Marc Rich
Belgian-American commodities trader and founder of Glencore, indicted for tax evasion and trading with Iran, later pardoned by President Bill Clinton.
Marc Rich (born Marcell David Reich; December 18, 1934 – June 26, 2013) was a Belgian-American commodities trader, financier, and businessman. He created the commodity firm Glencore, and later faced U.S. federal charges for tax evasion, wire fraud, racketeering, and selling Iranian oil to Israel while Americans were held hostage in Iran. When the indictment was filed, he escaped to Switzerland and never came back to the United States. On his final day in office, President Bill Clinton granted Rich a controversial pardon.
Rich was born to a Jewish family in Antwerp, Belgium, in 1934. To escape the Nazis, his parents emigrated with him to the U.S. in 1941, traveling through Vichy France, Spain, Portugal, and aboard the liner Serpa Pinto. His father opened a jewelry store in Kansas City, Missouri, then moved the family to Queens, New York City, in 1950. There, he started a company importing Bengali jute for burlap bags, later traded agricultural products, and helped found the American Bolivian Bank. Rich attended Rhodes Preparatory School in Manhattan and then New York University, but dropped out after one semester to work for Philipp Brothers (later Phibro LLC) in 1954, alongside Pincus Green.
At Philipp Brothers, Rich became a metals dealer, learning about international raw materials markets and trading with poor, third-world nations. He managed operations in Cuba, Bolivia, and Spain. In 1974, he and Green founded their own Swiss company, Marc Rich + Co. AG, which eventually became Glencore Xstrata Plc. Dubbed "the King of Oil" by partners, Rich is credited with expanding the spot market for crude oil in the early 1970s, pulling business from larger oil companies that relied on long-term contracts. As the *Financial Times* noted, his key insight was that oil and other raw materials could be traded with less capital and fewer assets if backed by bank finance—a leveraged model that became the template for modern traders like Trafigura, Vitol, and Glencore.
His time at Philipp Brothers let Rich build ties with various dictatorial regimes and embargoed nations. He later told biographer Daniel Ammann that his most important and profitable deals came from violating international trade embargoes and doing business with South Africa's apartheid regime. His clients also included Fidel Castro's Cuba, Marxist Angola, the Nicaraguan Sandinistas, Muammar Gaddafi's Libya, Nicolae Ceaușescu's Romania, and Augusto Pinochet's Chile. According to Ammann, Rich had no regrets, saying, "I deliver a service. People want to sell oil to me and other people wanted to buy oil from me. I am a businessman, not a politician."
After the 1979 Iranian Revolution, Rich used his relationship with Ayatollah Khomeini to buy Iranian oil despite the U.S. embargo. *Forbes* reported that Asadollah Asgaroladi was his secret business partner in bypassing those sanctions. Iran became Rich's main crude oil supplier for over 15 years. He sold Iranian oil to Israel through a secret pipeline and, thanks to his ties with Iran and Khomeini, helped Mossad agents make contacts in Iran. He also popularized letters of credit in the oil trade. His real estate firm, Marc Rich Real Estate GmbH, worked on large projects, including in Prague. In 1981, Rich and Marvin Davis bought 20th Century Fox. After Rich was indicted for violating U.S. trade sanctions with Iran, his assets, including his Fox stake, were frozen. Davis was allowed to buy Rich's share and later sold it to Rupert Murdoch for $232 million in March 1984. Rich had connections to mafia associates in the Soviet Union and former Soviet Union, including Grigori Loutchansky and Marat Balagula, who was convicted of gasoline price fixing. *Business Insider* estimated Rich's net worth at $2.5 billion.
In 1983, Rich and Green were indicted on 65 criminal counts, including tax evasion, wire fraud, racketeering, and trading with Iran during the oil embargo. A conviction on all counts could have meant over 300 years in prison. The case, filed by U.S. Federal Prosecutor Rudolph Giuliani, was the largest tax evasion case in U.S. history at the time. Learning of the impending indictment, Rich fled to Switzerland, insisting he was not guilty, and never returned to face the charges. His companies eventually pleaded guilty to 35 counts of tax evasion and paid $90 million in fines, but Rich remained on the FBI's wanted list. Rich had donated heavily to Israeli officials and organizations, which lobbied extensively for his pardon. His ex-wife Denise also made donations to the Democratic Party.
- born
- December 18, 1934
- died
- June 26, 2013
- field
- Commodities trading, finance
- nationality
- Belgian-American
- known_for
- Founding Glencore; receiving a controversial presidential pardon from Bill Clinton
Lore & Background
Rich was born in 1934 to a Jewish family in Antwerp, Belgium. In 1941 his parents emigrated with their son to the United States to escape the Nazis, traveling via Vichy France, Spain, Portugal, and the liner Serpa Pinto. His father opened a jewelry store in Kansas City, Missouri, then moved the family to Queens, New York City in 1950, where he started a company that imported Bengali jute to make burlap bags, and later started a business trading agricultural products and helped found the American Bolivian Bank. Rich attended high school at Rhodes Preparatory School in Manhattan, then attended New York University but dropped out after one semester to work for Philipp Brothers in 1954, where he worked with Pincus Green. At Philipp Brothers, he became a dealer in metals, learning about international raw materials markets and commercial trading with poor, third world nations. He helped run the company's operations in Cuba, Bolivia, and Spain. In 1974, he and Green set up their own company in Switzerland, Marc Rich + Co. AG, which later became Glencore Xstrata Plc. Nicknamed 'the King of Oil,' Rich expanded the spot market for crude oil in the early 1970s. He developed relationships with various dictatorial regimes and embargoed nations, making his 'most important and most profitable' business deals by violating international trade embargoes and doing business with the apartheid regime of South Africa. He also counted Fidel Castro's Cuba, Marxist Angola, the Nicaraguan Sandinistas, Muammar Gaddafi's Libya, Nicolae Ceaușescu's Romania, and Augusto Pinochet's Chile among his clients. Following the Iranian Revolution in 1979, Rich used his relationship with Ayatollah Khomeini to buy oil from Iran despite the American embargo. Iran became his most important supplier of crude oil for more than 15 years. He sold Iranian oil to Israel through a secret pipeline and helped give Mossad's agents contacts in Iran. He popularised the use of letters of credit in the oil trade. His real estate company, Marc Rich Real Estate GmbH, was involved in large developer projects (e.g., in Prague, Czech Republic). Rich and Marvin Davis bought 20th Century Fox in 1981. Due to the indictment filed against Rich for violating U.S. trade sanctions, his assets including his holding in 20th Century Fox were frozen. Davis was permitted by authorities to purchase Rich's holding and subsequently so
Reader's Guide
In 1983, Rich and partner Pincus Green were indicted on 65 criminal counts, including income tax evasion, wire fraud, racketeering, and trading with Iran during the oil embargo (at a time when Iranian revolutionaries were still holding American citizens hostage). The charges would have led to a sentence of more than 300 years in prison. The indictment was filed by then-U.S. Federal Prosecutor Rudolph Giuliani. Learning of the plans for the indictment, Rich fled to Switzerland and never returned to the U.S. to answer the charges. Rich's companies eventually pleaded guilty to 35 counts of tax evasion and paid $90 million in fines, although Rich himself remained on the FBI's Ten Most-Wanted Fugitives List for many years. On January 20, 2001, hours before leaving office, President Bill Clinton granted Rich a controversial presidential pardon. Clinton's critics alleged that Rich's pardon had been bought, as Denise Rich had given more than $1 million to the Democratic Party, including more than $100,000 to the Senate campaign of Hillary Rodham Clinton and $450,000 to the Clinton Library foundation. Clinton also cited clemency pleas from Israeli government officials, including then-Prime Minister Ehud Barak. Rich had made substantial donations to Israeli charitable foundations, and many senior Israeli officials argued on his behalf. Many leading figures of the Jewish world, including Abraham Foxman of the ADL (which had received over $250,000 from Rich), also wrote to Clinton for Rich's pardon. Clinton later expressed regret for issuing the pardon.
Did You Know?
- Rich was nicknamed 'the King of Oil' by his business partners.
- Rich's key insight was that oil could be traded with less capital and fewer assets if backed by bank finance, a model that became the template for modern traders like Trafigura, Vitol, and Glencore.
- Rich's ex-wife Denise made donations to the Democratic Party.
- Rich did not return to the United States even to attend his daughter's funeral in 1996.
Notable Quotes (Wikiquote)
"Marc Rich (born Marcell David Reich, 18 December, 1934 – 26 June, 2013) was an international commodities trader, hedge fund manager, financier and businessman." — Marc Rich "As a trader you often walk on the blade. Be careful and don't step off." — Marc Rich
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