[House Report 107-454]
[From the U.S. Government Printing Office]
Union Calendar No. 269
107th Congress Report
HOUSE OF REPRESENTATIVES
2d Session 107-454
_______________________________________________________________________
JUSTICE UNDONE: CLEMENCY DECISIONS IN THE CLINTON WHITE HOUSE
__________
SECOND REPORT
by the
COMMITTEE ON GOVERNMENT REFORM
Volume 1 of 3
together with
MINORITY AND ADDITIONAL VIEWS
Chapter 1--``Take Jack's Word'': The Pardons of International Fugitives
Marc Rich and Pincus Green
Chapter 2--Roger Clinton's Involvement in Lobbying for Grants of
Executive Clemency
Available via the World Wide Web: http://www.gpo.gov/congress/house
http://www.house.gov/reform
May 14, 2002.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
__________
U.S. GOVERNMENT PRINTING OFFICE
78-264 WASHINGTON : 2002
COMMITTEE ON GOVERNMENT REFORM
DAN BURTON, Indiana, Chairman
BENJAMIN A. GILMAN, New York HENRY A. WAXMAN, California
CONSTANCE A. MORELLA, Maryland TOM LANTOS, California
CHRISTOPHER SHAYS, Connecticut MAJOR R. OWENS, New York
ILEANA ROS-LEHTINEN, Florida EDOLPHUS TOWNS, New York
JOHN M. McHUGH, New York PAUL E. KANJORSKI, Pennsylvania
STEPHEN HORN, California PATSY T. MINK, Hawaii
JOHN L. MICA, Florida CAROLYN B. MALONEY, New York
THOMAS M. DAVIS, Virginia ELEANOR HOLMES NORTON, Washington,
MARK E. SOUDER, Indiana DC
STEVEN C. LaTOURETTE, Ohio ELIJAH E. CUMMINGS, Maryland
BOB BARR, Georgia DENNIS J. KUCINICH, Ohio
DAN MILLER, Florida ROD R. BLAGOJEVICH, Illinois
DOUG OSE, California DANNY K. DAVIS, Illinois
RON LEWIS, Kentucky JOHN F. TIERNEY, Massachusetts
JO ANN DAVIS, Virginia JIM TURNER, Texas
TODD RUSSELL PLATTS, Pennsylvania THOMAS H. ALLEN, Maine
DAVE WELDON, Florida JANICE D. SCHAKOWSKY, Illinois
CHRIS CANNON, Utah WM. LACY CLAY, Missouri
ADAM H. PUTNAM, Florida DIANE E. WATSON, California
C.L. ``BUTCH'' OTTER, Idaho STEPHEN F. LYNCH, Massachusetts
EDWARD L. SCHROCK, Virginia ------
JOHN J. DUNCAN, Tennessee BERNARD SANDERS, Vermont
------ ------ (Independent)
Kevin Binger, Staff Director
Daniel R. Moll, Deputy Staff Director
James C. Wilson, Chief Counsel
Robert A. Briggs, Chief Clerk
Phil Schiliro, Minority Staff Director
David A. Kass, Deputy Chief Counsel
M. Scott Billingsley, Counsel
Pablo E. Carrillo, Counsel
Jason A. Foster, Counsel
Hilary J. Funk, Counsel
Matthew J. Rupp, Counsel
Phil Barnett, Minority Chief Counsel
Michael Yeager, Minority Deputy Chief Counsel
Michael Yang, Minority Counsel
?
LETTER OF TRANSMITTAL
----------
House of Representatives,
Washington, DC, May 14, 2001.
Hon. J. Dennis Hastert,
Speaker of the House of Representatives,
Washington, DC.
Dear Mr. Speaker: By direction of the Committee on
Government Reform, I submit herewith the committee's second
report to the 107th Congress. The committee's report is based
on a study conducted by the full committee.
Dan Burton,
Chairman.
DEDICATION
----------
This report is dedicated to the memory of M. Scott
Billingsley, counsel for the House Committee on Government
Reform from 1999-2001. Scott died unexpectedly on March 25,
2002, at the age of 31.
During his time on the Committee staff, Scott was centrally
involved in a number of important investigations. Scott made
immeasurable contributions to the Committee's work, not only
through his critical thinking and excellent writing, but also
through his professionalism and cheerful spirit, which made him
a pleasure to work with.
Scott devoted two years of his short life to the Committee
on Government Reform because he wanted to root out waste,
fraud, and abuse, and promote integrity in the federal
government. Scott's final, and most important work for the
Committee was on the investigation of President Clinton's
eleventh-hour clemency grants. Scott played a key role
investigating the pardons of Marc Rich and Pincus Green and
drafted much of the first chapter of this report. Scott's work
on the Rich and Green pardons was typical of all of his work
for the Committee: excellent, accurate, and thorough.
Scott Billingsley certainly has a legacy that goes far
beyond his work on this Committee. He has left behind many
individuals who will miss him dearly. His memory will be
cherished by his parents, sister, fiance, family, and countless
others whose lives he touched. However, this report should
serve as a small, but lasting, reminder of Scott Billingsley's
work and his devotion to the pursuit of truth.
C O N T E N T S
----------
Page
Volume 1
EXECUTIVE SUMMARY................................................ 1
INTRODUCTION..................................................... 25
Chapter One--``Take Jack's Word'': The Pardons of International
Fugitives Marc Rich and Pincus Green
FINDINGS OF THE COMMITTEE........................................ 99
INTRODUCTION..................................................... 105
I. BACKGROUND OF MARC RICH AND PINCUS GREEN........................107
A. Rich and Green's Business Activities...................... 107
1. How Rich and Green Became Wealthy..................... 107
2. Marc Rich's History of Illegal and Improper Business
Dealings............................................. 108
a. Iran.............................................. 110
b. South Africa...................................... 110
c. The Soviet Union/Russia........................... 111
d. Cuba.............................................. 113
e. Libya............................................. 113
f. Iraq.............................................. 113
g. Angola............................................ 114
h. Romania........................................... 114
i. Serbia............................................ 115
B. The Criminal Charges Against Marc Rich and Pincus Green... 115
1. The Investigation of Rich and Green................... 115
2. The Indictment........................................ 120
3. Rich and Green Flee the Country....................... 121
4. The Corporate Guilty Pleas............................ 122
C. Attempts to Bring Rich and Green to Justice............... 123
1. Attempts to Extradite Rich and Green.................. 123
2. Marc Rich and Pincus Green's Attempts to Renounce
Their Citizenship.................................... 123
3. U.S. Attempts to Apprehend Rich and Green............. 125
4. 1992 Congressional Hearings........................... 127
5. Actions Taken by the U.S. Against Rich's Business
Interests............................................ 128
a. U.S. Mint Contract Cancellation................... 128
b. Suspension of Rich's Grain Dealings............... 129
c. Cuban Asset Forfeiture............................ 130
II. ATTEMPTS TO SETTLE THE MARC RICH AND PINCUS GREEN CASE..........131
A. Attempts to Settle in the 1980s........................... 131
B. Marc Rich's Humanitarian Activities in the 1980s and 1990s 133
C. Rich Hires Jack Quinn..................................... 135
D. Quinn's Fee Arrangements.................................. 137
1. Was Quinn Expecting Payment for His Work on the
Pardon?.............................................. 137
2. Has Quinn Received Payments from Marc Rich Since the
Pardon Was Granted?.................................. 141
E. Quinn's Attempts to Settle the Case....................... 145
III.THE MARC RICH AND PINCUS GREEN PARDON PETITION..................149
A. Rich Contemplated a Pardon Early in 2000.................. 149
B. The Preparation of the Pardon Petition.................... 154
C. The Misleading Legal Arguments in the Petition............ 156
1. The Indictment of Rich Was Not Flawed................. 156
a. The Department of Energy Regulations Were Fair.... 156
b. Rich and Green Were Not Singled Out............... 157
c. Rich and Green Did Trade with the Enemy........... 159
d. Rich and Green Did Evade Federal Taxes............ 160
2. The Prosecutors Were Not ``Overzealous''.............. 162
a. The Prosecutors Negotiated with Rich and Green.... 162
b. The Rich Prosecution Was Not Tainted with Media
Attention........................................ 164
c. RICO Charges Were Fairly Brought.................. 165
D. The ``Letters of Support'' in the Petition................ 167
1. Rich Paid a Number of Individuals Who Wrote in His
Support.............................................. 167
2. Some Who Wrote Letters Were Misled About the Purpose.. 170
3. Many of the Letters Were Misrepresented to the
President............................................ 171
IV. LOBBYING FOR THE MARC RICH PARDON...............................173
A. The Marc Rich Lobbying Team............................... 173
1. Denise Rich........................................... 173
a. Denise Rich's Relationship with Marc Rich......... 173
b. Denise Rich's Relationship with President Clinton. 175
c. Denise Rich's Role in the Marc Rich Pardon Effort. 176
d. Denise Rich's Motives............................. 180
2. Beth Dozoretz......................................... 182
a. Beth Dozoretz's Relationship with Bill Clinton.... 182
b. Beth Dozoretz's Involvement in the Marc Rich
Pardon Campaign.................................. 184
c. Jack Quinn's Attempt to Keep Information About
Dozoretz from the Committee...................... 187
3. Israeli Prime Minister Ehud Barak and Other Israeli
Leaders.............................................. 188
4. Elie Wiesel........................................... 192
5. King Juan Carlos...................................... 195
6. Avner Azulay.......................................... 196
7. Michael Steinhardt.................................... 196
8. Gershon Kekst......................................... 197
9. Robert Fink........................................... 206
10. Kathleen Behan....................................... 206
11. Peter Kadzik......................................... 206
B. Importance of Secrecy to the Marc Rich Team............... 207
C. Jack Quinn and Eric Holder Cut the Justice Department Out
of the Process........................................... 208
D. The Filing of the Pardon Petition......................... 214
1. December 11, 2000, Call from Ehud Barak............... 215
2. Quinn Was Likely Legally Prohibited from Lobbying the
White House.......................................... 216
E. The Lobbying Effort....................................... 218
1. Quinn's Contacts with Bruce Lindsey in Belfast........ 219
2. Peter Kadzik's Lobbying Contacts with John Podesta.... 220
3. Further Contacts Between Jack Quinn and White House
Staff................................................ 223
4. Initial Discussions Between the White House and
Justice Department................................... 225
5. January 8, 2001, Call Between President Clinton and
Ehud Barak........................................... 226
6. ``The HRC Option''.................................... 227
F. The Final Days of the Marc Rich Lobbying Effort........... 230
1. Communications Between Peter Kadzik and John Podesta.. 230
2. The January 16, 2001, White House Meeting Regarding
Rich................................................. 231
3. The Justice Department Receives Jack Quinn's January
10 Letter............................................ 233
4. Final Lobbying Contacts Leading up to January 19, 2001 233
a. Jack Quinn's January 18, 2001, Letter to the
President........................................ 235
b. Bruce Lindsey's Contacts with SEC Chairman Arthur
Levitt........................................... 236
G. January 19-20, 2001....................................... 238
1. The Call Between Prime Minister Barak and President
Clinton.............................................. 238
2. Eric Holder Weighs In................................. 240
3. The January 19 Meeting Between White House Staff and
President Clinton.................................... 245
4. The President's Call to Jack Quinn.................... 247
5. The White House Informs the Justice Department of the
Decision............................................. 250
H. Aftermath of the Rich and Green Pardons................... 254
1. Eric Holder's Congratulatory Remarks.................. 254
2. The Rich Team's Effort to Deal with the Press......... 255
3. President Clinton's Column in The New York Times...... 258
V. FAILURE OF KEY PARTIES TO COOPERATE IN THE MARC RICH AND PINCUS
GREEN INVESTIGATION.............................................262
A. Marc Rich................................................. 262
B. Pincus Green.............................................. 263
C. Jack Quinn................................................ 263
D. Denise Rich............................................... 264
E. Beth Dozoretz............................................. 264
F. Avner Azulay.............................................. 265
G. Peter Kadzik.............................................. 265
H. Terry McAuliffe........................................... 266
Chapter Two--Roger Clinton's Involvement in Lobbying For Executive
Clemency
FINDINGS OF THE COMMITTEE........................................ 709
INTRODUCTION..................................................... 715
I. ROGER CLINTON'S PATTERN OF TRADING ON HIS BROTHER'S NAME........717
A. Roger Clinton's Foreign Travelers Checks and Other
Questionable Sources of Income........................... 719
B. Roger Clinton's Lobbying Regarding Cuban Travel
Restrictions............................................. 723
C. The Shakedown of John Katopodis........................... 725
II. THE GAMBINO PAROLE AND PARDON EFFORTS...........................731
A. Rosario Gambino's Involvement with Organized Crime........ 731
B. The U.S. Parole Commission's Handling of Rosario Gambino's
Case..................................................... 735
C. Roger Clinton's Involvement with the Gambino Family....... 739
1. Clinton's Contacts with the Parole Commission......... 743
a. Clinton's Initial Approach to the Parole
Commission....................................... 743
b. Clinton's Meetings with Parole Commission Staff... 747
i. December 1997 Meeting......................... 747
ii. Spring 1998 Contacts......................... 751
iii. July 1998 Meeting........................... 753
2. The FBI Investigation of Clinton's Contacts with the
Parole Commission.................................... 753
a. Clinton's Continued Attempts to Contact the
Commission....................................... 755
b. The FBI's Request to Have an Agent Pose Undercover 758
c. The FBI's Recording of Clinton's Conversations
with Thomas Kowalski............................. 760
3. Roger Clinton's Apparent Attempt to Involve the White
House in the Parole Decision......................... 764
D. Roger Clinton's Financial Relationship with the Gambinos.. 765
E. The FBI's Interview of Roger Clinton...................... 766
1. Roger Clinton's Statements Regarding His Brother's
Knowledge............................................ 767
2. Roger Clinton's Statements Regarding Payment from the
Gambinos............................................. 768
3. Roger Clinton's Statements Regarding the Rolex Watch.. 771
F. The Efforts to Obtain Executive Clemency for Rosario
Gambino.................................................. 773
III.THE LINCECUM PARDON OFFER.......................................777
A. Garland Lincecum's Account................................ 778
1. The Initial $35,000 Payment........................... 778
2. The First Dallas Meeting.............................. 779
3. Lincecum's Attempts to Raise the Remaining Money...... 782
4. Lincecum's Payment of $200,000........................ 785
5. The Division of Lincecum's Money Among Clinton, Locke,
and Morton........................................... 786
6. Lincecum's Attempts to Receive the Pardon............. 787
B. Roger Clinton's Reaction to the Allegations............... 790
C. Dickey Morton's and George Locke's Reactions to the
Allegations.............................................. 792
D. Analysis.................................................. 795
IV. OTHER PARDON CANDIDATES.........................................799
A. Dan Lasater and George Locke.............................. 799
B. J.T. Lundy................................................ 802
C. Blume Loe................................................. 807
D. Rita Lavelle.............................................. 809
E. John Ballis............................................... 811
F. Stephen Griggs............................................ 815
G. Phillip Young............................................. 819
H. Joseph ``Jay'' McKernan................................... 822
I. Mitchell Wood............................................. 823
J. Mark St. Pe............................................... 825
K. William D. McCord......................................... 826
V. FAILURE OF KEY PARTIES TO COOPERATE IN THE ROGER CLINTON
INVESTIGATION...................................................827
A. Roger Clinton............................................. 827
B. Tommaso Gambino........................................... 828
C. Lisa Gambino.............................................. 828
D. Victor Crawford and Kathy Vieth........................... 828
E. George Locke.............................................. 829
F. Dickey Morton............................................. 829
G. Richard Cayce............................................. 829
H. J.T. Lundy................................................ 829
I. Robert Lundy.............................................. 829
J. Chief Carl Griggs......................................... 830
K. Blume Loe and Cynthia Goosen.............................. 830
L. Bruce Lindsey............................................. 830
M. Meridith Cabe............................................. 830
N. Department of Justice..................................... 831
O. The White House........................................... 831
Volume 2
Chapter Three--Hugh Rodham's Role in Lobbying for Grants of Executive
Clemency
FINDINGS OF THE COMMITTEE........................................ 1261
INTRODUCTION..................................................... 1267
I. THE CARLOS VIGNALI COMMUTATION.................................1267
A. The Case Against Carlos Vignali........................... 1267
B. Vignali's Efforts to Obtain Executive Clemency............ 1276
1. Initial Efforts to Reduce Vignali's Sentence.......... 1276
a. Contacts with Prosecutors in Minnesota............ 1276
b. Vignali's Appeal.................................. 1277
c. Letters to the White House and Justice Department. 1277
2. Vignali's Clemency Petition........................... 1280
3. Supporters of Vignali's Clemency Petition............. 1283
a. Letters of Support from Prominent California
Politicians...................................... 1284
i. Congressman Xavier Becerra.................... 1284
ii. Congressman Esteban Torres................... 1286
iii. State Senator Richard Polanco............... 1286
iv. Los Angeles County Supervisor Gloria Molina.. 1287
v. Los Angeles City Councilmember Mike Hernandez. 1288
vi. Cardinal Roger Mahony........................ 1289
b. Support from Los Angeles County Sheriff Lee Baca.. 1290
i. Sheriff Baca's Relationship with the Vignalis. 1290
ii. Sheriff Baca's Involvement in the Vignali
Clemency Effort.............................. 1292
iii. Conclusion.................................. 1293
c. Support from U.S. Attorney Alejandro Mayorkas..... 1295
i. Mayorkas' Initial Exposure to the Vignali
Matter....................................... 1296
ii. Mayorkas Calls the White House............... 1297
iii. Conclusion.................................. 1299
4. California Law Enforcement and Political Officials
Supported Vignali's Clemency Petition Despite Serious
Allegations Against Horacio and Carlos Vignali....... 1301
a. There Were Extensive Allegations of Drug
Trafficking Against Both Horacio and Carlos
Vignali.......................................... 1301
b. The Extensive Allegations Against Horacio and
Carlos Vignali Were Never Considered by Sheriff
Baca, U.S. Attorney Mayorkas, or the Clinton
White House...................................... 1304
C. The White House's Review of the Vignali Clemency Request.. 1307
1. Hugh Rodham's Hiring.................................. 1307
2. Hugh Rodham's Initial Approach to the White House..... 1309
3. The Justice Department's Input on the Vignali Case.... 1311
4. The Final Decision on the Vignali Commutation......... 1314
a. Contacts Between the White House and Interested
Parties.......................................... 1314
b. Contacts Between the White House and Hugh Rodham.. 1317
c. Hugh Rodham's Invocation of First Lady Hillary
Clinton.......................................... 1318
d. The President's Decision to Grant the Commutation. 1319
5. The White House Has No Justification for the Vignali
Commutation.......................................... 1320
D. The Aftermath of the Vignali Commutation.................. 1324
1. The Response of Hugh Rodham........................... 1324
2. The Florida Bar's ``Investigation'' of Hugh Rodham.... 1325
3. The Message Sent by the Vignali Commutation........... 1327
II. THE PARDON OF A. GLENN BRASWELL................................1328
A. Braswell's History of Misconduct.......................... 1329
B. Consideration of the Braswell Pardon by the Clinton White
House.................................................... 1332
III.HUGH RODHAM'S EFFORTS TO OBTAIN CLEMENCY FOR THE LUMS..........1336
A. Background on Gene and Nora Lum........................... 1336
B. Hugh Rodham Approaches the White House About the
Possibility of a Pardon for the Lums..................... 1337
IV. FAILURE OF KEY PARTIES TO COOPERATE IN THE HUGH RODHAM
INVESTIGATION..................................................1339
A. Hugh Rodham............................................... 1339
B. Horacio and Carlos Vignali................................ 1340
C. James Casso............................................... 1340
D. Glenn Braswell............................................ 1341
E. Kendall Coffey............................................ 1341
F. Gene and Nora Lum......................................... 1341
G. Nicole Lum................................................ 1341
Chapter Four--Tony Rodham's Role in Lobbying for Grants of Executive
Clemency
FINDINGS OF THE COMMITTEE........................................ 1589
INTRODUCTION..................................................... 1590
I. EDGAR AND VONNA JO GREGORY.....................................1591
A. Background................................................ 1591
B. Tony Rodham's Relationship with the Gregorys.............. 1592
C. Tony Rodham's Efforts to Help the Gregorys Obtain Pardons. 1595
D. Deliberations by the Administration....................... 1598
E. Conclusion................................................ 1600
II. FERNANDO FUENTES COBA..........................................1602
A. Background on Fernando Fuentes Coba....................... 1602
B. The Pardon Attorney Refuses to Process Fuentes' Clemency
Petition................................................. 1604
C. Tony Rodham's Attempt to Become Involved in the Fuentes'
Clemency Effort.......................................... 1605
D. Tony Rodham's Representations to Mannerud Were Fraudulent. 1608
Chapter Five--The Grant of Clemency to Drug Money Launderer Harvey
Weinig
FINDINGS OF THE COMMITTEE........................................ 1709
I. BACKGROUND.....................................................1712
A. Weinig and His Co-Conspirators............................ 1712
B. The Money Laundering Operation............................ 1713
C. Weinig and His Co-Conspirators Run Afoul of the Colombian
Cocaine Cartel........................................... 1714
D. Weinig's Prosecution and Sentencing....................... 1718
II. WEINIG'S EFFORTS TO OBTAIN EXECUTIVE CLEMENCY..................1722
A. Weinig Hires Reid Weingarten to Lobby for Clemency........ 1722
B. Weinig's Wife Seeks Support for His Clemency Petition..... 1725
C. Weinig's Wife Obtains Support from Individuals with Ties
to the Administration.................................... 1726
III.THE WHITE HOUSE'S REVIEW OF WEINIG'S COMMUTATION REQUEST.......1729
A. The Justice Department's Input in the Weinig Clemency
Matter................................................... 1729
1. The U.S. Attorney Strongly Objected to Commuting
Weinig's Sentence.................................... 1729
2. The Pardon Attorney Objected to Commuting Weinig's
Sentence............................................. 1730
B. The White House's Deliberations........................... 1732
C. The White House Had No Justification for the Weinig
Commutation.............................................. 1733
D. Aftermath of the Weinig Commutation....................... 1736
Volume 3
Appendices
Appendix I.--Committee correspondence............................ 2079
Appendix II.--Committee subpoenas................................ 2577
Appendix III.--Marc Rich and Pincus Green pardon petition........ 2967
Views
Minority views of Hon. Henry A. Waxman, Hon. Tom Lantos, Hon.
Major R. Owens, Hon. Edolphus Towns, Hon. Paul E. Kanjorski,
Hon. Patsy T. Mink, Hon. Bernard Sanders, Hon. Eleanor Holmes
Norton, Hon. Elijah E. Cummings, Hon. Dennis J. Kucinich, Hon.
Danny K. Davis, Hon. Thomas H. Allen, Hon. Janice D.
Schakowsky, and Hon. Diane E. Watson........................... 3292
Additional views of Hon. Dan Burton.............................. 3389
Union Calendar No. 269
107th Congress Report
HOUSE OF REPRESENTATIVES
2d Session 107-454
======================================================================
JUSTICE UNDONE: CLEMENCY DECISIONS IN THE CLINTON WHITE HOUSE
_______
May 14, 2002.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Mr. Burton, from the Committee on Government Reform submitted the
following
SECOND REPORT
On March 14, 2002, the Committee on Government Reform
approved and adopted a report entitled ``Justice Undone:
Clemency Decisions in the Clinton White House.'' The chairman
was directed to transmit a copy to the Speaker of the House.
EXECUTIVE SUMMARY
THE PARDONS OF MARC RICH AND PINCUS GREEN
Marc Rich and Pincus Green have a history of illegal and
corrupt business dealings contrary to the security interests of
the United States.
Rich and Green have had extensive trade with
terrorist states and other enemies of the United States.
Despite clear legal restrictions on such trade, Rich and Green
have engaged in commodities trading with Iraq, Iran, Cuba, and
other rogue states which have sponsored terrorist acts. By
engaging in these activities, Marc Rich and Pincus Green
demonstrated contempt for American laws, as well as the well-
being of Americans who were harmed or threatened by these
states.
The Central Intelligence Agency provided the
following declassified information about Marc Rich to the
Committee:
If President Clinton had checked with the CIA, he would
have learned that Marc Rich had been the subject of
inquiries by various foreign government liaison
services and domestic government agencies regarding
their ongoing investigations of criminal activity.
In addition, President Clinton would have received
information worthy of his consideration in making his
decision on the pardon. This information cannot be
declassified.
Marc Rich and Pincus Green were guilty of serious crimes and
showed contempt for the American justice system.
Marc Rich and Pincus Green attempted to obstruct the
criminal investigation of them in every way imaginable,
including attempting to smuggle subpoenaed documents out of the
country. Rich and Green's tactics resulted in a record-setting
contempt fine against them, totaling $21 million. Despite these
tactics, the U.S. Attorney for the Southern District of New
York was able to indict Marc Rich and Pincus Green on 51 counts
of illegal activity, including tax evasion, mail fraud, wire
fraud, and racketeering. The evidence against them was
overwhelming.
Because of the strength of the case against them,
Marc Rich and Pincus Green fled the country rather than face
trial. Rich's own lawyer told him that by fleeing the country,
Rich had ``spit on the American flag'' and that ``whatever you
get, you deserve.'' For the 17 years leading up to his pardon,
Marc Rich was one of America's 10 most wanted international
fugitives. Although Jack Quinn, Rich's attorney, argued that
Rich did not flee the United States to avoid prosecution,
Rich's ex-wife refuted this view, stating that Rich told her
that ``I'm having tax problems with the government . . . and I
think that we are going to have to leave.''
In order to avoid extradition or apprehension by
United States law enforcement, Marc Rich and Pincus Green
attempted to renounce their United States citizenship. While
this attempt was rejected by the United States, it demonstrated
that Rich and Green had no loyalty to the United States and
viewed their citizenship as a liability to be discarded at
will.
Rich and Green's crimes were so serious that for seventeen
years, the U.S. government devoted considerable resources to
apprehending them and closing down their business activities.
Rich and Green were such high-profile fugitives that
on a number of occasions in the 1980s and 1990s, the United
States Marshals Service attempted to arrest them in various
foreign countries. A number of countries from the United
Kingdom to Russia attempted to assist the United States in
these efforts. The pardons of Rich and Green have sent a
message that individuals can go from the FBI's most wanted list
to a Presidential pardon if they spend money and have the
proper connections. This message undermines U.S. efforts to
apprehend fugitives abroad.
Rich and Green were such high-profile fugitives that
in 1991, the Government Reform Committee, under Democratic
leadership, held a number of hearings, and issued two reports
about the government's efforts to apprehend Rich and Green. At
that time, Democrats and Republicans in Congress took the Bush
Administration to task for not being aggressive enough in
hunting down Rich and Green, or shutting down their business
interests in the U.S.
While Rich and Green were fugitives from justice,
the American government took a number of actions against their
interests in the U.S. The federal government seized Rich's
assets and shut down his trade in metals and grain with the
government.
The United States government repeatedly tried to reach a plea
agreement with Rich and Green.
For a number of years after Rich and Green fled the
country, the U.S. government attempted to negotiate a plea
bargain to settle the case. The government made a number of
concessions in an attempt to reach a deal, but all offers were
rebuffed by Rich and Green, who would not agree to any deal
that resulted in jail time. While lobbying for a pardon, Jack
Quinn and Rich's other lawyers claimed that the Justice
Department had not even negotiated with Rich, and therefore,
that a pardon was justified. Quinn and the other lawyers were
misleading the White House when they made these claims.
Jack Quinn misled the White House about the Rich case and
attempted to mislead the Committee and the public regarding his
work for Marc Rich.
Marc Rich hired Jack Quinn after a recommendation
from Eric Holder. After numerous failed attempts to have his
case settled, Marc Rich hired Jack Quinn to represent him.
Quinn was hired after a recommendation from Deputy Attorney
General Eric Holder. Gershon Kekst, who worked for Marc Rich on
the pardon matter, asked Holder for a recommendation of how to
settle a criminal matter with the Justice Department. Holder
recommended that he hire a Washington lawyer ``who knows the
process, he comes to me, and we work it out.'' Holder then
explicitly recommended the hiring of Jack Quinn. While Holder
did not know that Kekst was referring to Marc Rich, it suggests
that Holder was favorably disposed to Jack Quinn, and would be
very receptive to arguments made by Quinn, no matter how
baseless they were.
Marc Rich was going to pay Jack Quinn for his work
on the pardon. After the Marc Rich pardon was granted, Jack
Quinn claimed that he was not being paid by Rich for his work
on the pardon and that he expected no future payment for his
work on the pardon. However, the Committee has uncovered
evidence that Robert Fink, a lawyer close to Marc Rich, had
discussions with Rich and Quinn about paying Quinn for his work
on the Rich pardon. Documents which Quinn and Fink withheld
from the Committee for over a year, and which were produced
only after a federal judge ordered them produced to a grand
jury, shed further light on the contemplated payment of Quinn.
These documents indicate that Quinn raised the question of his
``status'' with Rich and asked that Rich pay him a $50,000 per
month retainer. The Committee attempted to interview Quinn
about these documents, but Quinn refused to meet with Committee
staff.
Jack Quinn may have been attempting to receive money
from Marc Rich after the pardons were granted. At the
Committee's February 8, 2001, hearing, Quinn pledged that ``I
will not bill [Rich], and I will not accept any further
compensation for work done on the pardon.'' This pledge
surprised Rich's lawyer, who expected that Rich would be paying
Quinn for his work. Indeed, records just produced to the
Committee indicate that Quinn may have been attempting to
negotiate some payment from Marc Rich shortly after he pledged
that he would not take additional money for his work. A March
5, 2001, e-mail from Quinn to Rich states, ``If you are
agreeable, and I hope you are, I need to fax to you in the next
few days a new retainer agreement.'' This e-mail raises the
possibility that Quinn has been attempting to obtain payments
from Rich, in possible violation of his pledge to the
Committee. The Committee attempted to interview Quinn about
this matter, but he refused.
Jack Quinn's work on the Rich pardon was in apparent
violation of Executive Order 12834. That executive order was
enacted as part of President Clinton's promise to create ``the
most ethical administration in history,'' and it prohibited
former executive branch employees from lobbying their former
executive branch agencies within five years of their departure.
Quinn has claimed that his work on the Rich pardon came within
an exception for ``communicating . . . with regard to a . . .
criminal . . . law enforcement inquiry, investigation or
proceeding[.]'' However, this exception was clearly intended to
apply to appearances before courts, not lobbying the White
House for a pardon. The ``revolving door'' lobbying ban was
intended to apply exactly to cases like this, where a former
White House Counsel could come back and lobby the President to
take an action that had no constitutional limits on it, largely
based on the President's personal trust for that former
staffer.
The pardon petition compiled by Jack Quinn and the
other Marc Rich lawyers was highly misleading. Most of the
arguments used by Jack Quinn to justify the Rich and Green
pardons were false and misleading. These arguments could have
been completely refuted if anyone in the White House had sought
out any of the prosecutors familiar with the Rich case.
The ``letters of support'' in the pardon petition
were used in a misleading manner. Another key element of the
Rich pardon petition was a number of letters of support for
Rich and Green from prominent Americans and Israelis. Rich and
Green used these letters to try to show that their humanitarian
activities justified their pardons. However, many of these
letters were obtained under false pretenses, and the writers of
the letters were not told that they were being used to obtain a
Presidential pardon. In addition, a number of individuals who
wrote in support of Rich and Green received large amounts of
money from them.
Marc Rich and Pincus Green used a number of different
individuals with close personal relationships with President
Clinton and his staff to lobby regarding the pardon.
The role of Denise Rich. Denise Rich played a key
role in obtaining the Rich and Green pardons. Denise Rich had a
close relationship with President Clinton, which was based in
part on her role as a large-scale contributor to Democratic
causes and the Clinton library, and in part on her extensive
personal contacts with President Clinton. The $450,000 given by
Denise Rich to the Clinton Library was an early and large
contribution. Denise Rich used her relationship with President
Clinton to lobby for the Marc Rich pardon on a number of
occasions. She has refused to cooperate with the Committee,
invoking her Fifth Amendment rights rather than answer
questions about her role in the pardon.
The role of Beth Dozoretz. Beth Dozoretz, another
close friend of President Clinton, played a key role in
obtaining the Rich pardon. Like Denise Rich, Beth Dozoretz had
a relationship with President Clinton built on personal ties
and political fundraising. Dozoretz has raised and contributed
millions of dollars for the Democratic party and has pledged to
raise an additional million dollars for the Clinton library.
Beth Dozoretz also has close relationships with Denise Rich and
Jack Quinn. Dozoretz used her close relationship with President
Clinton to lobby for the Rich pardon. Because Dozoretz has
invoked her Fifth Amendment rights against self-incrimination,
the Committee is unable to conclude whether or not Dozoretz
made any linkage between contributions to the DNC or the
Clinton library and the granting of the Rich pardon.
The role of Prime Minister Ehud Barak. Israeli Prime
Minister Ehud Barak spoke to President Clinton three times
about the Rich pardon. In his public statements about the Rich
pardon, President Clinton has pointed to these conversations
with Prime Minister Barak as one of the primary reasons he
granted the pardon. However an examination of the transcripts
of the calls shows that Barak did not make a particularly
impassioned plea for Rich. Therefore, it appears that the
President may be attempting to use Prime Minister Barak's
interest in the Rich matter as a cover for his own motivations
for granting the Rich pardon.
Barak had met with Rich personally and told Clinton
that the Rich pardon ``could be important . . . not just
financially, but he helped Mossad on more than one case.''
Barak's statement raises the possibility that either Barak or
Clinton acted on the Rich matter because of some promise of
future financial return.
Eric Holder and Jack Quinn worked together to cut the Justice
Department out of the decisionmaking process. Holder's decision
to support the pardon had a critical impact.
Jack Quinn and Deputy Attorney General Eric Holder
worked together to ensure that the Justice Department,
especially the prosecutors of the Southern District of New
York, did not have an opportunity to express an opinion on the
Rich pardon before it was granted. The evidence amassed by the
Committee indicates that Holder advised Quinn to file the Rich
pardon petition with the White House, and leave the Justice
Department out of the process. One e-mail produced to the
Committee suggests that Holder told Quinn to ``go straight to
wh'' and that the ``timing is good.'' The evidence also
indicates that Holder failed to inform the prosecutors under
him that the Rich pardon was under consideration, despite the
fact that he was aware of the pardon effort for almost two
months before it was granted.
Eric Holder's support of the Rich pardon played a
critical role in the success of the pardon effort. Holder
informed the White House that he was ``neutral, leaning towards
favorable'' on the Rich pardon, even though he knew that Rich
was a fugitive from justice and that Justice Department
prosecutors viewed Rich with such contempt that they would no
longer meet with his lawyers. Holder has failed to offer any
credible justification for his support of the Rich pardon,
leading the Committee to believe that Holder had other
motivations for his decision, which he has failed to share with
the Committee.
Eric Holder was seeking Jack Quinn's support to be
appointed as Attorney General in a potential Gore
Administration, and this may have affected Holder's judgment in
the Rich matter. On several occasions, Holder sought out
Quinn's endorsement to be appointed as Attorney General if Al
Gore were to win the November 2000 election. Quinn was a Gore
confidant whose endorsement would carry great weight. Holder's
initial help to Quinn in the Rich matter predated the Supreme
Court's decision in Bush v. Gore, and accordingly, Holder had
some legitimate prospect of being appointed Attorney General
when he was helping Quinn keep the Rich matter from the Justice
Department's scrutiny. While Holder denies that his desire to
be appointed Attorney General had anything to do with his
actions in the Rich matter, it provides a much clearer and more
believable motivation than any offered by Holder to date.
President Clinton made his decision knowing almost nothing
about the Rich case, making a number of mistaken assumptions,
and reaching false conclusions.
The White House never consulted with the prosecutors
in the Southern District of New York regarding the Rich case.
As a result, the White House staff was never able to refute the
false and misleading arguments made in the Marc Rich pardon
petition.
Every White House staff member who was working on
the Rich pardon opposed it. However, because they failed to do
the necessary background research on the Rich case, they were
unable to refute the arguments made by Jack Quinn.
President Clinton was misled by Jack Quinn in their
negotiations regarding the Rich pardon. Late in the evening of
January 19, 2001, President Clinton and Jack Quinn had a
telephone discussion regarding the Rich pardon. During this
conversation, Quinn repeated his usual misleading arguments
about the Rich case. Quinn also offered to make his clients
subject to civil liability for their actions. In furtherance of
this offer, Quinn agreed to waive all statute of limitations
and other defenses, which Rich and Green would have as a result
of their fugitivity. President Clinton has cited this waiver as
a key factor in his decision to grant the pardons. However, if
President Clinton or his staff had done even cursory legal
research, they would have understood that this was a hollow,
meaningless deal. First, Quinn agreed to waive defenses that
Rich and Green did not have. It is basic legal doctrine that
fugitivity tolls the statute of limitations. Second, Rich and
Green likely do not face any civil liability for their crimes,
since those fines were already paid by their companies. Third,
Rich and Green had been willing to pay $100 million to settle
their case for years. A fine, even a large one, would have had
no impact on Rich and Green, and it would merely stand for the
proposition that the U.S. justice system is for sale.
When the White House did finally provide the names
of Marc Rich and Pincus Green for a Justice Department
background check in the middle of the night on January 19,
2001, the check turned up new, troubling information which was
disregarded by President Clinton. When the White House
requested the Justice Department to perform a computer
background check on Rich and Green prior to granting the
pardons, the check came back with information that they were
wanted for ``arms trading.'' This was new information for all
of the White House staff, and it raised serious questions among
them as to whether the pardons should be granted. However, the
only step the White House took to check on this allegation was
to call Jack Quinn. Quinn predictably denied that his clients
were involved in arms trading. Faced with this conflicting
information about Rich and Green, President Clinton instructed
his staff to ``take Jack's word'' and issue the pardons.
President Clinton has failed to offer a full accounting for his
decision to issue the Marc Rich and Pincus Green pardons.
President Clinton has failed to answer any questions
about the Rich and Green pardons. The few statements that he
has issued have been misleading, incomplete, and raised more
questions than they answered. Given his complete failure to
explain the pardons, the Committee is left with serious
unanswered questions regarding President Clinton's motives.
ROGER CLINTON'S EFFORTS TO LOBBY FOR EXECUTIVE CLEMENCY
Roger Clinton engaged in a systematic effort to trade on his
brother's name during the Clinton Administration.
President Clinton encouraged Roger Clinton to
capitalize on their relationship. At the beginning of his
second term, President Clinton instructed Roger Clinton to use
his connections to the Administration to gain financial
advantage. According to the lawyer for former Arkansas State
Senator George Locke: ``Roger related that Bill Clinton had
instructed him that since this was his last term in office,
Roger should find a way to make a living and use his
relationship with the President to his advantage.'' By
suggesting that Roger Clinton exploit his name, Bill Clinton
encouraged the conduct described in this chapter. Roger Clinton
apparently took this advice to heart, telling one person from
whom he solicited money that he and the President ``had only
four years to get things done'' and that they did not care
``about ethics or what appearances were.''
Roger Clinton received substantial sums of money
from foreign governments solely because he was the President's
brother. When the FBI interviewed him, Roger Clinton admitted
that since the beginning of the Clinton Administration, he had
received substantial sums of money from foreign governments.
Clinton told the FBI that ``he knows he receives these
invitations [to make paid appearances in foreign countries]
strictly because he is the First Brother of the President of
the United States.'' Clinton also informed the FBI that in
addition to receiving hundreds of thousands of dollars for
musical performances from foreign governments, he also received
money for President Clinton from foreign governments. Roger
Clinton told the FBI that he had to be instructed repeatedly by
the President or White House staff that the President was not
permitted to receive cash from foreign governments.
Roger Clinton received at least $335,000 in
unexplained travelers checks, many of which were purchased
overseas and likely imported illegally. The Committee uncovered
at least $335,000 in travelers checks deposited in Roger
Clinton's bank account. Most of these travelers checks
originated overseas, largely from Taiwan, South Korea, and
Venezuela. The travelers checks were not restrictively endorsed
by the purchaser but were instead given to Roger Clinton blank.
This method of transferring large sums of money to Roger
Clinton appears designed to conceal the fact that the funds
originated overseas and probably violated criminal statutes
requiring reports of the importation of monetary instruments.
Roger Clinton has refused to provide the Committee with any
explanation of why he received these funds. These suspicious
transactions require a complete and thorough investigation by
law enforcement authorities, especially in light of his
admissions to the FBI about receiving money from foreign
governments.
Roger Clinton likely violated federal law by failing
to register as required under the Lobbying Disclosure Act. One
company paid Roger Clinton $30,000 to lobby President Clinton
and others to loosen government restrictions on travel to Cuba.
Although his activity appears to meet the criteria outlined in
the statute for those required to disclose their contacts with
covered executive branch officials, Roger Clinton did not
register as a lobbyist and did not disclose his paid lobbying
contacts with his brother. His failure to register, therefore,
needs to be investigated carefully and completely by the
Department of Justice.
Roger Clinton participated in a plot to obtain a
$35,000 per month contract in exchange for delivering a cabinet
secretary to a speaking event. The FBI briefly investigated
Roger Clinton's involvement in a scheme with Arkansas lawyer
Larry Wallace to pressure John Katopodis, promoter of an
Alabama airport project. Clinton and Wallace attempted to
obtain a $35,000 per month contract in exchange for Clinton's
promise to ensure that Secretary of Transportation Rodney
Slater would speak at a conference sponsored by Katopodis'
organization of local governments. When Katopodis refused to
pay and Slater subsequently refused to acknowledge the
invitation, Katopodis suspected that Clinton and Wallace were
to blame. Wallace had told him that his project would remain at
a standstill until Katopodis ``showed him the money.''
Roger Clinton lobbied for the release from prison of Rosario
Gambino, a notorious heroin dealer and organized crime figure.
Rosario Gambino was a major drug trafficker. Rosario
Gambino has been convicted in the United States and Italy of
heroin trafficking. Before being sentenced to 45 years in
federal prison, Gambino associated with known members of
organized crime both in Italy and the United States. His
associates have described him as a member of the Sicilian
Mafia. When his brothers were convicted of racketeering,
murder, illegal gambling, loan sharking, and heroin trafficking
in 1994, witnesses described them as ``the main link between
Mafia heroin traffickers in Sicily and the American Mafia.''
Roger Clinton received at least $50,000 from the
Gambino family, and he expected to receive more if he succeeded
in getting Rosario Gambino out of prison. Tommaso ``Tommy''
Gambino, the son of Rosario Gambino, approached Roger Clinton
to help win the release of Rosario Gambino from prison. Tommy
Gambino promised Roger Clinton a substantial financial reward
if he was successful. Even though he never was successful,
Tommy Gambino provided Roger Clinton with $50,000, a gold Rolex
watch, and an undisclosed amount of ``expense money.''
Roger Clinton attempted to use his relationship to
the President to influence the decisionmaking of the United
States Parole Commission (``USPC''). Roger Clinton lobbied the
Parole Commission to grant parole to Gambino. While lobbying
Parole Commission staff, Roger Clinton informed them that
President Clinton was aware of his efforts on behalf of Rosario
Gambino and that the President had suggested that he contact
the Parole Commission members directly. Although the Commission
staff tried to insulate the Commissioners from undue influence,
Roger Clinton clearly attempted to use his relationship to the
President to influence the Commission improperly and win
Gambino's release.
The Chief of Staff of the Parole Commission hindered
the FBI's investigation. In 1998, the FBI began investigating
Roger Clinton's contacts with the Parole Commission. However,
it met resistance from Marie Ragghianti, the Chief of Staff of
the Parole Commission. Ragghianti, who had participated in
meetings with Roger Clinton on the Gambino case, objected to
the FBI investigation and successfully halted an FBI plan to
have an undercover agent meet with Clinton posing as a Parole
Commission staffer. She also attempted to keep the FBI from
recording a meeting between Roger Clinton and a Parole
Commission staffer. Ragghianti's efforts may have kept the FBI
from reaching a full understanding of Roger Clinton's
involvement in the Gambino case.
Roger Clinton lied to FBI agents investigating his
contacts with the Parole Commission and his relationship with
the Gambino family. When interviewed by the FBI in 1999, Roger
Clinton said that he had never represented to anyone at the
Parole Commission that the President was aware of his contacts
with the Commission on behalf of Rosario Gambino. This self-
serving claim is contradicted by contemporaneous, written
memoranda detailing Clinton's contacts as well as by the vivid
and credible recollections of Parole Commission staff. Clinton
also lied about the purpose of a $50,000 check from the
Gambinos, which he deposited on the day of the FBI's interview.
While it is unclear whether he deposited the check before or
after the interview, Clinton told the agents that Tommy Gambino
had offered to loan him money for a down payment on his house.
He repeated this explanation to the media when news of the
money became public in 2001. However, after reviewing both
Clinton's and Gambino's bank records, the Committee has found
no evidence that Clinton used the $50,000 for a down payment or
that he ever repaid any of the money. Accordingly, his claim to
the FBI that the money was merely a loan is false. During his
interview, Clinton also told the FBI agents three separate and
contradictory stories in response to questions about his
receipt of a Rolex watch from Tommy Gambino before finally
producing a Rolex to the agents and claiming he had bought it
in Tijuana, Mexico.
Roger Clinton apparently lobbied the White House to
grant a commutation to Rosario Gambino. In the last days of the
Clinton Administration--after Roger Clinton had failed to win
parole for Rosario Gambino and after he had received a Rolex
watch and $50,000 from the Gambino family--the White House
received a petition for commutation for Rosario Gambino.
Documents indicate that the White House lawyer responsible for
clemency matters requested a criminal background check on
Gambino, which is normally done when some serious consideration
is being given to a grant of clemency. The obvious and logical
inference that explains how the Gambino petition garnered that
level of attention at the White House is that Roger Clinton was
pushing for it. Because key Clinton White House staff have
refused to answer questions about this matter, it is unknown
whether Roger Clinton hand-delivered the Gambino petition as he
did with others or whether he brought it to the attention of
the White House some other way. Although the President did not
ultimately grant clemency to Gambino, the circumstances
surrounding the consideration of his petition are nevertheless
suspect. The fact that granting clemency to a mobster and
confirmed criminal like Gambino was considered at all is
disturbing enough, but the reason it was considered is even
more offensive. The Gambino family was apparently able to
purchase access to the parole and clemency processes with cash
payments and expensive gifts to the brother of the President of
the United States. Moreover, despite an FBI investigation of
the matter, the Justice Department has, to date, been unwilling
or unable to prosecute Clinton for any of his activities.
Roger Clinton received a substantial portion of $225,000 that
was swindled from the Lincecum family in Clinton's name with
the promise of a pardon that never came.
The Lincecum family paid $225,000 to obtain a pardon
for Garland Lincecum. In 1998, Garland Lincecum, a convicted
felon, was informed that he could purchase a presidential
pardon for $300,000. Lincecum was told that Arkansas
businessmen Dickey Morton and George Locke, who had a close
relationship with Roger Clinton, could obtain the pardon.
Lincecum borrowed $225,000 from his mother and brother and
claims that a business associate paid another $70,000 to Morton
and Locke for his pardon. The money he borrowed from his family
constituted their life savings and means of support in
retirement.
Roger Clinton received at least $43,500 in proceeds
from the Lincecums' payments to Morton and Locke. Dickey
Morton, George Locke, and Roger Clinton divided the funds among
themselves with Roger Clinton receiving a total of $25,500 in
checks and $18,000 in cash. The Lincecums paid the checks to a
company called CLM, which they were told stands for Clinton,
Locke, and Morton. Dickey Morton then disbursed the funds from
the company's bank account to Clinton, Locke, and himself.
Roger Clinton has falsely denied any relationship with CLM
while offering no explanation of why he received this
substantial share of an elderly woman's retirement savings
through CLM.
Roger Clinton may have been involved in a scheme to
defraud the Lincecums. Garland Lincecum never received a
pardon, and there is no evidence that Dickey Morton, George
Locke, or Roger Clinton ever submitted Lincecum's name to the
Justice Department or White House for consideration for a
pardon. Therefore, it appears that the Lincecums were the
victims of a scam perpetrated by Morton, Locke, and perhaps
Roger Clinton as well.
Roger Clinton may have been involved in lobbying for as many as
13 other pardons and commutations.
Roger Clinton publicly admitted involvement in six
clemency efforts, but the evidence connects him to many more.
Roger Clinton told the media that he had asked for pardons for
approximately six close friends and that he did so because of
concern for them and not for any personal gain. For example,
Roger Clinton lobbied for pardons for George Locke and Dan
Lasater, two associates from Arkansas who were convicted of
drug offenses together with Clinton himself in the 1980s.
However, the Committee has obtained evidence connecting Clinton
to many more pardon seekers. Some of the cases involve people
who were not his personal friends and some involve
solicitations or offers of money and lucrative business
opportunities in exchange for his ability to place a clemency
petition in front of the President.
Roger Clinton was asked to lobby for a pardon for
horse breeder J.T. Lundy in exchange for secretly sharing
profits in a lucrative business venture. Lundy promised Clinton
a share of a the profits from a Venezuelan coal deal in
exchange for Clinton's help in obtaining a pardon for him.
Lundy suggested a scheme whereby the payments to Clinton could
be concealed by placing his share of the profits in Dan
Lasater's name. Lasater, who owned a 20 percent interest in the
venture, discussed the possibility of a pardon for Lundy with
Roger Clinton.
Roger Clinton delivered the pardon petition of
former Reagan EPA official Rita Lavelle to the White House.
According to Lavelle, an intermediary for Roger Clinton asked
her for a $30,000 fee for him to hand-carry her petition to the
President. Lavelle responded that she could not afford to pay
any money, but she said Clinton agreed to deliver the petition
anyway. On the last night of the Clinton presidency, Roger
Clinton asked Lavelle, ``do you have $100,000 to get this
through?'' Being bankrupt, however, Lavelle laughed at the
question. She did not pay Clinton any money and did not receive
a pardon.
Roger Clinton was asked to lobby for a pardon for
Houston real estate developer John Ballis, and Ballis' petition
was seriously considered at the White House. After being
convicted of S&L fraud, Ballis married a former employee of Dan
Lasater and friend of Roger Clinton. Through his wife's
connection, Ballis sought Roger Clinton's help. Clinton first
lobbied for Ballis before the U.S. Parole Commission, sometimes
during the same meetings in which he lobbied for mobster
Rosario Gambino. Ballis credited Clinton with helping him
obtain early release and sought his help in obtaining a
presidential pardon to eliminate his parole supervision and
restitution payments. While he was not granted any form of
clemency, the President reviewed his petition, and a White
House lawyer called Ballis' lawyer two nights before
inauguration day to ask if Ballis would accept a grant of
clemency that left intact his obligation to pay restitution.
Roger Clinton lobbied his brother to grant clemency
to Steven Griggs, the son of the chief of an unrecognized
American Indian tribe, who was in prison on drug charges. Like
Ballis, Steven Griggs was not a close friend of Roger Clinton's
but merely someone who knew someone who knew him. Griggs also
did not receive clemency, but Roger Clinton helped ensure that
Griggs' petition was brought to the attention of the President
even though Griggs had been a fugitive for a year before being
sentenced. Griggs argued in his petition that he had received
an unusually harsh sentence but failed to mention that he had
fled after his conviction. It is not clear what motivated Roger
Clinton to assist Griggs, but some evidence suggests that the
tribe may have planned to open a casino when and if it were to
become recognized by the federal government.
According to his former lawyer, Arkansas restaurant
operator Phillip Young was approached with an offer to obtain a
pardon through Roger Clinton for $30,000. While Young denied to
Committee staff that he was actually approached by anyone with
such a proposal, his denial is not as credible as his former
attorney's version of events.
Both the White House and the Justice Department hindered the
Committee's investigation of Roger Clinton by improperly
refusing to produce key documents.
For months, the Bush White House prevented the
National Archives from producing even non-deliberative,
clemency-related records from the Clinton administration. The
Committee did not learn that President Clinton had been
considering a clemency petition from notorious mobster Rosario
Gambino until after Archives personnel ``inadvertently''
produced documents that President Bush's Counsel had sought to
withhold. The accidental production also included documents
relating to three other previously unknown individuals who had
sought clemency through Roger Clinton. The Bush Administration
did manage to retain four additional deliberative Gambino
documents from the files of the Clinton White House, refusing
to produce the records even though they were not subject to any
executive privilege claim.
The Ashcroft Justice Department produced certain
Gambino-related records, but inexplicably withheld others.
After producing sensitive documents such as U.S. Parole
Commission files related to Rosario Gambino and a summary of an
FBI interview with Roger Clinton, the Justice Department ceased
producing additional documents, claiming they were related to
an ongoing criminal investigation, even though the Clinton-
Gambino matter had reportedly been closed in 2000.
HUGH RODHAM'S INVOLVEMENT IN THE VIGNALI COMMUTATION
Vignali's clemency petition was false and misleading.
Carlos Vignali lied in his clemency petition. First,
he continued to maintain his innocence, despite overwhelming
evidence of his involvement in selling a substantial amount of
cocaine across state lines and a specific finding by the
sentencing judge that he lied at trial about his involvement in
a large drug distribution network. Second, Vignali claimed that
he was a first-time offender, despite the fact that he had a
prior criminal record. By not accepting responsibility for his
crime and lying about his background, he should not have been
eligible for executive clemency.
Vignali's supporters provided letters of support which were
false and misleading.
A key element of the campaign by Carlos Vignali and
his father Horacio Vignali, was a series of letters on Carlos'
behalf from prominent Los Angeles politicians. A number of
these letters contained misleading statements calculated to
create the impression that Carlos Vignali was innocent. The
officials who submitted letters included Representative Xavier
Becerra, Representative Esteban Torres, State Assembly Speaker
Robert Hertzberg, State Assembly member Antonio Villaraigosa,
State Senator Richard Polanco, Los Angeles County Supervisor
Gloria Molina, Los Angeles City Councilmember Mike Hernandez,
and Cardinal Roger Mahony, Archbishop of Los Angeles.
Los Angeles County Sheriff Lee Baca provided critical support
for the Vignali commutation, which was inappropriate, given his
position.
Sheriff Baca had a close relationship with Horacio
Vignali which was based on Vignali's political and financial
support for Baca. Sheriff Baca has known Horacio Vignali since
1991, and Vignali has been a key political supporter of Baca,
giving him at least $11,000 in contributions and raising
between $60,000-$70,000 more.
Sheriff Baca spoke with the White House in support
of the Vignali commutation. In January 2001, Baca received a
telephone call from Hugh Rodham in which Rodham told Baca that
he would get a call from the White House about Horacio Vignali.
Shortly thereafter, Baca received a call from White House staff
and spoke in support of Horacio Vignali. Based on Baca's
statements in this telephone call, White House staff clearly
and justifiably concluded that Baca supported the commutation
of Carlos Vignali's sentence.
Sheriff Baca continues to claim, without any basis,
that he did not support the Vignali commutation. Rather than
express regret for his role in the Vignali commutation, Sheriff
Baca maintains that he opposed the Vignali commutation and did
nothing that could have been interpreted as support for the
commutation. However, Sheriff Baca's supposed opposition to the
Vignali commutation does not square with the fact that: (1) he
drafted a letter which he believed Horacio Vignali would use in
the clemency effort; and (2) when he was asked squarely by the
White House if the President should commute Vignali's prison
sentence, he stated that it was ``the President's decision to
make,'' rather than express his opposition. These facts, and
others outlined in this report, indicate that Sheriff Baca
wanted to support the Vignali commutation, but was afraid of
creating a paper record which would clearly indicate his
support.
Sheriff Baca's efforts on behalf of the Vignalis are
even more inappropriate given that there were extensive
allegations that Horacio Vignali, Carlos' father, was also
involved in illegal drug trafficking. It is inappropriate
enough for a senior law enforcement official like Baca to
support a grant of clemency for an unrepentant, large-scale
drug dealer like Carlos Vignali. However, when coupled with
credible allegations indicating that Horacio Vignali was a drug
dealer, and in fact was the source of cocaine supply for his
son, Baca's support of Horacio and Carlos Vignali is even more
inappropriate.
U.S. Attorney Alejandro Mayorkas provided critical support for
the Vignali commutation, which was inappropriate, given his
position.
U.S. Attorney Alejandro Mayorkas called the White
House in support of the Vignali commutation. Mayorkas, the top
federal prosecutor in Los Angeles, was asked by Horacio Vignali
to call the White House in support of his son's clemency
petition. Mayorkas then called the White House about the
Vignali commutation. While Mayorkas does not recall the details
of his conversation, he now concedes that his call conveyed
support for the Vignali commutation.
Mayorkas supported the Vignali commutation despite
his ignorance of the facts of the case and his knowledge that
the prosecutors responsible for the Vignali case opposed
clemency. Before he called the White House, Mayorkas had spoken
twice with Todd Jones, the U.S. Attorney responsible for the
Vignali case. Jones told Mayorkas that Vignali was a ``major
player'' in drug trafficking, that he was ``bad news'' and that
Mayorkas should not ``go there'' when it came to Vignali.
Despite these warnings from a prosecutor who was intimately
familiar with the Vignali case, Mayorkas still called the White
House in support of the Vignali commutation.
Mayorkas' support for the Vignali commutation was
inappropriate. Mayorkas knew little about the Vignali case.
What he did know indicated that Carlos Vignali was an
unrepentant large-scale criminal. These facts alone make his
support for the commutation, as a senior federal prosecutor,
totally inappropriate.
There are a number of allegations that both Horacio and Carlos
Vignali were involved in illegal drug trafficking.
There are allegations that, in addition to his son,
Horacio Vignali was involved in illegal drug trafficking and
that Carlos Vignali was involved in drug trafficking far beyond
the conduct which led to his conviction in Minnesota. DEA
reports documenting these allegations include the following
statements:
``[Horacio Vignali] negotiated with ATF agents to sell
a machine gun and stated to them that he had also
smuggled heroin into the United States utilizing
automobiles.''
``[Redacted] has also purchased cocaine from Carlos
Vignali Jr. of Los Angeles . . . Vignali's father
Carlos Vignali aka ``pops'' owns a body shop, at 1260
Figueroa and is the source of supply for his son.''
``Carlos Horatio Vignali's role in [George Torres' drug
dealing] organization is relatively unknown at this
time. It is believed that Vignali functions as a
financial partner in the organization.''
These DEA reports are corroborated by law
enforcement personnel who indicate that they had received
information indicating that both Horacio and Carlos Vignali
were involved in large-scale drug trafficking. These charges
have never been formally made in court, or substantiated by
physical evidence. However, the mere existence of such
allegations should have precluded senior law enforcement and
political officials from supporting a commutation for Carlos
Vignali on the strength of his father's reputation. However, it
appears that no one checked with the DEA prior to granting the
commutation.
Hugh Rodham provided false and misleading information to the
White House in support of the Vignali commutation.
Hugh Rodham was paid $204,200 for his work on the
Vignali commutation. It appears that in return for this money,
he worked part-time for two months gathering materials in
support of Vignali's case and making telephone calls to White
House staff. It appears that Rodham's payment in the Vignali
matter was contingent upon his success, as he received the
$200,000 payment on January 24, 2001, after President Clinton
granted clemency to Vignali.
Rodham repeatedly provided false information during
his communications with the White House. First, and most
importantly, Rodham told Bruce Lindsey that the trial attorney
who prosecuted Vignali supported the commutation. This was
completely false. Second, Rodham told Lindsey that Vignali was
a first-time offender, when in fact, he had two prior
convictions and two other arrests. Rodham also told Lindsey
that Vignali ``did not play a major role in the offense,'' when
in fact, Vignali was a major source of cocaine for the
Minnesota drug-dealing ring at issue in his case.
Hugh Rodham told the White House that First Lady Hillary Rodham
Clinton was aware of his lobbying efforts and that the Vignali
commutation was ``very important'' to her.
Hugh Rodham told White House staff that the Vignali
commutation was ``very important to him and the First Lady as
well as others.'' This statement is confirmed by the
independent recollection of the White House staffer who spoke
to Rodham as well as the note which she took contemporaneously.
Rodham's statement raises two possibilities: first, that the
First Lady was aware of, and approved of, Hugh Rodham's
lobbying efforts; or second, that Hugh Rodham was lying to
White House staff regarding the First Lady's knowledge of his
efforts.
The White House sought the opinion of powerful Los Angeles
political figures, but failed to consult with the prosecutors
or judge who understood the Vignali case.
White House staff engaged in telephone conversations
with a number of outside individuals regarding the Vignali
case--Hugh Rodham, Lee Baca, and Alejandro Mayorkas, none of
whom knew very much about the Vignali case. It appears that key
White House staff gave great weight to the input provided by
Rodham, Baca, and Mayorkas, even though they knew little about
the case and had mixed motives.
White House staff failed to reach out to the
prosecutors who had convicted Vignali, or the judge who
sentenced him. White House staff justified their failure to
take this simple action by concluding that they knew that the
prosecutors and judge would object, so there was no need to
speak to them. However, if the White House had spoken to Todd
Jones, Denise Reilly, Andrew Dunne, or Judge David Doty, they
would have learned that Carlos Vignali: (1) was not a small-
time drug dealer; (2) was unrepentant about his criminal
activity; and (3) never cooperated with law enforcement by
telling them who supplied him cocaine.
The White House ignored the strenuous objections to the Vignali
commutation which were lodged by the Pardon Attorney.
The Pardon Attorney provided the White House with a
report that contained his recommendation against granting the
Vignali commutation. This report contained a number of powerful
arguments against the commutation, which were apparently
ignored by the White House. The existence of the Pardon
Attorney's report means that the White House cannot claim that
it was totally unaware that Vignali's arguments were completely
false. The White House knew that the Vignali clemency petition
had no merit, yet decided to grant the commutation anyway.
President Clinton's decision raises questions about why the
Vignali commutation was granted.
Rodham has apparently misled the public about returning to the
Vignalis those fees he received in connection with the clemency
and ignored former President and Senator Clinton's request that
he do so.
On February 21, 2001, at the request of former
President Clinton and Senator Hillary Rodham Clinton, Rodham
promised to return to Horacio Vignali the legal fees he
received in connection with the Vignali clemency. But, as of
June 2001, Rodham had apparently returned only about $50,000 of
the money that Horacio Vignali paid him. Rodham's attorney has
confirmed to Committee staff that Rodham has not returned any
additional amounts and has no plans to return the remaining
$154,000.
HUGH RODHAM'S INVOLVEMENT IN THE BRASWELL PARDON
Glenn Braswell was under investigation by multiple federal
agencies and several state attorneys general when the pardon
was granted.
Over the past two decades, Braswell has created a
dietary supplement empire using false advertising to mislead
consumers. After serving time in prison for mail fraud and tax
evasion in 1983, Braswell has continued to defraud consumers
about the benefits of his herbal remedies. In addition to
facing numerous lawsuits, Braswell's companies have been
investigated by the Internal Revenue Service, Federal Trade
Commission, Food and Drug Administration, and Better Business
Bureau.
Unsurprisingly, Braswell was under another criminal
investigation by federal prosecutors for a massive tax evasion
and money-laundering scheme when he was pardoned. Braswell's
petition bypassed the traditional route through the Justice
Department and went directly to the White House. If the FBI had
conducted a background investigation instead of the White
House, Braswell's petition would have been rejected quickly.
Braswell paid Hugh Rodham $230,000 for successfully obtaining
the pardon.
Braswell hired Rodham to support his pardon petition
for $230,000. For this price, Rodham claims he forwarded a
letter of support for Braswell to the White House Counsel's
Office, and he made a follow-up inquiry. According to Rodham,
these two actions were the extent of his role in the Braswell
pardon. Rodham refunded the $230,000 to Braswell after facing
widespread criticism from the media and members of both
political parties.
HUGH RODHAM'S EFFORTS TO LOBBY FOR CLEMENCY FOR THE LUMS
Gene and Nora Lum, prominent Democratic contributors and
fundraisers, were convicted of making illegal conduit
contributions and tax offenses.
In 1997, the Lums pleaded guilty to making $50,000
in illegal conduit contributions to the DNC. They were
sentenced to home detention, confinement in a halfway house and
a $30,000 fine. In August 1998, Gene Lum pleaded guilty to tax
fraud for filing tax returns claiming more than $7.1 million in
false deductions and was sentenced to two years imprisonment.
The Lums attempted to obtain executive clemency through Hugh
Rodham.
Hugh Rodham lobbied the White House as part of the
Lums' efforts but failed to secure them a grant of clemency. In
December 2000, Nora Lum called one of her husband's criminal
attorneys and asked him to send various documents to Hugh
Rodham at the White House. He did so. In early January 2001,
Rodham called Gene Lum's attorney again and asked him to resend
those documents directly to, among others, Meredith Cabe, an
associate White House counsel responsible for clemency matters.
Subsequently, Rodham telephoned Cabe and discussed the merits
of the Lums' pardon request. Cabe then told White House Counsel
Beth Nolan and Deputy White House Counsel Bruce Lindsey about
her discussion with Rodham. Both told Cabe that the Lums were
not going to receive clemency.
The Lums and Hugh Rodham have refused to cooperate with the
Committee's investigation.
Gene and Nora Lum have refused to cooperate with the
Committee's investigation. The Lums' daughter, Nicole (with
whom Hugh Rodham apparently had some sort of business
relationship), has likewise declined to be interviewed by the
Committee. Hugh Rodham has also refused to cooperate with the
Committee's request for an interview. Therefore, the Committee
is unable to obtain a full understanding of the Lums' efforts
to obtain executive clemency and Rodham's role in those
efforts.
TONY RODHAM'S EFFORTS TO LOBBY FOR EXECUTIVE CLEMENCY
Tony Rodham's Role in the Case of Edgar and Vonna Jo Gregory
Tony Rodham lobbied President Clinton to grant
pardons to Edgar and Vonna Jo Gregory while he was receiving
substantial sums of money from the Gregorys. Rodham received
$244,769 in salary from the Gregorys over two and a half years
and also received another $79,000 in loans from the Gregorys.
The Gregorys claim that they paid Rodham this large sum of
money for various consulting services that Rodham provided to
the Gregorys. However, the Gregorys do not have any
documentation reflecting work performed for them by Rodham.
Given the fact that the Gregorys do not have any
documentary evidence reflecting the $244,769 of work performed
for them by Rodham, substantial questions are raised as to what
Rodham actually did for the Gregorys that was so valuable. The
most valuable thing that Rodham did for the Gregorys was to
obtain presidential pardons. Therefore, there is a substantial
question as to whether the Gregorys paid Rodham for his efforts
to obtain presidential pardons for them.
If Rodham was paid to obtain presidential pardons
for the Gregorys, it creates the strong appearance of
impropriety. The prospect of financial benefit for Rodham would
taint Rodham's actions in lobbying for the pardon. Also, if
President Clinton knew about Rodham's financial arrangement, it
would taint his actions in granting the pardons.
Compounding the appearance of impropriety in the
Gregory case is the fact that the pardons were opposed by the
Justice Department, the prosecutors responsible for the case,
and also the Gregorys' sentencing judge. Apparently, the only
people in the Clinton Administration who felt that the Gregorys
deserved pardons were President Clinton and Deputy White House
Counsel Bruce Lindsey, both of whom knew of Tony Rodham's
involvement in the matter.
Tony Rodham's Role in the Case of Fernando Fuentes Coba
Tony Rodham offered to help Vivian Mannerud obtain a
pardon for her father, Fernando Fuentes Coba, in exchange for
$50,000. When Rodham learned in late 2000 that Mannerud was
seeking a pardon for her elderly father, he met with Mannerud
and told her that he could help obtain the pardon if she paid
him a $50,000 consulting fee. Rodham told Mannerud that he had
successfully obtained pardons before and showed her the
Gregorys' pardon petition to support his claim.
Rodham attempted to convince Mannerud to hire him by
making a number of false representations to her. Rodham told
Mannerud that he was close personal friends with the Pardon
Attorney, Roger Adams. Rodham also told Mannerud that he would
use the $50,000 to hire a law firm to handle her case and that
Roger Adams' wife worked at the law firm, which would help her
case be treated favorably. All of these representations were
completely false and were apparently made to mislead Mannerud
as to the purpose of the payment to Rodham.
Mannerud rejected Rodham's offer. Mannerud was
concerned that Rodham could not guarantee that he could obtain
a pardon in exchange for the $50,000. She was also concerned
about becoming embroiled in a scandal. Therefore, she rejected
Rodham's offer.
After Mannerud rejected Rodham's offer, an associate
of Rodham came back to Mannerud with another offer. According
to Mannerud, a month after she rejected Tony Rodham's proposal,
Marilyn Parker, a mutual friend of Rodham's and Mannerud's who
attended the initial meeting between them, came back to
Mannerud and told her that Rodham now wanted only $30,000 to
help her obtain a pardon for her father. Mannerud was still
concerned about the nature of Rodham's proposal and rejected
it.
The actions taken by Rodham and Parker may have been
illegal. Rodham, and maybe Parker as well, engaged in an effort
to defraud Mannerud. While the effort was unsuccessful, it may
have constituted criminal conduct. The Committee recommends
that the Justice Department investigate these allegations.
PRESIDENT CLINTON'S GRANT OF CLEMENCY TO DRUG MONEY LAUNDERER
HARVEY WEINIG
Weinig was properly imprisoned for conspiring to launder
millions of dollars in drug money and concealing and furthering
an extortion-by-kidnapping scheme.
Weinig, a former Manhattan attorney, conspired to
launder about $19 million in drug proceeds through a Swiss bank
for the Cali cartel. Members of the money laundering
organization, of which Weinig was a part, boasted that they
successfully laundered more than $70 million for the cartel. In
addition to conducting banking transactions for the
organization, Weinig consulted with co-conspirators in
furtherance of the organization's activities and stored the
drug proceeds in his New York City apartment.
Weinig and other co-conspirators at his law firm
stole from the Cali cartel about $2.5 million they were
supposed to have laundered. This theft exposed Weinig's family
to a risk of being harmed by those drug dealers. In the course
of investigating the organization's money laundering
activities, authorities intervened when they learned that the
drug dealers sent a hit man to kill one of Weinig's co-
conspirators.
Weinig learned that one of his co-conspirators
kidnapped an individual as part of a scheme to extort money
from the victim's family. Rather than report the kidnapping,
Weinig made his office available as a meeting place where the
ransom could be delivered and directed his associates at the
firm to execute transfer agreements.
Weinig's lawyer, a prominent Washington attorney with close
connections to the Clinton Administration, lobbied the White
House in support of Weinig's clemency petition.
Weinig's wife, Alice Morey, retained Reid
Weingarten, who was close to the Clinton White House, to lobby
for the commutation. In April 2000, Weingarten filed a clemency
petition on Weinig's behalf with the Justice Department and the
White House. Knowing that the Justice Department would advise
the President to reject the Weinig commutation petition,
Weingarten lobbied the White House directly, approaching White
House Counsel Beth Nolan, Deputy White House Counsel Bruce
Lindsey and Chief of Staff John Podesta.
Weingarten chose not to familiarize himself with the
facts of Weinig's underlying conviction. Accordingly, he was
unable to convey to those he lobbied a full, accurate factual
basis of the merits of Weinig's petition.
Two former Clinton Administration officials, David Dreyer and
Harold Ickes, lobbied the White House on Weinig's behalf.
Alice Morey enlisted the assistance of her cousin,
former White House Deputy Communications Director David Dreyer.
Dreyer repeatedly raised the Weinig commutation with John
Podesta. Ultimately, Podesta recommended that the President
grant the Weinig commutation. Dreyer has invoked his Fifth
Amendment rights rather than cooperate with the Committee's
investigation.
Morey also obtained support for Weinig's commutation
from former Deputy Chief of Staff Harold Ickes, whose children
attended the same school as did her sons. Ickes discussed the
Weinig case with President Clinton twice and recommended the
commutation of Weinig's sentence.
The Justice Department repeatedly and adamantly recommended
against the commutation of Weinig's sentence.
On several occasions, U.S. Attorney Mary Jo White,
whose office convicted Weinig, objected to any reduction of
Weinig's sentence. Ultimately, in a report to President
Clinton, the Pardon Attorney and Deputy Attorney General Eric
Holder voiced their strong opposition to a commutation of
Weinig's sentence.
Pardon Attorney Roger Adams submitted a report to
the President advising against the Weinig commutation. Adams
pointed out that Weinig ``was a well-respected lawyer who used
his professional skills to assist in laundering millions of
dollars that he knew constituted the proceeds of a huge
narcotics trafficking enterprise. He was involved in this
activity for an extended period of time, and he admits that he
engaged in it purely out of greed.'' Adams also informed the
President that Weinig ``aided and abetted the extortion of
money from an individual he knew had been kidnapped at the
direction of a co-defendant in order to coerce the production
of a ransom.''
After an apparently cursory review, the White House set aside
the Justice Department's negative recommendation and granted
Weinig clemency.
Support for Weinig's petition from John Podesta and
Beth Nolan appears to have been critical. The Associate White
House counsels responsible for clemency matters did not support
the petition. However, setting aside the negative
recommendations of not only the Justice Department but also
staff at the White House Counsel's Office, Nolan and Lindsey,
who were lobbied by Weingarten, recommended Weinig's clemency
to President Clinton. John Podesta, who was lobbied by
Weingarten and Dreyer, also recommended to the President that
Weinig's sentence be commuted.
The White House was unjustified in commuting Weinig's sentence.
None of the arguments made by Weinig entitle him to
executive clemency. In his petition, Weinig stated three main
reasons why his sentence should have been commuted: (1) his
sentence was disproportionate and excessive; (2) his
contributions to society justified his early release from
prison; and (3) one of his children was suffering emotional
difficulties as a result of his imprisonment and needed him to
return home. The first reason is simply not true. Weinig's
sentence was comparable to those received by other co-
conspirators who were directly responsible for laundering large
amounts of drug money and declined to cooperate with
authorities. Weinig's sentence was also comparable to those
received by co-defendants who participated in the extortion-by-
kidnapping scheme, which Weinig concealed and facilitated. The
other two reasons fail to distinguish Weinig from the vast
number of other similarly situated felons, who were properly
sentenced but whose families have suffered because of their
imprisonment.
President Clinton's commutation of Weinig's sentence has sent
out the wrong message about the United States' commitment to
fighting drug trafficking.
President Clinton's decision conveyed an appearance
of granting special consideration to wealthy, politically well-
connected criminals and their relatives. Pardon Attorney Roger
Adams foresaw the message sent by the Weinig commutation,
warning President Clinton that ``[t]o commute [Weinig's] prison
term to the five years he proposes would denigrate the
seriousness of his criminal misconduct, undermine the
government's legitimate interest in encouraging prompt guilty
pleas and truthful cooperation from criminal defendants, and
could give the appearance of granting special consideration to
economically advantaged, white-collar offenders.''
The Weinig commutation undermines the nation's
efforts to fight the illegal drug trade. Complaints are
frequently made that U.S. drug laws punish low-level drug
criminals too severely, yet do not punish high-level drug
distributors enough. When a large-scale drug money launderer
like Harvey Weinig receives executive clemency after serving
five years of an eleven-year sentence, it sends the message
that the U.S. is not serious about prosecuting the high-level
criminals who make the drug trade possible.
The Weinig commutation has eroded the United States'
moral authority to press other countries to fight the drug
trade within their own borders. The Weinig commutation could
harm the efforts of the U.S. government to extradite drug
traffickers and money launderers from Latin America. Newspapers
in Latin American countries have accused the U.S. of hypocrisy
in the Weinig case. For example, in Colombia's leading daily,
former Colombian attorney general Gustavo De Greiff, in an op-
ed entitled ``The Morality of the Strongest,'' labeled
President Clinton's clemency decision ``monstrous.''
INTRODUCTION
A. Why the Committee Investigated These Matters
Unlike most other powers granted to the President by the
Constitution, the power to grant executive clemency is
virtually unchecked. Some have argued that because the power to
grant clemency is unlimited, Congress has no oversight role
over grants of executive clemency. The opposite is true.
Because the President can grant clemency to whomever he wants
for whatever reasons, it is critically important that certain
grants of clemency be subject to Congressional and public
scrutiny. If this scrutiny were not applied to grants of
clemency, the power could easily be abused. As James Madison
observed:
A popular Government, without popular information, or
the means of acquiring it, is but a prologue to a Farce
or a Tragedy; or perhaps both. Knowledge will forever
govern ignorance: And a people who mean to be their own
Governors, must arm themselves with the power which
knowledge gives.\1\
---------------------------------------------------------------------------
\1\ James Madison, The Writings of James Madison 103 (Gaillard Hunt
ed., 9th ed. 1910).
While the grants of clemency issued by President Clinton will
not, and cannot, be overturned by the Committee's
investigation, this report can serve a valuable purpose to
inform the public about President Clinton's abuse of power in
issuing grants of clemency to so many undeserving individuals.
The report can also serve as a reminder to future Presidents
not to exercise their pardon power in such a reckless and
corrupting fashion.
Before President Clinton, when a President made
controversial grants of clemency, he often provided a full
accounting of his reasons for the decision. For example, when
President Ford pardoned former President Nixon in 1974,
President Ford made an unprecedented appearance before the
House Judiciary Committee to explain his decision.\2\ When
President George H.W. Bush pardoned Caspar Weinberger for his
involvement in the Iran-Contra matter, he provided a full
accounting of his decision in a public statement and released a
number of documents dispelling any concerns that President
Bush's pardon was meant to cover up his own involvement in the
Iran-Contra matter.\3\ President Bush even consulted with
prominent Democratic Members of Congress before issuing the
Weinberger pardon to see if they would object.\4\ However,
President Clinton issued a number of controversial pardons and
commutations and failed to ever provide a satisfactory
accounting for his decisions. Not only did he avoid
consultation with Members of Congress, but President Clinton
also avoided consultation with his own Justice Department and
other knowledgeable agencies. Moreover, President Clinton has
declined to answer any questions about his decisions, choosing
instead to make occasional self-serving statements to friendly
reporters.\5\
---------------------------------------------------------------------------
\2\ ``Pardon of Richard M. Nixon and Related Matters,'' Hearing
Before the House Comm. on the Judiciary, 93rd Cong. (Oct. 17, 1974).
\3\ 57 Fed. Reg. 62,145 (1992).
\4\ According to news reports, House Speaker Tom Foley, Chairman
Les Aspin, and Senator Daniel Patrick Moynihan told President Bush that
they would not object to the Weinberger pardon. Senator Moynihan even
urged President Bush to grant a pardon to Iran-Contra figure Elliot
Abrams, a former Moynihan aide. See Marjorie Williams, Burden of Proof,
Wash. Post Mag., Apr. 11, 1993, at 6; Rowland Evans and Robert Novak,
Bush Faces Fallout on Iran-Contra Pardons, Chi. Sun-Times, Dec. 30,
1992, at 25.
\5\ See, e.g., Rivera Live (CNBC television broadcast, Feb. 15,
2001).
---------------------------------------------------------------------------
President Clinton's abuse of the clemency power began with
the August 11, 1999, grants of clemency to 16 terrorists who
were part of the FALN and Macheteros terrorist network. When
the Committee and the public understandably raised questions
regarding these grants of clemency, President Clinton did
nothing to answer those questions. Rather, he invoked executive
privilege over 2,800 pages of documents which would have showed
why he made his decision.\6\ When President Clinton did attempt
to offer an explanation for the FALN clemency, it was factually
inaccurate. Indeed, some documents indicated that the President
made his decision for political benefit.\7\ For example, one
document said that the release of the 16 terrorists would
``have a positive impact among strategic Puerto Rican
communities in the U.S. (read, voters).'' Another document
stated: ``[t]he Vice President's Puerto Rican position would be
helped.'' \8\
---------------------------------------------------------------------------
\6\ Log of Documents Subject to Executive Privilege, noted in ``The
FALN and Macheteros Clemency: Misleading Explanations, A Reckless
Decision, A Dangerous Message,'' Hearing Before the Comm. on Govt.
Reform, 106th Cong. 325-68 (Dec. 10, 1999).
\7\ See generally ``The FALN and Macheteros Clemency: Misleading
Explanations, A Reckless Decision, A Dangerous Message,'' Hearing
Before the Comm. on Govt. Reform, 106th Cong. (Dec. 10, 1999).
\8\ Id.
---------------------------------------------------------------------------
In the final hours of his term, President Clinton issued
141 pardons and 36 commutations.\9\ While other Presidents had
issued controversial pardons and commutations, never before had
a President made so many grants of clemency with so little
justification. To understand the wholesale nature of the
President's questionable clemency grants, it is useful to
recall that he granted clemency to 13 individuals convicted in
connection with independent counsel investigations of the
Clinton Administration.\10\ Strong arguments could be made
against all of these grants of clemency. The individuals who
received these grants of clemency were convicted of serious
crimes, and many of them played significant roles in major
political scandals. For example, Susan McDougal was convicted
of mail fraud, misapplication of funds, and false statements,
and then was jailed on contempt of court charges for refusing
to tell a grand jury whether President Clinton had testified
truthfully at her trial. If Susan McDougal were not a close
friend of the President, her pardon would be troubling enough.
She was a convicted felon who defrauded a bank and defied the
right of a grand jury to receive honest testimony. Considering
that McDougal was a close friend of the President, who was
jailed for contempt rather than testify against him, there is
the indelible appearance that the pardon was a reward for
McDougal's silence. Yet the Committee did not investigate the
McDougal pardon or any of the other 12 pardons and commutations
relating to independent counsel investigations. Neither did the
Committee investigate the pardons and commutations granted to
former Congressman Mel Reynolds,\11\ William Borders,\12\ or
CIA Director John Deutch,\13\ all of which were subject to
widespread criticism. Rather, the Committee limited its
investigation to pardons and commutations where there was no
credible explanation for the grant of clemency, and where there
was an appearance of impropriety relating to inappropriate
access or corruption. The fact that the Committee did not
investigate pardons like Susan McDougal's speaks volumes about
both the Committee's exercise of restraint and the severity of
the abuses in those cases the Committee did investigate.
---------------------------------------------------------------------------
\9\ Department of Justice Document Production DJ/PAO-MR-00009-23
(List of Pardon and Commutation Grants, Jan. 20, 2001) (Exhibit 1).
\10\ Individuals convicted in the Whitewater investigation and
receiving pardons on January 20, 2001, were: Susan H. McDougal; Robert
W. Palmer; Stephen A. Smith; and Christopher V. Wade. Individuals
convicted in the investigation of former Agriculture Secretary Mike
Espy and receiving pardons on January 20, 2001, were: Richard Douglas;
Alvarez Ferrouillet; John Hemmingson; James H. Lake; Brook K. Mitchell,
Sr.; and Jack L. Williams. Receiving a commutation for a conviction in
the Espy case was Ronald Blackley. Individuals convicted in the
Cisneros investigation and receiving pardons on January 20, 2001, were:
Henry Cisneros and Linda Jones. In addition, Archibald Schaffer, a key
defendant in the Espy investigation, received a pardon shortly before
the end of the Clinton Administration, on December 22, 2000.
\11\ Reynolds received a commutation for his federal convictions
for bank fraud, wire fraud, false statements, and conspiracy to
defraud. He also served time in prison for state convictions for sexual
misconduct, obstruction of justice, and solicitation of child
pornography. He is currently a registered sex offender in the state of
Illinois. See Illinois Sex Offender Information (visited Mar. 4, 2002)
(listing Reynolds' registration as a
sex offender).
\12\ Borders was convicted for participating in a conspiracy to
bribe federal judge Alcee Hastings. Borders refused to testify at
Hastings' criminal trial or his impeachment hearings, which resulted in
Borders' imprisonment for both contempt of court and contempt of
Congress. By granting clemency to Borders, President Clinton violated
his own standards as drafted by then-White House Counsel Jack Quinn.
Quinn wrote that ``offenses involving central involvement in political
corruption'' were among those President Clinton would not consider
``under almost any circumstances.'' Arnold & Porter Document Production
A0556-57 (Executive Clemency Policy, Jan. 26, 1996) (Exhibit 2).
\13\ Deutch was accused of mishandling hundreds of highly
classified documents, including information relating to covert actions,
storing many on a home computer used to surf ``high risk'' sites on the
internet, making the documents easily accessible to a hacker. Jerry
Seper, Deutch Planned Guilty Plea Before Clinton Pardoned Him, Wash.
Times, Jan. 25, 2001, at A3. Less than a day before receiving the
pardon, Deutch had signed a plea agreement wherein he admitted a
misdemeanor and agreed to pay a $5,000 fine. Vernon Loeb, Senate
Committee Questions Clinton's Pardon of Deutch, Wash. Post, Feb. 16,
2001, at A2.
---------------------------------------------------------------------------
The Committee investigated two types of clemency grants.
First was the case of Marc Rich and Pincus Green, which raised
substantial questions of direct corruption, primarily whether
pardons were issued in exchange for political and other
financial contributions. The second group of cases involved
indirect corruption, where close relatives of the President--
namely Roger Clinton, Hugh Rodham, and Tony Rodham--apparently
traded on their relationships with the President to lobby for
pardons and commutations. These cases raised serious concerns
that Roger Clinton and the Rodhams used their access to the
White House to lobby for pardons, in some cases successfully,
and received large payments for their lobbying efforts.
The Committee had three main purposes in its clemency
investigation. First, as discussed above, the Committee sought
to let the public know whether President Clinton had abused the
clemency power. By subjecting the President's exercise of
clemency to public scrutiny, the Committee hopes to make it
clear to future Presidents that history will hold them
accountable for clemency grants that are abusive. Second, the
Committee sought to determine whether there are adequate
safeguards in place to prevent individuals with close
relationships with the President from trading on their access
to win pardons. A number of the most troubling pardons granted
by President Clinton were the result of lobbying from former
White House staff like Jack Quinn or close relatives like Hugh
Rodham. Third, the Committee examined whether there are
adequate procedures in the pardon process to protect against
abuse by the President. While the Justice Department has
regulations governing its handling of applications for
clemency, the President is free to ignore those regulations,
and President Clinton did ignore them in the last month he was
in office. The key lesson to be learned from the facts detailed
in this report is that more disclosure is likely to remedy the
problems in each of these three areas of concern. Public
scrutiny after-the-fact may provide some deterrence, but a more
open process before a grant of clemency is likely to be more
effective. That is why the Committee moved legislation to
require public disclosure of contributions to entities like the
Clinton Library, given the potential effect of such
contributions on policymaking decisions.\14\ Another example of
potential legislation would be a clarification of the
definition of ``lobbying'' under the Lobbying Disclosure
Act.\15\ It could be amended to explicitly cover those who are
paid to contact executive branch officials on behalf of
clemency seekers.\16\ If Jack Quinn and Hugh Rodham had been
required to disclose their status publicly as paid lobbyists
seeking clemency for their clients, then Marc Rich and Carlos
Vignali may not have been pardoned. The public outcry could
have occurred beforehand and possibly prevented the damage done
by these grants of clemency to public confidence in the
integrity of government. Even if such a measure would not have
prevented these particular grants of clemency, knowing who is
paid to lobby for clemency would certainly assist future
presidents in making appropriate decisions.
---------------------------------------------------------------------------
\14\ As a result of the Committee's investigation into the Marc
Rich and Pincus Green pardons, the Committee voted out H.R. 577, the
Presidential Library Disclosure Act, a bill which ensures that
contributions to presidential libraries are publicly disclosed. This
bill was approved by the House of Representatives in a 392 to 3 vote on
February 5, 2002, and is awaiting action in the Senate.
\15\ 2 U.S.C. Sec. 1602(8)(a) currently defines a ``lobbying
contact'' as:
---------------------------------------------------------------------------
G. . any oral or written communication . . . to a covered
executve branch official . . . that is made on behalf of a
client with regard to--
G(i) the formulation, modification, or adoption of
Federal legislation (including legislative proposals);
G(ii) the formulation, modification, or adoption of a
Federal rule, regulation, Executive order, or any other
program, policy, or position of the United States
Government;
G(iii) the administration or execution of a Federal
program or policy (including the negotiation, award, or
administration of a Federal contract, grant, loan, permit,
or license);
Gor (iv) the nomination or confirmation of a person for
a position subject to confirmation by the Senate.
---------------------------------------------------------------------------
\16\ 2 U.S.C. Sec. 1602(8)(b)(xii) currently contains an exception
for ``a communication that is . . . made to an official in an agency
with regard to . . . a judicial proceeding or a criminal or civil law
enforcement inquiry, investigation, or proceeding.'' This exception
could arguably exclude lobbying for clemency from the statute's
disclosure requirements. But see In re Grand Jury Subpoenas, 179 F.
Supp. 270 (S.D.N.Y., Mar. 9, 2001) (holding that ``the pardon process
was not adversarial'' in the Marc Rich case, that his lawyers were
``acting principally as lobbyists,'' and that they were, therefore, not
entitled to withhold certain documents under the attorney-client
privilege).
---------------------------------------------------------------------------
B. President Clinton Deviated From All Applicable Standards
In his rush to grant pardons and commutations in the waning
hours of his presidency, Bill Clinton ignored almost every
applicable standard governing the exercise of the clemency
power. There were three obvious sources of guidance regarding
the exercise of the power. First, the Justice Department had
published guidelines regarding its handling of clemency
petitions. While these guidelines were not binding upon the
President, they should have provided guidance to the Justice
Department and the President. At a minimum, they provide a
mechanism to provide the President with relevant information.
The Justice Department guidelines state first that pardon
petitions should not be filed until five years after the
petitioner is released from prison, or, if no prison time is
served, five years after the date of conviction.\17\ The
guidelines also state that commutation petitions should not be
filed while there are other forms of judicial or administrative
relief, like appeals, still available.\18\
---------------------------------------------------------------------------
\17\ 28 C.F.R. Sec. 1.2 (2002).
\18\ 28 C.F.R. Sec. 1.3 (2002).
---------------------------------------------------------------------------
The U.S. Attorney's Manual also contains detailed standards
applied to clemency petitions by the Pardon Attorney's Office.
The Manual lists five standards applicable to the review of
pardon petitions:
1. Post-conviction conduct, character, and reputation.
An individual's demonstrated ability to lead a
responsible and productive life for a significant
period after conviction or release from confinement is
strong evidence of rehabilitation and worthiness for
pardon.
* * *
2. Seriousness and relative recentness of the offense.
When an offense is very serious (e.g., a violent crime,
major drug trafficking, breach of public trust, or
white collar crime involving substantial sums of
money), a suitable length of time should have elapsed
in order to avoid denigrating the seriousness of the
offense or undermining the deterrent effect of the
conviction. In the case of a prominent individual or
notorious crime, the likely effect of a pardon on law
enforcement interests or upon the general public should
be taken into account.
* * *
3. Acceptance of responsibility, remorse, and
atonement.
The extent to which a petitioner has accepted
responsibility for his or her criminal conduct and made
restitution to its victims are important
considerations. A petitioner should be genuinely
desirous of forgiveness rather than vindication. While
the absence of expressions of remorse should not
preclude favorable consideration, a petitioner's
attempts to minimize or rationalize culpability does
not advance the case for pardon.
* * *
4. The need for relief.
The purpose for which a pardon is sought may influence
disposition of the petition. A felony conviction may
result in a wide variety of legal disabilities under
state or federal law, some of which can provide
persuasive grounds for recommending a pardon.
* * *
5. Official recommendations and reports.
The comments and recommendations of concerned and
knowledgeable officials, particularly the United States
Attorney whose office prosecuted the case and the
sentencing judge, are carefully considered. The likely
impact of favorable action in the district or
nationally, particularly on current law enforcement
priorities, will always be relevant to the President's
decision.\19\
---------------------------------------------------------------------------
\19\ U.S. Attorney's Manual 1-2.112.
The U.S. Attorney's manual also contains standards for the
---------------------------------------------------------------------------
consideration of commutation petitions:
Generally, commutation of sentence is an extraordinary
remedy that is rarely granted. Appropriate grounds for
considering commutation have traditionally included
disparity or undue severity of sentence, critical
illness or old age, and meritorious service rendered to
the government by the petitioner, e.g., cooperation
with investigative or prosecutive efforts that has not
been adequately rewarded by other official action.\20\
---------------------------------------------------------------------------
\20\ U.S. Attorney's Manual 1-2.113.
A second source of guidance comes from a 1996 memorandum
from then-White House Counsel Jack Quinn to Deputy Attorney
General Jamie Gorelick and Pardon Attorney Margaret Colgate
Love. In this memorandum, Quinn issued a number of directives
from President Clinton regarding the exercise of his clemency
authority. Quinn first stated that the ``President intends to
continue to rely greatly on your joint recommendations
regarding clemency applications.'' Quinn also stated that
President Clinton had identified a number of factors in
addition to those listed in the U.S. Attorney's Manual, which
he wanted considered as part of the review of clemency
petitions:
The following circumstances would weigh in favor of
granting clemency:
1. Indications that the crime for which clemency is
sought was truly abberational, i.e., a lone instance of
criminal behavior in an otherwise exemplary life.
2. Cases committed long ago when the individual was
very young and which do not involve major crimes.
3. Cases not involving major crimes in which the
individual has clearly turned his or her life around by
making sustained and significant contributions to the
community since being released from prison.
By contrast, in certain cases, even extraordinarily
exemplary actions post-conviction may not merit the
remedy of executive clemency. These cases might
include:
1. The commission of major crimes: There are categories
of crimes which are so serious that the President will
not consider granting a pardon for them under almost
any circumstances. Such crimes would include large-
scale drug trafficking, sex offenses involving minors,
offenses involving central involvement in political
corruption, or violent crimes such as murder or rape.
2. An extensive criminal history: Three or more
separate convictions should raise a substantial
presumption against granting a pardon with respect to
any one of them. This presumption would only be
overcome by a truly exceptional rehabilitative history
involving exemplary service to the individual's
community or country.\21\
---------------------------------------------------------------------------
\21\ Arnold & Porter Document Production A0556-57 (Memorandum from
Jack Quinn to Jamie Gorelick (Jan. 26, 1996)) (Exhibit 2).
The final source of guidance regarding the exercise of the
President's clemency power is, of course, the President's own
personal views. In 1996, President Clinton was asked if he was
considering a pardon for Susan McDougal and other Whitewater
---------------------------------------------------------------------------
defendants. He responded:
[M]y position would be that their cases should be
handled like others . . . there's a regular process for
that, and I have regular meetings on that. And I review
those cases as they come up and after there's an
evaluation done by the Justice Department, and that's
how I think it should be handled.\22\
---------------------------------------------------------------------------
\22\ The NewsHour with Jim Lehrer (PBS television broadcast, Sept.
23, 1996).
Therefore, the President suggested that the McDougal case,
and all others, would be handled according to the ``regular
process,'' including screening by the Justice Department.
As to the President's claim that he would follow the
``regular process,'' he granted clemency to 30 individuals who
had not even filed clemency petitions with the Justice
Department,\23\ and some who had not filed any petition at all,
not even with the White House.\24\ The President also granted
clemency to 14 individuals who had their petitions previously
denied and thus were not pending with the Justice
Department.\25\ Even more important, in a number of cases,
President Clinton dramatically deviated from the ``regular
process'' of seeking the Justice Department's input.
---------------------------------------------------------------------------
\23\ Letter from Sheryl Walter, Office of Legislative Affairs,
Department of Justice, to the Honorable Dan Burton, Chairman, Comm. on
Govt. Reform (Feb. 6, 2001) (Exhibit 3).
\24\ The Committee has not attempted to discover every single case
where clemency was granted without a clemency petition being filed.
However, it has been reported that a number of individuals who were
convicted in connection with independent counsel investigations, for
example, Richard Douglas, Alvarez Ferrouillet, John Hemmingson, James
H. Lake, Brook K. Mitchell, Sr., Jack L. Williams, Ronald Blackley,
Henry Cisneros, and Linda Jones all received grants of clemency without
having filed a petition with either the White House or the Justice
Department. See Weston Kosova, Running on Fumes: Pulling All-Nighters,
Bill Clinton Spent His Last Days Obsessing Over Details and Pardons,
Newsweek, Feb. 26, 2001, at 30.
\25\ Letter from Sheryl Walter, Office of Legislative Affairs,
Department of Justice, to the Honorable Dan Burton, Chairman, Comm. on
Govt. Reform (Feb. 6, 2001) (Exhibit 3).
---------------------------------------------------------------------------
Many of the President's last-minute grants of clemency
violated all of these standards. Marc Rich and Pincus Green,
for example, fail all five Justice Department criteria for
pardons. They did not demonstrate responsible behavior after
their indictment. Rather, by all accounts, they have remained
fugitives from justice and continued to engage in business
relations with the enemies of the United States. Their offenses
were serious and notorious crimes for which, according to the
Justice Department, a suitable length of time should pass
between conviction and pardon. Yet Rich and Green never even
stood trial. Rich and Green did not demonstrate any
responsibility, remorse, or atonement for their crimes. Rather,
they maintained that they were ``singled out'' and unfairly
prosecuted. Rich and Green had no real need for relief. They
lived in luxury and apparently sought the pardons only so that
they could travel freely around the world, without the fear of
being apprehended by the U.S. Marshals Service in countries
that were cooperating with U.S. efforts to apprehend them.
Finally, there were no official recommendations or reports
regarding the Rich and Green pardons, since the White House
circumvented the normal pardon review process. If there had
been such reports, however, it is safe to assume that the U.S.
Attorney's office would have strongly objected to the Rich and
Green pardons.
The other grants of clemency reviewed in this report also
fail to meet the applicable standards. Carlos Vignali satisfies
none of the appropriate grounds for commutation identified in
Justice Department regulations, as his sentence was not
disparate or unfair, and he did not cooperate with law
enforcement. As a large-scale drug dealer, Vignali also was not
eligible for clemency under the President's own guidelines of
1996. Harvey Weinig similarly failed all relevant standards,
having been sentenced fairly and having never cooperated with
law enforcement. Weinig, as a large-scale money launderer for
the Cali Cartel, also was ineligible for clemency under the
President's guidelines. Glenn Braswell clearly failed to meet
the standards for a pardon, as he was under active
investigation for new criminal acts at the time he received a
pardon. Edgar and Vonna Jo Gregory similarly fell short of the
applicable standard, having committed one of the largest bank
frauds in Alabama history. Moreover, prosecutors objected to
the Gregory pardons.
C. Individuals Close to President Clinton Used Their Influence to Lobby
for Undeserved Grants of Clemency
One of the most disturbing aspects of the closing month of
President Clinton's term in office is that a number of people
close to the President used their relationship with him to
lobby for clemency grants which ordinarily would not have been
considered. While there are certainly individuals who would
seek to abuse their access in any administration, never have
they been so successful as in the Clinton Administration. Jack
Quinn abused his relationship with the President to lobby for
the pardons of Marc Rich and Pincus Green. There can be little
doubt that these pardons would not have been issued if Jack
Quinn had not exploited his position as former White House
Counsel. Hugh Rodham successfully lobbied the President for
grants of clemency to Carlos Vignali and Glenn Braswell. Tony
Rodham successfully lobbied the President to grant pardons to
Edgar and Vonna Jo Gregory. David Dreyer, a former White House
staffer, lobbied the President to grant a commutation to his
cousin, Cali cartel money launderer Harvey Weinig.
It is clear that none of these grants of clemency would
have been issued on the merits. Marc Rich and Pincus Green were
fugitives from justice, indicted for the largest tax evasion
scheme in U.S. history and for selling oil to Iran while
Americans were being held hostage. Carlos Vignali was the
source of cocaine for a major drug dealing ring. Glenn Braswell
was an extremely successful con artist who was actually under
criminal investigation at the time he received his pardon from
President Clinton. Edgar and Vonna Jo Gregory had been
convicted for the largest bank fraud in Alabama history. Harvey
Weinig laundered millions of dollars for the Cali cartel and
participated in a kidnapping, and was only caught when he began
to steal money from the Cali cartel. Only by capitalizing on
relationships between President Clinton and individuals close
to him were these petitioners able to obtain grants of
clemency.
D. A Number of Potential Violations of Law Have Been Discovered by the
Committee
In the course of its investigation, the Committee has
learned of a number of potential violations of law by Roger
Clinton and Tony Rodham. The Committee recommends that the
Department of Justice review these matters in conjunction with
the ongoing criminal investigation being conducted by the U.S.
Attorney for the Southern District of New York.
The Committee has uncovered a number of potential criminal
acts by Roger Clinton. First, Roger Clinton may have imported
more than $10,000 in monetary instruments into the United
States without properly disclosing it to the Customs Service.
Clinton received substantial sums of money originating from
overseas between 1998 and 2000. If Clinton imported this money
into the United States, then he was required to report it to
proper authorities and apparently did not do so. Second, Roger
Clinton appears to have violated the Lobbying Disclosure Act.
There is evidence that Roger Clinton lobbied the President
regarding travel restrictions to Cuba. Clinton did not register
as a lobbyist, despite the fact that he was likely required to
do so. Third, Clinton lied to FBI agents who interviewed him
regarding his lobbying for Rosario Gambino in 1999. When they
interviewed Roger Clinton, he claimed that ``he did not
represent to anyone on the Parole Commission that his brother
was aware of his efforts to assist the Gambino family.'' \26\
However, when Clinton lobbied the U.S. Parole Commission, he
had explicitly stated that his brother was ``completely aware''
of his involvement.\27\ Roger Clinton also lied to the FBI
about a $50,000 payment from the Gambino family.\28\ Although
he deposited the payment the same day as the FBI interview, he
did not disclose it to the agents explicitly or truthfully.
Rather he claimed that Rosario Gambino's son had offered to
loan him money for a down payment on a house.\29\ Despite this
claim to the FBI, which Clinton repeated to the media in the
summer of 2001, bank records indicate that Clinton neither used
the $50,000 for a down payment nor did he ever repay any of the
money. During the interview, Clinton also told three separate
and contradictory stories when questioned about a Rolex watch
he received from the Gambinos.\30\
---------------------------------------------------------------------------
\26\ Department of Justice Document Production FBI-RC-00003
(Summary of Interview with Roger Clinton, Oct. 1, 1999) (Exhibit 4).
\27\ USPC Document Production 00894 (Memorandum from Michael A.
Stover, General Counsel, U.S. Parole Commission, to File (Jan. 31,
1996)) (Exhibit--5); Telephone Interview with Thomas Kowalski, Case
Operations Manager, U.S. Parole Commission (July 27, 2001). Roger
Clinton made it clear to Parole Commission staff on multiple occasions
that President Clinton had specific knowledge that he was contacting
the Parole Commission regarding Rosario Gambino. See generally, Chapter
Two: Roger Clinton's Involvement in Lobbying for Executive Clemency,
Section II.E.1., ``Roger Clinton's Statements Regarding his Brother's
Knowledge.''
\28\ See generally, Chapter Two: Roger Clinton's Involvement in
Lobbying for Executive Clemency, Section II.E.2., ``Roger Clinton's
Statements Regarding Payment from the Gambinos.''
\29\ Department of Justice Document Production FBI-RC-00005-06
(Summary of Interview with Roger Clinton, Oct. 1, 1999) (Exhibit 4).
\30\ The interviewing FBI agents apparently were not satisfied with
Roger Clinton's candor during the interview, as they took the unusual
step of explaining to Clinton the penalties for making false statements
during the course of the interview. Id. at FBI-RC-00006. See generally,
Chapter Two: Roger Clinton's Involvement in Lobbying for Executive
Clemency, Section II.E.3., ``Roger Clinton's Statements Regarding the
Rolex Watch.''
---------------------------------------------------------------------------
The Committee has also learned about Tony Rodham's
participation in a scheme to defraud Vivian Mannerud in
connection with Mannerud's effort to obtain a commutation for
her father, Fernando Fuentes Coba. Tony Rodham was introduced
to Mannerud by his business partner, Marilyn J. Parker.
Together, Rodham and Parker attempted to convince Mannerud to
hire Rodham to help her obtain a commutation for her father. In
making his pitch to Mannerud, Rodham made a number of false
statements to Mannerud, including the assertion that he was
friendly with Pardon Attorney Roger Adams, and that he would
hire a law firm at which Adams' wife was a partner. Rodham then
asked Mannerud to pay him $50,000 to help with the Fernando
Fuentes Coba commutation effort. After Mannerud refused,
Marilyn Parker called Mannerud to tell her that Rodham now only
wanted $30,000 to help with the Fuentes commutation. Mannerud
declined both offers for fear of being involved in some
improper activity. The activity by Rodham and Parker may amount
to a criminal conspiracy to defraud Vivian Mannerud. Whether or
not the conduct by Rodham and Parker amounts to criminal
activity depends greatly upon the specific evidence that can be
gathered by the Justice Department. However, it is clear that
this matter deserves thorough investigation by the Department
of Justice.
E. The Message Sent by President Clinton's Grants of Clemency
The way in which a President exercises the clemency power
speaks volumes about that President's priorities. The clemency
grants reviewed in this report send a clear message, one that
does not speak well of President Clinton. While the clemency
power is vitally important and should be used by the President,
it should not be debased, particularly where large sums of
money are flowing to relatives of the President or to
foundations in which he has a significant interest.
First, President Clinton granted pardons and commutations
to individuals who never would have received clemency but for
the fact that they hired individuals close to the President to
represent them. Marc Rich, Pincus Green, Carlos Vignali, Glenn
Braswell, Edgar Gregory, and Vonna Jo Gregory were all
extremely wealthy and were able to hire Jack Quinn, Tony
Rodham, and Hugh Rodham to lobby the White House and short-
circuit the normal clemency review procedures. The average low-
income criminal defendant does not have the money necessary to
hire a White House insider to lobby for his pardon. At best, he
can fill out his clemency application and watch it proceed
through the normal Justice Department review process. By
listening to the advice of highly-paid White House insiders
like Jack Quinn, Hugh Rodham, and Tony Rodham, and by granting
clemency to their clients, President Clinton has sent the
message that he had two standards of justice--one for the rich,
and one for the poor. Representative Elijah Cummings described
some of his concerns about this issue at the Committee's
February 8, 2001, hearing:
One of the things that concerns me about [the Rich]
pardon is that I think anybody who is sitting in this
audience or anybody who is watching this at home, you
know, when the little guy, when the Department of
Justice comes after the little guy, the guys that I
used to represent, they tear their lives apart, I mean
rip them apart. They can't afford the Mr. diGenovas,
the great lawyers, as he is and others. They do the
best they can. They spend all of their money. Their
reputations are tarnished. Even if they're found not
guilty, friends are brought in, FBI goes into their
homes, subpoenas are issued.
And when people look at Mr. Rich and others who
apparently goes off to another country, they've got the
money to do so, and it appears as if they're evading
the process. The little guys that I represent and the
women, you know, they really have a problem with that,
because they sit here and they say, wait a minute, you
know, I'm sitting in jail for 20 years. And it does not
even compare. I mean, I may have done one-millionth of
what was allegedly done here, but I'm sitting in jail.
And I didn't have the money to go off somewhere else. I
didn't have the money to do that. I didn't have the
money to hire the big-time lawyers. So it does concern
me.
* * *
And it's one thing to go to trial. It's one thing to
stay here and face the music. It's one thing to be
found not guilty. It's a whole other thing, in my
opinion, when somebody, because they have the money,
can go outside the country and evade the system. I tell
you it really concerns me because my constituents have
a major problem with that, and I do, too.\31\
---------------------------------------------------------------------------
\31\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 164-65
(Feb. 8, 2001) (statement of the Honorable Elijah Cummings).
These concerns are shared by many on the Committee.
President Clinton's pardons did not just send the message
that he believes in two standards of justice. By pardoning
fugitives from justice, President Clinton undermined the
efforts of law enforcement officers everywhere. Since 1983,
Assistant United States Attorneys and agents of the United
States Marshals Service have been trying to apprehend Marc Rich
and Pincus Green. They listed Rich as one of the most wanted
fugitives in the world. They set up sting operations to arrest
Rich overseas. They have submitted arrest requests and
extradition requests to a number of foreign countries.
President Clinton's pardon of wanted fugitives is a direct slap
in the face to the U.S. law enforcement officers who spent
almost two decades trying to apprehend Rich. The pardons also
could serve to undermine U.S. efforts to extradite fugitives in
the future.
By commuting the sentences of Carlos Vignali and Harvey
Weinig, President Clinton undermined U.S. efforts to fight the
flow of illegal drugs into the country. Neither was a minor
participant in drug trafficking. Vignali supplied cocaine to
the largest drug-dealing ring in Minnesota history. Moreover,
he never cooperated with law enforcement and failed to reveal
where he obtained his cocaine. Harvey Weinig laundered millions
of dollars for the Cali cartel. Without individuals like Harvey
Weinig, drug traffickers would not be able to enjoy the
proceeds from their drug sales. Despite the seriousness of
their crimes, President Clinton commuted the sentences of both
Vignali and Weinig.
The message of these commutations was loud and clear. Tony
Adams, a narcotics detective in Minnesota, spoke eloquently to
the meaning of the Vignali commutation. Adams stated that he
was stunned to learn of the commutation: ``It's like,
basically, you've just been told that this kid, he's
untouchable.'' \32\ Adams observed that the Vignali case ``more
or less tells us that America's system has been bought if you
have money.'' \33\ He also observed that ``politicians always
get in front of this camera and say ``We're trying to take dope
off the streets. We're trying to put dope dealers in jail.''
Well, you just let one out, a big one.'' \34\ Finally, Adams
suggested that ``the politicians in L.A. or Washington, D.C.,
should finish the nine years that [Vignali] has left on his
time, and I'm standing right by that.'' \35\ Adams is certainly
not alone in his criticism of the Vignali commutation, but his
comments are particularly noteworthy, coming from a detective
who investigated the case, and who routinely places his life on
the line to protect the public from drug traffickers.\36\
---------------------------------------------------------------------------
\32\ Richard A. Serrano and Stephen Braun, Working the American
System, L.A. Times, Apr. 29, 2001, at 10.
\33\ Fox Special Report with Brit Hume (Fox News television
broadcast, Feb. 27, 2001).
\34\ Nightline (ABC News television broadcast, Feb. 23, 2001).
\35\ Fox Special Report with Brit Hume (Fox News television
broadcast, Feb. 23, 2001).
\36\ While conducting plainclothes surveillance in April 2001,
Adams was shot at by a suspect and escaped uninjured. David Chanen, Man
Fires at Officer, But Nobody is Hurt, Star Trib. (Minneapolis, MN),
Apr. 20, 2001, at 9B.
---------------------------------------------------------------------------
The Weinig case has sent no less a destructive message to
U.S. law enforcement. In fact, the Weinig commutation has
created a great deal of consternation in Latin American nations
from which the U.S. is attempting to extradite drug kingpins.
Many individuals in these nations have argued that they should
not extradite their citizens to the U.S. for narcotics offenses
because the U.S. clearly is not serious about enforcing its
narcotics laws, pointing specifically to the Weinig
commutation.\37\ By pardoning a major money launderer for the
Cali cartel, President Clinton has made it harder for the U.S.
to extradite drug traffickers to the U.S. and harder to fight
the war on drugs.
---------------------------------------------------------------------------
\37\ See Colombian General Hits Clinton Commutation, Wash. Times,
Mar. 6, 2001, at A13; Russell Crandall, The Americas: In the War on
Drugs, Colombians Die, Americans Are Pardoned, Wall St. J., Apr. 20,
2001, at A15.
---------------------------------------------------------------------------
F. Obstacles Faced by the Committee
The Committee conducted a thorough investigation,
interviewing dozens of witnesses. The majority of parties
contacted by the Committee cooperated with the investigation.
However, a number of key individuals refused to cooperate,
which in turn seriously hampered the Committee's investigation.
1. Witnesses Who Have Not Cooperated with the Investigation
The Committee has faced a number of obstacles that have
prevented it from discovering the full truth regarding the
pardon and commutations which it investigated. The greatest
problem faced by the Committee was that a number of key
witnesses invoked their Fifth Amendment rights or otherwise
refused to cooperate with the Committee's investigation. A
total of 26 witnesses either invoked their Fifth Amendment
rights or refused to be interviewed in the course of the
Committee's investigation. Some of these witnesses, like Marc
Rich, Denise Rich, Beth Dozoretz, and Roger Clinton, were
critically important. The impact of the refusal of key
witnesses to cooperate is discussed below in the relevant
chapters regarding each part of the investigation.
Another significant problem the Committee has faced is the
refusal of a number of parties to produce records subpoenaed or
requested by the Committee. A number of document requests
issued by the Committee have not been complied with by their
recipients, either because of an invocation of Fifth Amendment
rights or an invocation of attorney-client privilege. In some
cases, the invocation of privilege has been spurious. For
example, Hugh Rodham refused to produce any records regarding
the Vignali matter because of the attorney-client privilege.
Obviously, Rodham possesses records which are not privileged,
which he could provide to the Committee, however, he simply
declined to do so.\38\ This refusal adversely impacted the
ability of the Committee to develop a full understanding of
Rodham's work on the Vignali matter. The specific problems
faced by the Committee in each aspect of the pardon
investigation are discussed below in the relevant chapters
regarding each pardon and commutation.
---------------------------------------------------------------------------
\38\ Such records would include records provided to Rodham by third
parties and documents which Rodham provided to third parties.
---------------------------------------------------------------------------
2. The White House
It is a matter of some concern that the Bush White House
and Justice Department failed to cooperate fully with the
Committee's investigation. Early in its investigation of the
Marc Rich pardon, the Chairman requested that former President
Clinton waive any claim of executive privilege he might have
over testimony and documents relating to the pardons and
commutations he granted.\39\ On February 27, 2001, former
President Clinton's attorney, David Kendall, sent the Chairman
a letter in which he informed the Committee that ``he will
interpose no Executive Privilege objections to the testimony of
his former staff concerning these pardons, or to other pardons
and commutations he granted.'' \40\ Despite former President
Clinton's decision to waive executive privilege, the Committee
faced a number of problems receiving records relating to the
pardons and commutations, both from the White House and the
Justice Department.
---------------------------------------------------------------------------
\39\ Letter from the Honorable Dan Burton, Chairman, Comm. on Govt.
Reform, to former President William J. Clinton (Feb. 15, 2001) (Exhibit
6).
\40\ Letter from David E. Kendall, Counsel for President Clinton,
Williams & Connolly, to the Honorable Dan Burton, Chairman, Comm. on
Govt. Reform (Feb. 27, 2001) (Exhibit 7). In addition to waiving any
claim of privilege with respect to the testimony of his former staff,
President Clinton has not raised executive privilege with respect to
any of the records the Committee has requested from the National
Archives.
---------------------------------------------------------------------------
Beginning on January 25, 2001, the Committee issued a
series of document requests to the National Archives and
Records Administration (``NARA''), seeking records relating to
pardons and commutations issued or considered by former
President Clinton. Under the Presidential Records Act, once the
responsive records were located by NARA staff, they were
provided to staff for former President Clinton to be reviewed
for executive privilege concerns.\41\ After President Clinton's
staff had reviewed them, the records were reviewed by staff for
President Bush, who independently has the right to assert
executive privilege over the records. The Committee's first
requests to NARA for records relating to Marc Rich and Pincus
Green were satisfied. However, shortly thereafter, the
Committee began to have significant problems receiving the
records it had requested from NARA.
---------------------------------------------------------------------------
\41\ See 44 U.S.C. Sec. 2204 (2002).
---------------------------------------------------------------------------
On March 8, 2001, the Committee issued a request to NARA
for records relating to the pardons and commutations of a
number of individuals--including Glenn Braswell, Carlos
Vignali, Edgar and Vonna Jo Gregory, and Eugene and Nora Lum--
as well as records relating to Roger Clinton's involvement in
lobbying for pardons. The Committee's request called for the
records to be provided to the Committee by March 22, 2001. At
some point in April 2001, NARA had gathered all of the
responsive documents, and they had been reviewed and cleared by
the office of former President Clinton. However, they had not
been provided to the Committee because of objections from the
Bush White House Counsel's Office.\42\
---------------------------------------------------------------------------
\42\ Notes of Telephone Conversation with Amy Krupsky, Associate
General Counsel, National Archives and Records Administration (May 1,
2001).
---------------------------------------------------------------------------
Committee staff spent the next month engaged in fruitless
negotiations with the Bush White House regarding the production
of the requested records. Staff from the Bush White House
explained that they had concerns about producing the requested
records, because the records went to the heart of the clemency
review process, which was part of a core Presidential power.
During these negotiations, Committee staff pointed out that the
White House had been delaying the production of a wide variety
of records from NARA, including documents sent into the White
House from individuals seeking pardons, and that these records
could not possibly raise any privilege concerns. The White
House agreed to provide these types of non-deliberative records
to the Committee.\43\
---------------------------------------------------------------------------
\43\ The White House did not agree to provide records provided to
the White House from third parties until June 6, 2001. It is unclear
why these types of records, which were clearly not privileged, were
withheld from the Committee for so long. The delay in the production of
these records--which did not occur until three months after they were
requested--imposed a substantial delay on the Committee's
investigation.
---------------------------------------------------------------------------
However, the White House was not nearly so accommodating
with respect to deliberative documents about the clemency
process that were generated inside of the Clinton
Administration. White House staff informed the Committee staff
that the White House did not plan to assert executive privilege
over these records but would simply decline to produce them and
hope that the Committee understood the reasons why. Committee
staff attempted to explain that a number of these records were
critically important to the Committee's investigation. For
example, the report prepared by Pardon Attorney Roger Adams
regarding the Vignali commutation was central to the
Committee's understanding of the Vignali matter. Committee
staff also offered to reach a number of compromise
accommodations, which would satisfy the Committee's needs to
review the Adams memo, while still protecting the White House's
interests. All of these offers were rejected. The White House's
refusal to reach any accommodation meant that the Committee was
unable to obtain a number of key documents regarding pardons
and commutations issued by President Clinton.
On June 7, 2001, shortly after the Committee's offers to
the White House were rejected, the Committee received a
production of records from NARA. This production apparently
included both deliberative and non-deliberative records
responsive to the Committee's March 8, 2001, request.
Approximately two weeks later, Committee staff informed the
White House that NARA had provided the Committee with a number
of records that the White House may have intended to withhold
from the Committee. Shortly thereafter, the Committee received
a telephone call and then a letter from the NARA General
Counsel, Gary Stern, requesting the return of the documents. In
his letter, Stern stated that ``some of the records that were
provided to the Committee were inadvertently produced.
Accordingly, we now request the return of these records, and
any copies made thereof.'' \44\
---------------------------------------------------------------------------
\44\ Letter from Gary Stern, General Counsel, NARA, to Jim Wilson,
General Counsel, Comm. on Govt. Reform (June 21, 2001) (Exhibit 8).
---------------------------------------------------------------------------
However, for several reasons, the Committee decided not to
return the records in response to Stern's request. First, the
records were responsive to the Committee's request and,
therefore, should have been produced in any event. Second,
neither President Bush nor President Clinton asserted any
privilege over the documents. In the absence of a valid claim
of privilege, the Committee has a right to receive documents
responsive to its request. Third, even if President Bush or
President Clinton had asserted executive privilege, the
Committee might have determined to keep certain essential
records produced by NARA on June 7, 2001. A number of these
records were critical to the Committee's investigation and did
not raise legitimate executive privilege concerns. However,
since neither the current nor the former President raised any
such privilege, the Committee used these documents in its
investigation and in this report.
The documents that were ``inadvertently'' produced to the
Committee were of central importance to the Committee's
investigation. The following is a brief description of some of
the records included in that production:
All White House records regarding the Vignali
commutation: These records included the report by Pardon
Attorney Roger Adams objecting to the Vignali commutation.\45\
This report was of critical importance to the Committee, as it
showed the extent to which the Clinton White House was aware of
Carlos Vignali's criminal activities. These records also
included one White House document indicating that Hugh Rodham
had informed the White House staff that the Vignali commutation
was ``very important'' to First Lady Hillary Clinton.\46\
---------------------------------------------------------------------------
\45\ See NARA Document Production (Report to the President on
Proposed Denial of Executive Clemency for Carlos Anibal Vignali, Jr.,
Jan. 12, 2001) (Exhibit 9).
\46\ See NARA Document Production (Note from Dawn Woolen,
Administrative Assistant, to Bruce Lindsey, Deputy Chief of Staff, the
White House) (Exhibit 10).
Documents that led the Committee to uncover Roger
Clinton's efforts to obtain a commutation for organized crime
figure Rosario Gambino: Before receiving these records from
NARA, the Committee was aware only of a payment of $50,000 from
Anna Gambino to Roger Clinton. Only after receiving these
documents did the Committee have reason to believe this payment
might be related to an effort to free Rosario Gambino from
prison.\47\
---------------------------------------------------------------------------
\47\ Committee staff had been unable to reach Mrs. Gambino or
determine the purpose of her payment. The key document in the NARA
production was a note apparently drafted by White House staffer
Meredith Cabe which referenced the fact that she was requesting an NCIC
check on Rosario Gambino. Given the fact that Rosario Gambino was a
well-known organized crime figure who was an exceedingly unlikely
candidate for a legitimate grant of clemency, the Committee
investigated this matter and determined that Anna Gambino was Rosario
Gambino's daughter, and that the payment of $50,000 from Anna Gambino
to Roger Clinton was part of the Gambinos' efforts to obtain a
commutation for Rosario Gambino.
Documents showing three additional pardons that
Roger Clinton attempted to obtain: These documents indicated
that representatives of Mark St. Pe and Steven Griggs sent
materials requesting pardons to Roger Clinton at the White
House, and that these materials were forwarded to the White
House Counsel's office. Another document indicating that
William McCord had sent a petition was produced in the midst of
---------------------------------------------------------------------------
other Roger Clinton-related material.
Pardon Attorney Roger Adams' report on the
commutation of drug money launderer Harvey Weinig: This report
demonstrated that the White House was fully aware of the extent
of Weinig's criminal activities, including his role in a
kidnapping.\48\
---------------------------------------------------------------------------
\48\ See NARA Document Production (Report to the President on
Proposed Denial of Executive Clemency for Harvey Weinig) (Exhibit 11).
Given the importance of these records to the Committee's
investigation, and the absence of any claim of privilege over
the documents, the Committee decided to use the records in its
investigation and in this report. Given the apparent
sensitivity of the records to the White House, the Committee is
using only those records which are directly relevant to
necessary subject matter covered in this report.
The Committee must emphasize that it is disappointed with
the way the Administration handled its requests for documents
relating to the pardon matter. It is clear that if a large
number of documents relating to the pardon had not been
``inadvertently'' produced by NARA personnel on June 7, the
Committee would never have received those records.
Consequently, Members of Congress, historians, and the public
might never have known about many of the significant abuses of
public trust detailed in this report. Developments since June
2001 have made it clear that the Administration is engaged in a
wide-ranging effort to expand executive privilege beyond its
traditional boundaries and reduce Congressional oversight of
the White House and Justice Department. It is disappointing
that the Bush Administration would attempt to withhold key
documents from the Committee in an investigation like this,
where the Committee is looking into allegations of malfeasance
at the highest levels of government. That the Bush
Administration attempted to withhold these records even though
former President Clinton approved their release is especially
discouraging.
3. The Justice Department
The recalcitrance of the Bush Administration in refusing to
turn over records in the pardon investigation also extended to
the Justice Department. The Justice Department refused to
provide a number of records requested by the Committee in the
course of its investigation. Most of these documents related to
the Committee's investigation of Roger Clinton, specifically
relating to Roger Clinton's efforts to obtain a commutation for
Rosario Gambino. The Committee requested from the Justice
Department all records relating to any consideration of a grant
of clemency for Rosario Gambino, as well as all records
relating to the Justice Department's investigation of Roger
Clinton's efforts to obtain a grant of clemency for Gambino.
The Justice Department refused to comply fully with either
request.
With respect to the Committee's request for records
relating to the Justice Department's work on the Gambino
commutation request, the Department refused to turn over any
records or even specify which records it was withholding.
Apparently, the Justice Department based its refusal on
privilege concerns, presumably executive privilege, although
Justice Department staff did not identify any specific
privileges in explaining their decision.
With respect to the Committee's request for records
relating to the investigation of Roger Clinton's involvement in
the Gambino matter, the Justice Department initially provided
records but then abruptly stopped doing so. The Justice
Department claimed that it was entitled to withhold records
because of its ongoing investigation of Roger Clinton. However,
the records that the Committee sought related to the Justice
Department's investigation of Roger Clinton, which was
conducted in 1998 and 1999, and then closed, not its ongoing
investigation from the Southern District of New York. The
Justice Department's decision to withhold these records
significantly hindered the Committee's investigation of the
Gambino matter. The withheld documents likely contain the
Justice Department's rationale for failing to pursue criminal
charges against Roger Clinton, as well as the answers to key
factual questions such as whether the FBI was even aware of the
$50,000 payment from the Gambinos before the Committee
uncovered it in the summer of 2001. Without a complete
understanding of facts and reasoning underlying the Justice
Department's decision to close the Clinton-Gambino
investigation, the Committee is unable to determine whether
that decision was made in good faith or may have been tainted
by political considerations.
[Exhibits referred to follow:]
CHAPTER ONE
``TAKE JACK'S WORD'': THE PARDONS OF INTERNATIONAL FUGITIVES MARC RICH
AND PINCUS GREEN
FINDINGS OF THE COMMITTEE
Marc Rich and Pincus Green have a history of illegal and
corrupt business dealings contrary to the security interests of
the United States.
Rich and Green have had extensive trade with
terrorist states and other enemies of the United States.
Despite clear legal restrictions on such trade, Rich and Green
have engaged in commodities trading with Iraq, Iran, Cuba, and
other rogue states that have sponsored terrorist acts. By
engaging in these activities, Marc Rich and Pincus Green
demonstrated contempt for American laws, as well as the well-
being of Americans who were harmed or threatened by these
states.
The Central Intelligence Agency provided the
following declassified information about Marc Rich to the
Committee:
If President Clinton had checked with the CIA, he would
have learned that Marc Rich had been the subject of
inquiries by various foreign government liaison
services and domestic government agencies regarding
their ongoing investigations of criminal activity.
In addition, President Clinton would have received
information worthy of his consideration in making his
decision on the pardon. This information cannot be
declassified.
Marc Rich and Pincus Green were guilty of serious crimes and
showed contempt for the American justice system.
Marc Rich and Pincus Green attempted to obstruct the
criminal investigation of them in every way imaginable,
including attempting to smuggle subpoenaed documents out of the
country. Rich and Green's tactics resulted in a record-setting
contempt fine against them, totaling $21 million. Despite these
tactics, the U.S. Attorney for the Southern District of New
York was able to indict Marc Rich and Pincus Green on 51 counts
of illegal activity, including tax evasion, mail fraud, wire
fraud, and racketeering. The evidence against them was
overwhelming.
Because of the strength of the case against them,
Marc Rich and Pincus Green fled the country rather than face
trial. Rich's own lawyer told him that by fleeing the country,
Rich had ``spit on the American flag'' and that ``whatever you
get, you deserve.'' For the 17 years leading up to his pardon,
Marc Rich was one of America's 10 most wanted international
fugitives. Although Jack Quinn, Rich's attorney, argued that
Rich did not flee the United States to avoid prosecution,
Rich's ex-wife refuted this view, stating that Rich told her
that ``I'm having tax problems with the government . . . and I
think that we are going to have to leave.''
In order to avoid extradition or apprehension by
United States law enforcement, Marc Rich and Pincus Green
attempted to renounce their United States citizenship. While
this attempt was rejected by the United States, it demonstrated
that Rich and Green had no loyalty to the United States, and
viewed their citizenship as a liability to be discarded at
will.
Rich and Green's crimes were so serious that for seventeen
years, the U.S. government devoted considerable resources to
apprehending them and closing down their business activities.
Rich and Green were such high-profile fugitives that
on a number of occasions in the 1980s and 1990s, the United
States Marshals Service attempted to arrest them in various
foreign countries. A number of countries from the United
Kingdom to Russia attempted to assist the United States in
these efforts. The pardons of Rich and Green have sent a
message that individuals can go from the FBI's most wanted list
to a Presidential pardon if they spend money and have the
proper connections. This message undermines U.S. efforts to
apprehend fugitives abroad.
Rich and Green were such high-profile fugitives that
in 1991 the Government Reform Committee, under Democratic
leadership, held a number of hearings and issued two reports
about the government's efforts to apprehend Rich and Green. At
that time, Democrats and Republicans in Congress took the Bush
Administration to task for not being aggressive enough in
hunting down Rich and Green, or shutting down their business
interests in the U.S.
While Rich and Green were fugitives from justice,
the American government took a number of actions against their
interests in the U.S. The federal government seized Rich's
assets and shut down his trade in metals and grain with the
government.
The United States government repeatedly tried to reach a plea
agreement with Rich and Green.
For a number of years after Rich and Green fled the
country, the U.S. government attempted to negotiate a plea
bargain to settle the case. The government made a number of
concessions in an attempt to reach a deal, but all offers were
rebuffed by Rich and Green, who would not agree to any deal
that resulted in jail time. While lobbying for a pardon, Jack
Quinn and Rich's other lawyers claimed that the Justice
Department had not even negotiated with Rich, and therefore,
that a pardon was justified. Quinn and the other lawyers were
misleading the White House when they made these claims.
Jack Quinn misled the White House about the Rich case and
attempted to mislead the Committee and the public regarding his
work for Marc Rich.
Marc Rich hired Jack Quinn after a recommendation
from Eric Holder. After numerous failed attempts to have his
case settled, Marc Rich hired Jack Quinn to represent him.
Quinn was hired after a recommendation from Deputy Attorney
General Eric Holder. Gershon Kekst, who worked for Marc Rich on
the pardon matter, asked Holder for a recommendation of how to
settle a criminal matter with the Justice Department. Holder
recommended that he hire a Washington lawyer ``who knows the
process, he comes to me, and we work it out.'' Holder then
explicitly recommended the hiring of Jack Quinn. While Holder
did not know that Kekst was referring to Marc Rich, it suggests
that Holder was favorably disposed to Jack Quinn, and would be
very receptive to arguments made by Quinn, no matter how
baseless they were.
Marc Rich was going to pay Jack Quinn for his work
on the pardon. After the Marc Rich pardon was granted, Jack
Quinn claimed that he was not being paid by Rich for his work
on the pardon, and that he expected no future payment for his
work on the pardon. However, the Committee has uncovered
evidence that Robert Fink, a lawyer close to Marc Rich, had
discussions with Rich and Quinn about paying Quinn for his work
on the Rich pardon. Documents which Quinn and Fink withheld
from the Committee for over a year, and which were produced
only after a federal judge ordered them produced to a grand
jury, shed further light on the contemplated payment of Quinn.
These documents indicate that Quinn raised the question of his
``status'' with Rich and asked that Rich pay him a $50,000 per
month retainer. The Committee attempted to interview Quinn
about these documents, but Quinn refused to meet with Committee
staff.
Jack Quinn may have been attempting to receive money
from Marc Rich after the pardons were granted. At the
Committee's February 8, 2001, hearing, Quinn pledged that ``I
will not bill [Rich], and I will not accept any further
compensation for work done on the pardon.'' This pledge
surprised Rich's lawyer, who expected that Rich would be paying
Quinn for his work. Indeed, records just produced to the
Committee indicate that Quinn may have been attempting to
negotiate some payment from Marc Rich shortly after he pledged
that he would not take additional money for his work. A March
5, 2001, e-mail from Quinn to Rich states ``If you are
agreeable, and I hope you are, I need to fax to you in the next
few days a new retainer agreement.'' This e-mail raises the
possibility that Quinn has been attempting to obtain payments
from Rich, in possible violation of his pledge to the
Committee. The Committee attempted to interview Quinn about
this matter, but he refused.
Jack Quinn's work on the Rich pardon was in apparent
violation of Executive Order 12834. That executive order was
enacted as part of President Clinton's promise to create ``the
most ethical administration in history,'' and it prohibited
former executive branch employees from lobbying their former
executive branch agencies within five years of their departure.
Quinn has claimed that his work on the Rich pardon came within
an exception for ``communicating . . . with regard to a . . .
criminal . . . law enforcement inquiry, investigation or
proceeding[.]'' However, this exception was clearly intended to
apply to appearances before courts, not lobbying the White
House for a pardon. The ``revolving door'' lobbying ban was
intended to apply exactly to cases like this, where a former
White House Counsel could come back and lobby the President to
take an action that had no constitutional limits on it, largely
based on the President's personal trust for that former
staffer.
The pardon petition compiled by Jack Quinn and the
other Marc Rich lawyers was highly misleading. Most of the
arguments used by Jack Quinn to justify the Rich and Green
pardons were false and misleading. These arguments could have
been completely refuted if anyone in the White House had sought
out any of the prosecutors familiar with the Rich case.
The ``letters of support'' in the pardon petition
were used in a misleading manner. Another key element of the
Rich pardon petition was a number of letters of support for
Rich and Green from prominent Americans and Israelis. Rich and
Green used these letters to try to show that their humanitarian
activities justified their pardons. However, many of these
letters were obtained under false pretenses, and the writers of
the letters were not told that they were being used to obtain a
Presidential pardon. In addition, a number of individuals who
wrote in support of Rich and Green received large amounts of
money from them.
Marc Rich and Pincus Green used a number of different
individuals with close personal relationships with President
Clinton and his staff to lobby regarding the pardon.
The role of Denise Rich. Denise Rich played a key
role in obtaining the Rich and Green pardons. Denise Rich had a
close relationship with President Clinton, which was based in
part on her role as a large-scale contributor to Democratic
causes and the Clinton library, and in part on her extensive
personal contacts with President Clinton. Denise Rich used this
relationship with President Clinton to lobby for the Marc Rich
pardon on a number of occasions. Denise Rich has refused to
cooperate with the Committee, invoking her Fifth Amendment
rights rather than answer questions about her role in the
pardon.
The role of Beth Dozoretz. Beth Dozoretz, another
close friend of President Clinton, played a key role in
obtaining the Rich pardon. Like Denise Rich, Beth Dozoretz had
a relationship with President Clinton built on personal ties
and political fundraising. Dozoretz has raised and contributed
millions of dollars for the Democratic party, and has pledged
to raise an additional million dollars for the Clinton library.
Beth Dozoretz also has close relationships with Denise Rich and
Jack Quinn. Dozoretz used her close relationship with President
Clinton to lobby for the Rich pardon. Because Dozoretz has
invoked her Fifth Amendment rights against self-incrimination,
the Committee is unable to conclude whether or not Dozoretz
made any linkage between contributions to the DNC or the
Clinton library and the granting of the Rich pardon.
The role of Prime Minister Ehud Barak. Israeli Prime
Minister Ehud Barak spoke to President Clinton three times
about the Rich pardon. In his public statements about the Rich
pardon, President Clinton has pointed to these conversations
with Prime Minister Barak as one of the primary reasons he
granted the pardon. However an examination of the transcripts
of the calls shows that Barak did not make a particularly
impassioned plea for Rich. Therefore, it appears that the
President may be attempting to use Prime Minister Barak's
interest in the Rich matter as a cover for his own motivations
for granting the Rich pardon.
Barak had met with Rich personally and told Clinton
that the Rich pardon ``could be important . . . not just
financially, but he helped Mossad on more than one case.''
Barak's statement raises the possibility that either Barak or
Clinton acted on the Rich matter because of some promise of
future financial return.
Eric Holder and Jack Quinn worked together to cut the Justice
Department out of the decisionmaking process. Holder's decision
to support the pardon had a critical impact.
Jack Quinn and Deputy Attorney General Eric Holder
worked together to ensure that the Justice Department,
especially the prosecutors of the Southern District of New
York, did not have an opportunity to express an opinion on the
Rich pardon before it was granted. The evidence amassed by the
Committee indicates that Holder advised Quinn to file the Rich
pardon petition with the White House and leave the Justice
Department out of the process. One e-mail produced to the
Committee suggests that Holder told Quinn to ``go straight to
wh,'' and that the ``timing is good.'' The evidence also
indicates that Holder failed to inform the prosecutors under
him that the Rich pardon was under consideration, despite the
fact that he was aware of the pardon effort for almost two
months before it was granted.
Eric Holder's support of the Rich pardon played a
critical role in the success of the pardon effort. Holder
informed the White House that he was ``neutral, leaning towards
favorable'' on the Rich pardon, even though he knew that Rich
was a fugitive from justice, and that Justice Department
prosecutors viewed Rich with such contempt that they would no
longer meet with his lawyers. Holder has failed to offer any
credible justification for his support of the Rich pardon,
leading the Committee to believe that Holder had other
motivations for his decision, which he has failed to share with
the Committee.
Eric Holder was seeking Jack Quinn's support to be
appointed as Attorney General in a potential Gore
Administration, and this may have affected Holder's judgment in
the Rich matter. On several occasions, Holder sought out
Quinn's endorsement to be appointed as Attorney General if Al
Gore were to win the November 2000 election. Quinn was a Gore
confidant whose endorsement would carry great weight. Holder's
initial help to Quinn in the Rich matter predated the Supreme
Court's decision in Bush v. Gore, and accordingly, Holder had
some legitimate prospect of being appointed Attorney General
when he was helping Quinn keep the Rich matter from the Justice
Department's scrutiny. While Holder denies that his desire to
be appointed Attorney General had anything to do with his
actions in the Rich matter, it provides a much clearer and more
believable motivation than any offered by Holder to date.
President Clinton made his decision knowing almost nothing
about the Rich case, making a number of mistaken assumptions
and reaching false conclusions.
The White House never consulted with the prosecutors
in the Southern District of New York regarding the Rich case.
As a result, the White House staff was never able to refute the
false and misleading arguments made in the Marc Rich pardon
petition.
Every White House staff member who was working on
the Rich pardon opposed it. However, because they failed to do
the necessary background research on the Rich case, they were
unable to refute the arguments made by Jack Quinn.
President Clinton was misled by Jack Quinn in their
negotiations regarding the Rich pardon. Late in the evening of
January 19, 2001, President Clinton and Jack Quinn had a
telephone discussion regarding the Rich pardon. During this
conversation, Quinn repeated his usual misleading arguments
about the Rich case. Quinn also offered to make his clients
subject to civil liability for their actions. In furtherance of
this offer, Quinn agreed to waive all statute of limitations
and other defenses, which Rich and Green would have as a result
of their fugitivity. President Clinton has cited this waiver as
a key factor in his decision to grant the pardons. However, if
President Clinton or his staff had done even cursory legal
research, they would have understood that this was a hollow,
meaningless deal. First, Quinn agreed to waive defenses that
Rich and Green did not have. It is basic legal doctrine that
fugitivity tolls the statute of limitations. Second, Rich and
Green likely do not face any civil liability for their crimes,
since those fines were already paid by their companies. Third,
Rich and Green had been willing to pay $100 million to settle
their case for years. A fine, even a large one, would have had
no impact on Rich and Green, and it would merely stand for the
proposition that the U.S. justice system is for sale.
When the White House did finally provide the names
of Marc Rich and Pincus Green for a Justice Department
background check in the middle of the night on January 19,
2001, the check turned up new, troubling information which was
disregarded by President Clinton. When the White House
requested the Justice Department to perform a computer
background check on Rich and Green prior to granting the
pardons, the check came back with information that they were
wanted for ``arms trading.'' This was new information for all
of the White House staff, and it raised serious questions among
them as to whether the pardons should be granted. However, the
only step the White House took to check on this allegation was
to call Jack Quinn. Quinn predictably denied that his clients
were involved in arms trading. Faced with this conflicting
information about Rich and Green, President Clinton instructed
his staff to ``take Jack's word,'' and issue the pardons.
President Clinton has failed to offer a full accounting for his
decision to issue the Marc Rich and Pincus Green pardons.
President Clinton has failed to answer any questions
about the Rich and Green pardons. The few statements that he
has issued have been misleading, incomplete, and raised more
questions than they answered. Given his complete failure to
explain the pardons, the Committee is left with serious
unanswered questions regarding President Clinton's motives.
INTRODUCTION
The pardons of Marc Rich and Pincus Green were the most
controversial and most outrageous pardons issued by President
Clinton, and likely, by any President. Rich and Green were
fugitives from justice, and were two of the largest tax cheats
in U.S. history. In addition, they had a long and disgraceful
record of trading with America's enemies, helping prop up the
Ayatollah Khomeini, Saddam Hussein, Muammar Qaddafi, and the
Russian mafia, among others. This track record has led even
Marc Rich's lawyers to call him a ``traitor'' and observe that
he has ``spit on the American flag.''
It is beyond any dispute that Marc Rich and Pincus Green
did not deserve pardons. Therefore, the inevitable question is
why the President granted them. Some believe that the Rich and
Green pardons were the product of a pardon process that
completely broke down at the end of the Clinton Administration.
These individuals would argue that in his rush to create a
legacy at the end of his term, President Clinton short-
circuited the normal clemency review process, and granted
pardons without conducting the due diligence that was required.
While this is hardly a charitable view of President Clinton, it
is the most innocuous explanation that can be presented for the
Rich and Green pardons.
There are a number of reasons to believe that the pardons
were not just the product of a sloppy process. After all, even
though they did not fully understand the scope of Rich and
Green's crimes, the President and White House staff grasped the
essentials of the Rich case: Rich and Green were massive tax
cheats, fugitives from justice, and had traded with the enemy.
Yet, they received the pardons despite these damning facts.
Therefore, the Committee has looked at the motives of the key
players in the Marc Rich and Pincus Green pardon effort.
The evidence raises many questions regarding the motives of
the key players.
Jack Quinn, for example, used his influence as a
former White House Counsel to lobby the President on Rich's
behalf. Quinn repeatedly provided misinformation to the White
House. At the height of the public's outcry about the Rich
case, Quinn claimed that he was representing Rich on a pro bono
basis. However, the evidence obtained by the Committee shows
that Quinn was attempting to secure a lucrative payment from
Rich, and may still be trying to obtain payment from Rich.
Deputy Attorney General Eric Holder provided
critical support for the Rich pardon. While Holder should have
ensured that the Justice Department's views were represented in
the pardon process, Holder instead advised Jack Quinn on how to
cut the Justice Department out of the process. While all of the
White House staff was opposing the Rich and Green pardons, Eric
Holder provided critical support for it at the eleventh hour.
Holder may claim that his actions were the result of
misjudgment, but Holder himself admitted that he was seeking
Quinn's support to be nominated as Attorney General if Al Gore
was elected President. This created a conflict of interest for
Holder.
Denise Rich and Beth Dozoretz were both close
friends of President Clinton and major contributors to the
Democratic Party. In addition, Denise Rich contributed $450,000
to the Clinton Library, and Dozoretz pledged to raise $1
million for the Clinton Library. Both lobbied the President on
the Rich pardon. Both have also invoked their Fifth Amendment
rights rather than testify about their discussions with the
President.
President Clinton is ultimately responsible for the
pardons, and must ultimately provide an explanation of why he
granted them. He has, however, failed to provide any
satisfactory rationale for his actions. He has failed to answer
any serious questions, and instead, has offered only one self-
serving, factually inaccurate newspaper column to justify the
pardons. President Clinton's attempted explanations have raised
more questions than answers about his motivations for granting
two of the most unjustified pardons in U.S. history.
Regardless of the motivations for the Rich and Green
pardons, the nation must live with the consequences of them.
The pardons have sent two equally destructive messages. First,
by granting the pardons, President Clinton undermined the
efforts of U.S. law enforcement to apprehend fugitives abroad.
By pardoning a man who evaded capture by the U.S. Marshals
Service for almost two decades, President Clinton sent the
message that indeed, crime can pay, and that it may be
worthwhile to remain a fugitive rather than face charges. The
pardon also could undermine U.S. efforts to obtain extradition
of fugitives from foreign countries. When a man like Rich can
go from the Justice Department's most wanted to a free man with
a stroke of the pen, it is difficult for the U.S. to credibly
demand the extradition of wanted fugitives. Finally, the
pardons send the message that President Clinton did believe
that different rules applied to wealthy criminals. If he did
not have the money to hire Jack Quinn and his White House
access, Marc Rich never would have obtained a pardon. The
President abused one of his most important powers, meant to
free the unjustly convicted or provide forgiveness to those who
have served their time and changed their lives. Instead, he
offered it up to wealthy fugitives whose money had already
enabled them to permanently escape American justice. Few other
abuses could so thoroughly undermine public trust in
government.
I. BACKGROUND OF MARC RICH AND PINCUS GREEN
A. Rich and Green's Business Activities
1. How Rich and Green Became Wealthy
Marc Rich is one of the wealthiest people in the world. His
network of business enterprises is estimated to generate
upwards of $30 billion annually.\1\ Rich's personal net worth
is estimated at between $1.5 and $8 billion.\2\ Along with his
business partner Pincus ``Pinky'' Green, Rich has made this
fortune principally through the commodities trading business.
---------------------------------------------------------------------------
\1\ Josh Getlin, Clinton Pardons a Billionaire Fugitive, and
Questions Abound, L.A. Times, Jan. 24, 2001, at A1.
\2\ A. Craig Copetas, Court TV Chat Transcript (visited Mar. 10,
2002) http://www.courttv.com/talk/chat--transcripts/2001/0220rich-
copetas.html. It should be noted that estimates of Rich's personal
fortune are probably lower than the actual amount because of Rich's
history of questionable accounting and tax evasion, including that for
which he was indicted in 1983.
---------------------------------------------------------------------------
Rich began his career as a commodities trader in 1954 with
the New York office of the trading firm Philipp Brothers.\3\
Rich traded in a wide variety of commodities, including
precious metals. Throughout his early career he was highly
successful, amassing huge profits for the firm. Over time, Rich
also developed a niche within the firm as a crude oil trader.
He and Green revolutionized international oil trading by
creating the ``spot market,'' which is the practice of
purchasing oil from producers and immediately selling it to
refineries for a large profit.
---------------------------------------------------------------------------
\3\ A. Craig Copetas, Metal Men: Marc Rich and the 10-Billion-
Dollar Scam 65 (1985).
---------------------------------------------------------------------------
After more than twenty years of trading for Philipp
Brothers, Rich decided that he could make more money on his
own. In 1975, while managing Philipp Brothers' Madrid office,
Rich called a meeting of the firm's European managers in Zug,
Switzerland, during which he demanded an impossibly high
bonus.\4\ When, as expected, Rich's boss refused, Rich
announced that he was leaving the firm to start his own
company. He left with Pincus Green, taking six other top
traders from the firm, as well as files of information on
Philipp Brothers' clients.\5\ Rich's new firm was a success,
and Rich was well on his way to becoming a billionaire. By
1982, Marc Rich + Co. A.G. had become the second largest
commodities firm in the world.\6\ However, as Rich's biographer
explained, the initial financing for Rich's new company was
based largely on ``a promise from Iranian Senator Ali Rezai to
help set up a series of no-holds-barred oil deals that would,
in part, lead to making Marc Rich the most wanted white-collar
fugitive in American history.'' \7\
---------------------------------------------------------------------------
\4\ Id. at 96.
\5\ Id. at 99.
\6\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 98 (Feb.
8, 2001) (prepared testimony of Morris ``Sandy'' Weinberg, Jr., and
Martin J. Auerbach, former Assistant U.S. Attorneys for the S.D.N.Y.,
Department of Justice).
\7\ A. Craig Copetas, Metal Men: Marc Rich and the 10-Billion-
Dollar Scam 99 (1985).
---------------------------------------------------------------------------
2. Marc Rich's History of Illegal and Improper Business
Dealings
Even before he had departed Philipp Brothers, Marc Rich
developed a reputation as a shrewd and unethical manipulator.
As fellow Phillip Brothers' trader Bill Spier explained, ``What
separated our friendship was his belief that you could only
make it bigger and better than the next guy by buying people
off. Marc was suave and sophisticated and obsessed with power.
He was always looking to see who he could buy off.'' \8\ While
at Philipp Brothers, Rich also learned to deal with rogue
political regimes in order to make a profit. For example, in
1958, Rich was sent to Cuba, and continued to work there after
the fall of the Batista regime. As one former associate
explained, ``Marc cut his teeth in Havana, and the experience
shaped his character because it taught him that being illegal
was okay under certain conditions[.]'' \9\
---------------------------------------------------------------------------
\8\ Id. at 66.
\9\ Id. at 71.
---------------------------------------------------------------------------
Once he set up his own business enterprise, Rich's
questionable practices appear to have expanded. His trading
empire was based largely on systematic bribes and kickbacks to
corrupt local officials. For example, in 1977, one of Rich's
traders claimed to have deposited $125,000 into the Swiss bank
account of Reza Fallah, then-head of the Iranian National Oil
Company, in exchange for ``services rendered'' in securing a
shipment of Iranian oil to Spain.\10\ In 1978, Rich and Green
were caught diverting Nigerian oil shipments to South Africa.
When the Nigerians threatened to cut off relations with Rich,
he paid a $1 million bribe to the Nigerian transport minister
to get the contract back.\11\ Rich also reportedly paid former
Jamaican President Edward Seaga $45,000 to send the Jamaican
track and field team to the 1984 Olympics. In return, Rich
signed a ten-year agreement to purchase most of the output of
the Jamaican Alcoa plant, which annually produced a significant
portion of the world's aluminum.\12\ One former Rich trader
explained the standard practices of Rich's companies as
follows: ``[t]o go into places like Iran and do honest business
is naive. I'd figure 15 percent of your net in payoffs for
every deal made.'' \13\
---------------------------------------------------------------------------
\10\ Id. at 115.
\11\ Id. at 119.
\12\ Shawn Tully, Why Marc Rich is Richer Than Ever, Fortune, Aug.
1, 1988, at 74.
\13\ A. Craig Copetas, Metal Men: Marc Rich and the 10-Billion-
Dollar Scam 115 (1985).
---------------------------------------------------------------------------
As is explained in more detail below in the section
discussing Rich's legal troubles in the United States, Rich
also laundered funds and hid his profits to protect them from
the taxing authorities of various countries. For example, Rich
routinely used Panamanian shell companies (Sociedades Anonimas)
to launder money and to conceal profits from taxing
authorities.\14\ As explained by author Craig Copetas:
---------------------------------------------------------------------------
\14\ Id. at 125.
Panamanian corporate law is particularly helpful to a
trader whose operations extend outside the Central
American nation and into several different countries. A
Sociedad Anonima is never required to file financial
reports or tax returns and may maintain its books in
any manner it desires in any part of the world. This
permits a procedure generally known as laundering, and
for Marc Rich--an expert at sidestepping the politics
of nations by acting as a maverick middleman between
producers and consumers--it was quite the bargain at
$1,650 plus a $50 annual franchise tax.\15\
---------------------------------------------------------------------------
\15\ Id.
Rescor Incorporated, (a company that Rich used in his illegal
oil scam that led to his legal troubles in the United States)
was one such shell company. At one point, according to a former
Rich shareholder, Rich had $800 million in cash concealed in
his Panamanian shell companies.\16\
---------------------------------------------------------------------------
\16\ Id.
---------------------------------------------------------------------------
Working with corrupt governments was not Marc Rich's only
trademark. Much of Rich's fortune was made dealing with
countries that no one else would deal with. Rich shrewdly used
his multinational status, and his familiarity with unscrupulous
business practices, to profit from embargoes and wars by
trading with pariah nations. Rich's pattern of dealing with
America's enemies, especially Iran, led even one of Rich's own
lawyers to admit that Rich could be considered a traitor to his
country:
Mr. Waxman. Do you agree with the statement that these
gentlemen [Rich and Green] were two traitors to their
country?
Mr. Libby. I can understand someone using those terms.
Mr. Waxman. Do you agree with them?
Mr. Libby. Their companies engaged in trades with
Iran--
Mr. Waxman. Traitors not traders.
Mr. Libby. No, sir, I was trying to finish--during a
period when trades [sic] were held, and that was an act
you could consider an act of a traitor.
Mr. Waxman. That someone could consider, but you do not
consider it?
Mr. Libby. I could consider it. I do not condone it. I
didn't advise it. I do not admire it.\17\
---------------------------------------------------------------------------
\17\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 486
(Mar. 1, 2001) (testimony of I. Lewis ``Scooter'' Libby).
The following section describes specific business
relationships that Rich maintained with regimes or countries
with interests adverse to the United States. U.S. intelligence
agencies have considerable information about Marc Rich, none of
which was reviewed by the White House prior to the pardons.
Unfortunately, most of the information remains classified. The
---------------------------------------------------------------------------
CIA, however, did declassify the following statement:
If President Clinton had checked with the CIA, he would
have learned that Marc Rich had been the subject of
inquiries by various foreign government liaison
services and domestic government agencies regarding
their ongoing investigations of criminal activity.
In addition, President Clinton would have received
information worthy of his consideration in making his
decision on the pardon. This information cannot be
declassified.
As described below, though, the public record alone should have
been enough to eliminate any possibility of pardons for Marc
Rich and Pincus Green.
a. Iran
Marc Rich got his start in the oil trade through business
dealings with the Shah of Iran. After the Shah fell from power,
many were concerned by Ayatollah Khomeini's violent rise to
power. However, Rich saw a new opportunity, and began trading
with the Khomeini regime. In the early days of the Iranian
revolution, after the new Iranian government seized 51 American
hostages, the United States imposed a strict trade embargo on
Iran. Nevertheless, Rich directed his staff to meet the new
directors of the Iranian state-owned oil company.\18\ Shortly
thereafter, Marc Rich and Pincus Green reached a deal to
purchase Iranian oil through his Swiss company, Marc Rich + Co.
A.G. Reportedly, Rich paid for much of this purchase in small
arms, automatic rifles, and hand-held rockets.\19\ One of
Rich's colleagues stated that because of this deal ``Rich got
more excited than I had ever seen him.'' \20\
---------------------------------------------------------------------------
\18\ A. Craig Copetas, Metal Men: Marc Rich and the 10-Billion-
Dollar Scam 131 (1985).
\19\ Id.
\20\ Id. at 132.
---------------------------------------------------------------------------
b. South Africa
Rich's companies also dealt extensively with the South
African government throughout the apartheid regime.
Notwithstanding the United Nations' ban on oil sales to South
Africa, throughout the 1980s Rich's company was one of the
three main traders of oil between the Middle East and South
Africa.\21\ Where other companies saw legal peril, Marc Rich
saw profit, with South African companies willing to pay a
premium of $8 per barrel of oil. According to the Dutch-based
Shipping Research Bureau, Rich supplied about 6 percent of all
oil imports to South Africa between 1979 and 1986, earning
upwards of $1 billion from the transactions.\22\ And according
to a former Rich shareholder, at the time of their indictment
in the United States, Rich and Green were trading Soviet and
Iranian oil to the apartheid government in South Africa in
exchange for Namibian uranium, which Rich and Green in turn
sold back to the Soviet Union.\23\
---------------------------------------------------------------------------
\21\ Andrew Lycett, Spectrum: Plain Sailing Through the Sanctions
Net, Times (London), Sept. 12, 1986.
\22\ Shawn Tully, Why Marc Rich is Richer Than Ever, Fortune, Aug.
1, 1988, at 74.
\23\ A. Craig Copetas, Metal Men: Marc Rich and the 10-Billion-
Dollar Scam 198 (1985).
---------------------------------------------------------------------------
At times, Rich's deals with South Africa were so risky and
profitable that Rich would scuttle the oil tanker at the
conclusion of the deal and fly the crew home. In one deal, a
tanker was loaded with oil from the Soviet Union, was diverted
from its intended itinerary, covered its name with tarpaulins,
communicated only in code, and then delivered its oil in secret
to South Africa.\24\
---------------------------------------------------------------------------
\24\ Jim Hougan, King of the World (Marc Rich), Playboy, Feb. 1,
1994, at 104.
---------------------------------------------------------------------------
c. The Soviet Union/Russia
The South African uranium transactions were not the only
dealing Rich had with the Soviet Union. In fact, Rich and his
companies dealt extensively with the Soviet Union and other
Communist countries. His oil trading with the Soviet Union
provided Moscow with the hard currency needed to purchase grain
during the United States' grain embargo.\25\ Rich's dealings
with the Soviet Union were so extensive and helpful to the
Soviet Union that when he was indicted in the United States in
1983, one Moscow newspaper printed a front page, above-the-fold
story defending Marc Rich and attacking the United States.\26\
In fact, the Russian newspaper Izvestia wrote the following in
defense of Rich:
---------------------------------------------------------------------------
\25\ Id.
\26\ A. Craig Copetas, Metal Men: Marc Rich and the 10-Billion-
Dollar Scam 196-197 (1985).
The United States thinks that all countries, big and
small, must subvert their national interests to
American measures. . . . Under the pretext of
nonpayment of taxes by the Swiss branch of the Marc
Rich firm, American authorities have given an
ultimatum: either Switzerland changes its internal
legislation or its companies will be deprived of
admission to American markets. This action by the
Reagan Administration is an open threat, an attempt to
interfere into the internal affairs of Western European
countries through the threat of economic sanctions. The
Americans are living under the illusion of a Pax
Americana.\27\
---------------------------------------------------------------------------
\27\ Id. at 197.
The fact that one of the leading propaganda organs of the
Soviet state would dedicate itself to the defense of a
capitalist commodities trader like Marc Rich shows the
importance Rich and his company had in providing hard currency
to the Soviet regime.
Marc Rich's influence has only grown in post-Communist
Russia. Rich took advantage of widespread privatization in
Russia to acquire large supplies of industrial materials at
bargain prices. As explained in The Washington Post, ``[a]fter
the Soviet Union fell apart in 1991, these relationships helped
Rich become for a time the single most important Western trader
in Russia.'' \28\ There is also evidence that Rich has
developed deep ties with Russian organized crime, a powerful
force in post-Communist Russia.\29\ According to press
accounts, law enforcement agencies including the FBI and the
CIA had information indicating that Rich had financial ties to
the Russian mafia.\30\ According to one U.S. intelligence
source who spoke to the press, ``Clinton would have found out
about the relationships if he had asked either the FBI or CIA,
[but] [h]e clearly never bothered to ask.'' \31\ Another source
told the press that ``[t]he FBI has tons of material on the
Russian mafia and in particular the Rich-mafia connection.''
\32\
---------------------------------------------------------------------------
\28\ Michael Dobbs, Rich Made His Fortune by Breaking the Rules,
Wash. Post, Mar. 13, 2001, at A1.
\29\ Robert I. Friedman, Red Mafiya: How the Russian Mob has
Invaded America 51 (2000) (indicating that Rich had a relationship with
Russian gangster Marat Balagula, now serving time in prison for
gasoline price fixing). Rich is also suspected to have been involved in
metals trading going in and out of the Estonian port of Tallinn, where
Russian copper, nickel and cobalt are often exported. Tallinn is
notorious for being controlled by the Russian mafia. Rich's company has
denied using the port of Tallinn. See Tony Glover, The EU's Baltic
Extension, EuroBusiness, May 1, 1994.
\30\ Matthew McAllester, Rich's Suspect Ties/Sources: Clinton Could
Have Learned Russian Mob Links, Newsday, Mar. 1, 2001, at A5.
\31\ Id.
\32\ Id.
---------------------------------------------------------------------------
Reportedly, Rich has been linked specifically by U.S. law
enforcement to Mikhail Chernoy, a former agent for Trans-World
Metals. Chernoy is a defendant in a civil case in the U.S.
District Court for the Southern District of New York. He is
named as a controller of two Russian aluminum companies by
European companies who claim that the defendants used bribery,
money-laundering and extortion in order to illegally seize a
large aluminum plant in Russia.\33\ Moreover, according to an
investigative report commissioned by the World Bank in 1998,
Chernoy was arrested by the Swiss police in 1996 during an
investigation of Russian gangs.\34\ As the report states,
Mikhail's brother Lev ``is believed to be a major Russian mafia
figure by most international police and intelligence
organizations.'' \35\ The report further states that Marc Rich
provided the seed money necessary to start up Trans-World
metals.\36\
---------------------------------------------------------------------------
\33\ Id.
\34\ Id.
\35\ Id.
\36\ Id. David Reuben, the Chairman of Trans-World has denied this
account. See Letters, Newsday, Mar. 7, 2001, at A39.
---------------------------------------------------------------------------
Rich has also been linked to Grigori Loutchansky, a
Georgian-born Israeli citizen who is considered to be a
significant player in Russian mob activities. According to
press accounts, Loutchansky worked with Rich in the early 1990s
selling Russian oil and aluminum from formerly state-run
enterprises.\37\ Loutchansky, who was ``accused of drug
trafficking and smuggling nuclear weapons,'' \38\ is ``listed
in a 1995 State Department `watch list' as a `suspected
criminal,' '' \39\ and was involved in the 1996 campaign
fundraising scandal. Time magazine has said that Loutchansky is
``considered by many to be the most pernicious unindicted
criminal in the world,'' \40\ yet he dined with Clinton at a
White House dinner in 1993 and subsequently channeled money
into Clinton's campaign.\41\ He was also invited to a
fundraising dinner in July 1995 but was unable to attend when
his visa was denied and invitation withdrawn.\42\
---------------------------------------------------------------------------
\37\ The U.S. Connection in Caucasus, Intelligence Newsletter, No.
401, Mar. 8, 2001.
\38\ Judi Hasson, Panel Offers Evidence of China Link Beijing Bank
Wired Funds to L.A. Man Prior to Donation, USA Today, July 11, 1997, at
6A.
\39\ Jerry Seper, Ukrainian Gained U.S. Entry Because of Spelling
Mismatch, Wash. Times, Dec. 13, 1997, at A4.
\40\ Statement by Former CIA Director on Clinton Ties to
Loutchansky, U.S. Newswire, Nov. 3, 1996.
\41\ Jerry Seper, Soloman Asks Again for Data on Meetings with
Russian, Wash. Times, Feb. 11, 1997, at A4.
\42\ Lee Davidson, Bennett Zeros in on Demo Donations, Deseret News
(Salt Lake City, UT), July 11, 1997, at A1.
---------------------------------------------------------------------------
d. Cuba
In this hemisphere, Rich continued to conduct business with
Communist Cuba, notwithstanding the U.S. embargo. Rich's early
dealings with Fidel Castro as a trader for Philipp Brothers
apparently paid off decades later when he started his own
companies. Marc Rich reportedly assisted Cuban efforts to
escalate its nuclear power program in 1991.\43\ Rich negotiated
with Castro's son to develop a uranium deposit in Western
Cuba.\44\ The highly enriched uranium could be used to fuel
Cuba's twin 440-megawatt nuclear power reactors. In addition,
U.S. officials were concerned about the weapons potential of
the enriched uranium used in the reactor.\45\ Also in 1991,
Marc Rich & Co., Ltd. arranged a $3.9 million deal for sugar
and oil that were transferred through Cuba.\46\ Ultimately,
these transactions violated the Cuban Assets Control
regulations, and the Office of Foreign Assets Control of the
U.S. Department of Treasury blocked nearly $3 million of funds
from Rich's Cuba transactions.\47\
---------------------------------------------------------------------------
\43\ John J. Fialka and Jose de Cordoba, Cuba Speeds Nuclear
Project; Marc Rich Is Said to Assist, Wall St. J. europe, June 4, 1991,
at 2.
\44\ Id.
\45\ See id.
\46\ Department of Treasury Document Production 000635 (Note to
file C-17306 from the Compliance Programs Division) (Exhibit 1).
\47\ Department of Treasury Document Production 000652 (Memorandum
from R. Richard Newcomb, Director of the Office of Foreign Assets
Control, Department of the Treasury, to Ronald K. Noble, Under
Secretary for Enforcement, Department of the Treasury (Sept. 16, 1994))
(Exhibit 2).
---------------------------------------------------------------------------
e. Libya
Marc Rich also apparently traded with Libya under Muammar
Qaddafi.\48\ Rich's companies purchased oil from Libya
beginning in the 1970s.\49\ Yet even after the United States
bombed Libya in April of 1986 in response to the terrorist
attacks originating in that country, Rich reportedly continued
to purchase crude oil from Qaddafi's regime.\50\ Rich continued
to do business with Libya even after U.S. oil companies
completely withdrew from the country.\51\ Unlike the other
American oil companies, Rich ignored the oil embargoes and
executive orders of the Reagan Administration designed to
punish the terrorist-sponsoring state.
---------------------------------------------------------------------------
\48\ A. Craig Copetas, Metal Men: Marc Rich and the 10-Billion-
Dollar Scam 118 (1985).
\49\ Id.
\50\ Strong Tanker Fixtures Seen as Indication of Undiminished
Interest in Libyan Oil, Platt's Oilgram News, July 16, 1986, at 1.
\51\ Id.
---------------------------------------------------------------------------
f. Iraq
It has also been reported that Marc Rich attempted to
violate the UN embargo against Iraq during the Persian Gulf
War.\52\ Other reports indicate that U.S. officials have been
investigating charges that Rich lent money to Saddam Hussein's
government in exchange for future deliveries of cheap oil.\53\
In a statement to The Financial Times of London, Marc Rich
acknowledged that he had communications with Iraq in September
of 1991, but denied that it involved oil trading.\54\ The fact
that Rich would admit to having discussions with Saddam
Hussein's government just months after the end of the Gulf War
is remarkable. Based on his pattern of shrewd, unethical, and
illegal business dealings with other rogue regimes, Rich's
claim to be interested only in humanitarian aid for Iraq
completely lacks credibility.
---------------------------------------------------------------------------
\52\ See John Hooper, Oil Traders Get Rich in Global Game of Chess,
The Guardian (London), Aug. 7, 1990. See also Jim Hougan, King of the
World (Marc Rich), Playboy, Feb. 1, 1994, at 104.
\53\ Paul Klebnikov, How Rich Got Rich, Forbes, June 22, 1992, at
41.
\54\ Ian Rodger, Marc Rich Hopes for Resolution of Tax Case,
Financial Times, (London), Mar. 12, 1993, at 26.
---------------------------------------------------------------------------
g. Angola
In Angola, as in many other countries, Marc Rich and Pincus
Green became close to the dictators ruling the country. These
relationships gave them exclusive rights to the country's oil.
When other Western oil companies wanted Angolan oil, they had
to turn to Marc Rich and Pincus Green. This point was made with
somewhat comedic effect when, in the late 1970s, a number of
western oil executives were called to a meeting with Angola's
oil agents. Expecting a group of communist officials, the
executives ``were visibly stunned when the communist
representative who walked into the conference room turned out
to be Pinky Green, greeting Exxon executives with a hearty `How
ya doin'?' '' \55\
---------------------------------------------------------------------------
\55\ A. Craig Copetas, Metal Men: Marc Rich and the 10-Billion-
Dollar Scam 115 (1985).
---------------------------------------------------------------------------
h. Romania
Marc Rich is reported to have traded several commodities,
including oil, with the Romanian regime of Nicolae
Ceausescu.\56\ At the time, Rich reportedly had his own
refineries based in Romania.\57\ Trade unionists in Romania
have accused Rich of cashing in on the fortunes that Ceausescu
stole from the Romanian people.\58\ It also appears that, based
on documents received by the Committee from the U.S. Department
of Agriculture, Marc Rich was trading grain with the Ceausescu
regime in the late 1980s.\59\ As is discussed in detail below,
these sales (in addition to sales to countries like China, the
Soviet Union, and Saudi Arabia) resulted in Rich's companies
receiving $95 million from the Department of Agriculture
through a program that provided surplus grain to companies
selling subsidized grain abroad.\60\ This led to an
investigation by then-Congressman, and later Secretary of
Agriculture, Dan Glickman. Glickman's investigation would
eventually lead the first Bush Administration to direct the
Department of Agriculture to bar Rich's companies from
receiving any new contracts.
---------------------------------------------------------------------------
\56\ Romania: Life After Debt, International Trade Finance, May 18,
1989.
\57\ Jim Hougan, King of the World (Marc Rich), Playboy, Feb. 1,
1994, at 104.
\58\ Id.
\59\ See Department of Agriculture Document Production (Minutes of
Richo Grain Board Meeting, Jan. 6, 1987); Department of Agriculture
Document Production (Listing of E.E.P. Awards Made to Richco Grain,
Sept. 27, 1989) (Exhibit 3).
\60\ Bruce Ingersoll, U.S. Suspends Grain Export Subsidies for Firm
Linked to Fugitive Marc Rich, Wall St. J., Oct. 12, 1989, at sec. 3, p.
19.
---------------------------------------------------------------------------
i. Serbia
One document from the Office of Foreign Assets Control
produced to the Committee by the U.S. Department of Treasury
indicates that Rich was also dealing with Serbia in violation
of U.S. and international sanctions.\61\ Press accounts
indicate that Rich violated the U.N. trade embargo by dealing
with Belgrade in a variety of commodities, including copper and
oil.\62\ According to an article in The Oil Daily, at the time
of the U.N. embargo, Serbia reportedly had a deal in place with
Marc Rich to process crude oil in Romania.\63\
---------------------------------------------------------------------------
\61\ Department of Treasury Document Production 000652 (Memorandum
from R. Richard Newcomb, Director of the Office of Foreign Assets
Control, Department of the Treasury, to Ronald K. Noble, Under
Secretary for Enforcement, Department of the Treasury (Sept. 16, 1994))
(Exhibit 2).
\62\ Michael Dobbs, Rich Made His Fortune by Breaking the Rules,
Wash. Post, Mar. 13, 2001, at A1.
\63\ Roger Benedict, U.N. Oil Cutoff of Serbia Hinges on Russia,
China (Security Council Vote), Oil Daily, June 1, 1992, at 1.
---------------------------------------------------------------------------
When asked at a Committee hearing about allegations
relating to Marc Rich's transactions with rogue states, Rich's
lawyer Jack Quinn responded ``I don't know the answer to
that.'' \64\ When asked about the White House's knowledge and
research of these activities, White House Counsel Beth Nolan
told the Committee that she never received an intelligence
briefing and never explained Rich's shady dealings to the
President.\65\ While it may be understandable that Jack Quinn
would not know--or at least not want to know--about Rich's
dealings with so many dictatorships and rogue regimes, it is
inexcusable that the White House failed to take the time to
learn about these disturbing details.\66\
---------------------------------------------------------------------------
\64\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 111
(Mar. 1, 2001) (testimony of Jack Quinn).
\65\ Id. at 374.
\66\ The Committee, however, does not take the position that it was
``understandable'' for Quinn not to have known about Rich's dealings
with rogue states. While Quinn's actions may be legally permissible,
one must think long and hard about the morality of Quinn's actions.
Given Rich's status as a fugitive, common sense and due diligence
should have led Quinn to inquire further into Rich's past dealings.
However, the power of money is often enough to promote willful
ignorance.
---------------------------------------------------------------------------
It is clear that Rich built his fortune doing business
without legal, ethical, or even moral restraints. He regularly
dealt with corrupt officials, dictators and rogue regimes. U.S.
and international embargoes and sanctions were not barriers to
Rich, merely hurdles to be climbed over, under, or around. As
is discussed in more detail below, it is shameful and an
embarrassment to the United States that the Clinton
Administration did not take adequate steps to determine the
extent of Marc Rich's illegal and unethical business activities
before the President granted his pardon. This failure by the
Clinton Administration is especially troubling in light of the
fact that Marc Rich built his fortune by trading with so many
enemies of the United States.
B. The Criminal Charges Against Marc Rich and Pincus Green
1. The Investigation of Rich and Green
Marc Rich's illegal business practices in the United States
came under the scrutiny of the United States government in the
early 1980s. In the fall of 1981, staff from the Fraud Section
of the Criminal Division of the Department of Justice called
Assistant U.S. Attorney Morris ``Sandy'' Weinberg, Jr. of the
Southern District of New York (``SDNY'').\67\ They told
Weinberg of a lead they had received concerning a crude oil
reseller named Marc Rich whose company had an office in New
York City.\68\ As Weinberg and his fellow former prosecutor
Martin Auerbach explained to the Committee during the first
hearing on the Rich pardon, this initial lead on Marc Rich was
developed through oil reseller prosecutions in Abilene,
Texas.\69\ John Troland and David Ratliff of West Texas
Marketing--who had been prosecuted for illegal oil reselling--
provided information about the offshore laundering of funds by
Rich.\70\
---------------------------------------------------------------------------
\67\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 97 (Feb.
8, 2001) (prepared testimony of Morris ``Sandy'' Weinberg, Jr., and
Martin J. Auerbach, former Assistant U.S. Attorneys for the S.D.N.Y.,
Department of Justice).
\68\ Id.
\69\ Id. at 97-98.
\70\ Id.
---------------------------------------------------------------------------
In December of 1981, when Weinberg flew to Texas to
investigate, he obtained a furlough for the principals of West
Texas Marketing (``WTM''), who took him to their office.\71\
Upon reviewing their records of WTM's dealings with Marc Rich,
Weinberg confirmed that Rich earned $70 million in illegal oil
resale profits in 1980 and 1981 and had funneled the money to
his Swiss company in order to evade federal income tax and
federal energy oil control regulations.\72\ As Weinberg
testified to the Committee, it was then apparent to him that he
and his office had uncovered ``the biggest tax fraud in
history.'' \73\ As he further testified:
---------------------------------------------------------------------------
\71\ Id. at 98.
\72\ Id.
\73\ Id. The eventual indictment accused Marc Rich's companies of
evading taxes on over $100 million in unreported income.
The case against Mr. Rich and Mr. Green was very
strong. . . . Like any fraud case, the evidence was
rife with false documents, inflated invoices, sham
transactions and off the books deals. The conspirators
kept track of the illegal profits in hand written
journals in what was described as the ``pot.'' . . .
[T]he evidence included meetings between co-
conspirators and Marc Rich regarding the pots and the
scheme to funnel the illegal profits out of the country
to off-shore accounts.\74\
---------------------------------------------------------------------------
\74\ Id. at 104.
The illegal scheme that Weinberg uncovered stemmed from
Marc Rich's evasion of specific Department of Energy (``DOE'')
regulations. In September of 1980, pursuant to the Emergency
Petroleum Allocation Act of 1973,\75\ the DOE promulgated
regulations establishing the permissible average markup for oil
reselling.\76\ The permissible price was different for
different regulatory categories of crude oil. The categories
contemplated by the regulations included: ``old'' or ``lower
tier;'' ``new'' or ``upper tier;'' and ``stripper.'' \77\ Under
the regulations, every seller or reseller of domestic crude oil
was required to certify to the purchaser the respective amounts
and prices of old oil, new oil, and stripper oil contained in
the crude oil that was being sold.\78\ The regulations
prohibited markups of more than 20 cents per barrel of oil for
a reseller such as Marc Rich's company, Marc Rich + Co.
International, Ltd. (``International'').\79\ International was
also required to submit ERA-69 forms to the DOE on a monthly
basis that set forth the dollar amount of any permissible
average markup overcharges so that they could be immediately
refunded to customers.\80\
---------------------------------------------------------------------------
\75\ 15 U.S.C. Sec. 751, et seq.
\76\ Indictment, U.S. v. Marc Rich, Pincus Green et al. 8-9
(S.D.N.Y. Mar. 6, 1984) (S 83 Cr. 579) (Exhibit 4).
\77\ Id. at 6. As the indictment states, ``Crude oil coming from a
well at or below a designated 1972 level of production was labelled
`old'; `new' oil referred to crude oil discovered since 1973 or oil
obtained from existing wells in excess of the 1972 level of production;
`stripper' oil referred to crude oil produced from a well whose average
daily production was less then [sic] ten barrels.''
\78\ Id. at 7.
\79\ Id. at 8-9.
\80\ Id. at 9.
---------------------------------------------------------------------------
Beginning in September of 1980, Marc Rich and Pincus Green
agreed with the principals of West Texas Marketing that when
International was limited to the 20 cents per barrel markup,
the huge profits from their crude oil transactions would be
retained by WTM rather than being reflected on the books of
International.\81\ These profits were referred to as the
``pot.'' \82\ As the indictment against them would allege, to
further conceal the scheme, Rich, Green and the principals at
WTM conspired to have WTM prepare and mail invoices to
International, which falsely indicated that WTM had sold oil
barrels to International ``at the high world market price, when
in truth and in fact . . . International was paying a far lower
price upon WTM's agreement secretly to kickback to [Rich and
Green] the huge profits held by WTM for . . . International in
the `pot.' '' \83\
---------------------------------------------------------------------------
\81\ Id. at 10-11.
\82\ Id. at 11.
\83\ Id. The manipulation of the oil categories by oil resellers
such as Marc Rich and his companies was referred to as ``daisy
chaining.'' As is explained in the indictment:
GDuring the period of price controls, in order to evade
the regulations and produce huge profits, controlled oil
was on occasion sold through a series of oil resellers
known in the crude oil industry as a ``daisy chain.'' The
defendant INTERNATIONAL frequently participated as the
original reseller of controlled oil into a ``daisy chain.''
The ``daisy chain'' was utilized by the original reseller
to make it extremely difficult to trace the movement of
controlled barrels and to facilitate alteration of the
certifications on controlled barrels into stripper barrels
(uncontrolled) which could then be sold at the much higher
---------------------------------------------------------------------------
world market price.
Id. at 7-8.
The profits in these ``pots'' were moved out of the U.S. to
foreign bank accounts at the direction of Marc Rich and Pincus
Green.\84\ This would occur through sham foreign loss
transactions involving Marc Rich + Co., A.G., (``A.G.'').\85\
From October 1980 through May 1981, Rich, Green, and their
companies moved more than $23 million in income to offshore
accounts from WTM ``pots.'' \86\ These fraudulent transactions
were transmitted through telefaxes and wire transfers.\87\
---------------------------------------------------------------------------
\84\ Id. at 11.
\85\ Id. at 11-12.
\86\ Id. at 12.
\87\ Id. at 12-13.
---------------------------------------------------------------------------
This scheme by Rich and Green was essentially repeated with
another company, Listo Petroleum, for a total of $47
million.\88\ Rich and Green also entered into false deduction
transactions with Charter Crude Oil Company, as well as
ARCO.\89\ In the case of Charter, at the direction of Marc
Rich, International prepared fraudulent invoices purporting
that International had purchased foreign crude oil from A.G. at
its fair market value and subsequently sold it to a Charter
subsidiary at a substantial discount.\90\ As a result,
International fraudulently reduced its amount of taxable income
by more than $31 million dollars.\91\ In the ARCO case, in the
fall of 1980, Rich and Green's company Rescor invoiced their
other company, International, for nearly $3 million. The
invoice concerned a non-existent contract for the sale of
foreign crude oil to Rescor by International. The fraudulent
invoice made it appear that International had failed to provide
oil to Rescor which subsequently had to purchase a similar
quantity of oil from Arco at five dollars per barrel above the
original contract price.\92\ As a result, International
fraudulently reduced its amount of taxable income for 1980 by
nearly $3 million.\93\
---------------------------------------------------------------------------
\88\ Id. at 13, 15.
\89\ Id. at 15-18.
\90\ Id. at 16.
\91\ Id.
\92\ Id. at 17-18.
\93\ Id. at 18.
---------------------------------------------------------------------------
Finally, Weinberg uncovered evidence of Marc Rich and
Pincus Green trading with Iran during the American hostage
crisis. In 1979 and 1980, President Carter issued several
executive orders and the Department of Treasury subsequently
promulgated regulations that prohibited any American from
trading with Iran without a special license from the Department
of Treasury.\94\ The regulations further required all
individuals engaging in trade with Iran to keep records to be
available for examination by the Office of Foreign Assets
Control.\95\ Nevertheless, on April 30, 1980, Marc Rich + Co.,
A.G. entered into a contract with the National Iranian Oil
Company (``NIOC'') for the purchase of crude and fuel oil from
May 1, 1980 through September 30, 1980.\96\ As the indictment
indicates, from their offices in New York City, Rich and Green
in turn sold 6,250,000 barrels of the Iranian oil to an oil
company in Bermuda for a total of more than $200 million. In
order to conceal this scheme, Rich and Green did not disclose
to their banks in the United States that the ultimate
beneficiary of the U.S. dollars was the NIOC.\97\ Rich and
Green further devised a secret code for their interoffice cable
communications to disguise the participation of the Iranian oil
company.\98\ The scheme was completed through several wire
transactions and transmissions, and ultimately caused United
States dollars to be illegally transferred to Iran at the same
time that Iran was holding American hostages.\99\
---------------------------------------------------------------------------
\94\ Id. at 44-45. The executive orders issued pursuant to the
International Economic Emergency Powers Act of 1977 included Executive
Orders No. 12,170, 12,205, and 12,211.
\95\ Id. at 45.
\96\ Id.
\97\ Id. at 46.
\98\ Id. at 47.
\99\ Id. at 47, 49. These charges were brought under 31 CFR
Sec. Sec. 535.206(a)(4), 535.208, 535.701, and 50 USC Sec. 1705, and 18
USC Sec. 2.
---------------------------------------------------------------------------
In early 1982, the Southern District of New York began
subpoenaing millions of documents from oil companies and crude
oil resellers in the United States that had done business with
Marc Rich.\100\ Prosecutors also served subpoenas on Marc
Rich's companies in New York.\101\ The Southern District
decided to subpoena Marc Rich + Co. A.G.--even though it was a
Swiss company--because there were sufficient contacts through
its American subsidiary to give them jurisdiction for enforcing
document subpoenas.\102\ Rich, who had retained high-powered
attorneys such as Edward Bennett Williams, Peter Fleming, and
former federal judge Marvin Frankel, sought to quash the grand
jury subpoenas.\103\ However, United States District Judge
Leonard Sand denied the Rich team's motion to quash and ordered
A.G. to produce the documents from Switzerland.\104\ The Second
Circuit Court of Appeals affirmed Judge Sand's decision in May
of 1983.\105\ When Marc Rich + Co. A.G. refused to produce the
documents, Judge Sand held the company in contempt and ordered
a $50,000 per day fine in order to compel production of the
documents.\106\ Nevertheless, Rich and his company refused to
produce the documents or pay the fine.\107\
---------------------------------------------------------------------------
\100\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 99 (Feb.
8, 2001) (prepared testimony of Morris ``Sandy'' Weinberg, Jr., and
Martin J. Auerbach, former Assistant U.S. Attorneys for the S.D.N.Y.,
Department of Justice).
\101\ Id.
\102\ Id.
\103\ Id.
\104\ Id.
\105\ Id.
\106\ Id. at 100.
\107\ Id.
---------------------------------------------------------------------------
Rich's behavior during the litigation soon became even more
confrontational and deceptive. As the Southern District of New
York was to learn, on June 29, 1983, Rich quietly sold off his
company's only American asset.\108\ Judge Sand called the sale
a ``ploy to frustrate the implementation of the court's
order,'' and thereby ordered a freeze of A.G.''s assets in the
United States.\109\ The Second Circuit Court of Appeals also
concluded that the sale was a fraud.\110\ As a result of these
rulings by the courts, Rich and his lawyers agreed to negotiate
a resolution of the contempt issue. A.G. agreed to pay the more
than $1 million in contempt fines that had accumulated and to
continue paying the contempt fines until all of the documents
had been produced from Switzerland.\111\
---------------------------------------------------------------------------
\108\ Id.
\109\ Id.
\110\ Id.
\111\ Id. at 101.
---------------------------------------------------------------------------
At first, Rich's company appeared to be complying with the
agreement by producing hundreds of thousands of documents from
Switzerland. However, on August 9, 1983, four days after the
agreement, the Southern District received an anonymous tip that
subpoenaed documents were being secreted out of the U.S. by a
paralegal of the law firm Milgrim Thomajan & Lee.\112\ In
responding to the tip, the Southern District seized two steamer
trunks full of subpoenaed documents from a Swiss Air
flight.\113\ As a result of this incident, Judge Sand ordered
the production of every document of the Marc Rich companies in
the world that had been subpoenaed.\114\ Rich and his legal
team argued that the Swiss government had already seized all of
the remaining documents, thereby rendering compliance with the
agreement they had reached impossible.\115\ Judge Sand
nevertheless ruled that the contempt fines should
continue.\116\ In total, Marc Rich + Co. A.G. paid over $21
million in contempt fines over the course of the
litigation.\117\
---------------------------------------------------------------------------
\112\ Id. When asked about this episode at the Committee's hearing,
Jack Quinn testified ``what I have been told is that those documents
were going to Switzerland for the purpose of being reviewed for
privilege by the lawyers.'' Id. at 113 (testimony of Jack Quinn). In
response to this claim, Martin Auerbach testified: ``With respect to
the documents that were being slipped out of the country, the
suggestion was never that those were being reviewed for attorney-client
privilege. It was simply that it would be more convenient for counsel
to review them in Switzerland then [sic] to review them in New York.
Now, we had tons and tons of documents delivered to us. These two
steamer trunks were slipping out. We didn't get a call from them
saying, you know, we've got some people over in Zug with nothing better
to do than to look at documents; would you mind if we took them over
there outside of the jurisdiction at the time when we're in contempt
for refusing to produce documents from Switzerland?'' Id. (testimony of
Martin J. Auerbach, former Assistant U.S. Attorney for the S.D.N.Y.,
Department of Justice).
\113\ Id. at 101 (prepared testimony of Morris ``Sandy'' Weinberg,
Jr., and Martin J. Auerbach, former Assistant U.S. Attorneys for the
S.D.N.Y., Department of Justice).
\114\ Id.
\115\ Id. at 101-02. The Committee does not know Rich's precise
role in orchestrating this action by the Swiss government. Rich's power
in that country makes it reasonable to assume that he might have played
a part in creating the condition that made his representations in the
United States possible. The Committee is not aware of the Swiss
government penalizing Rich or taking any other action against him.
\116\ Id. at 102.
\117\ Id.
---------------------------------------------------------------------------
Rich's attorneys made a number of attempts to settle the
case before an indictment was issued. When Rich hired Edward
Bennett Williams to represent him, Williams assured him that he
could settle the case if Rich paid a large fine, telling Rich
``I can get rid of it for $30 million.'' \118\ Williams then
went to Sandy Weinberg and asked how much the government wanted
to settle the case. When Weinberg told Williams he was not
interested, Williams asked Weinberg what he had in mind.\119\
Weinberg responded ``J-A-I-L.'' \120\ Later, Williams would
offer as much as $100 million to settle the Rich case.\121\ All
of these offers were rejected.
---------------------------------------------------------------------------
\118\ Evan Thomas, The Man to See: Edward Bennett Williams 415
(1991).
\119\ Id. at 416.
\120\ Id.
\121\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 103
(Feb. 8, 2001) (prepared testimony of Morris ``Sandy'' Weinberg, Jr.,
and Martin J. Auerbach, former Assistant U.S. Attorneys for the
S.D.N.Y., Department of Justice).
---------------------------------------------------------------------------
2. The Indictment
In September of 1983, a federal grand jury in New York
returned a 51-count indictment against Marc Rich, Pincus Green,
and their companies.\122\ The original indictment was
restructured into a 65-count indictment in March of 1984.\123\
All of the first 42 counts were charged against Marc Rich,
Pincus Green, Clyde Meltzer, A.G., and Marc Rich + Co,
International Ltd. The superseding indictment was arranged to
include in counts 1 through 23 the scheme to defraud the
IRS.\124\ These charges were brought pursuant to 18 USC
Sec. 1343, the federal statute prohibiting wire fraud.\125\
These charges related to the fraudulent transactions among WTM,
and Marc Rich's companies discussed above. Counts 24 through 38
included the scheme to defraud the Department of Energy, and
were brought pursuant to 18 USC Sec. 1341, prohibiting mail
fraud.\126\ Count 39 and 40 were racketeering charges brought
under the RICO statute, 18 USC Sec. 1962(c).\127\ Counts 41 and
42 included two tax evasion counts for Marc Rich + Co.
International's 1980 and 1981 tax returns, covering an amount
totaling over $100 million in unreported income which was
concealed by the efforts of Rich, Green, Meltzer, and Rich's
two companies.\128\ As stated in the indictment, International
was able to evade more than $49 million in taxes.\129\ These
counts were also brought against Marc Rich and Pincus Green
personally. The tax and racketeering counts were approved and
authorized by the Department of Justice.\130\ Counts 43 through
57 alleged that Rich defrauded the Department of Treasury for
his transactions with the Iranians during the oil embargo and
the American hostage crisis. Finally, counts 57 through 65
charged Rich with ``trading with the enemy'' for Rich's secret
deals with the Iranians.\131\ In the superseding indictment,
these charges were not leveled against the companies. As a
letter accompanying the indictment states, ``[t]he primary
focus of those counts has always been the activities of the
American individuals, Marc Rich and Pincus Green.'' \132\
---------------------------------------------------------------------------
\122\ Id.
\123\ See Indictment, U.S. v. Marc Rich, Pincus Green et al.
(S.D.N.Y. Mar. 6, 1984) (S 83 Cr. 579) (Exhibit 4).
\124\ Id. at 19-22.
\125\ Id. at 22.
\126\ Id. at 22-25.
\127\ Id. at 33-34.
\128\ Id. at 40-42.
\129\ Id.
\130\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 102-03
(Feb. 8, 2001) (prepared testimony of Morris ``Sandy'' Weinberg, Jr.,
and Martin J. Auerbach, former Assistant U.S. Attorneys for the
S.D.N.Y., Department of Justice).
\131\ U.S. v. Marc Rich, Pincus Green et al. (S.D.N.Y. Mar. 6,
1984) (S 83 Cr. 579). See also 50 U.S.C. Sec. 1705.
\132\ Cover letter to superseding indictment, U.S. v. Marc Rich,
Pincus Green et al. (S.D.N.Y. Mar. 6, 1984) (S 83 Cr. 579) (Exhibit 4).
---------------------------------------------------------------------------
3. Rich and Green Flee the Country
Even though their companies eventually pled guilty and paid
heavy fines, Rich and Green personally refused to face the U.S.
justice system. Rich and Green were out of the country when
their indictments were handed down. They refused to return to
the United States, even after warrants were issued for their
arrest. As Weinberg and Auerbach explained to the Committee,
``[b]y the time of the indictment, Marc Rich and Pincus Green
had made it clear that they would not return to the United
States to face the charges. Apparently, they had quietly left
the United States in June 1983 at a time when their lawyers
were attempting to negotiate a resolution of the case.'' \133\
Even Rich's own lead attorney, Edward Bennett Williams, was
shocked by Rich's conduct:
---------------------------------------------------------------------------
\133\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 103
(Feb. 8, 2001) (prepared testimony of Morris ``Sandy'' Weinberg, Jr.,
and Martin J. Auerbach, former Assistant U.S. Attorneys for the
S.D.N.Y., Department of Justice). It should be noted that by this
point, Rich and Green had already renounced their U.S. citizenship and
become citizens of Spain and perhaps Bolivia.
Rich responded to the warrant for his arrest by
refusing to return from Switzerland. Williams was
standing in the office of Marvin Davis in Los Angeles
when he heard the news that his client was on the lam.
According to Davis, Williams shouted in the phone,
``You know something, Marc? You spit on the American
flag. You spit on the jury system. Whatever you get,
you deserve. We could have gotten the minimum. Now
you're going to sink.'' \134\
---------------------------------------------------------------------------
\134\ Evan Thomas, The Man to See: Edward Bennett Williams 417
(1991). Rich denied Davis' account of this conversation, saying,
``There is not a shred of truth in it.''
Despite the outrage of their own lawyers, as well as the
prosecutors, Rich and Green never returned to the country to
face the charges. They remained fugitives in Switzerland for
more than seventeen years until they received their pardons
from President Clinton.
4. The Corporate Guilty Pleas
Notwithstanding the fact that Rich and Green would not
return to face the charges against them, their companies
entered plea negotiations with the government. A year after the
indictment was handed down, Marc Rich's companies pled guilty
to evading $50 million in taxes. In the allocution on October
11, 1984, Peter Fleming, counsel for Marc Rich + Co.
International, Ltd. stated to the court:
Beginning in September 1980 International generated
millions of dollars of income from crude oil
transactions which International should have disclosed
but intentionally did not disclose to the Internal
Revenue Service and the Department of Energy.
* * *
In connection with matters within the jurisdiction of
agencies of the United States, specifically the
Department of Energy and the Internal Revenue Service,
International and A.G. knowingly and willfully made
those documents and the ERA 69s filed with the
Department of Energy which were false in that they
failed to disclose material facts regarding the actual
income from those crude oil transactions, in violation
of Title 18, United States Code, Section 1001, which is
the charging statute of counts 1 through 38.
* * *
In addition, by knowingly and willfully failing to
report at least $50 million of taxable income generated
from these transactions for the years 1980 and 1981,
International committed income tax evasion for these
years in violation of Title 26, United States Code,
Section 7201.\135\
---------------------------------------------------------------------------
\135\ Transcript of Allocution, U.S. v. Marc Rich + Co., A.G. et
al. 18-19 (S.D.N.Y. Oct. 11, 1984) (S 83 Cr. 579) (Exhibit 5).
Counsel for Marc Rich + Co. A.G. then stated to the court,
``[a]s you know, A.G. is charged only in counts 1 through 38 of
this information, and A.G. adopts Mr. Fleming's statements in
connection with those counts.'' \136\ As part of their guilty
plea, A.G. and International (which by then had been renamed
``Clarendon, Ltd.''), also agreed to pay the United States $150
million,\137\ and agreed to waive any right to recover the $21
million in fines they had already paid the government.\138\ The
total amount that the companies paid to the government for
their crimes was $200 million.\139\ As then-United States
Attorney Rudolph Giuliani explained in court, this represented
the largest amount of money ever recovered by the United States
in a criminal tax evasion case.\140\
---------------------------------------------------------------------------
\136\ Id. at 20.
\137\ Id. at 3.
\138\ Id. at 4.
\139\ Id.
\140\ Id. at 5.
---------------------------------------------------------------------------
The guilty pleas and fines paid by the companies controlled
by Marc Rich and Pincus Green clearly demonstrate the guilt of
the two principals. Based on the overwhelming evidence against
them, it is no wonder Rich and Green fled the country rather
than face trial. The evidence, including the admissions by Marc
Rich's companies, also explains why Martin Auerbach of the
Southern District of New York could confidently respond to Jack
Quinn's criticism at the Committee's hearing, stating, ``Mr.
Quinn has suggested to the Committee and to the Nation that we
had a legal house of cards. Well, if we did, it was all aces.''
\141\
---------------------------------------------------------------------------
\141\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 106
(Feb. 8, 2001) (testimony of Martin J. Auerbach, former Assistant U.S.
Attorney for the S.D.N.Y., Department of Justice).
---------------------------------------------------------------------------
C. Attempts to Bring Rich and Green to Justice
1. Attempts to Extradite Rich and Green
After Rich and Green fled the country in anticipation of
their indictment, the Southern District of New York made many
attempts to have foreign governments extradite the two
fugitives in order to bring them back to the country to stand
trial on the numerous charges against them. On July 20, 1984,
the United States requested extradition of Rich and Green from
Switzerland. That request was rejected by the Swiss government
in September of 1984 on the basis that the offenses charged
against Rich and Green were ``fiscal violations'' and
violations of ``provisions concerning currency, trade policy
and economic policy'' \142\ and that the government of
Switzerland did not recognize the charges against Rich and
Green as extraditable crimes. In June of 1994, the Justice
Department attempted to extradite Rich and Green from Israel,
but the Israeli government also turned down the request.
Israel's Attorney General, Michael Ben-Ya'ir, told the U.S.
Government that the extradition treaty between the two
governments did not include fiscal offenses.\143\ And even
though Rich had become a citizen of Spain, prosecutors could
not extradite him from that country because, like Switzerland
and Israel, Spain does not extradite its citizens for tax
evasion.
---------------------------------------------------------------------------
\142\ Unofficial translation of a note delivered on September 25,
1984, by the Office for Police Matters to the Embassy of the United
States. See ``They Went Thataway: The Strange Case of Marc Rich and
Pincus Green,'' Hearing Before the Comm. on Govt. Operations, 102d
Cong. 3 (May 27, 1992).
\143\ Bo'az Ga'on, Rich as Korach, Ma'ariv Weekend Magazine, Oct.
1, 1999 (Exhibit 6).
---------------------------------------------------------------------------
2. Marc Rich and Pincus Green's Attempts to Renounce Their
Citizenship
After fleeing the United States, Rich and Green attempted
to renounce their U.S. citizenship for the specific purpose of
avoiding extradition on the charges against them. According to
a U.S. government memorandum from the Embassy in Madrid, Rich
expatriated himself on September 3, 1982, prior to his
indictment, and became a naturalized Spaniard on February 11,
1983.\144\ As Rich explained in a letter to the U.S. Consul
General in Zurich, ``I was naturalized under the laws of Spain,
swore an oath of allegiance to the King of Spain, and formally
stated that I thereby renounced U.S. nationality.'' \145\ On
May 27, 1983, Green, and perhaps Rich, were naturalized as
Bolivian citizens according to U.S. State Department
cables.\146\ In the case of Green, a letter from the Ministry
of the Interior in Bolivia states that ``the privilege of
Bolivian nationality has been given to Pincus Green Bergstein,
who previously renounced his nationality of origin and complied
with the required procedures determined by current legal
regulations.'' \147\ According to a letter from the Department
of Justice to Congressman Robert Wise in November of 1991, Rich
and Green also became citizens of Israel in 1983.\148\ The
pardon application submitted to the White House by Jack Quinn
also lists Green as a citizen of Switzerland, although it does
not list Rich as a Swiss citizen, and it appears that Rich is,
in fact, not a Swiss citizen.\149\
---------------------------------------------------------------------------
\144\ Department of State Document Production (Government
Memorandum from U.S. Embassy in Madrid to U.S. Department of State,
Aug. 25, 1983) (Exhibit 7).
\145\ Department of State Document Production (Letter from Marc
Rich to Ruth H. Van Heuven, U.S. Consul General, Switzerland (Oct. 27,
1992)) (Exhibit 8). In this and other letters, Rich claims that he
became a citizen of Spain in July of 1982, earlier than the date
indicated by the U.S. government. Spanish government documents appear
to confirm this. The Second Circuit Court of Appeals also affirmed a
district court ruling that Rich's attempt to renounce his citizenship
in Madrid had failed. The Second Circuit held:
GThe evidence strongly supports the district court's
finding that Rich had no intention whatsoever to relinquish
his American citizenship prior to commencement of this
action. Despite mouthing words of renunciation before a
Spanish official, he refused to acknowledge such
renunciation before the United States Consul in Madrid
before this action commenced. Instead, he brought a Swiss
action as an American national, traveled on his American
passport, and publicized himself in a commercial register
---------------------------------------------------------------------------
as a United States citizen.
Action S.A. v. Marc Rich & Co., Inc., 951 F.2d 504, 507 (2d Cir. 1991).
---------------------------------------------------------------------------
\146\ Department of State Document Production (Letter from the
American Consul to Pincus Green (Dec. 19, 1983)) (Exhibit 9). The State
Department apparently believed that Rich and Green entered Bolivia
illegally because of the restrictions on their passports, which would
have jeopardized their claim of Bolivian citizenship. See U.S. Marshals
Service Document Production (Department of State Cable, Oct. 11, 1983)
(Exhibit 10).
\147\ Department of State Document Production (Letter from Dr.
Emilio Perez Barrios, Sub-Secretary of Immigration, Bolivian Ministry
of Interior, to the American Consul (Sept. 9, 1983)) (Exhibit 11).
\148\ Department of Justice Document Production DOJ/SDNY-MR-00008-
09 (Letter from W. Lee Rawls, Assistant Attorney General, Office of
Legislative Affairs, Department of Justice, to the Honorable Robert E.
Wise, Jr., Chairman, Subcommittee on Govt. Information, Justice, and
Agriculture, Comm. on Govt. Operations (Nov. 21, 1991)) (Exhibit 12).
\149\ Petition for Pardon for Marc Rich and Pincus Green 1, 3 (Dec.
11, 2000) (Appendix III).
---------------------------------------------------------------------------
In 1983, the State Department informed the Southern
District of New York that Rich was seeking to renounce his U.S.
citizenship. The American embassy attempted to contact Rich to
have him fill out a questionnaire to determine his citizenship,
but he never responded.\150\ Rich and Green also never
responded to letters from the American Consul in Bern,
Switzerland, attempting to determine their citizenship. On
September 29, 1993, the U.S. State Department revoked Rich's
American passports because of the ``outstanding federal felony
warrant of arrest issued by the U.S. District Court for the
Southern District of New York.'' \151\ The next day, the State
Department also revoked Pincus Green's passport.\152\
---------------------------------------------------------------------------
\150\ Department of State Document Production (Letter from Julian
L. Bartley, Consul, Embassy of the United States of America in Madrid,
to Marc Rich (Mar. 25, 1983)) (Exhibit 13).
\151\ U.S. Marshals Service Document Production (State Department
Cable, Sept. 29, 1983) (Exhibit 14).
\152\ U.S. Marshals Service Document Production (State Department
Cable, Sept. 30, 1983) (Exhibit 15).
---------------------------------------------------------------------------
The confusion over Marc Rich's citizenship status also
became an issue of concern to the U.S. Treasury Department in
November of 1991. A letter written by the Office of Foreign
Assets Control prompted the State Department to make a
determination of Rich's citizenship. In its response of April
14, 1992, the State Department made a final determination that
Marc Rich had failed to renounce his citizenship, and was still
a U.S. citizen.\153\ The conclusion was based on the fact that
the Department never approved Rich's Certificate of Loss of
Nationality.\154\ It was also based on the fact that Rich did
not demonstrate the requisite intent to lose his U.S.
Citizenship--in part because he used his U.S. passport to
travel to the United States after he became a Spanish
citizen.\155\
---------------------------------------------------------------------------
\153\ Department of Treasury Document Production 000660-61 (Letter
from Carmen A. DiPlacido, Director of the Office of Citizens Consular
Services, Department of State, to Richard Newcomb, Director of the
Office of Foreign Assets Control, Department of the Treasury (Apr. 14,
1992)) (Exhibit 16).
\154\ Id.
\155\ Id.
---------------------------------------------------------------------------
Despite the U.S. Government's official finding that Rich is
still a U.S. citizen, Rich and his lawyers claim that he is not
a U.S. citizen. When he appeared on television after the Rich
pardon, Jack Quinn stated ``he is a U.S. citizen.'' \156\
However, when he appeared before the Committee, Quinn stated
that he ``misspoke'' when he was on Meet the Press, and took
the position that Rich had indeed renounced his citizenship.
Sandy Weinberg, testifying with Quinn, observed:
---------------------------------------------------------------------------
\156\ Meet the Press (NBC television broadcast, Jan. 28, 2001).
I suppose when he [Marc Rich] heard on television from
Mr. Quinn that he was a citizen, I'm sure it did
concern him whether or not he had a problem over the
last 20 years. I suspect that . . . Mr. Quinn got a
call the next day saying ``no, I'm not a citizen''
because I believe that there are some very significant
tax implications if he's been a citizen all these
years.\157\
---------------------------------------------------------------------------
\157\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 167
(Feb. 8, 2001) (testimony of Morris ``Sandy'' Weinberg, Jr., former
Assistant U.S. Attorney for the S.D.N.Y., Department of Justice).
---------------------------------------------------------------------------
3. U.S. Attempts to Apprehend Rich and Green
Between 1984 and 1992, the Department of Justice submitted
five provisional arrest requests to various countries in an
attempt to apprehend Rich and Green.\158\ None of these
attempts were successful. As early as October 9, 1985, Rich and
Green were listed as wanted international criminals by the U.S.
National Central Bureau of Interpol.\159\ In 1987, Interpol
issued an international ``red notice'' (warrant) that requested
the provisional arrest of Rich and Green with the eventual goal
of extradition.\160\ On several occasions, the FBI and the U.S.
Marshals Service appeared ready to apprehend the two fugitives.
One operation set up by the Marshals Service to snare Rich,
referred to as ``the Otford Project,'' was nearly
successful.\161\ In the fall of 1987, a U.S. Marshal assigned
to the project barely missed apprehending Rich in France after
he canceled a meeting with an African oil minister.\162\ A few
months later, in November of 1987, the U.S. Marshals Service
again came close to capturing Rich. They were tipped off by a
businessman close to Rich that Rich would be taking a private
plane to England for a weekend party. The Marshals set the trap
for Rich at the Biggen Hill Airport in Kent. However, thick fog
settled in over England, and Rich's plane turned back to
Switzerland.\163\
---------------------------------------------------------------------------
\158\ See ``They Went Thataway: The Strange Case of Marc Rich and
Pincus Green,'' Comm. on Govt. Operations, 102d Cong. 10 (May 27, 1992)
(quoting Letter from W. Lee Rawls, Assistant Attorney General, Office
of Legislative Affairs, Department of Justice, to the Honorable Robert
E. Wise, Jr., Chairman, Subcommittee on Govt. Information, Justice, and
Agriculture, Comm. on Govt. Operations (received Oct. 11, 1991)).
\159\ Interpol Document Production (Wanted International Criminal
Request, Oct. 9, 1985) (Exhibit 17). The document itself lists Rich and
Green as wanted for the indictments in the Southern District of New
York for wire fraud, mail fraud, income tax evasion, racketeering,
racketeering conspiracy, and trading with the enemy.
\160\ Interpol Document Production (Interpol International Red
Notice, June 4, 1992) (Exhibit 18).
\161\ Craig Copetas, The Sovereign Republic of Marc Rich,
Regardie's, Feb. 1, 1990, at 46.
\162\ Id.
\163\ Id.
---------------------------------------------------------------------------
In 1986, prior to the international arrest warrant being
issued, Rich had another brush with the law. Rich had been
asked by his wife Denise to visit her in London. After the
visit, Rich was at Heathrow airport to catch the return
Swissair flight to Zurich. As he approached the gate, Rich
apparently noticed that the security staff was conducting a
complete search of luggage and identification.\164\ Rather than
submit to the search, Rich apparently went to a public
telephone and left three checks payable to him for
1.6 million stuck between the pages of a telephone
book.\165\ Free of the checks that Rich thought would identify
him to the British authorities, Rich then boarded the flight
for Zurich.\166\
---------------------------------------------------------------------------
\164\ Id.
\165\ Id.
\166\ Id.
---------------------------------------------------------------------------
In September of 1991, the FBI and Interpol attempted to
arrest Rich in Finland.\167\ According to a Finnish businessman
who helped the FBI with the matter, Rich was tipped off that he
would be arrested at the Helsinki airport, and he therefore
turned his plane around before landing.\168\ Other failed
attempts to arrest Rich are indicated by several documents
produced to the Committee. As an Interpol cable indicates, Rich
was expected to be in Moscow both in May and September of 1992.
Attempts were made at the Justice Department in September of
that year to ``insure a provisional arrest warrant is in place
should [Rich] appear in Moscow.'' \169\ In March of 1992, the
U.S. Attorney for the Southern District of New York, as well as
the Office of International Affairs at the Justice Department,
made a request for Interpol to assist in apprehending Rich in
Dushanbe, Tajikistan, based on information that he would be
meeting with the new republic's prime minister.\170\ In fact,
Interpol sent a senior officer directly to Dushanbe carrying
the United States' provisional arrest request.\171\ A request
for the arrest of Rich was also made in anticipation of his
arrival in Czechoslovakia in February of 1992, when Rich was
negotiating the purchase of the Slovak Aluminum Company.\172\
Yet another document indicates that provisional arrest warrants
were also issued for Marc Rich in France, Portugal, and
Norway.\173\
---------------------------------------------------------------------------
\167\ Interpol Document Production (Letter from Darrell W. Mills,
Chief, Interpol-USNCB (1991)) (Exhibit 19).
\168\ Telephone Interview with Pertti Ruoho, Finnish Oil Trader
(Feb. 22, 2001). See also Letter from Darrell W. Mills, Chief,
Interpol-USNCB (1991)) (Exhibit 19).
\169\ Interpol Document Production (Interpol-USNCB transmission,
Sept. 1, 1992) (Exhibit 20).
\170\ Interpol Document Production (Interpol-USNCB transmission,
1992) (Exhibit 21).
\171\ Id.
\172\ Interpol Document Production (Fax from Donald S. Donovan,
Assistant Chief, Interpol-USNCB, to Don Ward, Deputy Chief, U.S.
Marshals Service (Feb. 21, 1992)) (Exhibit 22).
\173\ Interpol Document Production 000317 (Identifiers on Marc
Rich, Nov. 19, 1991) (Exhibit 23).
---------------------------------------------------------------------------
It is difficult to believe that Marc Rich went from being
an international fugitive, sought by teams of Marshals across
the world, to a free man with the simple stroke of a pen. The
effort to apprehend Marc Rich was the subject of intense law
enforcement, diplomatic, and Congressional interest. Beyond the
obvious negative effects of the Rich pardon, it also had a
demoralizing effect on the individuals who tried for so long to
track down Rich. In addition, it undermines U.S. authority to
apprehend criminal fugitives. When the United States government
attempts to apprehend someone by utilizing Interpol and working
with law enforcement in foreign countries, it is reasonable to
assume that those persons being sought should have to face
trial in the United States. By granting pardons to Rich and
Green, international law enforcement efforts on behalf of the
United States were seriously undermined.
4. 1992 Congressional Hearings
The Marc Rich matter and the failure of the government to
apprehend him was an issue of great interest to this Committee
when it was under a Democratic chairmanship in the early 1990s.
In particular, Congressman Robert Wise held three days of
hearings on the matter when he served as chairman of the
Subcommittee on Government Information, Justice, and
Agriculture of the Committee on Government Operations.\174\ The
hearings, entitled ``The Strange Case of Marc Rich: Contracting
with Tax Fugitives and At Large in the Alps,'' also resulted in
two Committee reports. One of those reports, entitled ``They
Went Thataway: The Strange Case of Marc Rich and Pincus
Green,'' focused on the efforts of the United States to
apprehend the two fugitives.\175\
---------------------------------------------------------------------------
\174\ The Government Information, Justice, and Agriculture
Subcommittee held three separate Marc Rich hearings on December 4,
1991, February 18, 1992, and March 5, 1992, entitled ``The Strange Case
of Marc Rich: Contracting with Tax Fugitives and At Large in the
Alps.''
\175\ ``They Went Thataway: The Strange Case of Marc Rich and
Pincus Green,'' Hearing Before the Comm. on Govt. Operations, 102d
Cong. (May 27, 1992).
---------------------------------------------------------------------------
Congressman Wise and his Subcommittee criticized the Reagan
and Bush Administrations for failing to take adequate steps to
apprehend Marc Rich. At a hearing on December 4, 1991,
Congressman Mike Synar was particularly critical of the
Department of Justice for failing to apprehend the fugitives:
It is unacceptable that the Justice Department has
failed to show up today. It is unacceptable that they
have failed to enforce the law in this very important
matter, and as the chairman pointed out, in the case of
the No. 1 tax abuser in our history. Can there be
little wonder, can there be little wonder why Americans
have lost confidence with respect to this government's
ability to enforce the laws? And can there be little
wonder why most Americans believe there are two sets of
laws in this country, one for the rich, no pun
intended, and one for the rest of us? \176\
---------------------------------------------------------------------------
\176\ ``The Strange Case of Marc Rich: Contracting with Tax
Fugitives and At Large in the Alps,'' Hearing Before the Govt.
Information, Justice, and Agriculture Subcommittee of the Comm. on
Govt. Operations, 102d Cong. 7 (Dec. 4, 1991) (statement of the
Honorable Mike Synar).
The Committee reached similar conclusions in its 1992
reports on the Rich matter, stating, for instance, that the
U.S. government ``lacked the political will to effect the
return of these fugitives[.]'' \177\ The Subcommittee urged
``that the Department of Justice rejuvenate its efforts to
apprehend the fugitives Marc Rich and Pincus Green and that it
become a high profile matter for the U.S. Government.'' The
report continued to admonish, stating, ``[t]he continuing
failure to return these fugitives to the United States to stand
trial before their fellow citizens only furthers the idea `that
there are . . . two standards of justice in the United States .
. . one for accused criminals without money and there's one for
accused criminals with money.' '' \178\
---------------------------------------------------------------------------
\177\ ``They Went Thataway: The Strange Case of Marc Rich and
Pincus Green,'' Hearing Before the Comm. on Govt. Operations, 102d
Cong. 37 (May 27, 1992).
\178\ Id. at 34.
---------------------------------------------------------------------------
The second report by the Subcommittee, ``Coin, Contracting,
and Chicanery: Treasury and Justice Departments Fail to
Coordinate,'' focused on the failure of the U.S. government to
keep Rich from receiving government contracts after he fled the
U.S.\179\ The Subcommittee concluded that Rich's Clarendon firm
continued to provide the U.S. Mint with metals despite being
debarred from government contracting.\180\ The Subcommittee
also criticized the Justice and Treasury Departments for
failing to take any action against Clarendon for over three
years because of a series of missteps and
miscommunications.\181\
---------------------------------------------------------------------------
\179\ ``Coins, Contracting, and Chicanery: Treasury and Justice
Departments Fail to Coordinate,'' Hearing Before the Comm. on Govt.
Operations, 102d Cong. (May 27, 1992).
\180\ Id. at 18.
\181\ Id. at 19.
---------------------------------------------------------------------------
5. Actions Taken by the U.S. Against Rich's Business
Interests
After they fled the country, several federal agencies took
actions against Rich and Green's businesses. Notwithstanding
their indictment and fugitive status, Rich and Green continued
to contract with several agencies within the U.S. government.
Companies controlled by Rich and Green held contracts with the
U.S. Mint as well as the U.S. Department of Agriculture. These
contracts continued for several years until they were
eventually reviewed by Congress and relevant agencies. The
Department of the Treasury also was forced to block money
destined for Rich and Green because of their companies'
dealings with Cuba.
a. U.S. Mint Contract Cancellation
In the wake of Rich's indictment, in 1985, one of his
companies, Clarendon, Ltd., was debarred from contracting with
the federal government by the Defense Logistics Agency.
However, the debarment lasted only three years. Soon after that
period, in July of 1988, Clarendon, Ltd. began contracting with
the U.S. Mint to supply raw metal for producing coins. From
1989 through 1992, Clarendon won numerous contracts to supply
the mint with copper, nickel, and zinc.\182\
---------------------------------------------------------------------------
\182\ ``The Strange Case of Marc Rich: Contracting with Tax
Fugitives and At Large in the Alps,'' Hearing Before the Govt.
Information, Justice, and Agriculture Subcommittee of the Comm. on
Govt. Operations, 102d Cong. 58 (Dec. 4, 1991) (statement of Kenneth
Gubin, Chief Counsel, U.S. Mint).
---------------------------------------------------------------------------
Clarendon was able to secure the metal contracts because,
from mid-1988 on, the company was not listed on the GSA's
``Parties Excluded from Procurement Programs'' list. This was
possible in part because Marc Rich set up the management of the
company so that he was not the majority stockholder. By
controlling 49 percent of Clarendon's stock, Rich could claim
that he did not have control over the company's business
decisions. This move, however, was part of a scheme by Marc
Rich in which he purchased back the remaining 51 percent of
Clarendon through a wholly owned subsidiary of Marc Rich + Co.,
A.G.\183\ By the time Clarendon was reaping the benefits of the
new contract with the Mint, Marc Rich was in full control of
the company. The contracts were reported to be worth up to
$45.5 million to Marc Rich's company.\184\ As discussed above,
this prompted congressional hearings and a subsequent report.
Congressman Robert Wise of West Virginia, who chaired the
hearings, stated to the press, ``[e]very time I reach into my
pocket for some change, I have to wonder if there's a little
bit of Marc Rich in there.'' \185\ This attention by Congress
eventually played a part in ending Rich's contracts with the
U.S. Mint. In a letter on February 27, 1992, Rich's lawyers
announced that, ``Clarendon does not intend to participate in
bid or contract opportunities with the Mint in the foreseeable
future.'' \186\
---------------------------------------------------------------------------
\183\ This scheme also led to a civil action against the company.
See U.S. v. Clarendon, Ltd. (D.D.C. Apr. 12, 1995) (CA 1:95CV00700).
The charges were authorized under the signature of Deputy Attorney
General Eric Holder.
\184\ Rick Wartzman, Bid to End Pact to Clarendon Comes Amid
Disputes Over Marc Rich's Stake, Wall St. J., Feb. 28, 1992, at B2a.
\185\ Id.
\186\ Department of Agriculture Document Production (Letter from
David P. Langlois, Partner, Milgrim Thomajan & Lee, to Kenneth Gubin,
Chief Counsel, U.S. Mint (Feb. 27, 1992)) (Exhibit 24).
---------------------------------------------------------------------------
b. Suspension of Rich's Grain Dealings
Between July of 1986 and September of 1989, one of Marc
Rich's companies, Richco Grain Ltd., participated in the
Commodity Credit Corporation's Export Enhancement Program. The
Department of Agriculture used the program to sell American
grain to overseas customers at prices below U.S. market levels.
The companies who won the contracts received subsidies from the
department in the form of surplus grains. A tally by the
Department showed that Richco received $95 million worth of
such U.S. grain through the program.\187\ Rich made money
through his sales of grain to China, the Soviet Union, Romania,
and Saudi Arabia.
---------------------------------------------------------------------------
\187\ Bruce Ingersoll, U.S. Suspends Grain Subsidies for Exporter,
Wall St. J., Oct. 12, 1989, at sec. 3, p. 19.
---------------------------------------------------------------------------
After prompting from Congressman Dan Glickman and an
investigation by the Inspector General, the Department of
Agriculture suspended Richco Grain Ltd. from participating in
the program. A letter written on September 29, 1989, by the
Vice-President of the Commodity Credit Corporation listed Rich
and Green's fugitivity and indictment as reasons for the
suspension.\188\ Notwithstanding the suspension, Congressman
Glickman continued to press the Bush Administration on the
matter. On March 4, 1992, Congressman Glickman wrote to
President Bush to ask that the Department of Agriculture
permanently exclude Rich and Green from participating in the
program by debarring them.\189\ The Bush Administration
responded by referring Glickman's letter to the Department of
Agriculture, requesting that the department ``take action, if
warranted, to see that no new contracts are awarded to Richco
Grain.'' \190\ It appears that no new contracts were awarded to
Marc Rich's company.
---------------------------------------------------------------------------
\188\ Department of Agriculture Document Production (Letter from
R.E. Anderson, Jr., Vice President of the Commodity Credit Corporation,
Department of Agriculture, to Robert Thomajan, Partner, Milgrim
Thomajan & Lee (Sept. 29, 1989)) (Exhibit 25).
\189\ Department of Agriculture Document Production (Letter from
Dan Glickman, Chairman, Subcommittee on Wheat, Soybeans, and Feed
Grains, Committee on Agriculture, to President George H.W. Bush (Mar.
4, 1992)) (Exhibit 26).
\190\ Department of Agriculture Document Production (Letter from
Allan V. Burman, Administrator of the Office of Federal Procurement
Policy, the White House, to Charles R. Hilty, Assistant Secretary for
Administration, Department of Agriculture (Apr. 20, 1992)) (Exhibit
27).
---------------------------------------------------------------------------
It is troubling that a member of President Clinton's own
cabinet, who, as a Member of Congress was justifiably concerned
over Marc Rich's dealings with the Agriculture Department, was
apparently not consulted when the White House was considering
the pardons. As Secretary of Agriculture, Glickman could have
provided insight into the ways in which the fugitive from
American justice continued to profit from the very government
that had indicted him.
c. Cuban Asset Forfeiture
Marc Rich has also had Department of Treasury actions taken
against his companies because of his disregard for U.S.
regulations related to the embargo against Cuba. In late 1991,
the Compliance Programs Division of the Office of Foreign
Assets Control blocked more than $2.5 million relating to a
$3.9 million deal for Cuban sugar brokered by Marc Rich + Co.,
Ltd. in the United Kingdom.\191\ This transaction had run afoul
of the Cuban Assets Control regulations.\192\ As R. Richard
Newcomb, Director of the Office of Foreign Assets Control
explained to Rich attorney Robert Fink in a December 27, 1995,
letter, these regulations prohibit transactions by persons
subject to U.S. jurisdiction involving any property of Cuba or
Cuban nationals.\193\ According to Newcomb, Rich's Cuban sugar
deal was clearly contemplated by the regulations and was
therefore illegal.\194\
---------------------------------------------------------------------------
\191\ Department of Treasury Document Production 000022 (Memorandum
from R. Richard Newcomb, Director of the Office of Foreign Assets
Control, Department of Treasury, to Peter K. Nunez, Assistant Secretary
of Enforcement of the Office of Foreign Assets Control, Department of
Treasury) (Exhibit 28).
\192\ Id. See 31 C.F.R. part 515.
\193\ Department of Treasury Document Production (Letter from R.
Richard Newcomb, Director of the Office of Foreign Assets Control,
Department of Treasury, to Robert F. Fink, Partner, Piper and Marbury
(Dec. 27, 1995)) (Exhibit 29).
\194\ Id.
---------------------------------------------------------------------------
In September of 1994, Marc Rich + Co., A.G. in Switzerland
provoked a similar blocking of nearly $1 million in proceeds
from an oil deal with Venezuela going through Cuba. Internal
notes of the Compliance Programs Division indicate deep concern
with attempts by the Venezuelan state-run oil company to have
the funds released. As the Compliance Division wrote in its
internal notes, the Venezuelan oil company ``also stated that
it `believes' that Marc Rich intended to resell the oil to
Cuba, but that this particular transfer did not relate to the
sale of the oil to Cuba. If it did not relate to Cuba, why did
it reference Cuba?'' \195\ Ultimately, in February of 1995, the
Department of Treasury unblocked the funds because, as it
stated in one document, ``Cuba does not have a direct interest
in the blocked transaction, which involves a Venezuelan and a
Swiss company[.]'' \196\
---------------------------------------------------------------------------
\195\ Department of Treasury Document Production 000635 (Note from
Compliance Programs Division, Office of Foreign Assets Control)
(Exhibit 1).
\196\ Department of Treasury Document Production 000636 (License
Request by J. Kerrigan, Compliance Programs Division of the Office of
Foreign Assets Control, Department of Treasury (Jan. 1, 1995)) (Exhibit
30).
---------------------------------------------------------------------------
It does not appear that the Clinton Administration took
into consideration the fact that Marc Rich and Pincus Green
profited from the United States while flouting its embargoes.
Indeed, a review of Rich and Green's business relationships
shows a complete disregard for the welfare of the United States
and its citizens. Furthermore, Rich's clever and illegal
business schemes meant that U.S. taxpayers' money came out of
agencies such as the U.S. Mint and the Department of
Agriculture and wound up in the pockets of Rich and Green while
they evaded the U.S. legal system, and U.S. income taxation.
This is one of the many reasons that Republicans and Democrats
alike have been so critical of President Clinton's decision to
grant these men a pardon.
II. ATTEMPTS TO SETTLE THE MARC RICH AND PINCUS GREEN CASE
A. Attempts to Settle in the 1980s
While living as fugitives in Switzerland, Marc Rich and
Pincus Green attempted to negotiate a settlement with the
Southern District of New York. In addition to prominent lawyers
such as Edward Bennett Williams, Rich and Green hired other
well-known and politically connected lawyers.\197\ In the
Spring of 1985, they hired President Richard Nixon's attorney
Leonard Garment.\198\ Around this same time, Garment hired
Lewis ``Scooter'' Libby to join his firm.\199\ Garment assigned
Libby the task of assessing whether or not there were legal
defenses to the charges to which Rich and Green's companies had
already pled guilty.\200\ As Libby testified at the Committee's
March 1, 2001, hearing, he worked with Robert Fink and other
attorneys in an attempt to demonstrate that Marc Rich's
companies ``had properly reported their tax obligations and
energy transactions and that these criminal charges should be
reexamined.'' \201\ Libby and the Rich legal team used their
analysis in an effort to negotiate a settlement with the
Southern District on the outstanding indictment.\202\
---------------------------------------------------------------------------
\197\ Marc Rich's practice of hiring attorneys who are close to the
parties investigating him has continued to this day. In response to
this Committee's investigation, Rich and his attorneys have hired an
array of prominent Republicans, including the former personal attorneys
to Chairman Burton and the Committee's former Chief Investigator.
\198\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 438
(Mar. 1, 2001) (testimony of Lewis Libby, former counsel for Marc Rich,
Dechert Price & Rhoads).
\199\ Id. Libby is currently Chief of Staff to Vice President Dick
Cheney.
\200\ Id.
\201\ Id.
\202\ Id.
---------------------------------------------------------------------------
It should be noted that Lewis Libby's involvement in the
Rich matter--like that of Garment and former Reagan Justice
Department official William Bradford Reynolds--was limited to
settlement negotiations and never included work on the pardon
matter. Libby, and to a lesser extent, Garment and Reynolds,
have been mentioned by President Clinton and others as
prominent Republicans who supported the Rich pardon. This
representation is inaccurate, as Libby, Reynolds and Garment
worked only on settlement negotiations, and did not work on the
pardon. Libby's efforts included an attempt to negotiate a
settlement with the Southern District of New York in the late
1980s until he left to work at the Pentagon in the first Bush
Administration in 1989.\203\ When he returned to private
practice in 1993, Libby again attempted to achieve a settlement
for Rich and Green.\204\ This attempt again failed by
1995.\205\ Libby's final involvement in the Rich case was in
1999 and early 2000, when he briefed the newly-hired Jack Quinn
on the legal team's previous efforts to reach a settlement with
the Southern District and helped prepare yet another request to
the Southern District.\206\ Libby was instructed to cease all
work on behalf of Rich and Green in the spring of 2000.\207\
---------------------------------------------------------------------------
\203\ Id.
\204\ Id. On this occasion he also worked with Laurence Urgenson of
Kirkland & Ellis.
\205\ Id.
\206\ Id. at 438-39.
\207\ Id. at 439. It appears that Rich's lawyers considered
approaching Libby to help with the pardon effort, but were concerned
that he would refuse them. On December 26, 2000, Robert Fink sent the
following e-mail to Jack Quinn and Michael Green:
GMarc thought it made sense to call Scooter to see if he
could be helpful, knowing he might not be able to be
helpful but that he would never do anything that hurt Marc.
I agreed and raised it with Mike Green. Mike is concerned
that Scooter would want to help but would feel he had to
raise the matter with the ethics committee on the
transition and it would get caught up there, and we would
effectively be bringing it to the attention of a number of
---------------------------------------------------------------------------
people who might not be helpful.
Piper Marbury Rudnick & Wolfe Document Production PMR&W 00398 (E-mail
from Robert Fink, Partner, Piper Marbury Rudnick & Wolfe, to Jack Quinn
and Michael Green, Partner, Dickstein Shapiro Morin & Oshinsky (Dec.
26, 2000)) (Exhibit 31).
Despite the fact that Rich and Green fled the country as a
result of their pending indictment, the Southern District of
New York continued to negotiate with lawyers like Fink, Libby
and Garment to try to achieve the return of Rich and Green to
the United States. In their appeals to President Clinton for a
pardon, Rich's lawyers often claimed that the SDNY refused to
negotiate with Rich. Nothing could be further from the truth.
Despite the fact that Rich and Green had fled the country, SDNY
prosecutors continued to negotiate with Rich, even offering to
reduce the charges against Rich and Green in return for their
surrender. For example, in the early 1990s, Otto Obermaier,
U.S. Attorney for the Southern District of New York, traveled
to Switzerland to meet with Rich and Green. This was a highly
unusual step for a United States Attorney to make. In fact,
Eric Holder testified at a Committee hearing that he could
think of no other instance in which a U.S. Attorney had
traveled to a foreign country to negotiate with an indicted
fugitive.\208\ Despite this accommodation, Rich and Green
failed to reach an agreement with the Southern District to
return to the United States to stand trial.
---------------------------------------------------------------------------
\208\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 268-69
(Feb. 8, 2001) (testimony of Eric Holder, former Deputy Attorney
General, Department of Justice).
---------------------------------------------------------------------------
The SDNY also offered a number of other accommodations if
Rich would return to the U.S. to face the charges. For example,
prosecutors offered to agree in advance on bail, so that Rich
would not have to be incarcerated pending trial.\209\ They also
offered to have a full meeting with Rich's attorneys, and
conduct a complete review of the charges against Rich.\210\
Most importantly, they offered to drop the RICO charges against
Rich and Green.\211\ Marc Rich's own lawyer, Robert Fink,
confirmed that prosecutors offered to drop the RICO charge as a
result of negotiations.\212\ Fink wrote about these
negotiations in an e-mail he sent to Avner Azulay on February
10, 2000, stating ``I was told at one point that they would
drop the RICO charge if we wanted if Marc came in.'' \213\ Fink
confirmed the substance of this e-mail at the Committee's
hearing:
---------------------------------------------------------------------------
\209\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00697
(E-mail from Robert Fink to Avner Azulay, Director, Rich Foundation
(Feb. 10, 2000)) (Exhibit 32).
\210\ Id.
\211\ Id.
\212\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 469
(Mar. 1, 2001) (testimony of Robert Fink).
\213\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00697
(E-mail from Robert Fink to Avner Azulay, Director, Rich Foundation
(Feb. 10, 2000)) (Exhibit 32).
Mr. LaTourette. Looking at [the February 10, 2000, e-
mail], or your recollection from the representation of
Marc Rich, is it accurate that at one point you were
told that the prosecuting authorities would drop the
---------------------------------------------------------------------------
RICO charge if Marc Rich returned to this country?
Mr. Fink. That was something that was discussed with me
in at least one meeting I had with the
prosecutors.\214\
---------------------------------------------------------------------------
\214\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 469
(Mar. 1, 2001) (testimony of Robert Fink).
Given the fact that the SDNY had offered to drop the RICO
charges if Rich and Green returned to the U.S., it is
interesting that Quinn continued to cite the RICO charges as
one reason the pardon was necessary. Throughout the pardon
petition, his contacts with White House officials, and even his
attempts to justify the pardon after the fact, Quinn cited the
RICO charges as a reason Rich and Green fled the country rather
than face trial. However, the SDNY's offer makes it clear that
Quinn's RICO argument, like most of his other arguments, was
false and misleading.
Finally, in addition to the offer to drop the RICO charges,
prosecutors also offered another accommodation to Rich and
Green. The SDNY indicated it would agree to bail so that Rich
and Green would not have to be incarcerated while they stood
trial. The only condition of this offer was that they give up
their passports.\215\ Even after the offers to drop RICO and
allow bail was presented to them, the two men still chose to
remain fugitives and refused to face the American judicial
system.
---------------------------------------------------------------------------
\215\ Id. at 470.
---------------------------------------------------------------------------
B. Marc Rich's Humanitarian Activities in the 1980s and 1990s
After he fled the United States, Marc Rich began to
contribute large sums of money to various humanitarian
activities, mainly in Israel and to Jewish communities in
Europe and the United States. Marc Rich's contributions, beyond
achieving their humanitarian purposes, also served a useful
purpose of making Rich a well-known and respected figure in
Israeli and Jewish political circles. These contacts would
prove useful both in Rich's unsuccessful attempt to settle his
indictment and in his successful campaign to win a pardon.
Rich also used his wealth to cultivate political contacts.
In 1985, after an Egyptian policeman shot and killed a number
of Israeli tourists at Ras Burka, Rich contributed $400,000 to
a compensation fund which was established for the victims.\216\
More recently, in 1995, Rich began to make offers of providing
substantial sums of money to help the Israeli-Palestinian peace
process.\217\ According to internal Marc Rich legal documents,
Rich offered to help fund the economic development of
Palestinian territories as part of the peace process.\218\ As
part of his offer, Rich apparently told Israeli officials that
his ability to help was limited by his outstanding U.S.
indictment. Receptive Israeli officials then went to U.S.
officials to see what could be done to settle Rich's case.
According to an account of the negotiations prepared by Rich's
lawyers, the Israeli government approached the Justice
Department to discuss the Rich case.\219\ Mark Richard, a
Deputy Assistant Attorney General in the Criminal Division,
informed the Israelis that while the Justice Department could
not act directly on the Israeli request, the Justice Department
would ``give serious consideration to a statement by the State
Department or the White House that the United States had an
interest in allowing Israel to obtain the active participation
of Rich in a Middle East Initiative.'' \220\
---------------------------------------------------------------------------
\216\ Petition for Pardon for Marc Rich and Pincus Green 8 (Dec.
11, 2000) (Appendix III); Leonard Garment, Crazy Rhythm 375 (1997).
\217\ Id. at 9; Jack Quinn Document Production (Background
Memorandum to the Marc Rich Case, Dec. 1997) at 5 (Exhibit 33).
\218\ Id.
\219\ Id.
\220\ Id.
---------------------------------------------------------------------------
Following Mark Richard's suggestion, the Israeli Foreign
Ministry took the Rich case to the State Department. In July
1995, Uri Savir, the Director General of the Foreign Ministry,
presented Ambassador Dennis Ross with a briefing paper on the
Rich case.\221\ Several months later, Ross informed Savir that
the Rich case was a ``hot potato'' and should not be
pursued.\222\ Despite Ross' rebuff, then-Foreign Minister
Shimon Peres instructed the Israeli Ambassador to the U.S.,
Itamar Rabinovich, to press the Rich matter with the State
Department.\223\ Peres himself also raised the Rich case with
Ross and the U.S. Ambassador to Israel, Martin Indyk.\224\
While Ross did not respond to Peres, Indyk suggested that the
Rich case could be discussed at greater length by Israeli
officials and the State Department.\225\ Ambassador Rabinovich
and his staff met with a State Department official in October
1995 and discussed the Rich case.\226\ In follow-up meetings
with the State Department, Israeli officials learned that they
were not likely to win support from the State Department for
settling the Rich case.\227\ According to the Israeli
officials, State Department officials were concerned about
allegations that the Administration was interfering with law
enforcement for political purposes, and the potential
embarrassment that would follow if the public learned of a deal
with Marc Rich.\228\
---------------------------------------------------------------------------
\221\ Id. at 5-6.
\222\ Id. at 6.
\223\ Id. Itamar Rabinovich, now President of Tel Aviv University,
wrote a letter of support for the Rich pardon to President Clinton.
\224\ Id.
\225\ Id.
\226\ Id.
\227\ Id.
\228\ Id.
---------------------------------------------------------------------------
According to the internal account prepared by the Marc Rich
lawyers, Shimon Peres continued his efforts on behalf of Marc
Rich even after Yitzhak Rabin was assassinated and Peres became
Prime Minister.\229\ However, by 1996, as Israeli elections
approached, Peres' priorities shifted, and Israeli contacts
with the U.S. government on the Rich matter subsided until the
pardon effort.
---------------------------------------------------------------------------
\229\ Id. at 7.
---------------------------------------------------------------------------
Other than the initial response from Mark Richard, it
appears that Justice Department and State Department officials
were unified in their resistance to Israeli efforts to have the
Rich case settled. The resistance of these government officials
should be contrasted with the receptivity displayed by
President Clinton and Deputy Attorney General Holder for the
much more drastic step of pardoning Rich. Also noteworthy is
the fact that this brief effort in 1995 appears to be the only
time that Marc Rich's name came up in the context of the Middle
East peace talks. To the extent that Rich's name came up, it
appears to have been a minor matter that never had any impact
on the Middle East peace talks. Dennis Ross, the Clinton
Administration's Middle East envoy, has stated that Marc Rich
``was not a factor in the Middle East talks.'' \230\ The fact
that Marc Rich was never a factor in the peace talks, either in
1995 or in 2000, suggests that President Clinton's key
justification for the pardon--that it was important to Israel--
is an after-the-fact excuse that the President has put forward
to cover up other motivations for the pardon.
---------------------------------------------------------------------------
\230\ James Risen and Alison Leigh Cowan, U.S. Diplomats Turned
Aside Israeli Push on Rich's Behalf, N.Y. Times, Feb. 17, 2001, at A1.
---------------------------------------------------------------------------
C. Rich Hires Jack Quinn
After several years of failed negotiations with the
Southern District of New York, Marc Rich and his team tried
another approach to resolve his case. Instead of dealing only
with the federal prosecutors from New York, Rich began a
process of going directly to the Justice Department in
Washington. Beginning sometime in 1997, Michael Steinhardt, a
prominent hedge-fund investor and friend of Rich, recommended
that Rich hire public relations consultant Gershon Kekst to
help with his case.\231\ Although Kekst was at first reluctant
to get involved, he eventually began working with Rich to help
resolve his legal troubles in the United States.\232\ It was
through Kekst's efforts that Jack Quinn was hired to work on
the Marc Rich case.
---------------------------------------------------------------------------
\231\ Telephone Interview with Michael Steinhardt (Mar. 12, 2001).
\232\ As discussed in Section IV(A)(9) of the report, Kekst tried
to disavow his role in helping Marc Rich with negotiations and the
pardon effort. It appears, however, that Kekst was deeply involved in
the pardon effort.
---------------------------------------------------------------------------
Kekst explained that in late 1998, he attended a dinner
celebrating the merger of Daimler Benz and Chrysler.\233\ At
the dinner, he was seated next to an individual he did not
know, who explained that he worked at ``Main Justice.'' \234\
It turned out that this individual was Deputy Attorney General
Eric Holder.\235\ Kekst asked this stranger to whom U.S.
Attorneys are accountable.\236\ Holder explained that they
answer to Main Justice.\237\ Kekst had Marc Rich in mind, but
did not mention Rich's name at the time.\238\ Kekst then asked
Holder what someone should do if ``they were improperly
indicted by an overzealous prosecutor.'' \239\ Holder told
Kekst that a person in that situation should try to work it out
and resolve it.\240\ Holder further stated that, ``lawyers know
there is a path back to DOJ, to me.'' \241\ Holder told Kekst
that such a person should ``hire a lawyer who knows the
process, he comes to me, and we work it out.'' \242\ Kekst
asked who such a lawyer would be, and Holder pointed to an
individual sitting at a nearby table and said, ``there's Jack
Quinn. He's a perfect example.'' \243\ According to Kekst,
Quinn was in attendance, but he did not discuss Marc Rich or
Eric Holder with Quinn at that dinner.\244\
---------------------------------------------------------------------------
\233\ Interview with Gershon Kekst, President, Kekst and Co. (Mar.
15, 2001). To the best of Kekst's recollection, the Daimler Chrysler
dinner took place in November of 1998.
\234\ Id.
\235\ Id.
\236\ Id.
\237\ Id.
\238\ Id.
\239\ Id.
\240\ Id.
\241\ Id.
\242\ Id.
\243\ Id.
\244\ Id.
---------------------------------------------------------------------------
Shortly after the Daimler Chrysler dinner, Kekst began to
explore this new strategy. First, he worked to gather names of
lawyers in addition to Jack Quinn who might be able to help
Marc Rich.\245\ By the time he met with Michael Steinhardt and
Robert Fink to discuss the Rich case several weeks later, Kekst
recommended that Rich hire a senior Washington lawyer who could
intercede with the Justice Department in Washington.\246\ Kekst
then provided the names of three such lawyers who might be able
to help: Warren Christopher, Judah Best, and Jack Quinn.\247\
Kekst called each of the three to introduce them to Fink.\248\
According to Kekst, Warren Christopher said that taking the job
would be inappropriate since he had just come out of
government.\249\ Fink interviewed Best but did not like him
enough to hire him for the job. Rich, Fink, and Kekst
eventually settled on Jack Quinn. As Quinn explained to The New
York Times, he traveled to Switzerland, studied the issues, and
met with Marc Rich ``not for hours, but for days.'' \250\
---------------------------------------------------------------------------
\245\ Id.
\246\ Id.
\247\ Id.
\248\ Id. At the Committee's March 1, 2001, hearing, Fink testified
that he asked Kekst to ``recommend someone who [he] called the white-
haired man.'' Fink testified that this expression referred to ``someone
who understood the entire political process.'' ``The Controversial
Pardon of International Fugitive Marc Rich,'' Hearings Before the Comm.
on Govt. Reform, 107th Cong. 471 (Mar. 1, 2001) (testimony of Robert
Fink).
\249\ Interview with Gershon Kekst, President, Kekst and Co. (Mar.
15, 2001).
\250\ Alison Leigh Cowan and Raymond Bonner, Lawyer Tells of His
Pursuit of Pardon for His Client, and Conversation With Clinton, N.Y.
Times, Jan. 25, 2001, at A21.
---------------------------------------------------------------------------
Jack Quinn began working for Marc Rich in the spring of
1999.\251\ According to Quinn, he was hired at first, ``not to
go to the White House, but to work with Main Justice and the
Southern District of New York.'' \252\ It is noteworthy that
Eric Holder's recommendation to Gershon Kekst was the impetus
for Marc Rich's hiring of Jack Quinn. Quinn had a warm
relationship with Holder--Holder even solicited Quinn for
support to have Holder nominated as Attorney General. This warm
relationship appears to have had a significant role in Holder's
support for the Rich pardon.
---------------------------------------------------------------------------
\251\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 216
(Feb. 8, 2001) (testimony of Jack Quinn).
\252\ Id.
---------------------------------------------------------------------------
D. Quinn's Fee Arrangements
Jack Quinn was a partner with the law firm of Arnold &
Porter when he began working for Marc Rich. Quinn also worked
on the Rich matter with Kathleen Behan, another Arnold & Porter
partner. As Behan explained to Committee staff, although they
were not officially retained by Marc Rich until July of 1999,
from February until July, Quinn and Behan were ``engaged in a
series of familiarization and preparatory efforts'' to learn
about the case ``in preparation for possible retention on the
matter.'' \253\ Quinn and Behan were officially retained after
they met with Marc Rich in Zug, Switzerland, in May of 1999 to
discuss the representation.\254\ As the engagement letter
explains, Quinn and Behan were hired for a minimum rate of
$55,000 per month for six months, totaling $330,000, with an
option to reconsider if their billable hours were to
``substantially exceed'' $55,000 per month.\255\
---------------------------------------------------------------------------
\253\ Interview with Kathleen Behan, Partner, Arnold & Porter (Feb.
27, 2001).
\254\ Id.
\255\ Arnold & Porter Document Production A0507-10 (Letter from
Kathleen Behan, Partner, Arnold & Porter, to Marc Rich (July 21, 1999))
(Exhibit 34).
---------------------------------------------------------------------------
1. Was Quinn Expecting Payment for His Work on the Pardon?
In November 1999, just several months after he was hired by
Rich, Quinn left Arnold & Porter to form the lobbying firm of
Quinn and Gillespie.\256\ While Quinn brought Rich as a client
to the new firm, he did not sign a new retainer with Rich.
Quinn continued to work for Rich at Quinn and Gillespie, both
on negotiations with the Justice Department, and on lobbying
for the pardon. However, Quinn has taken the incredible
position that he did not expect to be paid for any of his work
on the Rich case after he left Arnold & Porter. In the first
days of the uproar regarding the pardon, Quinn told The New
York Times, ``I have no understanding with Marc Rich about
future payments. If Marc Rich sent me a box of Godiva
chocolates tomorrow, it would be more than he is obligated to
do.'' \257\ He expanded on this position at a Committee
hearing:
---------------------------------------------------------------------------
\256\ According to one magazine article about his departure from
Arnold & Porter, Quinn brought $4.5 million in business to Arnold &
Porter. The article continued:
---------------------------------------------------------------------------
GBut that's small potatoes to what he can make on his
own, because now Quinn is not constrained by the hourly
rate structure and will take equity stakes in start-up
companies in exchange for his services. That will give him
the possibility of making millions on one client when it
goes public. Arnold & Porter, like almost all corporate
firms, does not allow equity participation with clients.
Kim Eisler, Old Political Opponents Join Forces for Lucrative Lobbying,
Washingtonian, Feb. 2000, at 12.
---------------------------------------------------------------------------
\257\ Raymond Bonner and Alison Leigh Cowan, Notes Show Justice
Official Knew of Pardon Application, N.Y. Times, Feb. 2, 2001, at A14.
Mr. Burton. You left [Arnold & Porter], and I guess the
contract stayed with them; is that right? What
happened? They went on just to a fee-for-service with
---------------------------------------------------------------------------
that law firm?
Mr. Quinn. Yes, sir.
Mr. Burton. And you have said that you didn't receive
any fees from Mr. Rich. You said something about a box
of chocolates. It was all going to be voluntary if you
got that. That just seems very unusual to me. Don't
most attorneys have some kind of a contractual
agreement when they leave a law firm with a new client?
Mr. Quinn. Yeah. Let me try to explain this to you. The
fees you just reported were received by Arnold and
Porter. And, of course, as a partner, and because I had
a contractual relationship with a firm, I benefited to
some extent from those fees. To another extent, the
fees went to other partners of the firm.
After leaving Arnold and Porter, I did consider and
discuss with Mr. Fink whether we should have a new
arrangement. I came to the conclusion that,
particularly because of the fact that we were
unsuccessful in achieving a resolution of this at the
Southern District, and because I didn't think, frankly,
there would be that much more additional time in it,
and because I believed that the earlier payments had
been fair and reasonable, that I would see this through
to the end simply on the basis of the fees we had been
paid earlier.
Mr. Burton. So you received nothing further from Mr.
Rich?
Mr. Quinn. I have not received any further fees from
him on this pardon matter.
Mr. Burton. Have you received any fees from him for
anything?
Mr. Quinn. No, sir.
Mr. Burton. You've received no fees from Marc Rich or
his--how about any of his companies or friends or
associates?
Mr. Quinn. No, sir.
Mr. Burton. All that was received was from the--to the
law firm that you previously worked with?
Mr. Quinn. Right.
* * *
Mr. Burton. Do you have any kind of understanding where
he is going to give you a lump sum of money or funds
down the road for the services you've rendered?
Mr. Quinn. No sir[.] \258\
---------------------------------------------------------------------------
\258\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 242
(Feb. 8, 2001) (testimony of Jack Quinn).
It is impossible to believe that Jack Quinn did his work on
the Rich pardon out of the goodness of his heart, on a pro bono
basis. Quinn apparently spent hundreds of hours \259\ on the
Rich matter, calling and e-mailing his colleagues on the Rich
legal team in the middle of the night, on vacation, on
Christmas Day, and New Year's Eve.\260\ While Quinn's
dedication to his client was admirable, it suggests that Quinn
anticipated some satisfaction beyond seeing Marc Rich and
Pincus Green pardoned.
---------------------------------------------------------------------------
\259\ In media accounts Quinn claimed that he spent 60-100 hours on
the Rich pardon. These claims simply are not credible. Kitty Behan, who
was considerably less involved in the Rich pardon than Quinn spent 126
hours on the Rich pardon. Arnold & Porter Document Production A0513-15,
A1128 (Arnold & Porter billing records for Marc Rich (Jan. 16, 2001 and
Feb. 23, 2001)) (Exhibit 35). It is likely that Quinn was
underestimating his hours to the media to try to support his claims
that he was not expecting to be paid.
\260\ See Arnold & Porter Document Production A0844 (E-mail from
Jack Quinn to Avner Azulay, Director, Rich Foundation et al. (Dec. 25,
2000)); Arnold & Porter Document Production A0850 (E-mail from Jack
Quinn to Avner Azulay, Director, Rich Foundation et al. (Dec. 27,
2000)); Arnold & Porter Document Production A0861 (E-mail from Robert
Fink to Avner Azulay, Director, Rich Foundation et al. (Jan. 2, 2001));
Piper Marbury Rudnick & Wolfe Document Production PMR&W 00091 (E-mail
from Robert Fink to Avner Azulay, Director, Rich Foundation, and Marc
Rich (Dec. 28, 2000)); Piper Marbury Rudnick & Wolfe Document
Production PMR&W 00097-98 (E-mail from Jack Quinn to Robert Fink (Dec.
31, 2000)) (Exhibit 36).
---------------------------------------------------------------------------
In addition to the common sense rejection of Quinn
proceeding on a pro bono basis, e-mails between Jack Quinn,
Robert Fink, and Marc Rich indicate that Rich was specifically
contemplating entering into a large-dollar retainer agreement
with Quinn after Quinn left Arnold & Porter. These documents
were withheld from the Committee for over a year on the basis
of a claim of attorney-client privilege which was rejected by
federal Judge Denny Chin. Once provided to the Committee, the
documents seriously undermined Quinn's claims that he never
expected any payment from Rich. On February 3, 2000, the day
after the Southern District of New York rejected Quinn's
request for a meeting to discuss the Rich case, Quinn asked
Fink about his status with Marc Rich, asking ``not that I'm
concerned, but did marc decide to renew the retainer? I've not
heard anything.'' \261\ Two weeks later, Fink addressed Quinn's
status in an e-mail to Marc Rich, suggesting that Quinn could
still be useful, despite his failure to date:
---------------------------------------------------------------------------
\261\ Jack Quinn Document Production JQ 02847 (E-mail from Jack
Quinn to Robert Fink (Feb. 3, 2000)) (Exhibit 37).
Separately, I have been thinking about your reaction to
Jack. When we meet [sic], he felt (and made it clear
that he believed this, but was not sure) that he could
convince Eric that it made sense to listen to the
professors and that he could convince Eric to encourage
Mary Jo to do the same. In this he was correct.
Moreover, in the preparation process, it became clear
that Jack was not just a pretty face but had thoughtful
ideas and questions and was not simply relying on his
past contacts to make this happen. So, I would not give
up on him, at least not yet, as he is still a
knowledgeable guy who has a clear understanding of
relationships and what may be doable. While we may get
more than that, we should not have enlarged
expectations.\262\
---------------------------------------------------------------------------
\262\ Piper Marbury Rudnick & Wolfe Document Production PMR&W
00720-21 (E-mail from Robert Fink to Marc Rich (Feb. 17, 2000))
(Exhibit 38).
On February 29, 2000, Fink sent another message to Rich
suggesting that he enter into a retainer agreement with Quinn
while their negotiations with the Justice Department were still
---------------------------------------------------------------------------
pending:
All in all, while he has been very busy and sometime
hard to get to, he has not separated himself from the
matter and has fully participated. He has not pushed me
for the retainer, though, and realizes that he does not
have an agreement with you. I think it makes sense to
compensate him for what he has done and may continue to
do. Just give it some more thought and we can come back
to it soon. We can wait, if you want, to see what Eric
says, although it may pay to respond now, before Eric
response [sic] to the last message from Jack, so it
does not look like you were only willing to pay because
of a positive response, as that was not the agreement.
Even if we stop everything we are doing, and decide not
to investigate the pardon, etc., at this time, we
should fold this down in a friendly way.\263\
---------------------------------------------------------------------------
\263\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00722
(E-mail from Robert Fink to Marc Rich (Feb. 29, 2000)) (Exhibit 39).
After the effort to settle the criminal case with the
Justice Department failed, Fink continued to recommend that
Rich enter into a retainer agreement with Quinn, who was
continuing to raise the issue. On June 6, 2000, Fink sent the
---------------------------------------------------------------------------
following e-mail to Rich:
Jack raised the question of his status. I told him that
I felt that you would feel that he had been compensated
for the past, even though the retainer had run out
before he stopped work, but that you would not want or
expect him to work without compensation going forward--
indeed, you appreciated that it was important to
compensate people who asked you to perform for you;
although I thought you would not want to get involved
in another one of those six month retainers.
Jack said he did not want to make a proposal that you
might find objectionable, but felt some clear
arrangement for the future was appropriate. I told him
I hoped to see you soon, and that I would raise it with
you when I see you and come back with a suggestion. He
was happy with that and we agreed to catch up with each
other on this issue in the beginning of July.\264\
---------------------------------------------------------------------------
\264\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00731
(E-mail from Robert Fink to Marc Rich (June 6, 2000)) (Exhibit 40).
At the beginning of July 2000, Fink e-mailed the figures for a
---------------------------------------------------------------------------
proposed retainer agreement to Marc Rich:
Here is my proposal on Jack Quinn, consistent with your
advice to me.
Jack originally proposed a $50,000 per month retainer
and additional hourly charges for Kitty Behan. We
settled at $55,000 per month, including Kitty, which
was a better deal because at her hourly rate her
billings would have averaged over $10,000 per month.
Moreover, we continued to consult with Jack (and Kitty)
after the retainer period had ended so that the average
blended rate for Jack was well below $45,000. (OK,
enough with making you feel better.)
At the moment the issue raised by you and Michael is
how to keep Jack on a ``retainer'' so that he is
available for questions that might arise and, more
importantly, available in the Fall, if we want him to
be. Since the Fall is not far away, and you will know
whether you want him to gear up again within four
months or so, I suggest that we offer Jack $10,000 per
month as a retainer to keep his eyes, ears and brain
open to events and thoughts that may be helpful, with
the understanding that if a decision is made to proceed
that we will renegotiate the monthly retainer to
reflect the changed circumstances.
This arrangement could start mid-July or August 1st. He
has not pushed me for this and, indeed, we are the ones
who raised the idea of keeping him on a retainer.
Still, if we do go back to Jack and offer a package, we
should not schedule it to begin weeks after the
proposal. So, if I were to call him next week, I would
want to suggest a July 15th start date.\265\
---------------------------------------------------------------------------
\265\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00732
(E-mail from Robert Fink to Marc Rich (July 7, 2000)) (Exhibit 41).
Despite the clear and detailed indications that Rich and Quinn
were negotiating a lucrative retainer agreement, Quinn
testified that he never received any money from Marc Rich
between the time that he left Arnold & Porter and the time that
the pardon was granted. The Committee requested interviews with
Jack Quinn and Robert Fink so that they could provide further
explanation regarding these e-mails. Both refused to
participate in an interview.
2. Has Quinn Received Payments from Marc Rich Since the
Pardon Was Granted?
Because he spent so much time and effort on the Marc Rich
pardon effort, and was successful, many believe that Quinn may
have expected some large payment from Rich after the pardon was
granted. Quinn has always denied these allegations. However,
among the documents withheld by Quinn, and which were forced
out by the decision of Judge Denny Chin in December 2001, were
documents which undermined Quinn's denials. Shortly after the
pardon was granted, Quinn was asked by a reporter if he
received a fee for his work on the Rich matter. Rather than
just saying ``no,'' it appears that Quinn did not know what to
say. On January 23, Quinn told Gershon Kekst that ``Debra [sic]
Orin wants to know if I received a fee. My instinct is to
either not respond or say that I have never, in 25 yrs, thought
it propoer [sic] to discuss a client fee arrangement or even if
there was one. What say you?'' \266\ Kekst suggested a response
that ``[t]he privacy of my personal and professional
relationships is inviolate and so I would not, as a lifelong
practice, discuss such a question. Suffice to say that in this
case my motivation was quite simple: an injustice needed to be
corrected and I determined to do what I could to help
accomplish that.'' \267\ Quinn then fueled further speculation
about his fee arrangement when he told the press that he was
handling the Rich pardon as a ``personal matter,'' indicating
he would not share the profits with his partners at Quinn &
Gillespie.\268\
---------------------------------------------------------------------------
\266\ Jack Quinn Document Production JQ 02973 (E-mail from Jack
Quinn to Gershon Kekst, President, Kekst and Co. (Jan. 23, 2001))
(Exhibit 42).
\267\ Id.
\268\ Alison Leigh Cowan and Raymond Bonner, Lawyer Tells of His
Pursuit of Pardon for His Client, and Conversation With Clinton, N.Y.
Times, Jan. 25, 2001, at A21.
---------------------------------------------------------------------------
E-mails between Marc Rich and Jack Quinn after January 20,
2001, suggest that Rich was seeking some way to show his thanks
to Quinn, perhaps alluding to a payment to Quinn. On January
23, 2001, Rich told Quinn that ``As time goes by it's sinking
in more and more and I once again want to thank you for all
you've done. I still want to thank you personally and properly
on a separate occasion when we meet.'' \269\ After Quinn's
appearance before the Committee, and on a number of television
programs, Rich e-mailed Quinn to congratulate him.\270\ Quinn
responded with his own thanks, and an assurance that he would
continue to fight to point out the flaws in Rich's
indictment.\271\
---------------------------------------------------------------------------
\269\ Jack Quinn Document Production JQ 02924 (E-mail from Marc
Rich to Jack Quinn (Jan. 23, 2001)) (Exhibit 43).
\270\ Jack Quinn Document Production JQ 02916 (E-mail from Marc
Rich to Jack Quinn (Feb. 9, 2001)) (Exhibit 44).
\271\ Jack Quinn Document Production JQ 02930 (E-mail from Jack
Quinn to Marc Rich (Feb. 9, 2001)) (Exhibit 45).
---------------------------------------------------------------------------
The most conclusive piece of evidence that Quinn fully
intended to be paid by Marc Rich for his work on the pardon
came from Rich lawyer Robert Fink at the Committee's March 1
hearing. Fink confirmed that Rich fully intended to pay Quinn
for his work. Fink's testimony also strongly suggests that
Quinn was lying when he stated that he had no expectation of
being paid for his work on the pardon:
Counsel. When Mr. Quinn began pursuing the pardon, the
prospect of a pardon, did you anticipate compensating
him for that work?
Mr. Fink. I anticipated that he would be compensated
for that work by Mr. Rich.
Counsel. And if you could, tell us what you were
thinking.
Mr. Fink. Actually, I--I don't know that I was thinking
anything other than he was entitled to some fair fee,
the exact parameters of which I did not have in mind. I
believe I told Mr. Quinn when we started to discuss the
pardon that we would find a fair fee arrangement for
him consistent with whatever his fee arrangements were.
I did not know how he was handling his fee
arrangements.
Counsel. Did you discuss with Mr. Rich compensating Mr.
Quinn?
Mr. Fink. Could you excuse me just one moment?
Counsel. Certainly.
[Mr. Fink confers with counsel.]
Mr. Fink. The answer is yes, I did. I communicated
thoughts I had to Mr. Rich, with which he did not
disagree.
Counsel. And what did you communicate to him?
Mr. Fink. I actually communicated to him what I told to
Mr. Quinn.
Counsel. And what was that?
Mr. Fink. That we would come to a fair fee arrangement
that was consistent with his normal fee arrangements.
Counsel. So you had communicated to Mr. Quinn that you
would come to an arrangement with him to compensate
him?
Mr. Fink. Yes.
Counsel. And when was that?
Mr. Fink. The precise date I do not know, but it was
most likely early November 2000.
Counsel. And when did you stop thinking that was going
to be the case?
Mr. Fink. I stopped thinking that was going to be the
case during the first hearings of this committee.
Counsel. When I was asking Mr. Quinn about his
compensation?
Mr. Fink. I believe you were the questioner.
Counsel. I'm not quite sure where to go after that. But
you had not had a conversation with Mr. Quinn during
which you had discussed the prospect of him not being
compensated up until at least the time of our last
hearing; is that correct?
Mr. Fink. It was always my contemplation, I mean, not
that I reflected on this frequently, but if you had
stopped me at any point in time and said would you
expect that Mr. Quinn would be compensated for this
work, I would have thought that he would be.\272\
---------------------------------------------------------------------------
\272\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 505-06
(Mar. 1, 2001) (testimony of Robert Fink).
Fink's testimony, in addition to the circumstantial evidence,
establishes that Quinn expected to receive payment for his work
on the Rich pardon. It is likely that Quinn attempted to
mislead the public and the Committee on this point to try to
improve the public perception of his actions in this case. That
is, if Quinn could say he did all of his work on the Rich
pardon out of his belief in the merits, rather than his belief
in a large payday, it would show the strength of the Rich case.
Knowing now that Quinn did do his work on the Rich pardon
with an expectation of payment, the question is--how large of a
payment would Quinn receive? Fink loosely characterized it as
``consistent with his normal fee arrangements.'' However, given
the enormous sums at Rich's disposal, and the vast amounts Rich
had spent, unsuccessfully, to resolve his case, it is not
unreasonable that Rich would pay Quinn a large sum of money.
However, at the Committee's February 8, 2001, hearing, Quinn
pledged not to accept any future payment on the Rich case:
Counsel. Mr. Quinn, the Chair asked you some questions
about compensation. Apart from your attorney's fees,
will you accept any money from Mr. Rich in the future?
Mr. Quinn. Well, look, I don't think it would be fair
to ask me to commit never to accept moneys from him. As
I've said to you, if I do work that justifies my
billing him for it, I will do so. I expect to be
reimbursed for the expenses I'm put to in connection
with this. Those are the only moneys I anticipate
receiving from him.
Counsel. But as far as your work done in pursuit of
obtaining a pardon for him, you do not anticipate him--
you're not going to ask him to pay you any money?
Mr. Quinn. That's correct.
Counsel. You're not going to accept any money if he did
offer it to you; is that correct?
Mr. Quinn. I only anticipate receiving from him moneys
in connection with work I may do.
Counsel. My question was, will you accept any money if
he offers it to you for the work you did in obtaining
the pardon?
Mr. Quinn. I have no idea what he might offer. It's a
hypothetical question. I don't think I should be
required to say--
Counsel. It's not a hypothetical question. It's a very
clear question. If Mr. Rich offers to pay you money in
the future for work you did in pursuit of obtaining his
pardon, will you accept it or will you not accept it?
Mr. Quinn. I will not bill him, and I will not accept
any further compensation for work done on the
pardon.\273\
---------------------------------------------------------------------------
\273\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 266
(Feb. 8, 2001) (testimony of Jack Quinn).
However, in February 2002, as a result of Judge Chin's
decision in the Southern District of New York, the Committee
received a number of documents which had been earlier withheld
from the Committee on the basis of attorney-client privilege.
One of the e-mails provided to the Committee indicated that on
March 5, 2001, after the Committee's second and final hearing
on the Marc Rich pardon, Quinn asked Rich to enter into a new
retainer agreement to pay Quinn. Quinn's e-mail reads as
---------------------------------------------------------------------------
follows:
Greetings. Quite a month we have had! If you are
agreeable, and I hope you are, I need to fax to you in
the next few days a new retainer agreement. I cannot,
under the D.C. Bar rules continue to work without a
written agreement, and I have been crafting one which I
will forward shortly. I hope that, in recent days, the
public has begun to see your pardon in a different
light. I particularly thought that our hearing last
Thursday brought to the fore aspects not previously
appreciated. About all this I hope we shall speak soon.
Best to you.\274\
---------------------------------------------------------------------------
\274\ Jack Quinn Document Production JQ 02916 (E-mail from Jack
Quinn to Marc Rich (Mar. 5, 2001)) (Exhibit 44).
Rich responded to Quinn by telling him: ``[w]ith reference
to your email of March 5, please go ahead and send me the new
retainer agreement.'' \275\ Neither Quinn nor Robert Fink
provided the Committee with a copy of any retainer agreement,
or any further e-mails regarding payments from Rich to Quinn
after March 5, 2001. However, the March 5 e-mail raises the
possibility that Quinn is receiving payment from Rich, despite
his express promise to the contrary at the Committee's February
8 hearing. The Committee requested an interview with both Quinn
and Fink to provide further explanation for these e-mail
messages, but both declined to participate. While Quinn has
refused to provide an explanation to the Committee, his
spokesman has told the press that Quinn has signed a new
retainer with Rich to ``cover new legal matters.'' \276\ The
Committee will continue to investigate this matter to determine
the nature of Quinn's work for Rich and the amounts that Quinn
is being paid.
---------------------------------------------------------------------------
\275\ Jack Quinn Document Production JQ 02974 (E-mail from Marc
Rich to Jack Quinn (Mar. 6, 2001)) (Exhibit 46).
\276\ Michael Isikoff, Secret E-Mail, Newsweek, Mar. 10, 2002.
---------------------------------------------------------------------------
E. Quinn's Attempts to Settle the Case
In October 1999, Quinn followed the advice offered by Eric
Holder to Gershon Kekst and approached Main Justice in an
effort to settle the Rich case. He started by drafting a
presentation for the Justice Department. Quinn also hired Neal
Katyal, a lawyer who interned for Quinn when he was Counsel to
Vice President Gore.\277\ Katyal had also worked as National
Security Advisor to Deputy Attorney General Eric Holder.
According to Katyal, he was hired more as a consultant than as
a lawyer.\278\ Katyal characterized the presentation he helped
prepare as more marketing than legal.\279\ Katyal helped draft
documents that were presented to Eric Holder. He denied
contacting Holder directly, or using his access to Holder to
benefit the Rich lawyers. However, he did acknowledge that on
several occasions Jack Quinn told him, ``you know, I want to
talk to Eric about this.'' \280\
---------------------------------------------------------------------------
\277\ Telephone Interview with Neal Katyal, Associate Professor,
Georgetown University Law Center (Mar. 26, 2001).
\278\ Id.
\279\ Id.
\280\ Id. Katyal further explained that Quinn already had an
independent relationship with Holder and would not have needed Katyal's
assistance in setting up any meetings between them.
---------------------------------------------------------------------------
Quinn had a number of contacts with Holder about settling
the Rich case. It appears that Quinn's main request to Holder
was that he intercede with the Southern District of New York
and have the Southern District's prosecutors meet with the
members of the Marc Rich legal team. On October 22, 1999, Quinn
met with Holder for the first time regarding the Rich case.
Quinn reviewed a number of points about the Rich case with
Holder, and asked that Holder intervene with the Southern
District of New York, to encourage the Southern District to
meet with Marc Rich's lawyers and reach a settlement of the
criminal case.\281\ On November 8, 1999, Holder called Quinn
and told him that he and other senior staff at the Justice
Department believed that the refusal of the Southern District
to meet with Rich's lawyers was ``ridiculous.'' \282\ Holder
recommended that Quinn send a letter requesting a meeting to
U.S. Attorney Mary Jo White, with copies to Holder and
Assistant Attorneys General James Robinson and Loretta Collins
Argrett.\283\ Holder told Quinn that once he got the letter, he
would call White and suggest that she should meet with
Quinn.\284\ Holder also told Quinn that he was assigning one of
his top deputies, David Margolis, to look at the Rich
matter.\285\
---------------------------------------------------------------------------
\281\ Jack Quinn Document Production (Note of Jack Quinn) (Exhibit
47).
\282\ Jack Quinn Document Production (Note of Jack Quinn (Nov. 8,
1999)) (Exhibit 48).
\283\ Id.
\284\ Id.
\285\ Id.
---------------------------------------------------------------------------
After Holder spoke with Mary Jo White about a meeting with
Quinn and members of the Rich legal team, Quinn made a direct
appeal to Mary Jo White, writing her on December 1, 1999:
We would like to begin by asking that you or your
representative, along with representatives of the Tax
and Criminal Divisions of the Department of Justice,
meet with Professors Wolfman and Ginsburg, and members
of our legal team, to personally evaluate their
conclusions. We urge this approach because the tax
allegations underlie so much of the indictment, and
because the merits of our tax position can be quickly
evaluated. We believe that such a meeting will advance
a resolution of this matter. We further believe that we
can persuade you that neither the law nor the policies
of the Department of Justice support the RICO charges
and that, in this regard, too, the indictment as
currently drafted should not stand.\286\
---------------------------------------------------------------------------
\286\ Jack Quinn Document Production (Letter from Jack Quinn and
Kathleen Behan, Partner, Arnold & Porter, to Mary Jo White, U.S.
Attorney for the S.D.N.Y., Department of Justice (Dec. 1, 1999))
(Exhibit 49).
On January 18, 2000, Quinn spoke to Holder to see how Mary
Jo White had received his letter. Holder told Quinn that he had
spoken to White, and that she was reviewing the matter
personally. Holder told Quinn that he would ``do what he can,''
\287\ and also provided encouragement to Quinn, telling him
that White ``didn't sound like her guard was up.'' \288\ On
February 2, 2000, the Southern District responded to Quinn and
Behan's letter by turning down their request to meet in order
to modify the indictment.\289\ As Mary Jo White further
explained in her letter to Quinn, ``I have communicated with
representatives of the Deputy Attorney General and Assistant
Attorney General, Criminal Division, and with the Acting
Assistant Attorney General of the Tax Division. They all concur
that this is a matter within the discretion of the United
States Attorney for the Southern District of New York.'' \290\
White's letter was a complete rejection of the overtures made
by Quinn and Holder, and was a significant setback for the Marc
Rich legal team. Robert Fink sent an e-mail to Avner Azulay
explaining that ``[w]e received a negative response to our
overture from [Deputy U.S. Attorney] Shira[h Neiman]. She said
her office will not negotiate while Marc is away, and that the
DoJ agrees. JQ was surprised and disappointed that the DoJ had
agreed even though he had not heard from Eric.'' \291\ Azulay
responded that ``I am not exactly surprised. I foresaw this
answer from the moment I read JQ's ltr. I hate to say that `I
told you so.' I was surprised by JQ's optimistic report.''
\292\
---------------------------------------------------------------------------
\287\ Jack Quinn Document Production (Note of Jack Quinn) (Exhibit
50).
\288\ Id.
\289\ Jack Quinn Document Production (Letter from Mary Jo White,
U.S. Attorney for the S.D.N.Y., to Jack Quinn and Kathleen Behan,
Partner, Arnold & Porter (Feb. 2, 2000)) (Exhibit 51).
\290\ Id.
\291\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00697
(E-mail from Robert Fink to Avner Azulay, Director, Rich Foundation
(Feb. 10, 2001)) (Exhibit 32).
\292\ Id.
---------------------------------------------------------------------------
After this rejection, Quinn turned his efforts to Eric
Holder, asking him to review the Rich case, despite White's
refusal to do so. Robert Fink laid out Quinn's proposed plan of
action in a February 17, 2000, e-mail to Marc Rich:
[Jack] agrees (subject to further discussion) with
trying to have Eric help us meet with the tax lawyers
in Main Justice (and maybe the head of the criminal
division) to see if the professors can convince the
chief government tax lawyers that this was a bad tax
case. He also agrees that such a conclusion would be
useful for many purposes including going back to the
SDNY. Similarly, he agrees we should make something of
the fact that the office was dealing with fugitives
(who surrendered this week) in connection with the
Russian money laundering case, while insisting that
they can't deal with fugitives. Still, he wants to give
Eric a short list of what is wrong with the indictment
as he agreed to do that. He feels we can do both.\293\
---------------------------------------------------------------------------
\293\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00701
(E-mail from Robert Fink to Marc Rich (Feb. 17, 2001)) (Exhibit 52).
On February 28, 2000, Quinn sent Holder a short memorandum
entitled ``Why DOJ Should Review the Marc Rich Indictment.''
\294\ In this memorandum, Quinn stated that ``[t]he refusal of
the SDNY to participate in a discussion of the Marc Rich case
is sorely disappointing. That office (and DOJ) should not sit
on a defective indictment.'' \295\ Quinn then explained why he
believed that the RICO, mail fraud, wire fraud, tax evasion,
and energy charges against Rich were faulty.\296\ Quinn also
claimed that the SDNY had recently negotiated with fugitive
Russian money launderers, despite their policy against
negotiating with fugitives. Quinn also stated that ``[t]he DOJ
website lists Marc Rich on its International Fugitive page.
This involves USG resources and is a potential embarrassment
for DOJ.'' \297\ Quinn did not provide any explanation, though,
of why listing Rich as a fugitive would be an embarrassment for
DOJ, given the fact that the Justice Department had been trying
to extradite or apprehend him for almost 20 years. Holder
apparently reviewed Quinn's arguments, but failed to help
Quinn. Quinn spoke to Holder on March 14, 2000, and reported
back to Fink, Behan, and Kekst:
---------------------------------------------------------------------------
\294\ Jack Quinn Document Production (Memorandum entitled ``Why DOJ
Should Review the Marc Rich Indictment'' (Feb. 28, 2000)) (Exhibit 53).
\295\ Id.
\296\ Id.
\297\ Id.
[W]e spoke briefly today. it started out badly--``we've
gone as far as we can go, can't figure out a way around
Shira[h Neiman], etc.''--but I pushed back hard on the
russian money laundering culprits and the uneven
treatment of marc. he wants to talk further about that
with his people, said he'd call me back tomorrow. it's
time to move on the GOI [Government of Israel]
front.\298\
---------------------------------------------------------------------------
\298\ Jack Quinn Document Production (E-mail from Jack Quinn to
Robert Fink (Mar. 14, 2000)) (Exhibit 54). Quinn's suggestion to ``move
on the GOI front'' was rebuffed by Avner Azulay, who stated that
``there is no way the MOJ [Israeli Minister of Justice] is going to
initiate a call to EH--a minister calling a second level bureaucrat who
has proved to be a weak link.'' Piper Marbury Rudnick & Wolfe Document
Production PMR&W 00728 (E-mail from Avner Azulay, Director, Rich
Foundation, to Robert Fink (Mar. 18, 2000)) (Exhibit 55).
Holder did speak to Quinn almost a month later, on March 25,
2000, and told him that ``we're all sympathetic'' and that the
``equities [are] on your side.'' \299\ However, Holder
apparently informed Quinn that he could not force a meeting on
the Rich case.
---------------------------------------------------------------------------
\299\ Jack Quinn Document Production (Note of Jack Quinn) (Exhibit
56). In this conversation, Holder also answered Quinn's arguments
regarding the SDNY's negotiations with the fugitive Russian money
launderers, pointing out that they, unlike Rich, agreed to cooperate
with the government.
---------------------------------------------------------------------------
At the Committee's February 8, 2001, hearing, Jack Quinn
confirmed that Holder was sympathetic to his cause:
I certainly formed the impression that there was, as
one of my notes reflect, a view among some senior
people in Main Justice that the equities were on our
side in some senses.
Again, I'm not trying to overstate this. I'm not trying
to say that I believed that senior people at Main
Justice thought the indictment was meritless, but I did
absolutely believe that Main Justice thought that the
Southern District was being unreasonable in being
unwilling to talk to us. I thought that there was a
more sympathetic audience at Main Justice.\300\
---------------------------------------------------------------------------
\300\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 230
(Feb. 8, 2001) (testimony of Jack Quinn).
However, Eric Holder attempted to qualify his support of Jack
---------------------------------------------------------------------------
Quinn's arguments:
With regard to question of equities and whether or not
we thought the Southern District was being
unreasonable, I think Mr. Quinn was just a little
confused. What we were talking about there was them
being unreasonable and not having the meeting. The
equities were on their side, as Mr. Quinn's side, with
regard to the meeting. No one at Main Justice thought
that, with regard to the substance, the equities were
on Mr. Quinn's side.\301\
---------------------------------------------------------------------------
\301\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 231
(Feb. 8, 2001) (testimony of Eric Holder, former Deputy Attorney
General, Department of Justice).
Even assuming, though, that Holder's support was limited to his
request for a meeting with Mary Jo White, it is still unclear
why he thought the ``equities were on Quinn's side,'' even with
respect to a meeting. The SDNY had a number of meetings and
negotiations with Rich's attorneys, both before and after
Rich's flight from the U.S. The SDNY had made a number of
reasonable offers to settle the case, and U.S. Attorney Otto
Obermaier and one of his senior aides even met with Rich in
Switzerland. Rich's lawyers, however, took an inflexible
position that they would not agree to any plea that required
jail time. Given this position, the SDNY decided further
negotiations would not be productive. For Holder to
characterize the SDNY's position as ``ridiculous,'' suggests
that Eric Holder supported Quinn's efforts to settle the Rich
case from the beginning.
III. THE MARC RICH AND PINCUS GREEN PARDON PETITION
A. Rich Contemplated a Pardon Early in 2000
Jack Quinn and others on the Marc Rich legal team have
maintained that they did not decide to seek pardons for Rich
and Green until October 2000.\302\ However, there is extensive
evidence that Marc Rich and his lawyers were contemplating a
pardon as early as February 2000, while they were still
attempting to settle Rich's criminal case with the Southern
District of New York. It appears that Rich and his legal team
viewed the Presidential pardon effort as a fall-back in case
they were unable to settle the criminal case. Moreover, it
appears that although they were considering petitioning for a
pardon as early as February 2000, Rich and his legal team
waited until November 2000 to submit their petition.
---------------------------------------------------------------------------
\302\ See, e.g., ``The Controversial Pardon of International
Fugitive Marc Rich,'' Hearings Before the Comm. on Govt. Reform, 107th
Cong. 45 (Feb. 8, 2001) (testimony of Jack Quinn).
---------------------------------------------------------------------------
As discussed previously, on February 2, 2000, Mary Jo
White, the U.S. Attorney for the Southern District of New York,
rejected Jack Quinn's offer to meet regarding the Marc Rich
case. After White's rejection, Jack Quinn turned again to
Deputy Attorney General Eric Holder, and asked him to intervene
and force a reconsideration of the Marc Rich indictment. By
late March 2000, it became clear to Quinn that Holder was
sympathetic to Quinn's requests, but would not force the
Southern District to meet with Quinn. However, during the time
that Quinn was discussing his request for a meeting with Eric
Holder, the Marc Rich legal team was already considering a
Presidential pardon.
A privilege log submitted to the Committee by Arnold &
Porter suggests that attorneys working for Marc Rich had been
researching Presidential pardons as early as March 1999.\303\
It appears, though that serious consideration of a pardon began
in February 2000, while Quinn was still attempting to settle
the criminal case through Eric Holder. February 9, 2000, Robert
Fink sent an e-mail to Jack Quinn and Kathleen Behan, which
referred to the pardon effort cryptically as the ``second
option:''
---------------------------------------------------------------------------
\303\ Arnold & Porter Document Production (Privilege Log, Mar. 27,
2001) (Exhibit 57). The privilege log notes that a memorandum regarding
the pardon power was prepared on March 12, 1999, and withheld from the
Committee on the basis of the attorney work product privilege.
I briefed Marc and he is awaiting word on your call. (I
have also sent Avner a briefed [sic] email letting him
know of the current status.) I also told Marc that I
would discuss with you and Kitty your views on the
second option (whether there is any reason to consider
it, or whether what happened here made it so unlikely
that you did not think it worthwhile, as I told him
that you would not work on it unless you thought there
was some possibility of success). He was curious as to
your thinking. I told him I would also check on your
thinking on what Avner was doing. but let's see what
Eric says.\304\
---------------------------------------------------------------------------
\304\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00695
(E-mail from Robert Fink to Jack Quinn and Kathleen Behan, Partner,
Arnold & Porter (Feb. 9, 2000)) (Exhibit 58).
On February 14, 2000, Fink had a telephone discussion with
Quinn regarding the efforts to settle Rich's criminal case in
New York. Quinn apparently mentioned the possibility of seeking
a Presidential pardon, as Fink's notes of the call state in
part, ``Pardon--mid to late Nov.'' \305\ Two weeks later,
Robert Fink sent another e-mail to Marc Rich explaining Quinn's
role in the negotiations with the Justice Department, and his
potential role in seeking a Presidential pardon. Fink concluded
his e-mail to Rich by suggesting that Rich enter into a
retainer agreement with Quinn before they heard back from Eric
Holder:
---------------------------------------------------------------------------
\305\ Piper Marbury Rudnick & Wolfe Document Production PMR&W
01202-03 (Notes of Robert Fink, Feb. 14, 2000) (Exhibit 59).
I think it makes sense to compensate him for what he
has done and may continue to do. Just give it some more
thought and we can come back to it soon. We can wait,
if you want, to see what Eric says, although it may pay
to respond now, before Eric response [sic] to the last
message from Jack, so it does not look like you were
only willing to pay because of a positive response, as
that was not the agreement. Even if we stop everything
we are doing, and decide not to investigate the pardon,
etc., at this time, we should fold this down in a
friendly way.\306\
---------------------------------------------------------------------------
\306\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00722
(E-mail from Robert Fink to Marc Rich (Feb. 29, 2000)) (Exhibit 39).
On March 18, 2000, Avner Azulay sent Fink an e-mail which
again alluded to the possibility of seeking a pardon in
November 2000. More importantly, this e-mail also raised the
possibility of capitalizing on Denise Rich's relationship with
---------------------------------------------------------------------------
President Clinton:
I had a long talk with JQ and Michael. I explained why
there is no way the MOJ [Israeli Minister of Justice]
is going to initiate a call to E[ric] H[older]--a
minister calling a second level bureaucrat who has
proved to be a weak link. We are reverting to the idea
discussed with Abe--which is to send D[enise] R[ich] on
a ``personal'' mission to N01. with a well prepared
script. IF it works we didin't [sic] lose the present
opportunity--until nov--which shall not repat [sic]
itself. If it doesn't--then probably Gershon's course
of acion [sic] shall be the one left option [sic] to
start all over again.\307\
---------------------------------------------------------------------------
\307\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00729
(E-mail from Avner Azulay, Director, Rich Foundation, to Robert Fink
(Mar. 18, 2000)) (Exhibit 60).
At the March 1, 2001, hearing on the Rich pardon, Jack Quinn
and Robert Fink were asked to explain their understanding of
this communication. Fink stated that he understood ``N01'' to
mean President Clinton.\308\ However, neither of the two
attorneys could provide a definitive answer as to whether
Denise Rich actually undertook the `` `personal' mission'' to
the President contemplated in the e-mail. For example, Quinn
provided the following response:
---------------------------------------------------------------------------
\308\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 515
(Mar. 1, 2001) (testimony of Robert Fink).
Now, I'm telling you, I did not speak to the President
in the year 2000 about the Marc Rich matter. I was not
a recipient of this [e-mail]. I have no reason to
believe that anyone asked Denise Rich to speak to him
about this matter, and I have no reason to believe that
she did so. But my firsthand knowledge of this is
limited to the facts I'm able to testify to.\309\
---------------------------------------------------------------------------
\309\ Id. at 396 (testimony of Jack Quinn).
When asked what Denise Rich's involvement was around this time,
Robert Fink provided an even more lawyerly response: ``I have
an imperfect memory, so I'll be careful. I believe as I sit
here that there was no involvement by Denise Rich in Mr. Rich's
problems during that period of time. I have absolutely no
recollection that she became involved in any way.'' \310\
---------------------------------------------------------------------------
\310\ Id. at 515 (testimony of Robert Fink).
---------------------------------------------------------------------------
Furthermore, neither attorney could give a definitive
answer as to whether this ``well prepared script'' for Denise
Rich related to the pardon, or to negotiations with the
Department of Justice. During questioning about the March 18,
2000, e-mail, Quinn testified that it was possible that ``every
one of us involved in this thought out loud with each other, is
there any way to persuade the President to tell Justice, to
tell the southern district to do something.'' \311\ Quinn
continued, however, stating, ``It's also entirely possible that
Mr. Azulay, others, myself included, were involved in a
conversation where someone said you know we are going to try to
pardon one of these days.'' \312\ Robert Fink's testimony,
while also not definitive, suggests that the script related to
negotiations with the Department of Justice. When asked about
the last sentence of Azulay's e-mail that discusses reverting
to ``Gershon's course of action'' if Denise Rich's script were
to fail, Fink stated, ``I suspect that he's talking about an
application for a pardon here.'' \313\ Assuming Fink's
supposition is correct, then the script for Denise would have
related to Department of Justice negotiations.\314\
---------------------------------------------------------------------------
\311\ Id. at 396 (testimony of Jack Quinn).
\312\ Id.
\313\ Id. at 516 (testimony of Robert Fink).
\314\ This also tends to suggest that while the attorneys were not
working on a pardon effort in March of 2000, the idea had already been
discussed.
---------------------------------------------------------------------------
In June 2000, Robert Fink had further communications with
Marc Rich indicating that they were intentionally waiting until
after the November 2000 election to petition for a Presidential
pardon:
Jack Quinn and I traded calls until today. He is well
and doing well. He has not forgotten you or what we set
out to do, but has pretty much concluded that there is
nothing to do until we get closer to (or even passed)
[sic] the election, or as he put it, the closing days
of the current administration.\315\
---------------------------------------------------------------------------
\315\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00731
(E-mail from Robert Fink to Marc Rich (June 6, 2000)) (Exhibit 40).
In July 2000, Fink again e-mailed Rich suggesting that Rich
sign a retainer agreement with Quinn so that he would be
---------------------------------------------------------------------------
available to work in the Fall of 2000:
At the moment the issue raised by you and Michael is
how to keep Jack on a ``retainer'' so that he is
available for questions that might arise and, more
importantly, available in the Fall, if we want him to
be. Since the Fall is not far away, and you will know
whether you want him to gear up again within four
months or so, I suggest that we offer Jack $10,000 per
month as a retainer to keep his eyes, ears and brain
open to events and thoughts that may be helpful, with
the understanding that if a decision is made to proceed
that we will renegotiate the monthly retainer to
reflect the changed circumstances.\316\
---------------------------------------------------------------------------
\316\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00732
(E-mail from Robert Fink to Marc Rich (July 7, 2000)) (Exhibit 41).
This documentary evidence is supported by the information
provided by two witnesses who indicate that they were aware of
pardon discussions well before the Fall of 2000. Abraham
Foxman, the National Director of the Anti-Defamation League,
informed the Committee that he recommended that Rich seek a
Presidential pardon as early as February 2000. Foxman first met
Marc Rich fifteen years ago through mutual friend Max Maxin who
was President of B'nai B'rith.\317\ According to Foxman, Maxin
asked Foxman to meet with Rich ``because Rich felt that there
may have been anti-Semitism involved in his prosecution.''
\318\ According to Foxman, he met Rich in Europe sometime in
late 1998 or early 1999.\319\ Foxman told Rich at that meeting
that he did not see any evidence to support a charge of anti-
Semitism.\320\ Later, in February of 2000, Foxman was contacted
by Zvi Rafiah, who was then congressional liaison for the
Israeli Embassy in Washington.\321\ Rafiah suggested that
Foxman go to Paris to meet with Avner Azulay, the former Mossad
agent who managed Marc Rich's philanthropic organizations.\322\
At that meeting in Paris, Foxman allegedly told Azulay that if
the attorneys for Rich continued to be unsuccessful in their
negotiations with the prosecutors in New York, a pardon might
be a ``long-shot'' possibility to consider.\323\ Foxman told
Azulay that, to the best of his knowledge, Denise Rich ``hated
Marc Rich's guts,'' but that if someone could convince her to
speak to the President, ``then you have the beginning of a
pardon situation.'' \324\ Foxman later learned that, ``as it
turns out, that is what happened.'' \325\
---------------------------------------------------------------------------
\317\ Interview with Abraham Foxman, National Director, Anti-
Defamation League (Mar. 19, 2001).
\318\ Id. Marc Rich has charged on a number of occasions that he
was singled out for prosecution because he was Jewish. There is no
support for Mr. Rich's assertion. Mr. Rich's decision to play the race
card emphasizes the extent to which he has failed to accept
responsibility for his crimes. Rather than recognizing the extent of
his criminal acts, of which violation of Department of Energy
regulations and the Tax Code were among the least, Rich has made
baseless accusations against federal prosecutors.
\319\ Id.
\320\ Id.
\321\ Id. According to Foxman, Rafiah is now a lobbyist for
``commercial interests.'' Id. Lobbying registration materials from the
FEC indicate that Rafiah's main client is Elisra Electronic Systems
Ltd., a company that develops and manufactures electronic warfare
systems. Lobbying Registration of Zvi Rafiah (visited Feb. 16, 2001)
(Exhibit 61).
\322\ Id.
\323\ Id.
\324\ Id.
\325\ Id.
---------------------------------------------------------------------------
Publicist Gershon Kekst claims that he mentioned the
possibility of a Presidential pardon to Rich's lawyers as early
as 1999. Kekst had been hired by Rich to assist with strategy
and public relations relating to his criminal case.\326\ In
1999, the same time period in which Kekst was looking for a
Washington lawyer to represent Rich, Kekst was giving general
thought to the Rich case, including his basic conclusion that a
public relations campaign could not help Rich. Seeking to
conduct a ``sanity check'' on his conclusion, Kekst turned to
former Attorney General William P. Barr, the Senior Vice
President and General Counsel for Verizon Communications. Kekst
met Barr through public relations work he did for Verizon
Communications.\327\ Kekst claimed that he was unaware at that
time that Barr had been U.S. Attorney General.\328\ However,
Kekst was impressed with Barr's legal acumen, and thought that
he could offer some insight into the Rich case. Kekst called
Barr, and asked him whether he thought that a public relations
campaign would be useful in trying to resolve the Rich
case.\329\ Kekst claims that Barr told him that a public
relations campaign was the worst thing he could do. According
to Kekst, Barr told Kekst that, assuming the Rich case was a
bad case, the most that Rich could do was wait until the end of
the Administration and seek a pardon from President
Clinton.\330\ Kekst stated that before Barr's suggestion, he
had never heard any discussion of Rich seeking a Presidential
pardon. Kekst also believes that Barr told him that even if the
case against Rich was not justified, as long as Mary Jo White
was U.S. Attorney and Rudolph Giuliani was Mayor, there was
nothing to be done.\331\ The latter point appears to have been
the main thing taken away from the conversation by Kekst and
those on the Rich team who he informed about the conversation
with Barr. In December 2000, Robert Fink e-mailed Jack Quinn
and reminded him that Kekst had spoken to Barr in 1999, and
that Barr believed ``it paid to wait for the new administration
and the retiring of several of the then-current players.''
\332\ Fink then suggested that they ask Barr to assist with the
pardon effort, but apparently, Quinn and Fink decided not to
include a prominent Republican in their efforts.\333\
---------------------------------------------------------------------------
\326\ Interview with Gershon Kekst, President, Kekst and Co. (Mar.
15, 2001).
\327\ Id.
\328\ Id.
\329\ Id.
\330\ Id.
\331\ Id.
\332\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00073
(E-mail from Robert Fink to Jack Quinn (Dec. 26, 2000)) (Exhibit 62).
\333\ Id.
---------------------------------------------------------------------------
For his part, Barr recalls that he told Kekst that
political pressure would be a ``waste of time.'' \334\ Barr
explained to Kekst that the Justice Department supported the
Southern District of New York prosecutors because it was a
matter of significant principle for the Department.\335\ He
also told Kekst that it was inconceivable that any relief was
possible as long as Rich remained a fugitive.\336\ In short,
Barr believed that the White House would never do anything for
Rich unless Rich were willing to surrender himself and accept
responsibility for what he had done.\337\
---------------------------------------------------------------------------
\334\ Telephone interview with William P. Barr (Mar. 10, 2002).
\335\ Id.
\336\ Id.
\337\ Id.
---------------------------------------------------------------------------
In the days immediately following the Rich pardon, Jack
Quinn and the other lawyers for Marc Rich emphasized that they
did not decide to seek a pardon for Rich until October 2000.
What they did not make clear, however, was that they were
actively considering a pardon much earlier. They decided to
wait until the closing days of the Clinton Administration to
apply for the pardon. While the reasons for the delay are not
clear, there are two likely reasons: first, by waiting until
December to apply, opponents of the pardon would have a limited
amount of time to learn of and resist the pardon effort;
second, the Clinton White House would have limited time to
conduct a detailed review of the petition and learn of its
numerous flaws.
B. The Preparation of the Pardon Petition
The centerpiece of Marc Rich's effort to obtain a
Presidential pardon was the pardon petition, which was put
together by the Marc Rich legal team in October and November
2000. The main attorneys involved in preparing the pardon
petition were Jack Quinn; Kathleen Behan; Robert Fink;
Christopher Man, an associate at Arnold & Porter; Michael
Hepworth, Of Counsel at Piper Marbury Rudnick & Wolfe; and G.
Michael Green of Dickstein Shapiro Morin & Oshinsky. These
lawyers spent dozens, if not hundreds, of hours compiling the
petition.
The resulting document, which had a number of
misrepresentations and factual inaccuracies, was a surprisingly
poor effort, considering the amount of time and money that went
into it. The argument section of the petition, the only portion
that was actually drafted anew in October and November 2000,
totaled 31 double-spaced pages. The first 20 of those pages
were dedicated to biographical sketches of Rich and Green.
These pages attempted to cast Rich and Green in a favorable,
even likable light. These statements seem almost laughable
given what the world knows now about Marc Rich and Pincus
Green:
Mr. Rich and Mr. Green have lived exemplary, indeed,
remarkable lives. Although they have suffered terrible
hardships as the result of their exile from the United
States, they have continued to work productively and
contribute to society.\338\
---------------------------------------------------------------------------
\338\ Petition for Pardon for Marc Rich and Pincus Green,
Memorandum in Support of Petitioners' Application for Pardon 4 (Dec.
11, 2000) (Appendix III).
Although it is true that the work of Rich and Green assisted
the governments of countries like Iraq, Iran, and Libya, it is
difficult to argue that they contributed to the United States
once they fled their country and attempted to renounce their
citizenship.
Included in the attempt to make Marc Rich seem like the
victim was a reference to the tragic death of his daughter
Gabrielle while Marc Rich was a fugitive from justice:
``Because Gabrielle lived and died in the United States, Mr.
Rich felt the extra weight of being unable to personally visit
with her during her final months.'' \339\ This claim, which was
repeated by Denise Rich in her appeals to the President, made
it sound as if the prosecutors in the Southern District of New
York denied Rich the opportunity to visit with his dying
daughter. Nothing could be further from the truth. Rich knew
that if he returned he would receive bail, and that he would
not be incarcerated unless convicted of the crimes he had been
accused of committing. He was prevented from returning to visit
his dying daughter only if he refused to face the U.S. justice
system. Rich's desire to both have his cake and eat it too,
makes it difficult to generate any sympathy for him in this
matter. In fact, the only possible conclusion is that Marc Rich
placed his own needs over those of his daughter.
---------------------------------------------------------------------------
\339\ Id. at 7 n.1.
---------------------------------------------------------------------------
The petition also made it sound as if Rich was providing
the world with an economic benefit through his dealings:
In building this business, Mr. Rich and Mr. Green made
substantial contributions to the world economy by
increasing competition--and even breaking cartels--in
the physical commodities industries.\340\
---------------------------------------------------------------------------
\340\ Id. at 6.
Of course, the petition did not mention that Marc Rich's
business was built by supporting corrupt and dictatorial
regimes across the world, ranging from Communist Cuba to
apartheid South Africa. Nor did the petition mention that
Rich's deals with third world countries meant that Rich himself
gained monopolies over commodities that often paid developing
nations less than fair-market prices for their commodities. Nor
did the petition point out that Rich provided opportunities to
those regimes the United States was actively attempting to
penalize, including Iran during the period when 54 Americans
were held hostage at the U.S. Embassy in Tehran.
The petition also made the claim that Rich and Green's
lives were exemplary, setting aside the 65-count indictment:
Other than the allegations for which clemency is
sought, Mr. Rich and Mr. Green never have been charged
with a crime. Indeed, Mr. Rich's and Mr. Green's lives
both before and after the accusations have been ones of
hard-working, resourceful businessmen who have become
remarkably successful and have devoted much time and
money to philanthropy and statesmanship.\341\
---------------------------------------------------------------------------
\341\ Id. at 20.
Again, the pardon petition made no mention of other less-than-
savory aspects of Marc Rich's business dealings, for which he
was never prosecuted, but which remain of questionable legality
and morality, including supporting the Khomeini regime while it
held U.S. hostages, selling weapons and missile parts to
Khomeini, and trying to do business with Saddam Hussein during
the Gulf War.
The petition then takes six pages to argue that the
indictment of Rich and Green was flawed and unfair, and the
appropriate subject of a Presidential pardon. As described
below, these arguments were largely a rehash of the same
arguments that Rich and his lawyers had been making since the
indictment was handed down. The final four pages of the
petition were used to explain that it was permissible for the
President to issue a pardon before a conviction. Also attached
to the petition were the ``letters of support,'' as well as
other attachments, including the tax analysis by Professors
Ginsburg and Wolfman, as well as other varied materials related
to negotiations with the Southern District of New York and the
President's pardon power in general.
C. The Misleading Legal Arguments in the Petition
The pardon petition crafted by Jack Quinn and the other
attorneys on the Rich legal team is filled with numerous
misleading and disingenuous legal arguments. Many commentators
have stated that Quinn was merely being a good lawyer providing
zealous representation to Marc Rich. However, many of the
points made by Quinn and others go beyond zealous
representation to the point of deception. Quinn had a
responsibility to be honest in the pardon petition, and he
failed. Normally, such dishonesty would not have a tremendous
effect, but when it was combined with the total failure of the
Clinton White House to examine the Rich case, the result was
disastrous.
1. The Indictment of Rich Was Not Flawed
The first charge leveled by Quinn and the Rich legal team
is that Rich and Green and their companies, Marc Rich + Co.
A.G. (``A.G.'') and Marc Rich + Co. International, Ltd.
(``International''), were subjected to an ``unprecedented
criminal investigation'' and ``a unique indictment based on
now-discarded and rejected theories.'' \342\ Notwithstanding
the fact that this is an argument made by almost all
individuals and companies accused of white collar crime, this
claim is especially specious here.
---------------------------------------------------------------------------
\342\ Id.
---------------------------------------------------------------------------
a. The Department of Energy Regulations Were
Fair
In his pardon petition, Rich claimed to have been the
victim of overly complex and unfair Department of Energy
regulations. One element of this line of defense is that the
regulations governing the conduct for which Rich and Green were
indicted were too confusing. According to the pardon petition,
the Department of Energy regulations limiting prices in oil
reselling were ``extremely complicated,'' and were therefore
rescinded in January 1981 because they were ``unworkable.''
\343\ Such an argument is completely disingenuous. Rich and
Green were able to understand the regulations well enough to
exploit them for millions of dollars in profit. Regardless of
whether they outlived their usefulness, they were deemed
appropriate at the time when the United States was seriously
concerned about fuel shortages. More important, they were the
law at that time, and Rich and Green therefore had a duty to
play by the rules or face the consequences. Indeed, other
companies were able to obey the law and were not subject to
prosecution.
---------------------------------------------------------------------------
\343\ Id. at 21.
---------------------------------------------------------------------------
Quinn also argued that the Department of Energy indicated
that Rich and his company ``properly . . . accounted for the
transactions.'' \344\ This argument is irrelevant because
Rich's accounting was not the central issue. Rather, Rich's
companies falsified reports in order to hide profits over the
legal limits in violation of law. Marc Rich's own companies
admitted as much when they pled guilty and paid $200 million in
taxes, penalties, and interest. As the lawyers for Rich's
companies stated in federal court:
---------------------------------------------------------------------------
\344\ Id. at 27.
Beginning in September 1980 International generated
millions of dollars of income from crude oil
transactions which International should have disclosed
but intentionally did not disclose to the Internal
---------------------------------------------------------------------------
Revenue Service and the Department of Energy.
* * *
In connection with matters within the jurisdiction of
agencies of the United States, specifically the
Department of Energy and the Internal Revenue Service,
International and A.G. knowingly and wilfully made
those documents and the ERA 69s filed with the
Department of Energy which were false in that they
failed to disclose material facts regarding the actual
income from those crude oil transactions[.] \345\
---------------------------------------------------------------------------
\345\ Transcript of Allocution, U.S. v. Marc Rich + Co., A.G. et
al. 18-19 (S.D.N.Y. Oct. 11, 1984) (S 83 Cr. 579) (Exhibit 5).
This language from the allocution clearly demonstrates not only
that the Department of Energy in no way exonerated Rich and
Green's activities, but also that Rich and Green and their
companies clearly understood the nature of the supposedly
complicated regulations well enough to violate them ``knowingly
and wilfully.'' Their arrangement with West Texas Marketing was
clearly intended to contravene the regulations and perpetrate
tax fraud against the United States.
b. Rich and Green Were Not Singled Out
Another element of Quinn's attack on the indictment is that
Rich and Green were unfairly singled out because ``others
engaging in similar activity'' were pursued only in civil
regulatory actions.\346\ This argument is simply false, and a
minimally competent lawyer would have known that it was false.
Even Rich's own lawyers had earlier determined this in their
research, which was also in Jack Quinn's possession. According
to a 1988 memo drafted by Rich's lawyers, there were 48
criminal cases nationwide brought against crude oil
resellers.\347\ In 14 cases, the defendants spent some time in
prison.\348\ Texas resellers John Troland and David Ratliff of
West Texas Marketing were prosecuted for ``daisy chain'' oil
transactions and for falsely classifying different types of
crude oil to skirt DOE regulations. It was while serving 10
months in prison that they first alerted prosecutors to the
activities of Rich and Green.
---------------------------------------------------------------------------
\346\ Petition for Pardon for Marc Rich and Pincus Green,
Memorandum in Support of Petitioners' Application for Pardon 22 (Dec.
11, 2000) (Appendix III).
\347\ Jack Quinn Document Production (Memorandum from Mark Ehlers
to Scooter Libby 1 n.1 (June 10, 1988)) (Exhibit 63).
\348\ Id. at 1-2 n.2.
---------------------------------------------------------------------------
Rich's lawyers have also argued that, unlike Rich and
Green, the few violators who were pursued criminally were
involved in ``daisy chaining'' or miscertification (falsely
labeling controlled oil as uncontrolled oil).\349\ However,
Rich and Green were not alone in facing criminal penalties even
though they were not accused of miscertification. Oscar Wyatt,
David Chalmers, and Sam Wilson, Jr. pled guilty to a willful
violation of the price control enforcement provision that
involved no accusation of miscertification.\350\ These cases
are consistent with the relevant statute, which distinguishes
between civil and criminal violations on the basis of whether
the conduct was willful--not whether it involved
miscertification.\351\
---------------------------------------------------------------------------
\349\ Quinn made this argument before the Senate Judiciary
Committee. See ``President Clinton's Eleventh Hour Pardons,'' Hearing
Before the Senate Judiciary Comm., 107th Cong. 78 (Feb. 14, 2001)
(testimony of Jack Quinn).
\350\ Jack Quinn Document Production (Memorandum from Mark Ehlers
to Scooter Libby 2-3 n.4 (June 10, 1988)) (Exhibit 63).
\351\ 15 U.S.C. Sec. 754 (1982 ed.)
---------------------------------------------------------------------------
More important, Rich and Green were also involved in
illegal conduct that was unique in the context of the commodity
they were trading. In September 1980, DOE clarified its oil
reseller regulations to make it plain that resellers were not
permitted to profit more than $0.20 per barrel.\352\ Rich and
Green made profits far in excess of that limitation but created
fraudulent invoices and filed false reports to hide about $100
million in illegal profits from both the DOE and the IRS. In
other words, Rich and Green were engaged in classic criminal
financial fraud. The grand jury in New York had ample evidence
from documents and witnesses that Rich and Green were willfully
violating the price controls and, as discussed above, their
companies later pled guilty to doing so.\353\
---------------------------------------------------------------------------
\352\ U.S. v. Marc Rich, Pincus Green et al. 9 (S.D.N.Y. Mar. 6,
1984)(S 83 Cr. 579).
\353\ Telephone Interview with Morris ``Sandy'' Weinberg, Jr.,
former Assistant U.S. Attorney for the S.D.N.Y., Department of Justice
(Feb. 7, 2001).
---------------------------------------------------------------------------
Quinn further tried to advance the argument that Rich and
Green's entire case was sui generis by stating in the petition
that similarly situated individuals and corporations such as
ARCO were never criminally charged.\354\ However, ARCO was not
a similarly situated corporation because it was never involved
in attempting to hide illegal profits as was Rich's company. In
fact, in looking at the more analogous case of the corporations
(West Texas Marketing and Listo Petroleum) that helped Rich
hide illegal profits, the executives of those companies were
prosecuted. Two executives from West Texas Marketing served 10
months in prison and one from Listo pled guilty to felony
charges of making false statements and was sentenced to five
years probation and fined $5,000.\355\
---------------------------------------------------------------------------
\354\ Petition for Pardon for Marc Rich and Pincus Green,
Memorandum in Support of Petitioners' Application for Pardon 26 (Dec.
11, 2000) (Appendix III).
\355\ See Patrick E. Tyler, U.S. Grand Jury Probing Shift of Oil
Profits, Wash. Post, Oct. 18, 1982, at A1. See also Rich Associate Gets
Probation, Associated Press, Dec. 17, 1984.
---------------------------------------------------------------------------
Beyond being completely false, the argument that Marc Rich
was ``singled out'' for prosecution also draws upon the
preposterous claims, made by Marc Rich himself, that the
prosecution was the result of anti-Semitism.\356\ In an
interview with the Israeli Ma'ariv Weekend Magazine, Rich
stated, ``I'm convinced that the fact that I was a foreigner
and a relative newcomer on the oil-trading market and Jewish
influenced the manner in which my case was handled.'' \357\
Rich has never provided any support for this outlandish claim.
Rich's clumsy attempt to play the race card was rejected even
by associates like Abraham Foxman, who found no evidence to
support it. Rich's attorneys did not make any overt reference
to anti-Semitism in the pardon petition, but did repeatedly
claim that Marc Rich had been ``singled out'' by prosecutors,
never explaining why they believed that to be the case.
Furthermore, Quinn's own notes make it appear possible that he
raised the specter of anti-Semitism in his last-minute appeal
to the President on January 19, 2001.\358\ It is unfortunate
that the President found Rich's arguments believable--when in
fact, they were completely inaccurate--a fact the President
could have discovered with minimal due diligence.
---------------------------------------------------------------------------
\356\ While these arguments were not made explicitly in the pardon
petition, Rich made them in the media, and Jack Quinn may have made
them to President Clinton. See Section IV(G)(4).
\357\ Bo'az Ga'on, Rich as Korach, Ma'ariv Weekend Magazine, Oct.
1, 1999 (Exhibit 6).
\358\ For a detailed discussion, see Section IV(G)(4) below.
---------------------------------------------------------------------------
c. Rich and Green Did Trade with the Enemy
The pardon petition claims that ``the Iranian [trading with
the enemy] counts were added to the indictment to incite public
opinion against the defendants.'' \359\ The petition further
claims that ``[t]he prosecutors quietly dropped the Iranian
claims against the companies, but never dealt with the claims
against the individuals.'' \360\ By making this claim, Rich
suggested that the charges had no merit. In fact, the charges
appear to have been accurate, and were only dropped from the
indictment for technical reasons. The trading with the enemy
charges against the Marc Rich companies were dropped because
Clyde Meltzer--the Listo petroleum executive who, unlike Rich
and Green, did not flee the United States--was not involved in
trading with Iran. Since Rich and Green fled and were
unavailable for trial, the only charges of conspiracy against
the remaining defendants were unrelated to Iran.
---------------------------------------------------------------------------
\359\ Petition for Pardon for Marc Rich and Pincus Green,
Memorandum in Support of Petitioners' Application for Pardon 22 (Dec.
11, 2000) (Appendix III).
\360\ Id.
---------------------------------------------------------------------------
The charges against Rich and Green personally for trading
with Iran during the hostage crisis were never dropped or
dismissed. They remained in effect at the time of the
pardon.\361\ Indeed, there is voluminous evidence that Rich and
Green traded with Iran, in addition to a number of other
prominent enemies of the United States. While a foreign company
may have been allowed to trade with Iran, Rich and Green were
American citizens and it was illegal for them to engage in
trade with Iran regardless of whether they did so on foreign
soil or through the use of a foreign corporation. In fact, the
evidence showed that Rich and Green negotiated the deals from
the Manhattan offices of Marc Rich International, an American
firm.\362\ It was the height of irresponsibility for Marc Rich
and his lawyers to suggest that prosecutors charged Rich with
trading with the enemy only to ``incite public opinion''
against Rich when Rich was, in fact, trading with Iran.
---------------------------------------------------------------------------
\361\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 110
(Feb. 8, 2001) (testimony of Morris ``Sandy'' Weinberg, Jr., former
Assistant U.S. Attorney for the S.D.N.Y., Department of Justice).
\362\ Id.
---------------------------------------------------------------------------
Jack Quinn, who signed the pardon petition, admitted in the
Committee's February 8, 2001, hearing that Rich had indeed
traded with Iran:
Mr. Shays. Did Mr. Rich trade with Iran when U.S.
hostages were being held captive?
Mr. Quinn. I do not know the precise answer to that
question. It is my belief that he traded with Iran. I
can't tell you right now when that occurred.
Mr. Shays. Should it make any difference to you if it
did?
Mr. Quinn. Again, I approached this as a lawyer
concerned with the indictment that was before me and
whether or not it should stand. I was not here to be a
character witness. I was here to take on four points--
Mr. Shays. It didn't make any difference to you. Should
it have made a difference to the President of the
United States?
Mr. Quinn. It is something he well may have taken into
consideration, certainly.\363\
---------------------------------------------------------------------------
\363\ Id. at 111.
While Quinn admitted that he knew that Rich did indeed trade
with Iran, he failed to address how he could state in the
pardon petition that ``the prosecutors quietly dropped the
Iranian charges against the companies, but never dealt with the
claims against the individuals.'' Quinn likely failed to
address this statement because he knew the implication that the
charges were ``quietly'' dropped for lack of evidence is
misleading.
d. Rich and Green Did Evade Federal Taxes
Quinn and the Rich legal team also attacked the core tax
evasion counts in the indictment against Rich and Green. As
they argued in the petition, ``The tax treatment of the
transactions in the indictment, however, is governed by a U.S.-
Swiss tax treaty, which was ignored by the prosecution. . . .
The transactions in issue were consistently reported in
accordance with the tax treaty.'' \364\ In making these
arguments, Rich's lawyers relied on what they called the
``independent'' analyses of law professors Bernard Wolfman and
Martin Ginsburg.\365\ However, the language from the pardon
application is misleading in its use of the word
``independent.'' First of all, the professors were paid
handsomely by Marc Rich for their work on his behalf. Professor
Ginsburg, husband of Supreme Court Justice Ruth Bader Ginsburg,
was paid $66,199 for his work on the Rich case.\366\ Professor
Wolfman was paid $30,754 for his analysis.\367\ Wolfman was
hired as a consultant by one of Rich's firms, and was paid
between $250 and $300 per hour.\368\ Hence, the analysis was
not ``independent'' of Marc Rich. Second, the professors did
not come to the same conclusion ``independently'' of each
other, but rather worked jointly. Third, they emphasized that
their analysis made ``no independent verification of the
facts,'' and that they were merely ``accepting the statements
thereof made to us by'' Marc Rich's attorneys.\369\ As Rich
prosecutor Martin Auerbach stated:
---------------------------------------------------------------------------
\364\ Petition for Pardon for Marc Rich and Pincus Green,
Memorandum in Support of Petitioners' Application for Pardon 23 (Dec.
11, 2000) (Appendix III).
\365\ Id.
\366\ Letter from Professor Martin D. Ginsburg, Professor,
Georgetown University Law Center, to the Honorable Dan Burton,
Chairman, Comm. on Govt. Reform (Feb. 12, 2001) (Exhibit 64). Ginsburg
is also of Counsel at Fried, Frank, Harris, Shriver & Jacobson. Of the
$66,199 received by his firm on the Rich matter, $43,980 reflected work
by Ginsburg personally. The remainder reflects work by other attorneys
assisting Ginsburg. Ginsburg billed his time at rates of $300 to $400
per hour. Id.
\367\ Letter from Bernard Wolfman, Professor, Harvard Law School,
to the Honorable Dan Burton, Chairman, Comm. on Govt. Reform (Feb. 8,
2001) (Exhibit 65).
\368\ Id.
\369\ Jack Quinn Document Production (Letter from Bernard Wolfman,
Professor, Harvard Law School, to Gerard E. Lynch, Criminal Division
Chief of the Office of the U.S. Attorney for the S.D.N.Y., Department
of Justice (Dec. 7, 1990)) (Exhibit 66).
The transmittal letter that came with that analysis
says it all and betrays the problem, the fundamental
flaw in the pardon application as it was applied to Mr.
Rich and Mr. Green, and that is a complete absence of a
knowledge of the facts, the true facts of this case,
---------------------------------------------------------------------------
the facts that led the companies to plead guilty.
When that analysis was sent 10 years ago, the
professors who wrote it said, . . . quote, making no
independent verification of the facts but accepting the
statements thereof made to us by Mr. Rich and Mr.
Green's lawyers.
And that is the problem. The President relied on the
facts as described to him by Mr. Rich and Mr. Green's
lawyers, making no independent investigation.\370\
---------------------------------------------------------------------------
\370\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 106
(Feb. 8, 2001) (testimony of Martin J. Auerbach, former Assistant U.S.
Attorney for the S.D.N.Y., Department of Justice).
In the end the analysis by the two professors cannot, and does
not, attempt to explain the necessity for double accounting,
phony invoices, and false reports to the Department of Energy.
Nor do the professors discuss the double accounting, phony
invoices, and false reports employed by Rich and Green to hide
their illegal profits. The only rational explanation for the
artifices employed by Rich is that he was fraudulently
attempting to hide profits from the DOE and the IRS. In the
final analysis, it is hard to avoid the conclusion that
Professors Ginsburg and Wolfman sold their names to the highest
bidder, thereby turning their backs on the accounting and legal
considerations that were necessary for a meaningful
professional opinion.
Quinn further attempted to justify the granting of a pardon
by explaining that Rich's companies reached a settlement with
the government and ``paid a total of approximately 200 million
dollars in back taxes, interest, fines and foregone tax
deductions, an amount far in excess of any taxes, penalties or
interest which might have been assessed in a civil tax
proceeding.'' \371\ Far from being a reason to grant a pardon,
this fact only proves the point that Rich and Green fled from
justice because they were caught red-handed and most likely
would have gone to prison if they stood trial in the United
States. Marc Rich + Co., A.G. and Marc Rich + Co.
International, Ltd. each pled guilty to making false statements
and evading about $48 million in taxes because the strength of
the case against them was overwhelming.\372\ Rich's companies
pled guilty to a criminal scheme to conceal ``in excess of $100
million in taxable income . . . most of which income was
illegally generated through the defendants' violations of
federal energy laws and regulations.'' \373\ Rich's companies
further admitted that they had engaged in this criminal scheme
``together with Marc Rich, Pincus Green . . . and others . . .
unlawfully, wilfully and knowingly[.]'' \374\ That Rich's
companies paid these moneys and made these admissions of guilt
squarely contradicts Quinn's claim that the indictment was
without merit.
---------------------------------------------------------------------------
\371\ Petition for Pardon for Marc Rich and Pincus Green,
Memorandum in Support of Petitioners' Application for Pardon 24-25
(Dec. 11, 2000) (Appendix III).
\372\ The case against Rich and Green individually was just as
strong as the case against the companies. As noted above, Edward
Bennett Williams offered to have Rich pay $100 million to settle the
charges against him individually. Prosecutor Sandy Weinberg told
Williams that the government would not reach any settlement that did
not result in jail time for Rich. See ``The Controversial Pardon of
International Fugitive Marc Rich,'' Hearings Before the House Comm. on
Govt. Reform, 107th Cong. 176 (Feb. 8, 2001) (testimony of Morris
``Sandy'' Weinberg, Jr., former Assistant U.S. Attorney for the
S.D.N.Y., Department of Justice). See also Evan Thomas, The Man to See:
Edward Bennett Williams 415-16 (1991).
\373\ Indictment, U.S. v. Marc Rich, Pincus Green et al. at 3-4
(Mar. 6, 1984) (S 83 Cr. 579) (Exhibit 4). See Transcript of
Allocution, U.S. v. Marc Rich + Co., A.G., Marc Rich Int'l, Ltd. et al.
at 11 (Oct. 11, 1984) (SS 83 Cr. 579) (Exhibit 5).
\374\ Indictment, U.S. v. Marc Rich, Pincus Green et al. at 3 (Mar.
6, 1984) (S 83 Cr. 579) (Exhibit 4). See Transcript of Allocution, U.S.
v. Marc Rich + Co., A.G., Marc Rich Int'l, Ltd. et al. at 11 (Oct. 11,
1984) (SS 83 Cr. 579) (Exhibit 5).
---------------------------------------------------------------------------
2. The Prosecutors Were Not ``Overzealous''
A second theme in the pardon application is that the
investigation and indictment of Rich and Green was flawed
because the prosecutors were overzealous and overly ambitious.
Quinn attacked not only Weinberg and Auerbach on this basis,
but also Rudolph Giuliani who was at the time the United States
Attorney for the Southern District of New York. As with the
claims of the flawed indictment, however, these claims were
also misleading.
a. The Prosecutors Negotiated with Rich and
Green
The pardon petition claims that the federal prosecutors
refused to negotiate with Rich and Green. Quinn repeated this
claim before the Committee, as well as in the press. However,
as is discussed in detail above, Rich and Green were fugitives.
The Southern District of New York had (and continues to have) a
longstanding policy of not negotiating with fugitives from
justice. As was explained by the SDNY in its February 2, 2000,
letter to Quinn, negotiating with fugitives ``would give
defendants an incentive to flee,'' providing them ``the
inappropriate leverage and luxury of remaining absent unless
and until the Government agrees to their terms.'' \375\ The
particular history of the office's dealings with Rich counseled
against negotiations. As is discussed in detail above, Rich had
a history of acting in bad faith during the grand jury
investigation. From refusal to obey grand jury subpoenas to
attempting to fly two steamer trunks full of subpoenaed
documents to Switzerland, Rich showed that he was not the type
of defendant with whom to negotiate.
---------------------------------------------------------------------------
\375\ Jack Quinn Document Production (Letter from Mary Jo White,
U.S. Attorney for the S.D.N.Y., Department of Justice, to Jack Quinn
and Kathleen Behan, Partner, Arnold & Porter (Feb. 2, 2000)) (Exhibit
51).
---------------------------------------------------------------------------
Yet even with such outrageous conduct, the Southern
District of New York made many good faith efforts to reach an
accommodation with Rich. During the investigation of Rich and
his companies, prosecutors undertook numerous negotiations with
Rich's lawyers, which resulted in the guilty pleas by Rich's
companies. Even after Rich fled the country, prosecutors
attempted to negotiate terms for Rich's return. In the early
1990s, U.S. Attorney Otto Obermaier and a top prosecutor in his
office took the extraordinary step of flying to Switzerland and
meeting with Marc Rich in an attempt to negotiate a resolution
to the case. Moreover, the Southern District made numerous
accommodations for Rich, including offering to drop the RICO
charges as well as allowing him and Green to stand trial
without spending any time in jail prior to trial. Despite these
efforts, Rich and Green refused to return to the United States
to stand trial. Rather, they would only return as part of a
settlement that guaranteed they would not serve jail time
unless convicted. It is therefore misleading for Quinn to
simply state that the Southern District of New York ``takes the
position that it will not even discuss the matter while Mr.
Rich and Mr. Green continue to live outside of the United
States.'' \376\ By itself, this statement fails to account for
the numerous good faith efforts of the prosecutors in spite of
their well-founded reluctance to negotiate with fugitives.
---------------------------------------------------------------------------
\376\ Petition for Pardon for Marc Rich and Pincus Green,
Memorandum in Support of Petitioners' Application for Pardon 25 (Dec.
11, 2000) (Appendix III).
---------------------------------------------------------------------------
Quinn also argued in the petition that the Southern
District had ``negotiated with numerous other absent defendants
over the years, and the Department of Justice has no such
policy against such negotiations.'' \377\ However, as the
Southern District noted in its February 2, 2000, letter to
Quinn, Department of Justice policy places the decision to
negotiate with a fugitive within the discretion of the office
responsible for the prosecution.\378\ The Southern District of
New York was well within the reasonable exercise of its
discretion to require Rich to return to the United States
before engaging in further negotiation, especially given Marc
Rich's history of bad faith behavior and brazen legal tactics.
---------------------------------------------------------------------------
\377\ Id.
\378\ Jack Quinn Document Production (Letter from Mary Jo White,
U.S. Attorney for the S.D.N.Y., Department of Justice, to Jack Quinn
and Kathleen Behan, Partner, Arnold & Porter (Feb. 2, 2000)) (Exhibit
51).
---------------------------------------------------------------------------
Finally, Quinn argued that the Southern District refused to
negotiate with his legal team by failing to agree to a meeting
between Professors Wolfman and Ginsburg and tax experts in the
Department of Justice.\379\ This, too, is misleading. As the
Southern District explained in the February 2, 2000, letter to
Quinn, ``in 1987, an Assistant in this Office met with Mr.
Rich's counsel and listened to the same presentation by
Professor Martin D. Ginsburg referenced in your letter
regarding the merits of the tax charges.'' \380\ Prosecutors
had rejected the Wolfman/Ginsburg analysis because it was based
on an inaccurate and incomplete representation of the facts of
this case. Its legal conclusions were, therefore, irrelevant.
For the Southern District to meet with the professors again
would have been redundant and fruitless.
---------------------------------------------------------------------------
\379\ Petition for Pardon for Marc Rich and Pincus Green,
Memorandum in Support of Petitioners' Application for Pardon 26 (Dec.
11, 2000) (Appendix III).
\380\ Jack Quinn Document Production (Letter from Mary Jo White,
U.S. Attorney for the S.D.N.Y., Department of Justice, to Jack Quinn
and Kathleen Behan, Partner, Arnold & Porter (Feb. 2, 2000)) (Exhibit
51).
---------------------------------------------------------------------------
b. The Rich Prosecution Was Not Tainted with
Media Attention
Quinn and the Rich legal team further tried to discredit
the prosecution by claiming that United States Attorney Rudolph
Giuliani was unfairly bringing the glare of the media to the
case. According to the pardon petition, Giuliani
``aggressively'' pursued Rich and Green in court as well as in
the press: ``Not only did Mr. Giuliani and other prosecutors
from his office speak frequently to the media in off and on
record conversations, the office held formal press conferences
where purported `evidence' against Mr. Rich and Mr. Green was
showcased to the press.'' \381\ Responding to this charge,
Mayor Giuliani said on Meet the Press,
---------------------------------------------------------------------------
\381\ Petition for Pardon for Marc Rich and Pincus Green,
Memorandum in Support of Petitioners' Application for Pardon 23 (Dec.
11, 2000) (Appendix III).
First of all, the indictment was actually just about
put together before I even became United States
Attorney. It's been pursued by at least three
Democratic appointees, who were United States attorney
and the Justice Department, that had him number six on
the fugitive list, was President Clinton's Democratic
Justice Department. And the United States attorney of
the Southern District in New York, an appointee of
President Clinton, is as outraged as I am by the pardon
that was given here. . . . You've been covering me a
long time, right, running for office? Did you ever hear
me mention Marc Rich? So this was hardly used by me in
any way in any of my political campaigns. . . . And the
fact that he was a fugitive--it was not something
[about which I would] say, ``Gee, look what a good job
I did as United States attorney.'' So that's kind of a
silly thing to [s]ay.\382\
---------------------------------------------------------------------------
\382\ Meet the Press (NBC television broadcast, Jan. 28, 2001).
Rudolph Giuliani was one of dozens of prosecutors,
Republican and Democrat, who worked on the Rich case. Robert
Litt and Gerald Lynch were prominent Democrats who were also
involved in the case. It would be strange for Quinn also to
accuse them of overcharging. Litt was one of Attorney General
Janet Reno's closest advisors, and Lynch, currently a professor
at Columbia University Law School, was appointed to the federal
bench by President Clinton. The two main prosecutors who
brought the Rich case, Morris Weinberg and Martin Auerbach,
were Democrats as well. The attempt to cast the Rich indictment
as the result of partisan prosecutorial overreaching by Rudolph
Giuliani is simply one more fabrication by Marc Rich's legal
team. This argument had no basis in reality, and likely was
invented to appeal to President Clinton's partisan instincts,
as well as his dislike for aggressive prosecutors. As many have
observed, by the end of his term, President Clinton was very
sensitive to issues of prosecutorial overreaching, as a result
of his perceptions of the Independent Counsel
investigations.\383\ Quinn exploited these sentiments
masterfully by fabricating claims regarding prosecutorial
conduct in the Rich case.
---------------------------------------------------------------------------
\383\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 341
(Feb. 8, 2001) (statement of the Honorable Henry Waxman).
---------------------------------------------------------------------------
c. RICO Charges Were Fairly Brought
The pardon application also accuses the federal prosecutors
of unfairly bringing a racketeering charge against Rich and
Green. According to Quinn, RICO was misused because the
underlying allegation involved tax fraud.\384\ The petition
points to a Department of Justice policy that was adopted in
1989, stating that, ``[f]ollowing the indictment, the United
States government recognized the misuse of RICO in tax fraud
cases and issued guidance in the United States Attorney's
Manual explicitly stating that tax offenses are not predicates
for RICO offenses.'' \385\ Jack Quinn suggested at the
Committee's February 8, 2001, hearing that the decision to
bring RICO charges against Marc Rich and Pincus Green was the
key factor that led to their flight from the United States:
---------------------------------------------------------------------------
\384\ Petition for Pardon for Marc Rich and Pincus Green,
Memorandum in Support of Petitioners' Application for Pardon 22 (Dec.
11, 2000) (Appendix III).
\385\ Id.
It's the position of my client that he remained outside
the United States because what Mr. Weinberg earlier
described to you as, in essence, a simple tax evasion
case was also made into a RICO case. And he may choose
to say it was only one count in the indictment, but it
was the sledgehammer that brought about the current
impasse.\386\
---------------------------------------------------------------------------
\386\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 161
(Feb. 8, 2001) (testimony of Jack Quinn).
Quinn's argument is flawed for a number of reasons. First,
at the time of the indictment, there was no policy against
bringing RICO charges predicated on tax offenses. To the
contrary, the RICO charges were brought consistent with Justice
Department policy and the RICO charges were reviewed and
approved by the RICO section of the Department of Justice--as
were the tax charges by the tax section.\387\ As prosecutor
Sandy Weinberg observed:
---------------------------------------------------------------------------
\387\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 187
(Feb. 8, 2001) (testimony of Morris ``Sandy'' Weinberg, Jr., former
Assistant U.S. Attorney for the S.D.N.Y., Department of Justice).
If you're away for 20 years and you're fortunate enough
to be able to persuade two foreign States not to
extradite you, the gloss of time is always going to
change the interpretation of the law. You can look at
indictments that were brought in 1980, and if you
examine them in 2000, the gloss of time is--you're
going to find that the courts interpret the laws
---------------------------------------------------------------------------
different in 2000 than they did in 1980.
But you've got to look at the guts of what the case was
about and these people. And when you look at the guts
of what the case was about and the people, it doesn't
make any difference whether or not we would bring a
RICO charge today. It is whether or not we would bring
a criminal charge today and whether or not it is
acceptable to be pardoning folks who have done things
like renouncing their citizenship, becoming fugitives,
not coming back and making these arguments that they
say are so clear. I mean it--was it justified? And you
can't come in and say, well, 20 years have passed and,
you know, the courts now interpret or the Justice
Department interprets the RICO statute
differently.\388\
---------------------------------------------------------------------------
\388\ Id. at 156.
Along similar lines, even former Clinton White House Counsel
---------------------------------------------------------------------------
Abner Mikva has stated:
Clearly, a defendant would rather negotiate the
unfairness of RICO charges from a comfortable abode in
Switzerland than from a hardback chair in the U.S.
attorney's office in Manhattan. This is especially true
when defendants have been trying, unsuccessfully, to
make the same ``unfair'' point about RICO for the last
30 years.\389\
---------------------------------------------------------------------------
\389\ Coming in from the Cold, The Recorder, Mar. 28, 2001, at 5.
Second, Quinn's argument also fails to address the non-tax
RICO predicates in the case or the fact that there are money
laundering statutes available today that were not available in
---------------------------------------------------------------------------
1980. As prosecutor Martin Auerbach observed:
I'm afraid that the argument with respect to the change
in RICO policy is as disingenuous as I find the
argument with respect to fugitivity. While it is true
that the Justice Department changed its view with
respect to tax counts as a predicate for RICO, it has
not changed its view with respect to mail and wire
fraud as a predicate to RICO. And as Mr. Quinn knows,
as the indictment reflects, there are both mail and
wire fraud counts which are predicates for RICO.
So I believe that the Justice Department might well
approve this indictment today. And I, in fact, believe
that, were they to review this indictment today, and of
course they did review it before it was brought, there
would be money laundering charges in this case.\390\
---------------------------------------------------------------------------
\390\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 156
(Feb. 8, 2001) (testimony of Martin J. Auerbach, former Assistant U.S.
Attorney for the S.D.N.Y., Department of Justice).
Therefore, it is likely that if he was charged today, Rich
would be facing stiffer, not lighter penalties.
Third, and most importantly, Quinn conveniently ignored the
fact that the prosecutors tried to reach an accommodation with
the two fugitives by offering to drop the RICO charges. As
Robert Fink himself testified to the Committee, he was in
discussions with prosecutors during which they offered to drop
the RICO charges if Rich and Green would simply stand trial in
the United States.\391\ These discussions are reflected in a
February 10, 2000, e-mail from Robert Fink to Avner Azulay:
``[a]t those times the office [Southern District of New York]
offered to do a variety of things, none of which are
necessarily still on the table. First, I was told at one point
that they would drop the RICO charge if we wanted if Marc came
in.'' \392\ Given the willingness of the SDNY to drop the RICO
charges, Quinn's claim that the RICO charge was ``the
sledgehammer that brought about the current impasse,'' is
completely inaccurate and misleading.
---------------------------------------------------------------------------
\391\ Id. at 469 (testimony of Robert Fink).
\392\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00697
(E-mail from Robert Fink to Avner Azulay, Director, Rich Foundation
(Feb. 10, 2000)) (Exhibit 32).
---------------------------------------------------------------------------
It appears that even Jack Quinn realized that the arguments
in the petition were deeply flawed. On December 29, 2000, he
sent the following e-mail to Kathleen Behan:
What do you think our chances really are for Marc? the
hardest question, i think, is ``if you're right about
the weakness of the govts case, why not go to ct and
win?'' the answr, i guess is that we couldn't have
gotten a fair trial, but that was 18 years ago.
couldn't he get one now? isn't that the way this shd
go? these are tough questions, but I guess we have
decent answers.\393\
---------------------------------------------------------------------------
\393\ Arnold & Porter Document Production KB00037 (E-mail from Jack
Quinn to Kathleen Behan, Partner, Arnold & Porter (Dec. 29, 2000))
(Exhibit 67).
It is unclear what ``decent answers'' Quinn had to that
argument or to any of the multiple arguments against the Rich
pardon.
D. The ``Letters of Support'' in the Petition
The legal arguments contained in the petition are not the
only problematic section of the Rich and Green pardon petition.
The ``letters of support'' in the petition also raise several
troubling issues. Most of the letters were collected by Avner
Azulay.\394\ Those letters were a crucial part of the pardon
petition, as they helped create the impression that Marc Rich
was a humanitarian who had made a minor mistake but who had a
positive impact on countless lives. The significance and import
of the letters presented to President Clinton was compromised
by several factors, including: (1) many of those who wrote the
letters in support of the pardon were either themselves, or
their organizations, given money by Rich; (2) many who wrote
the letters were misled about the purpose of the letter; and
(3) their letters were misrepresented to the President. Given
these facts, the letters of support in the Rich pardon petition
represent just one more dishonest ploy in Marc Rich's overall
scheme to obtain a pardon.
---------------------------------------------------------------------------
\394\ Interview with Kathleen Behan, Partner, Arnold & Porter (Feb.
27, 2001).
---------------------------------------------------------------------------
1. Rich Paid a Number of Individuals Who Wrote in His
Support
The letter written by Abraham Foxman is one of the most
prominently displayed letters in the petition. As National
Director of the Anti-Defamation League (ADL), his support of
clemency for Marc Rich was of obvious importance to the
application. However, the ADL received $100,000 from Marc Rich
shortly after Foxman became involved in the pardon effort.\395\
In fact, this money was received a few weeks after Foxman flew
to Paris to meet with Rich aide Avner Azulay.\396\ Moreover,
Rich has given the ADL a total of $250,000 since he fled the
country in 1983.\397\ Foxman has publicly denied that Rich's
contributions to the ADL had anything to do with his help in
the pardon effort. He stated to a group of reporters, ``I
really find offensive the idea that Abe Foxman was bought for a
check for $100,000. If he gave me nothing--or he gave me $10
million--I would have made the same decision, for which I now
say I made a mistake.'' \398\
---------------------------------------------------------------------------
\395\ Michael Isikoff, ``I Made a Mistake''; The ADL's Abe Foxman
Admits the Jewish Organization Received a $100,000 Grant from Marc Rich
but Maintains He Wasn't ``Bought,'' Newsweek, Mar. 23, 2001, at 2001 WL
24138340.
\396\ Id.
\397\ Id.
\398\ Id.
---------------------------------------------------------------------------
Notwithstanding Foxman's denial of a quid pro quo, the
payment to the ADL raises the general question of Marc Rich's
tactics in drumming up support for his pardon application. The
ADL was not the only organization to which Marc Rich paid money
or attempted to pay money. In another instance, Marc Rich
attempted to secure the assistance of the American Jewish
Congress (AJC) with the promise of a large contribution. A week
after Foxman's admission, Phil Baum, executive director of the
AJC revealed that his organization had been approached by a
representative of Marc Rich who told them, ``that if we were to
speak favorably of Mr. Rich, we would be the beneficiary of a
gift.'' \399\ Baum denied that there was any direct quid pro
quo.\400\ However, Baum went on to state that, ``there was an
understanding communicated to us[.]'' Baum further stated, ``It
was not a contract. But these things are communicated in more
subtle ways. We had reason to hope or expect that if we did
this thing, we could probably be the recipient of Mr. Rich's
generous recognition of our importance.'' \401\ The AJC
ultimately turned down Rich's request.\402\ Committee staff
attempted to contact Baum to corroborate this account and learn
other details of the offer from the Rich team. Unfortunately,
Baum failed to cooperate with the Committee's investigation,
refusing on three separate occasions to return phone calls from
Committee staff.
---------------------------------------------------------------------------
\399\ Beth J. Harpaz, Jewish Group Says Rich Reps Sought Pardon
Help for Money, Associated Press State and Local Wire, Mar. 28, 2001.
See also Brian Blomquist, Rich Tried to Tempt Jewish Group, N.Y. Post,
Mar. 29, 2001, at 14.
\400\ Beth J. Harpaz, Jewish Group Says Rich Reps Sought Pardon
Help for Money, Associated Press State and Local Wire, Mar. 28, 2001.
\401\ Id.
\402\ Id.
---------------------------------------------------------------------------
Another example of Rich's efforts includes Birthright
Israel, an organization that pays for young American Jews to
travel to Israel. Marc Rich has pledged $5 million to
Birthright Israel.\403\ The organization was founded by Michael
Steinhardt, a longtime friend of Rich's who was heavily
involved in the pardon effort. Steinhardt wrote a letter that
was included in the petition. In addition, Birthright Israel's
current North American Chairperson, Marlene Post, also wrote a
letter supporting Rich's request for clemency.\404\ This letter
was prominently displayed in the petition. As with the public
statements of the ADL and the AJC, a spokesman for Birthright
Israel denied any quid pro quo relating to the $5 million
pledge to the organization and the organization's support for
the Rich pardon.\405\
---------------------------------------------------------------------------
\403\ Beth J. Harpaz, Jews Divided Over Rich Pardon, Associated
Press, Mar. 29, 2001, at 2001 WL 17989287.
\404\ Letter from Marlene E. Post, North American Chairperson,
Birthright Israel, to President William J. Clinton (Dec. 7, 2000)
(Exhibit 68). The original letter was part of Rich and Green's pardon
petition.
\405\ Brian Blomquist, Rich Tried to Tempt Jewish Group, N.Y. Post,
Mar. 29, 2001, at 14.
---------------------------------------------------------------------------
Yet another person with a connection to Birthright Israel
also wrote a letter on behalf of Marc Rich. Rabbi Irving
Greenberg, Chairman of the U.S. Holocaust Memorial Museum
Council, wrote a letter on Holocaust Museum Council letterhead
in favor of clemency for Rich. Rabbi Greenberg is also
President of the Jewish Life Network, an organization that is a
partner with Birthright Israel.\406\ However, when Committee
staff asked Greenberg's lawyer about press accounts of Rich's
contributions, he stated that Rich had never given any
contributions to any organization or entity controlled or
operated by Greenberg.\407\ Greenberg's letter and Rich's
contributions to Birthright Israel caused seventeen former and
current members of the Holocaust Museum Council to send a
letter demanding Greenberg's resignation.\408\ Rabbi Greenberg
apologized for his letter on behalf of Rich, and ultimately,
the Council voted to keep him as Chairman.\409\
---------------------------------------------------------------------------
\406\ Jacqueline Trescott, Holocaust Council Head Urged to Resign,
Wash. Post, Apr. 5, 2001, at C9.
\407\ Telephone Interview with Andrew Levander, Partner, Swidler
Berlin Shereff Friedman (representing Rabbi Greenberg) (May 2, 2001).
\408\ Jacqueline Trescott, Holocaust Council Head Urged to Resign,
Wash. Post, Apr. 5, 2001, at C9. Kitty Dukakis also signed the letter.
\409\ Id.
---------------------------------------------------------------------------
There are other cases of Rich contributing or attempting to
contribute to individuals (and their organizations) who wrote
letters on his behalf. One prominent example is Jerusalem Mayor
Ehud Olmert, who wrote a letter to President Clinton on
November 27, 2000, that was included in the petition. According
to The New York Times, Rich contributed $25,000 to Olmert's
first mayoral campaign in 1993.\410\ The Committee has not been
able to determine whether Rich made financial contributions to
other foreign political officials who supported his pardon.
However, the Marc Rich team was clearly concerned about
inquiries along these lines. Shortly after the pardon was
granted, Avner Azulay sent an e-mail to others on the Rich team
stating that:
---------------------------------------------------------------------------
\410\ William A. Orme, Jr., Marc Rich Aided Israeli Official, N.Y.
Times, Feb. 22, 2001, at A21.
Pse [sic] keep barak [sic] out of the media. We have
enough names on the list other than his. Important to
keep all politicians out of the story. Pse [sic] share
with me the inclusion of any one on the list. This is
election time here and has a potential of blowup. A
newsweek reporter here has already asked if there were
any political contributions.\411\
---------------------------------------------------------------------------
\411\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00191
(E-mail from Avner Azulay, Director, Rich Foundation, to Jack Quinn et
al. (Jan. 22, 2001)) (Exhibit 69).
Some of the other letter writers have also mentioned Rich's
generosity and philanthropy as the reason for agreeing to write
their letters. For example, several of the letter writers in
Switzerland have ties to the Doron Foundation, an organization
of Rich's that gives awards of $63,000 to Swiss groups and
individuals.\412\ Zurich Mayor Josef Estermann was among that
group.\413\ Estermann did not return calls from Committee
staff. He has, however, spoken on the matter in his home
country, saying, ``I think every person has a right to a
pardon.'' \414\ To this, one Swiss paper responded, ``Yes, but
does this right have to be one you can buy?'' \415\ Others with
connections to the Doron Foundation who wrote letters on Rich's
behalf include: Pierre de Weck, of UBS Bank; Michael de
Picciotto, a director of Union Bancaire Privee in Geneva; Kurt
R. Bollinger, of the Swiss Air Rescue Foundation; and Professor
Verena Meyer of Zurich University. Michael de Picciotto spoke
with Committee staff over the phone. When asked if Marc Rich or
any of his associates had ever given anything of value to him
or his company in exchange for his letter, de Picciotto
responded, ``an important man like Mr. Rich does not need to do
anything like this.'' \416\ The others with connections to the
Doron Foundation failed to return Committee calls. Kurt
Bollinger, whose rescue service received an award from Rich's
foundation in 1992 failed to return the Committee's calls.\417\
---------------------------------------------------------------------------
\412\ Elizabeth Olson, Pardon in U.S. for Marc Rich Creates Storm
in Switzerland, N.Y. Times, Feb. 4, 2001, at 11. The Doron Foundation
has now been folded into the Marc Rich Foundation.
\413\ Id.
\414\ Id.
\415\ Id.
\416\ Telephone Interview with Michael D. de Picciotto, Managing
Director, Union Bancaire Privee, Geneva, Switzerland (Apr. 26, 2001).
\417\ Elizabeth Olson, Pardon in U.S. for Marc Rich Creates Storm
in Switzerland, N.Y. Times, Feb. 4, 2001, at 11.
---------------------------------------------------------------------------
Committee staff contacted or attempted to contact almost
all of those whose letters were included in the section of the
pardon petition entitled, ``Letters Addressed to the Honorable
President William J. Clinton Expressing Support for the Pardon
of Mr. Marc Rich.'' While the Committee does not have
sufficient evidence to conclude that all of the letters were
written on a quid pro quo basis, it cannot completely rule out
the possibility. This is largely because a number of the letter
writers and intended letter writers failed to cooperate with
the Committee by not returning phone calls. Nevertheless, there
does appear to be a pattern of receiving contributions or
pledges from Marc Rich among many of those who wrote letters.
The fact that a number of the most prominent letters of support
for the Rich pardon were tainted with allegations of linkage to
large financial contributions diminishes Rich's claims to have
been a great humanitarian. Rather, it appears that many of
Rich's humanitarian activities were just one part of a lengthy
strategy to escape criminal prosecution in the U.S.
2. Some Who Wrote Letters Were Misled About the Purpose
The significance and import of several of the letters is
further weakened by the lack of candor of the Rich team in
soliciting them. Rich's own lawyer, Robert Fink, admitted that
during the solicitation of the letters, ``[n]ot everyone was
necessarily told it was going to be for a pardon.'' \418\
Professor Verena Meyer, who serves on the board of the Doron
Foundation, stated that she did not know that her letter would
be included in a pardon petition.\419\ She thought the letters
were ``routine'' and ``assume[d] other members of the
foundation also wrote letters.'' \420\
---------------------------------------------------------------------------
\418\ Alison Leigh Cowan, Some Used in Pardon Effort Were Unaware
of Purpose, N.Y. Times, Jan. 26, 2001, at A15.
\419\ Elizabeth Olson, Pardon in U.S. for Marc Rich Creates Storm
in Switzerland, N.Y. Times, Feb. 4, 2001, at 11.
\420\ Id.
---------------------------------------------------------------------------
Several others who wrote letters on behalf of Rich felt
even more deceived. Professor Jonathan Halevy, CEO of the
Shaare Zedek Medical Center in Jerusalem, wrote a letter on
November 30, 2000, acknowledging contributions from Marc Rich's
Doron Foundation. Halevy was contacted by Avner Azulay and
asked to write a letter acknowledging the contribution.\421\
According to Halevy, Azulay told him that the letter would be
used in a ``book in honor of Mr. Rich and the foundation.''
\422\ When interviewed about his letter being used in Rich's
pardon application, Halevy stated, ``I'm obliged, if I got a
donation from someone, to confirm that I got it in writing. But
I think it would be very fair to tell me this was the
purpose.'' \423\ Anthony J. Cernera, President of Sacred Heart
University, in Fairfield, Connecticut, was similarly misled
about his letter. Cernera wrote Rich to ``express my deepest
appreciation for your on-going support for our program of
Christian-Jewish understanding.'' \424\ When the director of
public relations for the University discovered that Cernera's
letter was included in the pardon petition, he was astonished,
responding, ``Wow. So these letters were used as part of the
petition for his pardon?'' \425\
---------------------------------------------------------------------------
\421\ Alison Leigh Cowan, Some Used in Pardon Effort Were Unaware
of Purpose, N.Y. Times, Jan. 26, 2001, at A15.
\422\ Id.
\423\ Id.
\424\ Letter from Anthony J. Cernera, President, Sacred Heart
University, to Marc Rich (Nov. 27, 2000) (Exhibit 70).
\425\ Alison Leigh Cowan, Some Used in Pardon Effort Were Unaware
of Purpose, N.Y. Times, Jan. 26, 2001, at A15. In fact, when reached by
The New York Times, only one of six letter writers were aware that
their letters would be used as part of a pardon effort.
---------------------------------------------------------------------------
The fact that Avner Azulay and others on the Marc Rich team
misled individuals to obtain letters of support from them
suggests a level of dishonesty that calls into question all
representations made by the Rich pardon team. It also suggests
that a number of people affiliated with Marc Rich, many of whom
received his money, would not have written in his support if
they had known that their letter was being used to get a
pardon.
3. Many of the Letters were Misrepresented to the President
Finally, the letters included in the pardon petition are
further compromised by the way in which they were presented to
President Clinton. The second section of the petition
containing these letters was divided into two parts, one
entitled ``Letters Addressed to the Honorable President William
J. Clinton Expressing Support for the Pardon of Mr. Marc
Rich,'' and another entitled ``Letters Expressing Support for
the Pardon of Marc Rich.'' Both of these titles are misleading.
All of the twenty-one letters in the first part of this
section were addressed to President Clinton. However, several
of these letters made no mention of Marc Rich's request for a
pardon or executive clemency. Among the letters that included
no reference to the pardon issue were those written by Nobel
Laureate Camilio Jose Cela, Chief Rabbi of France; Rene-Samuel
Sirat, President of the Jewish Community of Madrid; Issac
Querub Caro; and President of the Association of Spanish
Business Enterprises Fernando Fernandez Tapias. These letters
all refer to Rich's philanthropic contributions over the years.
But none of them makes any reference to the pardon. It is
therefore misleading for such letters to be included under the
cover page indicating that all of the writers are expressing
their support for a pardon.
The cover page for the second part of this section of the
petition is even more problematic. There are fifty-two letters
included under the title ``Letters Expressing Support for the
Pardon of Mr. Marc Rich.'' Not one of these letters makes any
mention of the pardon effort. Almost all of these letters were
addressed to Marc Rich or Avner Azulay, thanking them for the
generosity of Marc Rich and his foundations. Furthermore, based
on the fact that most of these letters were written in late
November and early December of 2000, it is clear that they were
solicited by the Rich team for use in the pardon. However, as
discussed above, their use in the pardon application came as a
surprise to many of the letter writers. It stands to reason,
therefore, that most of the writers were not informed of the
purpose of the letters, let alone that they would be sent to
President Clinton in such a misleading format.
There is also disturbing evidence that a more accurate
title for these letters was considered, but not used, in the
application. Among the materials produced for the Committee was
an earlier draft of the same document, containing the same list
of names, but with a different header reading ``List of Letters
of Support for Marc Rich and Foundation.'' \426\ The existence
of this more accurate title makes it much less likely that the
use of the inaccurate and misleading title was a mere oversight
by the Rich team. Lawyers billing many hundreds of dollars an
hour certainly should not make such errors, and circumstantial
evidence makes it appear that they were simply trying to
mislead. Given the rejection of an accurate title, and the fact
that it was replaced with an inaccurate title, there can be no
other reasonable conclusion. Moreover, when the Committee
confronted Jack Quinn about the misleading cover page that was
included in the pardon petition, he stated:
---------------------------------------------------------------------------
\426\ Compare Jack Quinn Document Production (Document entitled
``List of Letters of Support for Marc Rich and Foundation'') (Exhibit
71), with Petition for Pardon for Marc Rich and Pincus Green, Document
entitled ``Letters Expressing Support for the Pardon of Mr. Marc Rich''
(Dec. 11, 2000) (Exhibit 72).
I don't know who made that change. And I accept
responsibility for anything filed in my name. I will
tell you that, for the most part, I was not involved in
the effort to gather these letters. I became aware
after the petition had been filed that some of these
letters were simply sought as testimonials to his
charitable activities and that some of the people from
whom they were sought were not told in advance that
these letters were going to be used from a pardon
application. I very much regret that. And to the extent
that, as a result, any of that was misunderstood or was
misleading, I certainly apologize for it.\427\
---------------------------------------------------------------------------
\427\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 172
(Feb. 8, 2001) (testimony of Jack Quinn).
The deceptive tactics used by the Rich team in securing and
presenting so many of the letters sent to President Clinton in
the pardon application are disturbing. The Committee is also
troubled by the fact that the Clinton Administration failed to
take the time to review these letters and the misleading way in
which they were presented. However, in the context of the rush
to grant last-minute pardons, and all of the unfortunate
decisions made during the pardon process, the dishonest use of
these letters is not surprising. The misleading presentation of
the letters is consistent with the misleading legal arguments
that form the basis of the Rich and Green pardon petition.
IV. LOBBYING FOR THE MARC RICH PARDON
A. The Marc Rich Lobbying Team
Marc Rich employed much more than Jack Quinn and a
deceptive petition to obtain his Presidential pardon. Just as
important to the pardon effort was a carefully orchestrated
lobbying campaign that used a number of individuals with unique
access to the Clinton White House. Rich employed private
attorneys with personal relationships with White House staff,
personal friends of the President, and foreign leaders to press
his case with the White House. The key players in the lobbying
effort included Denise Rich, Beth Dozoretz, Israeli Prime
Minister Ehud Barak, as well as other Israeli leaders, King
Juan Carlos of Spain, Michael Steinhardt, Peter Kadzik, and a
number of other individuals, all working for the same goal, the
pardon of Marc Rich and Pincus Green.
1. Denise Rich
Denise Rich was in many ways the key figure in the effort
to obtain a pardon for Marc Rich. She enjoyed a close
relationship with President Clinton, which gave the Rich team
the access they needed to make their case directly to the
President. She used this access as much as she could, sending
two letters to the President, and making her case to him
personally on at least three occasions. Denise Rich's
involvement in the pardon effort has raised three serious
questions: (1) why did Denise Rich agree to help Marc Rich; (2)
what were the nature of her communications with President
Clinton; and (3) did she in any way connect the pardon of Marc
Rich to contributions she had made or would make to the DNC or
Clinton Library? The Committee has not been able to find
definitive answers to these critical questions, largely because
Denise Rich has invoked her Fifth Amendment rights against
self-incrimination rather than cooperate with the Committee. To
attempt to understand Denise Rich's role in helping to obtain
Marc Rich's pardon, the Committee has considered documents
about the pardon effort, testimony provided by other
individuals, and even Denise Rich's self-serving media
appearances.
a. Denise Rich's Relationship with Marc Rich
Denise Rich was wealthy before she married Marc Rich. She
was the daughter of Emil Eisenberg, who founded Desco
Incorporated, one of the largest shoe manufacturers in the
United States. In 1966, at the age of 22, Denise married Marc
Rich, whom she had met six months earlier. Denise Rich was
married to Marc Rich for the next 25 years, having three
children. In 1983, when Marc Rich was indicted and fled the
country, Denise and her children left the United States with
Marc Rich. Despite the fact that she accompanied her husband
into exile, and remained with him there for the next eight
years, Denise Rich claims to have been ignorant of the reasons
for Rich's indictment and flight:
Question. In 1980, were you aware that your husband was
reportedly trading with Iran after we had an embargo
because of the hostages?
Denise Rich. I really didn't know much about that at
all because I was so involved in my life. It's not like
he would come home and he would say, ``Hey, I'm trading
with the enemy.'' We didn't talk about it.
* * *
Question. How did you find out [about the indictment]
and what was your reaction?
Denise Rich. All I really knew was that he spoke to me
and he said that ``I'm having tax problems with the
government. And--and I think that we are going to have
to leave.'' And my response was, ``I am his wife. These
are my children. I'm not going to split up the
family.'' And, so, I did what I think any wife would
do. I left the country.
Question. Did you understand that by fleeing to
Switzerland and refusing to return to this country,
that your husband was considered one of the 10 most
wanted fugitives in America?
Denise Rich. That had nothing to do with me because I
was . . .
Question. Yes. It's your husband, Denise. It's the
father of your children.
Denise Rich. Yes, he's the father of my children . . .
Question. He's a fugitive.
Denise Rich. . . . and he was my husband, but as far as
I knew, it was a tax situation. So I really never
understood anything else. And I really didn't--that's
all that I knew.\428\
---------------------------------------------------------------------------
\428\ 20/20 (ABC television broadcast, Apr. 27, 2001).
While living in exile, Denise began her musical career,
becoming a successful songwriter. In approximately 1990, Denise
discovered that Marc Rich had taken up with a younger woman,
model Gisela Rossi. In 1991, Denise divorced Marc Rich. In the
ensuing legal battle, she received a substantial sum of money,
which has never been disclosed by Marc Rich, Denise Rich, or
their representatives, but is believed to be in the vicinity of
$500 million.\429\ As a result of the divorce, Denise and Marc
Rich were reportedly on very poor terms, rarely speaking.
---------------------------------------------------------------------------
\429\ Some estimates list the amount as high as $900 million. See
Debunking the Buzz Over Denise, N.Y. Post, Feb. 1, 2001, at 10.
---------------------------------------------------------------------------
In 1996, however, the Richs' daughter Gabrielle died of AML
leukemia. Denise Rich has often pointed to Gabrielle's death as
an important factor in her change of heart regarding her ex-
husband. First, she has claimed that Marc Rich was ``cruelly
denied the opportunity'' \430\ to return to the U.S. to visit
her. She has also claimed that the death of Gabrielle caused
her to forgive her ex-husband for his transgressions:
---------------------------------------------------------------------------
\430\ Jack Quinn Document Production (Letter from Denise Rich to
President William J. Clinton (Dec. 6, 2000)) (Exhibit 73).
Question. Here is what a lot of people don't
understand. How do you go from almost hating your
husband at the time of the divorce to writing a letter
pleading for his clemency and his pardon? What changed
---------------------------------------------------------------------------
in your mind?
Denise Rich. My daughter died. And when you've lost a
child, there's nothing more you can say. There are no
more questions. When you've lost a child, everything
changes, and I felt--I felt in my heart
forgiveness.\431\
---------------------------------------------------------------------------
\431\ 20/20 (ABC television broadcast, Apr. 27, 2001).
This explanation, however, fails to address one fundamental
issue: should Marc Rich have decided to spend time with his
daughter, he could easily have done so. Rather, he placed his
legal jeopardy ahead of his concerns for his family and elected
to refrain from visiting her. Years later, it appears that he
and his ex-wife would cynically use the death of his daughter
to gain sympathy for his earlier transgressions.
b. Denise Rich's Relationship with President
Clinton
After her divorce from Marc Rich, Denise Rich returned to
New York, where she purchased what is reportedly the largest
penthouse on Fifth Avenue, a 28-room triplex filled with works
of art by Picasso, Miro, Dali, Calder, Warhol, and Chagall, as
well as a staff of 20 to serve her needs, including two cooks,
a stylist, and a ``personal healer.'' \432\ Shortly after
arriving in New York, Denise Rich sought to establish herself
as a leading figure in New York social circles. Geraldo Rivera,
a close friend of Denise Rich, observed that ``[t]he people who
think she wants to be a kind of Pamela Harriman person are not
off the mark. . . . She wanted a salon, she wanted a Gertrude
Stein, Paris kind of scene, she wanted to watch the parade of
contemporary popular cultural life march through her living
room.'' \433\
---------------------------------------------------------------------------
\432\ Lloyd Grove, The Reliable Source, Wash. Post, Apr. 27, 2001,
at C3.
\433\ Elisabeth Bumiller, Tossed Into a Tempest Over a Pardon;
Friends See Naivete, Critics a Payoff in a Clinton Fund-Raiser's Acts,
N.Y. Times, Feb. 2, 2001, at B1.
---------------------------------------------------------------------------
An important part of becoming a ``kind of Pamela Harriman''
was to get involved in political fundraising. Denise Rich began
making large political contributions and holding lavish
fundraisers shortly after her return to the United States.
Denise Rich and her daughters gave over $1.1 million to federal
political causes between 1993 and 2000, all but $5,000 of that
to Democrats. Denise Rich's political contributions increased
as the end of the Clinton Administration neared, with over
$625,000 of her contributions coming between 1998 and 2000.
While she was giving and raising vast amounts of money for
the Democratic Party, Denise Rich developed a close
relationship with President Clinton:
When I met him there was so much charisma, and I saw a
lot of idealism, and eventually I had a very special
relationship with the former President and the former
First Lady because they were so compassionate to me
when I lost my daughter. And it--and it was as if he
understood and . . . could put himself in my
shoes.\434\
---------------------------------------------------------------------------
\434\ 20/20 (ABC television broadcast, Apr. 27, 2001).
This special personal relationship was also manifested in
Denise Rich's political fundraising, where she became one of
the Democratic Party's largest and most reliable fundraisers.
In fact, Denise Rich held the fundraiser that was President
Clinton's first public appearance after the publication of the
Independent Counsel's referral in 1998. It raised nearly $3
million.\435\
---------------------------------------------------------------------------
\435\ Elisabeth Bumiller, Tossed Into a Tempest Over a Pardon;
Friends See Naivete, Critics a Payoff in a Clinton Fund-Raiser's Acts,
N.Y. Times, Feb. 2, 2001, at B1.
---------------------------------------------------------------------------
Denise Rich's special relationship with President Clinton
was also manifested in her large contributions to the William
J. Clinton Presidential Foundation, the charitable foundation
responsible for building the Clinton Library. Between 1998 and
2000, Denise Rich gave $450,000 to the Clinton Library.\436\
Among these contributions was a $250,000 gift in July 1998,
which was one of the earliest large contributions to the
Library, made during one of the darkest times in the Clinton
presidency.\437\ Because she and her friend Beth Dozoretz have
used the Fifth Amendment to avoid answering the Committee's
questions, little is known about Denise Rich's motivations for
contributing to the Clinton Library. However, one document
suggests that Denise Rich was seeking ``help'' from Dozoretz.
On a note accompanying her $100,000 library contribution,
Denise Rich wrote, ``Dear Beth, Thanks for your help, Lots of
love, Denise.'' \438\ However, since both Rich and Dozoretz
have refused to testify on grounds that their testimony would
incriminate them, the Committee has not been able to develop an
understanding of this note.
---------------------------------------------------------------------------
\436\ See William J. Clinton Presidential Foundation Document
Production WJCPF 0002 (Check from Denise Rich to the Clinton Library
for $250,000 (July 15, 1998)); William J. Clinton Presidential
Foundation Document Production WJCPF 0008 (Check from Denise Rich to
the Clinton Library for $100,000 (Aug. 7, 1999)); William J. Clinton
Presidential Foundation Document Production WJCPF 0031 (Check from
Denise Rich to the Clinton Library for $100,000 (May 11, 2000))
(Exhibit 74).
\437\ Id.
\438\ William J. Clinton Presidential Foundation Document
Production WJCPF 0037 (Note from Denise Rich to Beth Dozoretz, former
finance chair, Democratic National Committee) (Exhibit 75).
---------------------------------------------------------------------------
As Denise Rich helped President Clinton with his charity,
he helped Denise Rich with hers. In 1998 and 2000, President
Clinton attended fundraising galas for the G&P Charitable
Foundation, which Denise Rich established to raise funds for
cancer research.
c. Denise Rich's Role in the Marc Rich Pardon
Effort
Little is known about when Denise Rich decided to assist
the Marc Rich pardon effort, or who asked her to help.\439\
Avner Azulay has stated that he personally convinced her to
write in support of the pardon, telling her that ``everyone in
the world is supporting this and you can't just stand aside,
it's embarrassing.'' \440\ The first documentary evidence of
her support for the effort to resolve Marc Rich's criminal case
appears in the March 2000 e-mail discussing sending her on a
``personal mission'' to President Clinton.\441\ The first
specific references to her role in the late 2000 pardon effort
come in November 2000, in a meeting agenda prepared by attorney
Robert Fink. The agenda for that meeting, which included Jack
Quinn, includes an item ``Maximizing use of D.R. and her
friends.'' \442\ It appears that the first conversation between
Denise Rich and the pardon team took place on December 4, 2000,
when she spoke to Robert Fink.\443\
---------------------------------------------------------------------------
\439\ There are reports that Denise Rich may have also assisted the
effort to obtain a pardon for ex-boyfriend Niels Lauersen, a prominent
New York gynecologist who was convicted of fraudulent billing
practices. According to one account, though, Rich was approached to
help with Lauersen's pardon effort, and was willing to help, until she
was ``reminded that she might be spreading herself thin.'' See James
Barron with Alison Cowan and Shaila Dewan, A Second Pardon Front, N.Y.
Times, May 15, 2001, at B2.
\440\ Rich's Israeli Aide: The Pardon Surprised Us. So Did the
Furor, Forward, (Feb. 23, 2001), at 1.
\441\ There is some circumstantial evidence of reconciliation
between Denise Rich and Marc Rich somewhat earlier, at least in
November 1999, when Denise Rich and her daughter Danielle traveled to
Israel to attend the dedication of the Gabrielle Rich wing of the Tel
Aviv Museum of Art, which was funded by Marc Rich. A photograph of that
event shows Denise and Danielle Rich posing with one of Marc Rich's
closest aides, Avner Azulay.
\442\ Arnold & Porter Document Production A0567-69 (Agenda of Nov.
21, 2000, Meeting) (Exhibit 76).
\443\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00021
(Billing Records for Marc Rich, Dec. 19, 2000) (Exhibit 77).
---------------------------------------------------------------------------
The Rich legal team did maximize use of Denise Rich. They
started with a December 6, 2000, letter from Denise Rich to the
President. This letter was in many ways, the centerpiece of the
pardon petition. While it appears to have been a heartfelt
plea, in reality, it was drafted by Marc Rich's lawyers. The
letter combines inaccurate charges about the indictment with
emotional pleas about Rich's ``exile:''
I support his application with all my heart. 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.
* * *
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 U.S. Attorney, we felt he had
no choice but to remain out of the country.
Let no one think exile for life is a light burden. The
world we cared about was cut off from us. When our
daughter was dying from leukemia, Marc was cruelly
denied the opportunity to see her by the prosecutors.
What was this exile for? The charges all relate to old
energy regulations, where all of the other people and
companies involved in the same kinds of transactions
were never charged with a crime. Only my husband was
treated differently.\444\
---------------------------------------------------------------------------
\444\ Jack Quinn Document Production (Letter from Denise Rich to
President William J. Clinton (Dec. 6, 2000)) (Exhibit 73).
This letter was placed prominently at the front of the stack of
testimonials in the Marc Rich pardon petition, and it was
quoted extensively in the petition itself. Of course, the
arguments in the letter were completely inaccurate.
After including the letter in the pardon petition, Denise
Rich took a number of other actions to lobby for the pardon.
Another letter from her to President Clinton was prepared by
Marc Rich's lawyers on December 20, 2000. This letter was
discussed among the Marc Rich legal team, with Robert Fink
suggesting the following text: ``Because I could not bear it
were I to learn that you did not see my letter and at least
understand my special person[al] reasons for being a supporter
of a pardon, I am sending you an additional copy, and an
additional request that you wisely use your power to pardon
Marc.'' \445\ Jack Quinn thought that this language was
``perfect,'' \446\ and suggested that Denise Rich should ``hand
it to him [the President] in [a] sealed envelope and mention
that she is aware I intend to discuss the matter with him
personally. She shd simply ask him to read it later and let him
know how strongly we feel that we have the merits on our
side.'' \447\ After Marc Rich's lawyers had finalized the text
of the letter, it was presented to Denise Rich for her
signature. Denise Rich did see the President on December 20,
2000, at a White House Christmas party. According to one
witness at the party, Rich wrested the President away from
Barbra Streisand to press her case about the pardon.\448\
---------------------------------------------------------------------------
\445\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00068
(E-mail from Robert Fink to Kathleen Behan, Partner, Arnold & Porter et
al. (Dec. 19, 2000)) (Exhibit 78).
\446\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00069
(E-mail from Jack Quinn to Robert Fink et al. (Dec. 19, 2000)) (Exhibit
79).
\447\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00397
(E-mail from Jack Quinn to Robert Fink et al. (Dec. 19, 2000)) (Exhibit
80).
\448\ Alison Leigh Cowan, Documents Show a Complex Campaign to Win
a Pardon, N.Y. Times, Feb. 10, 2001, at A11.
---------------------------------------------------------------------------
Little is known about how many other contacts Denise Rich
might have had with President Clinton during the final month of
the Clinton Administration. There is evidence that she had at
least one, and maybe more, telephone calls with the President
about the pardon. E-mails between Jack Quinn and Robert Fink on
January 16, 2001, indicate that they wanted Denise Rich to make
``another call,'' indicating there had been other calls before
this one. First, Quinn wrote that:
I am advised that it would be useful if she [Denise]
made another call to P. I am in a fannie mae bd mtg,
but would like to set this in motion asap. Message shd
be simple: ``I'm not calling to argue the merits. Jack
has done that, and we believe a pardon is defensible
and justified. I'm calling to impress upon you that MR
and our whole family has paid a dear price over 18 yrs
for a prosecution that shd never have been brought and
that singled out MR while letting the oil companies he
dealt with go scot free. Please know how important this
is to me personally.'' can you or avner call her this
morning? \449\
---------------------------------------------------------------------------
\449\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00167
(E-mail from Jack Quinn to Robert Fink et al. (Jan. 16, 2000)) (Exhibit
81).
---------------------------------------------------------------------------
Fink responded:
I called at 10:30 AM and she is still asleep (she was
at her Dad's yesterday and it was a very full day) but
I left a message that I had to talk to her before a
noon meeting. I expect I will hear from her and I will
give her the message.\450\
---------------------------------------------------------------------------
\450\ Id.
In the absence of cooperation from Denise Rich, however, it
is impossible to know exactly how many contacts Rich had with
President Clinton, and what those contacts were about. An e-
mail from Jack Quinn to Robert Fink's assistant shortly after
the pardon raises interesting questions. This document was
withheld from the Committee for over a year, and was produced
only after a decision from a federal district court judge
requiring it to be turned over to a grand jury. Quinn wrote the
following in response to an e-mail titled ``One of the
---------------------------------------------------------------------------
Reporters' Requests:''
Shd def confirm it didn't. Is this the moment to say
that he asked DR for pol support? Or might DR have said
something stupid like that when they spoke. God knows,
I hope not.\451\
---------------------------------------------------------------------------
\451\ Jack Quinn Document Production JQ 02958 (E-mail from Jack
Quinn to Rosemary Micciulli, Quinn Gillespie & Associates (Jan. 24,
2001)) (Exhibit 82).
The Committee requested an interview with Jack Quinn after it
received this e-mail, but he refused. Without further
illumination from Quinn, this e-mail's meaning is not clear.
One interpretation suggests that a reporter may have called
asking whether the President asked Denise Rich for ``political
support,'' perhaps in the context of their discussions about
the Rich pardon. It also suggests that Quinn was fearful that
Denise Rich might have said something like this to the press.
Quinn's question ``is this the moment to say that he asked DR
for pol support,'' raises a real question as to whether
President Clinton asked Denise Rich for ``political support''
in the midst of their discussions about the Rich pardon. While
Quinn has refused to answer questions from the Committee about
this e-mail, his spokesman has informed the press that the
``he'' in the e-mail refers to former New York Mayor Rudy
Giuliani, not President Clinton.\452\ While Quinn's explanation
is possible, it is troubling that Quinn has refused to provide
this explanation to the Committee himself. Absent further
information from Quinn, Denise Rich, or President Clinton, the
Committee can only speculate as to the meaning of this e-mail.
---------------------------------------------------------------------------
\452\ Michael Isikoff, Secret E-Mail, Newsweek (Mar. 10, 2002).
---------------------------------------------------------------------------
It is clear that Denise Rich had frequent opportunities to
press the pardon case with President Clinton. Rich was
scheduled to visit the White House 19 times during the Clinton
presidency, with six of those visits scheduled between May 2000
and January 2001.\453\ In addition, Rich also called the White
House on several occasions near the end of the Clinton
Administration.\454\ However, without cooperation from Denise
Rich or President Clinton, the Committee is unable to know what
was discussed during those telephone calls or how many of those
scheduled White House visits actually occurred.
---------------------------------------------------------------------------
\453\ National Archives and Records Administration Document
Production (WAVES records (1994-2000)).
\454\ See, e.g., Verizon Document Production (Telephone calls from
Denise Rich to the White House (Dec. 9, 1999)); Qwest Document
Production (Telephone call from Denise Rich to the White House (Feb.
16, 2000)).
---------------------------------------------------------------------------
d. Denise Rich's Motives
Denise Rich's involvement in the Marc Rich pardon effort
raises a number of serious questions: (1) why did Denise Rich
agree to help Marc Rich; (2) did Denise Rich's extremely large
political contributions play any role in the President's
decision to grant the pardon of Marc Rich; (3) were additional
large contributions envisioned or hoped for; (4) what did the
President and Denise Rich discuss; and (5) was Denise Rich
making her political contributions with her own money? Due to
Denise Rich's decision to invoke her Fifth Amendment rights
against self-incrimination, the Committee is not able to answer
any of these questions definitively. However, there are a
number of factors suggesting that Denise Rich's involvement in
the Marc Rich pardon case is far more complicated than she has
suggested.
First, Denise Rich's explanation for why she helped Marc
Rich obtain the pardon does not withstand full scrutiny. Denise
Rich has stated that she helped him because, after her daughter
died, she forgave Marc Rich for his transgressions. She also
claimed that she helped get the pardon so that her daughters
could be with their father again. However, the Committee is
unaware of Rich returning to the United States since he has
obtained the pardon. Moreover, during Marc Rich's self-imposed
``exile,'' his daughters were free to visit him in Europe and
Israel, as they often did. Since Denise Rich's explanations do
not fully explain her involvement, it is fair to consider other
possible motivations. One comes from the fact that Rich
promised to give $1 million a year to the G&P Charitable
Foundation, at the precise time that he was trying to get
Denise Rich to help with the pardon effort.\455\ This sum would
have represented a major influx of cash for the G&P Foundation,
which raised $2.4 million in 1998 and only $978,000 in
1999.\456\ Second, the Committee has attempted to examine
whether Denise Rich and her daughters continue to receive
financial support from Marc Rich, or would receive enhanced
financial support in the future, other factors which could have
influenced their decision to support his pardon. While Denise
Rich's bank records do not indicate any influx of money from
Marc Rich, at least one document received by the Committee
suggests that Rich might have established a Swiss bank account
for his daughter Ilona. In a December 4, 2000, letter from
Robert Fink to Ilona Rich, Fink wrote ``here are some banking
papers to set up the account with UBS for you that need your
signature. Please execute where indicated and also return these
to me so I can send them back to Switzerland.'' \457\ While
this reference is certainly capable of multiple
interpretations, it at least raises the possibility that Marc
Rich was providing untraceable funds to his family through
Swiss bank accounts. This could provide another explanation for
their support for the pardon.
---------------------------------------------------------------------------
\455\ Alison Leigh Cowan, Rich Pardon Reportedly Followed Pledge to
Charity of Former Wife, N.Y. Times, May 1, 2001, at A1. $500,000 of
this sum would have been given by Marc Rich and the other $500,000
would have been given by Pincus Green.
\456\ See Department of the Treasury Form 990-PF, G&P Charitable
Foundation, 1998; Department of Treasury Form 990-PF, G&P Charitable
Foundation, 1999 (Exhibit 83). A copy of G&P's tax return for the year
2000 was unavailable because the Foundation may have received a filing
deadline extension.
\457\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00259
(Letter from Robert Fink to Ilona Rich (Dec. 4, 2000)) (Exhibit 84).
---------------------------------------------------------------------------
Similarly, the Committee is unable to reach any firm
conclusions regarding the nature of Denise Rich's
communications with the President, and specifically whether
Denise Rich's political contributions and contributions to the
Clinton Library played any role in the pardon. Absent true
cooperation from Denise Rich or President Clinton, there is no
way of knowing what they discussed, or what they were thinking
about the Marc Rich pardon. However, there are a number of
pieces of circumstantial evidence that raise the indelible
appearance of impropriety in this case, which Denise Rich and
President Clinton have done nothing to refute. First, Denise
Rich made $1.1 million in political contributions to Democrats,
including the Clintons, and the contributions increased
dramatically toward the end of the Clinton Administration.
Denise Rich also made $450,000 in contributions to the Clinton
Library, including one of the earliest large contributions to
the Library. Although this sum has been downplayed, it was in
fact an appreciable percentage of cash actually advanced to the
Library. Given the difficulties generally experienced raising
money after a President leaves office, the individuals who are
prepared to give large sums--particularly after there are no
more elections to finance--assume a particular importance.
Second, Denise Rich used the relationship she had with the
President, which was built in large part of political
contributions, to lobby the President to grant the pardon.
Third, Denise Rich and Beth Dozoretz, the two people who were
privy to the reasons for Denise Rich's political contributions
and her discussions with the President regarding the pardon,
were so concerned about their potential criminal exposure that
they invoked their Fifth Amendment rights. Were there a benign
explanation to the events prior to the pardon, there is little
conceivable reason to have invoked the Fifth Amendment. Fourth,
the President, Denise Rich, and Beth Dozoretz have offered the
weakest of justifications for their actions in the Marc Rich
pardon matter. Given these facts, there is an unmistakable
appearance of impropriety.
The Committee had the opportunity to grant Denise Rich
immunity against prosecution so that it could receive compelled
testimony from her, but decided not to proceed with a grant of
immunity for several reasons. First, there was no evidence that
Denise Rich intended to cooperate with the Committee. After the
Committee received notice that the Justice Department had no
objection to a grant of immunity, Committee staff contacted
counsel for Mrs. Rich, to determine whether they would offer
the Committee a proffer before the immunity vote. By receiving
a proffer, the Committee hoped to receive an understanding of
what Mrs. Rich would testify to if she received immunity.
Counsel for Mrs. Rich were unwilling to provide a proffer. By
refusing to provide a proffer, counsel for Mrs. Rich made it
clear that they had no intent of cooperating with the
Committee's investigation, and would make obtaining information
from Denise Rich as difficult as possible.
Another factor that played a role in the Committee's
decision not to grant immunity to Denise Rich were Mrs. Rich's
own public statements about her role in the investigation. When
Mrs. Rich appeared on the television program 20/20, to the
extent she made any statements addressing her role in the
pardon, her statements were difficult to believe. This
appearance raised real questions as to whether Denise Rich
intended to provide honest and complete testimony to the
Committee, even if she were immunized.
2. Beth Dozoretz
Together with Denise Rich and Jack Quinn, Beth Dozoretz
served a key role in lobbying for the pardon of Marc Rich. Like
Denise Rich, Dozoretz enjoyed a close personal relationship
with President Clinton that was a mixture of friendship and
extremely significant political fundraising. Like Denise Rich,
Dozoretz took advantage of this close relationship to press
President Clinton about the Rich pardon. Also, much like her
friend Denise Rich, Beth Dozoretz has invoked her Fifth
Amendment rights rather than testify before the Committee.
a. Beth Dozoretz's Relationship with Bill
Clinton
In 1992, Beth Dozoretz attended the Democratic Convention
in New York City at the urging of her husband, Ron Dozoretz.
Until that point, Dozoretz had never been significantly
involved in political events of any type. But at the Democratic
convention, Dozoretz had an epiphany of sorts, as Hillary
Clinton passed by:
On her way to the podium she had to walk by where I was
sitting. . . . She was looking around, smiling, and I
flattered myself to think that our eyes met. And I
blurted something out like, ``I just think you're
fabulous!'' And I felt like she looked at me and said,
``Thank you!'' with her big, beautiful smile.\458\
---------------------------------------------------------------------------
\458\ Lloyd Grove, The A-List's No. 1 Political Partiers; How Beth
and Ron Dozoretz Made Washington Their Very Own, Wash. Post, Apr. 1,
1999, at C1.
Beginning with the 1992 convention, Beth Dozoretz began to be
deeply involved in Democratic politics. She and her husband
moved to Washington from Norfolk, Virginia, in 1993. First at
an apartment in Georgetown and then at an estate in Northwest
Washington, the Dozoretzes began to host high-profile
fundraising events. Through these events, the Dozoretzes had
frequent contact with the Clintons, and struck up a warm
relationship with both the President and First Lady. During the
course of the Clinton presidency, the Dozoretzes were close to
the Clintons, vacationing with them, and playing golf with
them.\459\ Like Denise Rich, Beth Dozoretz remained close to
the President throughout the Monica Lewinsky scandal. In
November 1998, the Dozoretzes asked the President to serve as
godfather to their infant daughter.\460\
---------------------------------------------------------------------------
\459\ Id. The Dozoretzes had their critics, some of whom suggested
that their friendship with the Clintons was the result of a deliberate
plan:
---------------------------------------------------------------------------
GStarting from the very beginning, they were having
dinners and soirees at their apartment in Washington
Harbour. . . . The whole program was geared to rising to
the top. She had a staff from the very first day. I mean,
how many housewives have staffs? She played golf with the
president, and she took golf lessons so she could play with
him. Her husband obviously is very, very wealthy, and this
is something they set out to accomplish. And obviously they
have.
Id.
---------------------------------------------------------------------------
\460\ Id. President Clinton agreed, and he and Hillary Clinton
attended a high-profile christening at the Dozoretz estate. The star-
studded attendance list for the event also included Jack Quinn. Annie
Groer and Ann Gerhart, The Reliable Source, Wash. Post, Nov. 12, 1998,
at C3.
---------------------------------------------------------------------------
In addition to the close personal relationship she
maintained with President Clinton, Beth Dozoretz also developed
a fundraising relationship with the President. In 1994,
Dozoretz served as co-Chairman of the DNC's large contributor
program. By 1999, Dozoretz had raised $5 million for various
Democratic causes.\461\ As a result, in early 1999 Dozoretz was
appointed, with the President's personal blessing, as Finance
Chairman of the DNC, the chief fundraiser for the Democratic
Party. Dozoretz resigned her post in September 1999, to allow
new DNC Chairman Ed Rendell to appoint his own Finance
Chairman. However, even after she left her position as Finance
Chairman, Dozoretz continued to raise funds for the Democratic
Party, and maintain a warm relationship with President Clinton.
---------------------------------------------------------------------------
\461\ It was through her fundraising work for the DNC that Beth
Dozoretz became enmeshed in her first White House scandal. In September
1997, Dozoretz testified before the Senate Committee on Governmental
Affairs regarding a controversial White House fundraising coffee
attended by John Huang and Pauline Kanchanalak. Two witnesses at the
coffee testified that Huang made an illegal appeal for political
contributions at the White House coffee. Dozoretz, who was also
attending the coffee with a prospective donor, denied that Huang made
the remarks. See ``Investigation into Fundraising Activities During the
1996 Elections,'' Hearings Before the Senate Governmental Affairs
Special Investigations Comm., 105th Cong. (Sept. 16, 1997).
---------------------------------------------------------------------------
In addition to raising funds for the DNC, Beth Dozoretz
raised money for President Clinton's personal causes. For
example, she raised money for the President's legal defense
fund. She also raised money for the Clinton Library. Dozoretz
solicited Denise Rich for her first contribution to the Clinton
Library, a $250,000 contribution made in July 1998.\462\
Apparently, Rich gave the check to Dozoretz, who sent it on to
the lawyers for the Library.\463\ In connection with this, or
one of Denise Rich's other contributions to the Clinton
Library, Rich drafted a note to Dozoretz reading ``Dear Beth,
Thanks for your help, Lots of love, Denise.'' \464\ Apparently,
Denise Rich was a person specifically targeted by Dozoretz to
solicit for the Clinton Library. Dozoretz gave Peter O'Keefe,
the chief fundraiser for the Clinton Library, a list of
individuals Dozoretz intended to solicit, and Denise Rich was
listed on this document.\465\ In addition to the substantial
sums she raised from Denise Rich, on May 23, 2000, Beth
Dozoretz pledged to raise $1 million for the Clinton
Library.\466\
---------------------------------------------------------------------------
\462\ William J. Clinton Presidential Foundation Document
Production WJCPF 0002 (Check from Denise Rich to the William J. Clinton
Presidential Foundation Library for $250,000 (July 15, 1998)) (Exhibit
74).
\463\ William J. Clinton Presidential Foundation Document
Production WJCPF 0004 (Letter from Janine Werkman, Chief of Staff for
Beth Dozoretz, to Nicole Seligman (July 17, 1998)) (Exhibit 85).
\464\ William J. Clinton Presidential Foundation Document
Production WJCPF 0037 (Note from Denise Rich to Beth Dozoretz, former
finance chair, Democratic National Committee) (Exhibit 75).
\465\ William J. Clinton Presidential Foundation Document
Production WJCPF 0048 (List of Potential Contributors to William J.
Clinton Presidential Foundation) (Exhibit 86); Interview with Peter
O'Keefe, Fundraiser, William J. Clinton Presidential Foundation (Apr.
12, 2001).
\466\ This information was provided to the Committee in a briefing
by David Kendall and Nicole Seligman, counsel for the Clinton
Foundation. See also William J. Clinton Presidential Foundation
Document Production WJCPF 0024 (Letter from Skip Rutherford, President,
William J. Clinton Presidential Foundation, to Beth Dozoretz, former
finance chair, Democratic National Committee (Jan. 4, 2000)) (Exhibit
87).
---------------------------------------------------------------------------
b. Beth Dozoretz's Involvement in the Marc Rich
Pardon Campaign
Around Thanksgiving of 2000, Jack Quinn informed Beth
Dozoretz that he would be filing a pardon petition on behalf of
Marc Rich. Quinn was close friends with Dozoretz, and also knew
that she was close to Denise Rich. Quinn testified that he
``encouraged her to help me be sure that the President himself
was aware of the fact that the application had been filed with
the White House Counsel's office.'' \467\ According to Quinn,
Dozoretz did talk to the President, who told her that Quinn
should make his case to Bruce Lindsey and the other staff in
the White House Counsel's office.\468\ Quinn described his
motivation for involving Dozoretz at the Committee's March 1
hearing:
---------------------------------------------------------------------------
\467\ ``President Clinton's Eleventh Hour Pardons,'' Hearing Before
the Senate Judiciary Comm., 107th Cong. 69 (Feb. 14, 2001) (testimony
of Jack Quinn).
\468\ Id.
I did so because she was a friend of mine, because she
had a relationship with Denise Rich, she was in much
more frequent communication with the President than I
was. I was motivated by two things principally; one, I
was hopeful that she could let the President know that
I had or was going to file this so that he would be
aware it was there; and two, she was another person who
I hoped might be in a position to give me the kind of
information that I have, as a lawyer, thought would be
useful to me to pursue their efforts on behalf of my
client vigorously. Now, I want to also tell you have
[sic] that in that conversation I had with her again
around Thanksgiving time, I cautioned her that it would
be very important to make sure that no such
conversation was ever connected in any way with any
kind of fundraising activity. She reacted to that by
kind of looking at me like how could I even suggest
that. She said to me, of course I would never do that
to him.\469\
---------------------------------------------------------------------------
\469\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 410-11
(Mar. 1, 2001) (testimony of Jack Quinn).
It is apparent that Quinn turned to Dozoretz because of her
access to and influence with the President. Precisely how
Dozoretz used these skills is a mystery, because of Dozoretz's
invocation of her Fifth Amendment rights.\470\
---------------------------------------------------------------------------
\470\ Irving Sandorf, a former colleague of Dozoretz's from the
clothing industry, noted that ``She has a way of getting into you a
little bit. She knows how to manipulate people. I don't know if you'd
call them `people skills.' It's more like `I'll use you, you use me'
skills.'' See Lloyd Grove, The A-List's No. 1 Political Partiers; How
Beth and Ron Dozoretz Made Washington Their Very Own, Wash. Post, Apr.
1, 1999, at C1.
---------------------------------------------------------------------------
Over the course of the next two months, Beth Dozoretz and
Jack Quinn were in frequent contact about the Marc Rich pardon
effort.\471\ Jack Quinn estimated that they spoke between five
and ten times about the Marc Rich pardon effort. The real
question is, of course, how many times Beth Dozoretz spoke to
the President about the Marc Rich pardon, and what they spoke
about. Because of the Fifth Amendment claims of Dozoretz and
Denise Rich, the Committee knows little about these
communications. However, the e-mail discussions of the Marc
Rich legal team offer some insight into the matter. On January
10, 2001, Avner Azulay e-mailed Jack Quinn with the following
message:
---------------------------------------------------------------------------
\471\ Beth Dozoretz left telephone messages for Jack Quinn on:
December 8, 2000; January 2, 2001, with the question, ``[A]ny news on
the matter?''; January 8, 2001; an undated message between January 8
and January 18, 2001; January 18, 2001; and January 19, 2001, leaving
her contact information for the rest of that day. Jack Quinn Document
Production (Telephone Messages from Beth Dozoretz, former finance
chair, Democratic National Committee, to Jack Quinn) (Exhibit 88).
2. D[enise] R[ich] called from aspen. Her friend B--who
is with her--got a call today from potus--who said he
was impressed by J[ack] Q[uinn]'s last letter and that
he wants to do it and is doing all possible to turn
around the WH counsels. D[enise] R[ich] thinks he
sounded very positive but ``that we have to keep
praying.'' There shall be no decision this wknd and the
other candidate Milik [sic] is not getting it.\472\
---------------------------------------------------------------------------
\472\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00162
(E-mail from Avner Azulay, Director, Rich Foundation, to Jack Quinn et
al. (Jan. 10, 2001)) (Exhibit 89).
When questioned about this e-mail, Quinn confirmed that the
``B'' referred to by Azulay was indeed Beth Dozoretz.\473\
However, Quinn could do little to explain the message,
including why the President would by trying to convince the
staff of the need for the pardon, rather than vice-versa.
Robert Fink responded to this message with an e-mail stating,
``I said it before, and I say it again, `nice letter.' Keep on
praying, and, oh, a few phone calls won't hurt.'' \474\
---------------------------------------------------------------------------
\473\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 246-48
(Feb. 8, 2001) (testimony of Jack Quinn).
\474\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00162
(E-mail from Robert Fink to Jack Quinn (Jan. 10, 2001)) (Exhibit 89).
---------------------------------------------------------------------------
Dozoretz remained deeply involved in the Marc Rich pardon
effort through the granting of the pardon. Three e-mail
messages to Jack Quinn make it appear that Dozoretz was
urgently trying to reach Quinn on January 17, 2001. At 12:13
p.m., Quinn's assistant informed him that ``Beth Dozoretz wants
you to call her on her cell if you get a chance.'' \475\ At
1:38 p.m., Quinn's assistant told him that ``Beth is very eager
to talk to you. She called again and knows that you are at the
WH.'' \476\ A mere 24 minutes later, Quinn's assistant sent
Quinn an e-mail regarding ``BETH'' stating ``[v]ery sorry to
bother you with this but she is insistent. Please call her--she
says that it is URGENT.'' \477\ On January 19, 2001, Dozoretz
traveled to Beverly Hills, California, with her husband.\478\
That day, she called Jack Quinn to let him know her contact
information, both in her private jet, and at the Peninsula
Hotel, where she would be staying.\479\ At 10:48 p.m., Quinn
called Dozoretz at the Peninsula Hotel.\480\ Presumably, Quinn
informed Dozoretz that he believed Marc Rich was going to
receive a pardon. Shortly after that call, Dozoretz called the
White House and spoke to President Clinton.\481\ According to
one press report, Dozoretz thanked President Clinton, but he
was so busy that he did not initially understand why Dozoretz
was thanking him.\482\
---------------------------------------------------------------------------
\475\ Jack Quinn Document Production JQ 03027 (E-mail from April
Moore, Secretary to Jack Quinn, Quinn Gillespie & Associates, to Jack
Quinn (Jan. 17, 2001)) (Exhibit 90).
\476\ Jack Quinn Document Production JQ 03028 (E-mail from April
Moore, Secretary to Jack Quinn, Quinn Gillespie & Associates, to Jack
Quinn (Jan. 17, 2001)) (Exhibit 91).
\477\ Jack Quinn Document Production JQ 03029 (E-mail from April
Moore, Secretary to Jack Quinn, Quinn Gillespie & Associates, to Jack
Quinn (Jan. 17, 2001)) (Exhibit 92).
\478\ WAVES records from the White House indicate that both
Dozoretz and Denise Rich visited the White House on January 19, 2001.
However, it appears that these records are spurious. White House WAVES
records usually show a scheduled time of entry for any scheduled visit
to the White House. However, only if a visitor actually shows up at the
White House is an actual time of entry entered into the WAVES system.
In this case, the WAVES records show actual times of entry for Rich and
Dozoretz. The United States Secret Service, has explained, however,
that a large group of individuals were scheduled to visit the White
House at one time for a party. Rather than hold up the group of
individuals who were actually there, the Secret Service waved through
the entire group. Therefore, the WAVES system shows erroneously that
everyone who was scheduled for that event actually showed up. Hotel
records as well as several eyewitnesses confirm the fact that Dozoretz
was in transit and in California on January 19. The fact that the
United States Secret Service had no idea of who was actually admitted
to the White House is obviously troubling.
\479\ Jack Quinn Document Production (Telephone Message from Beth
Dozoretz, former finance chair, Democratic National Committee, to Jack
Quinn (Jan. 19, 2001)) (Exhibit 88).
\480\ Jack Quinn Document Production (Quinn Gillespie telephone
bill, Feb. 9, 2001) (Exhibit 93).
\481\ Peninsula Hotel Document Production (Dozoretz Invoice from
Peninsula Hotel, Jan. 21, 2001) (Exhibit 94).
\482\ Corky Siemaszko, Dem Aide Had Early Word of Pardons, N.Y.
Daily News, Feb. 26, 2001, at 6.
---------------------------------------------------------------------------
After the pardon was granted, Dozoretz continued her
contacts with Jack Quinn. Between January 23, 2001, and
February 5, 2001, Dozoretz called Quinn at least nine times,
leaving messages of support such as (1) ``NY Times was great
today!'' \483\ (2) ``You are getting a reputation as the
smartest lawyer in America;'' \484\ (3) ``Hearing lots of good
things about you especially hearing that you are brilliant;''
\485\ and (4) ``Just had important conversation she would like
to share with you.'' \486\
---------------------------------------------------------------------------
\483\ Jack Quinn Document Production (Telephone Message from Beth
Dozoretz, former finance chair, Democratic National Committee, to Jack
Quinn (Jan. 25, 2001)) (Exhibit 95).
\484\ Jack Quinn Document Production (Telephone Message from Beth
Dozoretz, former finance chair, Democratic National Committee, to Jack
Quinn (Jan. 29, 2001)) (Exhibit 96).
\485\ Jack Quinn Document Production (Telephone Message from Beth
Dozoretz, former finance chair, Democratic National Committee, to Jack
Quinn (Jan. 31, 2001)) (Exhibit 97).
\486\ Jack Quinn Document Production (Telephone Message from Beth
Dozoretz, former finance chair, Democratic National Committee, to Jack
Quinn (Feb. 1, 2001)) (Exhibit 98).
---------------------------------------------------------------------------
Beth Dozoretz's efforts to help get Marc Rich's pardon cast
yet additional doubt on the motives of President Clinton. Like
Denise Rich, Beth Dozoretz was a close personal friend of
President Clinton. Also like Denise Rich, and a number of the
President's other close friends, her friendship was closely
intertwined with her fundraising relationship for the President
and Democratic Party.
Dozoretz's involvement in the Marc Rich pardon effort has
the indelible appearance of impropriety. Whether or not
criminal acts were involved is unknown, and can only be
discovered with facts not available to the Committee--namely
the truthful testimony of Denise Rich and Beth Dozoretz.
However, the appearance of impropriety is substantial:
Beth Dozoretz was herself a major fundraiser for the
DNC as well as President Clinton's personal causes, including
his legal defense fund and library. In addition, she was the
primary solicitor for Denise Rich's contributions to the
Clinton Library. Therefore, at a minimum, Beth Dozoretz's
endorsement of a pardon carried particular weight with the
President.
The one communication between Dozoretz and President
Clinton of which the Committee is aware raises serious
questions. According to the e-mail describing the call,
President Clinton told Dozoretz that he was ``doing all
possible to turn around the WH counsels.'' This upside-down
construction suggests that the President had made up his mind
to grant the pardon, but was hoping to convince the staff so as
to improve appearances.
No acceptable explanation has been made to the
Committee of why Beth Dozoretz agreed to become involved in the
pardon effort. Obviously, Dozoretz is friendly with both Denise
Rich and Jack Quinn. It is possible that she agreed to help
Rich and Quinn as part of this friendship.\487\ However, given
the substantial effort that Dozoretz made, and the excitement
that she showed at the President's decision to grant the
pardon, the possibility that Dozoretz had some other motivation
should be considered.
---------------------------------------------------------------------------
\487\ Of course, there are questions regarding why Denise Rich and
Jack Quinn were making such great efforts to obtain the pardon. As
described above, Rich has never adequately explained her motivations,
leading to speculation that her motivation may have been financial, not
personal. Jack Quinn's explanations have been even more suspect, as he
has maintained that he was not expecting any payment for his work on
the Marc Rich pardon effort. As described above, this suggestion is
contradicted by common sense, as well as by Marc Rich's primary U.S.
lawyer, Robert Fink. Fink confirms that Quinn's motivation was likely
financial, as he was going to receive handsome financial compensation
for his efforts. Because Quinn and Rich have offered weak reasons for
their involvement in the Rich pardon effort, the motivations of
individuals with even less at stake, like Beth Dozoretz, must be
subjected to even greater scrutiny.
Rather than cooperate with the Committee's
investigators, Dozoretz invoked her Fifth Amendment right
---------------------------------------------------------------------------
against self-incrimination.
However, absent cooperation from Ms. Dozoretz, the
Committee is unable to answer these questions.
c. Jack Quinn's Attempt to Keep Information
About Dozoretz from the Committee
It should be noted that Jack Quinn apparently tried to keep
the Committee from learning the true nature of Beth Dozoretz's
role in the pardon effort. When Quinn was asked about the
January 10, 2001, e-mail at the Committee's February 8, 2001,
hearing, the Committee did not have any information regarding
the role of Dozoretz in the pardon effort. When he was asked
about the e-mail, Quinn did acknowledge that it referred to
Beth Dozoretz, but he was then quite reticent about explaining
Dozoretz's role:
Mr. Barr. Why would the President be sharing this
information with the finance chair of the DNC? What do
they have to do with it?
Mr. Quinn. I was on the receiving end of this e-mail,
and I don't know the answer to that. I was aware of
this e-mail.
Mr. Barr. Work with me, speculate a little bit, why
would the DNC finance chair be involved here?
Mr. Quinn. Well, I believe--my impression was that
Denise and Beth were--have been friends, and that, in
fact, they grew--
Mr. Barr. I suspect so.
Mr. Quinn. That they grew up in the same town in
Massachusetts up north.
* * *
Mr. Quinn. But let me be clear, I don't know that he
[the President] called her about this.
* * *
Mr. Barr. Clearly it was about this.
Mr. Quinn. I believe that--my impression was that in
the course of the conversation they were having she
asked him what is happening with these two pardon
applications, and apparently was with Denise Rich at
the time, which may have motivated her to ask the
President in the course of the conversation, but I was
not of the impression, I want to be careful to say this
accurately, that the call was placed for the purpose of
discussing the pardons.\488\
---------------------------------------------------------------------------
\488\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 248
(Feb. 8, 2001) (statement of the Honorable Bob Barr and testimony of
Jack Quinn).
Quinn's initial testimony on this point was misleading.
When Representative Barr asked why the President would be
calling Beth Dozoretz about the Rich pardon, Quinn answered ``I
don't know the answer to that.'' When Representative Barr asked
Quinn to speculate about why Dozoretz was involved in this
matter, the best Quinn could offer was that Denise Rich and
Beth Dozoretz were friends, and had grown up in the same town
in Massachusetts. Quinn neglected to mention the more salient
point that he had personally asked Dozoretz to become involved
in the pardon effort. Therefore, he knew specifically why she
was discussing the Rich pardon with the President. However, at
no time during the Committee's February 8 hearing did Quinn
disclose the fact that he had specifically asked Dozoretz to
become involved in the pardon effort, because of her close
relationship with President Clinton. If the House Government
Reform Committee and Senate Judiciary Committee had not held
follow-up hearings on this matter, it is likely that Quinn
never would have told the truth about Dozoretz's involvement.
The fact that Quinn tried to conceal this information only adds
to the appearance that Dozoretz's role in the pardon was
improper.
3. Israeli Prime Minister Ehud Barak and Other Israeli
Leaders
Key players in the lineup of individuals assisting the Marc
Rich pardon effort were Israeli Prime Minister Ehud Barak and a
number of other current and former Israeli officials who
weighed in with the Clinton Administration. President Clinton
has made much of the influence of Prime Minister Barak's appeal
in his decision making. This claim can be debated. However, it
cannot be debated that the Marc Rich team made a substantial
effort to get these Israeli officials involved. However, much
like some of the key American players, it is difficult to gauge
whether these officials were involved because they believed in
the Rich pardon, or because they received financial support
from Marc Rich.
After he fled the United States in 1983, Marc Rich began to
make large financial contributions to various charities in
Israel, as well as Jewish charities in Europe and the United
States. Marc Rich also made political contributions to Israeli
political candidates. However, since Israeli law does not
require the public disclosure of these contributions, the
Committee is not able to determine to whom Rich has
contributed. Communications among the Marc Rich legal team make
it clear that they were able to call upon a number of prominent
Israelis to weigh in on Rich's behalf with President Clinton.
Marc Rich's pardon petition included a number of letters of
support from prominent Israelis, including: Shlomo Ben-Ami, the
Minister of Foreign Affairs and Minister of Public Security;
Itamar Rabinovich, the former Israeli Ambassador to the United
States; Yaakov Neeman, the former Minister of Finance and
former Minister of Justice; Ehud Olmert, the Mayor of
Jerusalem; Isaac Herzog, the Israeli Government Secretary; and
Shabtai Shavit, the former Director of the Mossad.\489\ A
number of these officials received some sort of financial
contributions from Marc Rich. Olmert received a $25,000
political contribution from Rich in 1993.\490\ A community
development organization called Yedid, which was linked to
Shlomo Ben-Ami, received $100,000 from Rich.\491\ Herzog's wife
worked for the Rich Foundation.\492\
---------------------------------------------------------------------------
\489\ See Petition for Pardon for Marc Rich and Pincus Green (Dec.
11, 2000) (Appendix III).
\490\ Michael Dobbs, Pardon Smoothed Ties to Israel; Barak, Others
Aided Rich's Campaign, Wash. Post, Feb. 25, 2001, at A1.
\491\ Id.
\492\ Id.
---------------------------------------------------------------------------
More important than the letters of support, though, were
telephone calls to President Clinton from some of these Israeli
leaders. Most importantly, Marc Rich's supporters were able to
have Prime Minister Ehud Barak raise the Marc Rich pardon with
President Clinton. Prime Minister Barak described the approach
to him by Avner Azulay as follows:
Few months ago [sic] I was approached by the chairman
of the Rich Foundation in Israel. The chairman, Mr.
Azoulay is a man I know [sic] for many years, who had
contributed a lot to the security of the State of
Israel. The Rich Foundation is well known and highly
appreciated in Israel for its philanthropic activities
in the fields of healthcare, education and culture.
Mr. Azoulay asked me to raise Mr. Rich case with
President Clinton. I raised the subject with President
Clinton several times (probably three) in the course of
routine telephone conversations during the last two or
three months of his presidency and made a personal
recommendation to him to consider the case.\493\
---------------------------------------------------------------------------
\493\ Letter from Ehud Barak, Prime Minister, Israel, to the
Honorable Dan Burton, Chairman, Comm. on Govt. Reform (May 13, 2001)
(Exhibit 99).
Avner Azulay's efforts to enlist Israeli officials in the
pardon effort were helped dramatically when, in early January
2001, Marc Rich himself flew to Israel to attend a convention
for Birthright Israel, a recipient of Rich's largesse. While
Rich was in Israel, he took the opportunity to meet senior
Israeli political officials as well as Jewish-American leaders.
During this trip to Israel, Rich met personally with Prime
Minister Barak, and shortly after that meeting, Barak raised
the Rich pardon with President Clinton a second time. Azulay
referred to Rich's scheduled meetings in a January 4, 2001, e-
---------------------------------------------------------------------------
mail to the Rich legal team:
As I have already mentioned--during this wknd [sic]
M[arc] R[ich] is scheduled to meet the P[rime]
M[inister], F[oreign] M[inister] & SH[imon] P[eres]--as
well as a main vector to E[lie] W[iesel].
If possible it would be very useful to ask the W[hite]
H[ouse] to hold the final decision (unless it is
positive!)--until the above have the opportunity to
make/repeat their personal appeals.\494\
---------------------------------------------------------------------------
\494\ Arnold & Porter Document Production A0865 (E-mail from Avner
Azulay, Director, Rich Foundation, to Jack Quinn et al. (Jan. 4, 2001))
(Exhibit 100).
It also appears that the Rich team attempted to have other
Israeli officials call the President or his staff. Former
Israeli Prime Minister Shimon Peres called President Clinton
about the Marc Rich matter on December 11, 2000,\495\ the day
that the Rich petition was filed, and the same day that Prime
Minister Barak spoke to the President. On December 19, 2000,
Avner Azulay suggested that he ask Knesset Speaker Avraham Burg
to call the President on Marc Rich's behalf.\496\ It is unclear
whether Burg actually spoke with President Clinton. Burg
apparently did write a letter to President Clinton on January
9, 2001, advocating Rich's pardon.\497\
---------------------------------------------------------------------------
\495\ Arnold & Porter Document Production A0842 (E-mail from Avner
Azulay, Director, Rich Foundation, to Jack Quinn et al. (Dec. 25,
2000)) (Exhibit 101).
\496\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00071
(E-mail from Avner Azulay, Director, Rich Foundation, to Kathleen
Behan, Partner, Arnold & Porter et al. (Dec. 19, 2000)) (Exhibit 102).
\497\ Piper Marbury Rudnick & Wolfe Document Production PMR&W
00163-64 (E-mail from Avner Azulay, Director, Rich Foundation, to Jack
Quinn et al. (Jan. 11, 2001)) (Exhibit 103). While Burg's letter did
expressly advocate Rich's pardon, it was criticized by Gershon Kekst
and Bob Fink. Kekst asked Quinn and Fink ``is this a helpful letter?''
Id. Fink responded, ``I think Potus will realize that it is intended to
be helpful. Frankly, I am a little surprised Avner let it go in this
form, as we pulled one like it from the original petition. Maybe he did
not see it until after it had gone. I see no reason to rain on anyone's
parade.'' Id.
---------------------------------------------------------------------------
Azulay also asked Israel Singer, Secretary General of the
World Jewish Congress, and Edgar Bronfman, President of the
World Jewish Congress, to raise the Marc Rich matter with the
President:
Israel Singer & Edgar Bronfman (CEO & President of the
World Jewish Congress) are scheduled to meet potus on
Sunday evening in NY (the Israel Policy Forum--not
adequate for a private talk) and on Wednesday for a
private seance at the WH. In anticipation of Abraham
Burg's meeting, I contacted Singer through Rabbi
Rizkin. Burg will give his support only if he knows
that Singer and Bronfman will . . [sic] I don't know
but suspect that this has to do with JPoll.
Now Singer wants to be sure that the MRPG petition is
on the agenda of potus. I suggest you contact Israel
Singer the soonest possible--either to brief him and
answer his questions or arrange for a mtg with him
before he meets potus.\498\
---------------------------------------------------------------------------
\498\ Arnold & Porter Document Production A0866 (E-mail from Avner
Azulay, Director, Rich Foundation, to Jack Quinn et al. (Jan. 5, 2001))
(Exhibit 104).
In his desperation to find prominent Israeli supporters for
the Marc Rich petition, Jack Quinn even suggested that the
deceased widow of assassinated Israeli Prime Minister Yitzhak
Rabin, Leah, call President Clinton. Robert Fink made this
request to Avner Azulay in an e-mail: ``Oh one more thing. Jack
asks if you could get Leah Rabin to call the President; Jack
said he was a real big supporter of her husband.'' \499\ Azulay
responded the following day: ``Bob, having Leah Rabin call is
not a bad idea. The problem is how do we contact her? She died
last November--on the 5th anniversary of her husband's
murder.'' \500\ In the end, the Rich team settled for the
Rabins' daughter, who met with Avner Azulay on January 10,
2001, and informed him that she would call President Clinton on
Rich's behalf.\501\
---------------------------------------------------------------------------
\499\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00091
(E-mail from Robert Fink to Avner Azulay, Director, Rich Foundation
(Dec. 30, 2000)) (Exhibit 36).
\500\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00094
(E-mail from Avner Azulay, Director, Rich Foundation, to Robert Fink
(Dec. 31, 2000)) (Exhibit 105).
\501\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00162
(E-mail from Avner Azulay, Director, Rich Foundation, to Jack Quinn et
al. (Jan. 10, 2001)) (Exhibit 89).
---------------------------------------------------------------------------
One of the tactics used by Azulay to enlist Israeli leaders
was to link the Rich pardon to the Jonathan Pollard matter. The
Pollard pardon had long been a priority for a number of Israeli
officials, and Azulay attempted to use the Pollard matter to
Rich's advantage:
I can also cfm [sic] the info on J[onathan] P[ollard].
It seems that the topic was discussed in telecons with
potus--within the framework of the peace agreement.
JP's freedom is considered as a public-political
``sweet pill'' which shall help swallow (or divert
public attention from) the more sour pills in the
agreement with arafat [sic]. I am sure potus is aware
that JP is going to be big trouble with the entire
intelligence community and MR could go along with it
``less unnoticed''. On the other hand if he says no to
JP--one more reason to say yes to MR.\502\
---------------------------------------------------------------------------
\502\ Arnold & Porter Document Production A0865 (E-mail from Avner
Azulay, Director, Rich Foundation, to Jack Quinn et al. (Jan. 4, 2001))
(Exhibit 100).
Jack Quinn made the same linkage between Rich and Pollard in
his appeals to the White House: ``Lastly, I told her [Beth
Nolan] that, if they pardon JP, then pardoning MR is easy, but
that, if they do not pardon JP, then they should pardon MR. In
the last connection, she affirmed that they have heard from
people in or connected to the GOI [Government of Israel].''
\503\
---------------------------------------------------------------------------
\503\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00111
(E-mail from Jack Quinn to Avner Azulay, Director, Rich Foundation et
al. (Jan. 3, 2001)) (Exhibit 106).
---------------------------------------------------------------------------
It is difficult to gauge whether the efforts of the Marc
Rich team to link their fate to that of Jonathan Pollard helped
their cause. Jonathan Pollard certainly feels that the Rich
pardon was granted at his expense. Pollard made the following
statement after the Rich pardon:
I've become disillusioned. This is the hardest thing
for me. . . . But what has shaken me to my very bones
is to finally realize, after 16 years, that I made a
mistake. For 16 years I have been desperately waving
the Israeli flag, crying out for help to the Israeli
political establishment. But since the Marc Rich
campaign, I realize that I made a mistake. All those
years I should have waved something else to get their
attention. I should have waved a dollar bill in front
of them and convinced them that I had a lot of money.
That is the depths to which we have sunk as a nation,
that an agent has to bribe his own government to rescue
him. That is how low we have sunk.
Esther and I are pinching pennies in order to stay
alive. Israel has never assisted us. But this Marc Rich
fellow, with all of his millions, he's the one that
everyone in Israel is breaking their backs for.
* * *
Barak, the politicians, and all those who were
involved, were corrupted and debased by Marc Rich's
money. Every one of them was corrupted at some level or
another. The corruption and the repulsiveness that
characterized the Rich pardon campaign is
appalling.\504\
---------------------------------------------------------------------------
\504\ Eran Tiffenbraun and Mody Kreitman, Expose: Using Pollard to
Get Rich, Yediot Achronot, Feb. 25, 2001 (Exhibit 107).
While Pollard clearly did not deserve a pardon of his own, his
comments about the Rich pardon may be accurate.
4. Elie Wiesel
The Rich team also attempted to recruit prominent Holocaust
survivor and author Elie Wiesel to their cause. As a prominent
spokesman for Jewish causes and a close friend to President
Clinton, Wiesel was a logical candidate for the Rich team to
turn to. It appears that Gershon Kekst initially identified
Wiesel as a potential supporter of the Rich pardon. After a
meeting with Kekst, Avner Azulay informed Behan, Fink, and Marc
Rich that Kekst ``proposed Elie Wiesel as the ``moral
authority'' to present the plea. We discussed some ideas how to
reach him--and that I shall do in the next few days.'' \505\
---------------------------------------------------------------------------
\505\ Arnold & Porter Document Production A0542 (E-mail from Avner
Azulay, Director, Rich Foundation, to Kathleen Behan, Partner, Arnold &
Porter et al. (Nov. 15, 2000)) (Exhibit 108). When asked about this
document, Kekst said, ``I would not have proposed Elie Wiesel as a
moral authority to anyone on any subject.'' Interview with Gershon
Kekst, President, Kekst and Co. (Mar. 15, 2001). Kekst said that he was
asked, but refused, to request Wiesel's help. As discussed below, Kekst
has repeatedly denied that he made suggestions and recommendations even
when they are corroborated by contemporaneous e-mails. Kekst's denials
are not credible, and appear to be part of an effort to understate his
role in the Marc Rich pardon effort.
---------------------------------------------------------------------------
It appears that Azulay followed Kekst's recommendation, and
attempted to enlist Wiesel. In an e-mail of November 29, 2000,
Azulay suggested that the Rich team might be obtaining a letter
of support from Wiesel: ``We shall have a few days to get
additional letters in New York (Elie Wiesel, Abe Foxman and
others). I assume by now you are getting letters from
Switzerland and Spain.'' \506\ When he was interviewed over the
telephone by Committee staff, Wiesel confirmed that he was
asked by Avner Azulay to write a letter on behalf of Rich. At a
November or December 2000 meeting at Wiesel's home in New York
City, Azulay showed Wiesel other letters written on behalf of
Marc Rich.\507\ According to Wiesel, although he told Azulay
that he was impressed by the list of names, he said he could
not write such a letter for someone he did not know.\508\
Wiesel told Committee staff that he also told Azulay that he
did not believe Rich could legally receive a pardon without
standing trial.\509\ According to Wiesel, even though Azulay
assured him that Rich could receive a pardon, Wiesel told
Azulay that he could not write the letter because he had
already written a letter requesting a commutation of Jonathan
Pollard's sentence. Wiesel felt that he could not make another
request.\510\
---------------------------------------------------------------------------
\506\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00066
(E-mail from Avner Azulay, Director, Rich Foundation, to Robert Fink
and Marc Rich (Nov. 29, 2000)) (Exhibit 109).
\507\ Telephone Interview with Elie Wiesel (Apr. 2, 2001). Yossi
Ciecanover, a banker and former high official in Israel, and Danny
Karavan, who lived in both Paris and Israel, arranged this meeting.
Wiesel indicated that he was under the impression that Gershon Kekst
asked Yossi Ciecanover to contact Wiesel on behalf of Azulay.
\508\ Id.
\509\ Id.
\510\ Id.
---------------------------------------------------------------------------
According to Wiesel, Avner Azulay called him several days
later to see if he had changed his mind.\511\ Wiesel told him
that he had not.\512\ While this seemingly would have been the
end of Wiesel's involvement in the Rich pardon campaign, there
is evidence that it was not. Several e-mails indicate that
Wiesel may have lobbied the White House. On December 21, 2000,
Jack Quinn wrote to Robert Fink and Azulay, responding to
Azulay's question about ``having another VIP place an
additional call'' to President Clinton.\513\ As Quinn wrote,
``I think another call is fine, but it needs to come from
someone who can get POTUS personally on the line. Did Elie
Wiesel call?'' \514\ Azulay responded to Quinn's inquiry by e-
mailing, ``I don't know positively if he talked directly to
potus and if he did what was his reaction. All he told me was
that `he was at the WH the day potus traveled but he couldn't
give me any reaction.' '' \515\ Azulay then spoke with Wiesel
again, and on December 25, 2000, Azulay responded to Quinn in
an e-mail with the subject line ``elie wiesel,'' stating:
---------------------------------------------------------------------------
\511\ Id.
\512\ Id.
\513\ Arnold & Porter Document Production A0831 (E-mail from Jack
Quinn to Robert Fink et al. (Dec. 21, 2000)) (Exhibit 110).
\514\ Id.
\515\ Arnold & Porter Document Production A0836 (E-mail from Avner
Azulay, Director, Rich Foundation, to Jack Quinn et al. (Dec. 22,
2000)) (Exhibit 111).
I talked to him today. He says that he brought up the
topic at the WH on Monday Dec 12th, he refused to
disclose who he met. He was told of the difficulties
lying ahead in dealing with it (he would explain it
only in a face to face meeting) and hopes that they can
be surmounted[.] \516\
---------------------------------------------------------------------------
\516\ Arnold & Porter Document Production A0845 (E-mail from Avner
Azulay, Director, Rich Foundation, to Jack Quinn et al. (Dec. 25,
2000)) (Exhibit 112).
On December 27, 2000, Azulay told Quinn, Kekst, Behan,
Fink, and Marc Rich that he was looking for some way to have
Wiesel express his opinion on the Rich pardon in a clear way to
the President: ``Elie Wiesel--I am still checking if there is a
way to get from him a straight forward support statement--
direct call to potus.'' \517\ Azulay followed up with another
e-mail on December 31, 2000, stating that:
---------------------------------------------------------------------------
\517\ Arnold & Porter Document Production A0851 (E-mail from Avner
Azulay, Director, Rich Foundation, to Jack Quinn et al. (Dec. 27,
2000)) (Exhibit 113).
I was informed today that EW visited the WH last Dec
12th. He didn't meet or speak directly with potus. EW
had a scheduled mtg [sic] with the ``person responsible
for the pardons.'' His original goal was to discuss
Pollard--and at the same time raised a question about
the MRPG case. He was told that the MRPG case can't be
defined as humanitarian because there was no trial,
---------------------------------------------------------------------------
conviction or punishment to deal with[.]
I understand--although he didn't disclose it that he
talked with a lawyer, the WH counsel. Perhaps BL.
This is not new to you. What the lawyers think or
thought at the time. However, I think it worthwhile
mentioning that EW's mtg [sic] was held in the morniing
[sic] hours of Monday, Dec 12th--before xx [sic] before
the formal petition was delivered in the afternoon
hours. I hope that the lawyers have a different view of
the case by now?
It is clear that EW is reluctant to make a direct
appeal to potus--with the uncertainty that he is doing
something that doesn't stand a chance. Therefore, it
seems plausible that if someone he respects will
convince him that he is doing the right thing it might
still be possible.\518\
---------------------------------------------------------------------------
\518\ Arnold & Porter Document Production A0854 (E-mail from Avner
Azulay, Director, Rich Foundation, to Jack Quinn et al. (Dec. 31,
2000)) (Exhibit 114).
Despite the assurances that Wiesel had raised the Rich pardon
with White House staff, Azulay apparently continued his efforts
to have Wiesel raise it directly with the President. On January
2, 2001, he e-mailed Fink, Quinn, and Behan to tell them that
Knesset Speaker Avraham Burg was going to try to recruit Wiesel
to help with the Rich case.\519\
---------------------------------------------------------------------------
\519\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00104
(E-mail from Avner Azulay, Director, Rich Foundation, to Robert Fink et
al. (Jan. 2, 2001)) (Exhibit 115).
---------------------------------------------------------------------------
Other than the information that Azulay was able to get from
Wiesel, Gershon Kekst also told the rest of the Rich team that
Wiesel had weighed in with the White House on the Rich pardon.
In a January 9, 2001, e-mail, Kekst wrote that ``[b]y the way,
please tell marc [sic] that I am `assured' the call has been
made by elie [sic].'' \520\ Robert Fink responded that he would
``tell Marc about Elie.'' \521\ When he was interviewed by
Committee staff, Kekst explained that he discussed Wiesel's
involvement in the Rich pardon effort with Yossi Ciecanover, a
former senior Israeli government official.\522\ Ciecanover told
Kekst that he had been asked by Azulay to ask Wiesel to express
support for the Rich pardon.\523\ Ciecanover said that Wiesel
either ``would call'' or ``did call'' the President.\524\
---------------------------------------------------------------------------
\520\ Piper Marbury Rudnick & Wolfe Document Production PMR&W 00159
(E-mail from Gershon Kekst, President, Kekst and Co., to Robert Fink
and Jack Quinn (Jan. 9, 2001)) (Exhibit 116).
\521\ Id.
\522\ Interview with Gershon Kekst, President, Kekst and Co. (Mar.
15, 2001).
\523\ Id.
\524\ Id. Associate White House Counsel Eric Angel also suggested
that he heard that Wiesel raised the Rich matter with President
Clinton. However, after making this initial assertion, Angel
backtracked, and said that he was not certain if he recalled hearing
this before the pardons were granted, or from media accounts after the
fact. Interview with Eric Angel, former Associate Counsel to the
President, the White House (Mar. 28, 2001).
---------------------------------------------------------------------------
Elie Wiesel has denied any involvement in the Marc Rich
pardon effort, calling such allegations ``pure fantasy.'' \525\
Wiesel acknowledged that he did visit the White House in
December 2000 and January 2001.\526\ However, Wiesel denied
that he raised any Marc Rich pardon issues with anyone at the
White House on either of those visits.\527\ He also denied that
he ever raised any pardon issues with anyone at the White House
in any other form, other than writing a letter on Jonathan
Pollard's behalf to the President.\528\ Given the lack of any
first-hand evidence that Wiesel did actually lobby the
President on behalf of Marc Rich, the e-mails of Kekst and
Azulay most likely overstated involvement of Wiesel in the Rich
pardon effort.
---------------------------------------------------------------------------
\525\ Telephone Interview with Elie Wiesel (Apr. 2, 2001).
\526\ Id.
\527\ Id.
\528\ Id.
---------------------------------------------------------------------------
5. King Juan Carlos
King Juan Carlos apparently made two contacts with the
White House over the Rich pardon. The first contact was a
direct one, when the King called President Clinton personally
regarding the Rich pardon. On January 13, 2001, Avner Azulay
sent an e-mail to the Rich legal team indicating that ``we have
a CFM [confirmation] that the king of spain [sic] talked to
potus. He reports a positive conversation. No concrete sayings
[sic].'' \529\ It is unclear why the King took this action on
Rich's behalf. It is possible that the King was motivated by
Rich's support of Madrid's Jewish community, but he has not
offered any explanation for his actions.
---------------------------------------------------------------------------
\529\ Arnold & Porter Document Production A0881 (E-mail from Avner
Azulay, Director, Rich Foundation, to Jack Quinn et al. (Jan. 13,
2001)) (Exhibit 117).
---------------------------------------------------------------------------
Also in this same time frame, John Podesta heard of King
Juan Carlos' interest in the Rich pardon. Podesta received a
telephone call from former Congressman John Brademas, President
Emeritus of New York University, who is a friend of King Juan
Carlos.\530\ The King had informed Brademas that he had
recently met with the Israeli Foreign Minister, Shlomo Ben Ami,
who had raised the Marc Rich pardon with the King. The King in
turn called Brademas to see if Brademas could make the King's
interest in the pardon known to the White House. Podesta told
Brademas that ``while it was the President's decision, the
White House Counsel's Office and I were firmly opposed and I
did not believe that the pardon would be granted.'' \531\ While
Podesta apparently braced the King for the worst, the King's
interest in the Rich matter was made known to the President, as
well as Marc Rich's supporters, who have often mentioned his
support for the pardon.
---------------------------------------------------------------------------
\530\ ``The Controversial Pardon of International Fugitive Marc
Rich,'' Hearings Before the Comm. on Govt. Reform, 107th Cong. 320
(Mar. 1, 2001) (testimony of John Podesta, former Chief of Staff to the
President, the White House).
\531\ Id. at 317.
---------------------------------------------------------------------------
6. Avner Azulay
Avner Azulay is a former high-ranking Mossad agent. He
founded his own security consulting company after leaving the
Mossad in the early 1990s.\532\ Marc Rich retained his services
and placed him as the head of the Marc Rich Foundation and the
Doron Foundation, based in Jerusalem.\533\ These Foundations
handle all of Rich's philanthropic interests (they were
recently merged and are now referred to only as the Marc Rich
Foundation). These foundations also paid significant amounts of
money to many organizations and persons who wrote letters on
behalf of Marc Rich that were included in the pardon petition.
---------------------------------------------------------------------------
\532\ Bo'az Ga'on, Rich as Korach, Ma'ariv Weekend Magazine, Oct.
1, 1999 (Exhibit 6).
\533\ Id.
---------------------------------------------------------------------------
Azulay was a central figure in the pardon effort. His name
appears on a large number of the e-mails produced to the
Committee that were sent among the Rich pardon team. Azulay
played a key role in securing many of the letters included in
the petition. He traveled throughout Israel, Europe, and the
United States soliciting the letters for the pardon. Azulay
also solicited many Jewish leaders for their support of Rich.
In this effort, Azulay contacted Abraham Foxman, Elie Wiesel,
and Rabbi Irving Greenberg, among others. As would be revealed
after the pardon was granted, however, not everyone who was
approached by Azulay was told that their letter would be used
in the pardon effort.
The Committee first sought Avner Azulay's cooperation in
its investigation in a March 8, 2001, letter asking him to
participate in an interview with Committee staff.\534\ Azulay
refused to meet with staff, citing health reasons.\535\
Committee staff followed up with a number of telephone calls to
Azulay's counsel to try to secure an interview, but he made it
clear that Azulay would not participate in an interview, due to
health concerns and concerns regarding the ongoing criminal
investigation by the Southern District of New York. As a close
advisor to Marc Rich and a key participant in the pardon
effort, Azulay has a great deal of valuable information that he
has decided to withhold from the Committee. His lack of
cooperation appears to be part of a concerted effort by Marc
Rich and his closest advisers to keep critical information
about the pardon effort from the American people.
---------------------------------------------------------------------------
\534\ Letter from the Honorable Dan Burton, Chairman, Comm. on
Govt. Reform, to Avner Azulay, Director, Rich Foundation (Mar. 8, 2001)
(Exhibit 118).
\535\ Letter from Avner Azulay, Director, Rich Foundation, to the
Honorable Dan Burton, Chairman, Comm. on Govt. Reform (Mar. 15, 2001)
(Exhibit 119).
---------------------------------------------------------------------------
7. Michael Steinhardt
Michael Steinhardt is a prominent hedge fund investor who
has also been involved in Democratic politics, having served as
the Chair of the Democratic Leadership Council and the
Progressive Policy Institute. He first met President Clinton
while serving in the former position.