Their route included passage through Vichy France, Spain, Portugal, and aboard the liner Serpa Pinto. His father initially ran a jewelry business in Kansas City, Missouri before relocating the family to Queens, New York City in 1950. There, he launched an import company dealing in Bengali jute for burlap sacks and later helped establish the American Bolivian Bank (Banco Boliviano Americano S.A). Rich attended Rhodes Preparatory School in Manhattan and enrolled briefly at New York University, but left after one semester to join Philipp Brothers (now Phibro LLC) in 1954, where he worked alongside Pincus Green.

Business career

During his tenure at Philipp Brothers, Rich specialized as a metals trader, acquiring deep knowledge of international raw material markets and trading with emerging countries. He oversaw operations in locations such as Cuba, Bolivia, and Spain. In 1974, together with Pincus Green, he founded Marc Rich + Co. AG in Switzerland, which later developed into Glencore Xstrata Plc. Dubbed "the King of Oil," Rich played a pivotal role in expanding the crude oil spot market during the 1970s by transitioning from conventional long-term contracts to a leveraged trading approach supported by bank financing—a method that shaped modern commodity trading firms like Trafigura, Vitol, and Glencore.

Rich’s experience at Philipp Brothers enabled him to cultivate business ties with authoritarian regimes and countries under embargo. He regarded his most lucrative transactions as those that contravened international trade restrictions, including dealings with apartheid-era South Africa. His clientele extended to Fidel Castro’s Cuba, Marxist Angola, Nicaragua’s Sandinista government, Libya under Muammar Gaddafi, Romania ruled by Nicolae Ceaușescu, and Chile under Augusto Pinochet. Rich famously remarked: "I deliver a service. People want to sell oil to me and others want to buy oil from me. I am a businessman, not a politician."

Following the 1979 Iranian Revolution, Rich capitalized on his connections with Ayatollah Khomeini to procure oil from Iran despite U.S. sanctions. According to Forbes, Asadollah Asgaroladi acted as his covert partner in circumventing these restrictions. Iran remained Rich’s principal crude oil source for over fifteen years; he also facilitated the sale of Iranian oil to Israel through a clandestine pipeline. His network reportedly enabled contacts for Mossad operatives within Iran.

Rich’s real estate enterprise, Marc Rich Real Estate GmbH, was involved in significant development initiatives such as projects in Prague. In 1981, along with Marvin Davis, he acquired 20th Century Fox. However, after being indicted for breaching U.S. sanctions related to Iran while residing abroad in Switzerland, his assets—including his share of 20th Century Fox—were frozen. Davis subsequently sold this stake to Rupert Murdoch for $232 million in 1984.

Rich also maintained associations with organized crime figures from the Soviet Union and its successor states. These included Georgian-Israeli Grigori Loutchansky of Austrian oil firm Nordex and Russian Mafia affiliate Marat Balagula, who was convicted for gasoline price-fixing schemes. Such connections intersected with lobbying activities like those surrounding the Baku-Ceyhan pipeline during the Clinton administration.

Business Insider estimated Rich’s fortune at around US$2.5 billion.

U.S. indictment and pardon

In 1983, Marc Rich and his associate Pincus Green faced indictment on 65 criminal counts, encompassing income tax evasion, wire fraud, racketeering, and illegal trading with Iran during the oil embargo linked to the Iran hostage crisis. The potential penalties could have amounted to over 300 years in prison. The case, overseen by then-U.S. Federal Prosecutor Rudolph Giuliani, represented the largest tax evasion prosecution in the history of the United States.

Prior to the indictment, Rich escaped to Switzerland and never returned to confront the charges, consistently asserting his innocence. While his companies admitted guilt on 35 tax evasion counts and paid $90 million in penalties, Rich himself remained on the FBI's Ten Most Wanted list for an extended period, successfully avoiding arrest across various nations. He refrained from traveling back to the U.S., even missing his daughter's funeral in 1996.

On January 20, 2001, shortly before leaving office, President Bill Clinton granted a highly contentious presidential pardon to Rich. Legal counsel involved in this process included Leonard Garment, Scooter Libby, and subsequently Jack Quinn. Several prominent Clinton allies publicly dissociated themselves from this decision. Former President Jimmy Carter criticized the pardon as being influenced by substantial financial contributions. Clinton later expressed remorse over the pardon, acknowledging it "wasn't worth the damage to my reputation."

Accusations emerged that the pardon was effectively purchased; Denise Rich had contributed more than $1 million to the Democratic Party, including donations to Hillary Clinton's Senate campaign and the Clinton Library foundation. Additionally, Clinton referenced clemency appeals from Israeli officials such as then-Prime Minister Ehud Barak. Rich had made considerable donations to Israeli charities, with influential figures like Shimon Peres, Ehud Olmert, and Abraham Foxman of the Anti-Defamation League advocating on his behalf. Clinton admitted that these Israeli leaders played a role in shaping his decision.

There was speculation connecting Rich's pardon to his purported involvement with Mossad. Rich acknowledged assisting Israel’s intelligence agency—a fact confirmed by a former operative—including funding covert activities and facilitating Iranian oil shipments through a clandestine pipeline. Avner Azulay, a former Mossad agent overseeing Rich’s philanthropic organizations, orchestrated efforts to secure the pardon and persuaded Denise Rich to appeal directly to Clinton. Azulay also enlisted Barak’s intervention in lobbying Clinton personally. Former Mossad director Shabtai Shavit endorsed the pardon, emphasizing that intelligence agents worldwide utilized Rich’s offices.

Federal Prosecutor Mary Jo White was appointed by Attorney General John Ashcroft to investigate the pardon but was later replaced by James Comey, who criticized both Clinton’s pardons and Deputy Attorney General Eric Holder’s involvement. Holder denied circumventing established procedures but conceded procedural errors occurred during the pardon process. Congressional hearings revealed that most White House advisors recommended against granting clemency. Ultimately, investigators found no evidence of criminal misconduct.

The terms of the pardon required Rich to relinquish defenses against any civil lawsuits in U.S. courts upon returning; nevertheless, he never made such a return.

In an op-ed dated February 18, 2001, published in The New York Times, Clinton defended his decision by citing legal opinions asserting no crime had been committed and highlighting support from Republican lawyers including Lewis "Scooter" Libby, who had represented Rich until 2000. Libby later received presidential clemency from George W. Bush and Donald Trump. During congressional testimony, Libby denied any tax violations but condemned trading with Iran during the hostage crisis.

A New York Times editorial harshly criticized the pardon as "a shocking abuse of presidential power."

On November 1, 2016, under a Freedom of Information Act request, the FBI released documents pertaining to the pardon.

Paradise Papers

On November 5, 2017, the Paradise Papers, a collection of confidential documents concerning offshore investments, disclosed that the Appleby law firm had continued to represent Rich and Glencore on significant ventures even after Rich's indictment in 1983.

Legacy

Glencore International AG emerged as the successor to "Marc Rich + Co AG." In late 1993, following an unsuccessful attempt by Rich to dominate the zinc market, investors forced him out, resulting in his loss of control. After a management buyout, the company was rebranded as Glencore on September 1, 1994. Ivan Glasenberg assumed the CEO position in 2002. The 2013 merger between Glencore and Xstrata created Glencore Xstrata, with its headquarters located in Baar, Switzerland. Prior to its initial public offering in 2011 and the subsequent merger in 2013, Glencore operated as a private partnership. The company traces its roots back to Marc Rich + Co AG (established in 1974) and recognizes the significance of the 1993 management buyout.

In 2001, Crown Resources AG, based in Zug and associated with Alfa Group, merged with Marc Rich & Co. Investment AG (MRI), which served as Marc Rich Holding’s Swiss commodities trading division, forming a new trading entity.

Another corporate descendant is Trafigura Beheer BV, established in March 1993 in the Netherlands by former Marc Rich executives including Claude Dauphin. The primary office of Trafigura AG is now situated in Geneva, Switzerland.

Citizenship

Although Rich considered that acquiring Spanish citizenship meant renouncing his U.S. citizenship, a 1991 appeals court determined that he remained a U.S. citizen for tax purposes and was therefore liable for U.S. income taxes. Besides his American nationality, he also held passports from Belgium, Bolivia, Israel, and Spain.

Philanthropy

Rich was a prominent benefactor of Israel, donating approximately $150 million to various institutions such as the Israel Museum, Tel Aviv Museum, research centers, and theaters. In 1985, he provided assistance to compensate families affected by the Ras Burqa massacre. He also contributed tens of millions toward integrating Jewish immigrants from Ethiopia and Russia and supported programs like Project Discovery.

He established a museum wing named after his late daughter Gabriela and financed the "Marc Rich Israeli Cinema Center" at the Tel Aviv Cinematheque as well as the primary library at IDC Herzliya University bearing his name. Additionally, Rich fostered Israeli-Palestinian coexistence by funding health and educational initiatives in the West Bank and Gaza and made yearly donations to the President's Conference.

His charitable activities extended to Yale University’s Medical Research Center, Rabin Medical Center, and Dana Farber Cancer Institute.

Rich founded the Rich Foundation—one of Israel’s largest philanthropic funds—overseen by Avner Azulay with support from his former wife Denise and associates Elka Acle and Pincus Green. Over more than twenty years, it invested upwards of $135 million into culture, education, and health projects benefiting humanities and social sciences at Tel Aviv University, Israel Philharmonic Orchestra, Tel Aviv Cinematheque, Cameri theaters, city projects in Beersheba, IDC Herzliya, Shaare Zedek Medical Center, Beit Berl College, Tel Aviv Museum, and Israel Museum. He also supported Bar Ilan University’s Bioengineering building.

Awards

In acknowledgment of his significant impact on Israel and its scientific initiatives, Rich was awarded honorary doctorates by Bar Ilan University and Ben-Gurion University of the Negev in 2007. The following year, the Chaim Sheba Medical Center at Tel Hashomer presented him with the Sheba Humanitarian Award, an honor previously bestowed upon distinguished figures such as Michael Douglas, Elizabeth Taylor, and Gerald R. Ford.

Personal life and death

Rich entered into marriage with Denise Eisenberg in 1966; she was a songwriter and heir to a New England shoe manufacturing legacy. Together, they had three children. Tragically, their daughter Gabrielle Rich Aouad passed away from leukemia in 1996. Another daughter, Ilona Rich, who is married to Kenny Schachter, endured the loss of her son in 2019. Following their divorce in 1996, Rich married Gisela Rossi; this marriage ended in divorce in 2005.

After residing for many years in Zug, Switzerland, Rich made his home in Meggen on Lake Lucerne, where he valued his privacy highly. His real estate holdings also included properties in St. Moritz, Switzerland, and Marbella, Spain. A passionate art collector, he possessed works by renowned artists such as Renoir, Monet, and Picasso.

Rich passed away from a stroke on June 26, 2013, at age 78 in Lucerne. He left behind two daughters and was laid to rest in Israel.