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New York seeks $137 million from Rich in tax case

DOCUMENT Tax warrant issued by New York against Marc Rich (FindLaw)(PDF format) Documents in PDF format require Adobe Acrobat Reader for viewing.  IN-DEPTH SPECIAL Politics, money and power: The pardons controversy

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NEW YORK (CNN) -- The New York State Commissioner of Taxation and Finance announced Thursday that the state has begun legal action seeking $137 million from financier Marc Rich for personal income taxes on his earnings from fraudulent business activities during the early 1980s.

"Mr. Rich has avoided his tax payments in New York for nearly two decades while he was under federal indictment. It is now time for him to pay the piper," Commissioner Arthur J. Roth said in a written statement.

Roth said the state did not seek the taxes previously to avoid jeopardizing the federal investigation into charges of tax evasion and racketeering. Those charges were wiped out by former President Clinton's pardon of Rich in January. The pardon specifically allowed governments to file civil actions against Rich, Roth said.

Meanwhile Thursday, the attorney for Rich's ex-wife, Denise Rich, refused to confirm a newspaper report that she is talking to federal prosecutors about cooperating in their investigation of the pardon awarded to Rich.

"It is our policy not to comment on the status of any inquiry or investigation regarding Denise Rich," attorney Martin Pollner said in a written statement. The report appeared in the New York Daily News.

Roth said the state has filed a jeopardy assessment and issued a tax warrant against Rich personally, allowing the state to immediately place a lien on and begin collection against any assets held by him in New York.

"We do not intend to allow Mr. Rich to shuffle or conceal assets in order to avoid this tax bill," Roth said.

Roth said the state cannot take any of Denise Rich's assets in the case. He declined to comment on any action being taken against Rich's business partner, Pincus Green, who also was pardoned by Clinton.

The taxation department is alleging that Rich owes New York income taxes on gains from his two companies -- Marc Rich International and Marc and Company -- while he was a New York resident. He was chairman of both companies

The state is seeking $26.9 million in back taxes for the years 1980-1982, along with $13.5 million in penalties and $97.4 million in interest.

Rich was indicted in 1983 on federal counts of tax evasion, racketeering and other charges in a scheme involving the illegal trading of crude oil. He left the country and eventually settled in Switzerland. Clinton pardoned Rich on January 20, wiping out those charges.

In 1984 Rich's companies each pleaded guilty to 38 federal criminal counts, and Marc Rich International also pleaded guilty to two counts of tax evasion. The companies paid $150 million to settle their part of the case.

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Ashcroft may work with Congress on Rich probe
February 12, 2001

U.S. Department of Justice
U.S. Senate
Committee on Government Reform

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