Rich Firm Doing Business in New York and Other Cities

Novarco, which has done business in the U.S. in the years since Rich fled for Europe, shipped $100 million in oil from Nigeria into New York on Dec. 18, according to billing and shipping documents. The oil was delivered to a Brooklyn, N.Y.. shipyard via the Russian steamer Geroi Sevastopolya, owned by the Russian outfit called NovoShip, according to statistics from a Web site sponsored by The Journal of Commerce.

It's not clear who bought all of the oil. Con Edison, which supplies the electricity for New York City and is one of the country's biggest utilities, once did business with Novarco. But a Con Ed spokesman said Wednesday that "the last time we did business with them was two years ago."

The delivery was just one of many Rich's firm made to U.S. ports in the last several months. Statistics also show that from November to January, Novarco made 22 major shipments imported through the ports of New Orleans, New York, Baltimore and Bridgeport, Conn. The cargo carried on most of those ships was listed as copper or aluminum.

The average value of most of these shipments was $750,000 — with at least one shipment worth over $1 million. That's a wholesale price and a bargain considering the source of these shipments were places like Russia, Peru, Chile, Kazakhstan, as well as Nigeria.

Rich was pardoned on Jan. 20, 2001 by former President Bill Clinton, igniting a controversy that has included Rich's ex-wife, singer/socialite Denise Rich, and her friend, Democratic National Committee finance chairwoman Beth Dozoretz. Rich fled the U.S. in 1983 rather than pay $50 million in back taxes, but also for fear of standing trial for doing business with Iran during the 1979 hostage crisis.

But his exile hasn't stopped his companies from doing business, apparently without interference from federal regulators or law enforcement agencies.

Novarco, with its main offices in White Plains, N.Y., and branches in 17 offices around the country, is registered with the Federal Energy Regulatory Commission. The company also supplies the state of Florida with fossil fuel for electricity — selling to Florida Power & Light, one of the biggest suppliers of electricity in the country.

FPL has done business with Novarco for years. But "it's possible we didn't know Novarco was a Marc Rich company when we went into business with them," according to a company spokesman.

Novarco supplies fuel to the Everglades, Cape Canaveral and other locations through FPL. The material is called "No. 6" fuel — often referred to as "boiler" fuel — and, ironically, "bottom of the barrel" quality. It's cheap and plentiful and comes from Nigeria.

FPL also buys exactly the same fuel for the same locations from Glencore Ltd., which was a Marc Rich company in the U.S. until it was very publicly sold to its employees in 1994. The leader of the buyout was longtime Rich associate Willy Strothotte. The company was known as Clarendon Ltd. before it was called Glencore.

Glencore, like Novarco, is not required to make its records public because it is a privately held company.

A source at a shipping and container company in the Port of New Orleans said on Monday that Novarco — as well as other companies run by Rich associates — is a big customer.

Novarco is believed to be one of many companies that Rich has controlled or associated with over the years.

Another name to add to the list is Trafigura Ltd., a company with New York offices that seems to be registered out of Switzerland but is generally described as a Dutch company. The company supplies the U.S. Mint with nickel and copper, just as Marc Rich did before he was caught doing the same thing in 1992.

Information on Trafigura is scarce. "It's run by eight former Marc Rich traders," said a source who himself also worked for Rich and then Trafigura. Rich and Trafigura attempted a merger last year, but it fell through.

Some wonder how a company like Trafigura — a billion- dollar multinational commodities trader — could escape notice in the press. There have been roughly half a dozen small stories about them in the media since they debuted in 1993.

But that's changing. Trafigura has recently been embroiled in a scandal in South Africa — one of the countries where Rich operates — over paying bribes to state oil officials as part of its deal with the state oil operation.

According to press reports, "Documents and affidavits filed in the Pretoria High Court say that, as part of a deal with Trafigura and its South African joint venture, the Bahamas-registered High Beam, cash bribes worth $60,000 were distributed between state oil officials and a further $2 million promised.

"One affidavit by a state oil official says Keith Kunene, the former chair of the Central Energy Fund, had suggested during discussions about the bribes that: 'Trafigura had people who could assist us in opening foreign bank accounts.'"