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HOLY WAR AT HARRODS


Vanity Fair, September 1995

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Foreword

Although Mohamed 'Al' Fayed's capacity for fantasy, vengefulness, and thievery had all been aired in the DTI report of March 1990, Fayed's heavily-publicized gifts to children's charities helped him prosper in British society.

    Five years later the American current affairs magazine, Vanity Fair, sent its top investigative journalist, Maureen Orth, to England to research a story on the larger-than-life Egyptian owner of Harrods.  The intention had been to produce a positive profile of Fayed - how the stuffy British Establishment had refused to accept this Anglophile Egyptian philanthropist.  However, when Orth began her research she soon changed her ideas.

    Free from spin and packed with devastating facts about Fayed in a structured format, Orth's piece remains the definitive concise work on Mohamed 'Al' Fayed and a master class example to investigative journalists the world over.  It was the first time that any publication had catalogued Fayed's lying, thieving, bugging of his staff, sexual shenanigans, true background, and propensity for prosecuting vendettas against innocent people.  When it was published in September 1995 Fayed sued the magazine for libel.  Vanity Fair refused to back down.  In the first days of December 1997 Fayed withdrew his action against the magazine.

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Vanity Fair
September 1995
HOLY WAR AT HARRODS
Mohamed Al Fayed, controversial chairman of Harrods,

owner of the Ritz hotel in Paris, and onetime front man for the Sultan

of Brunei, is battling the Tory party and the British upper class

in his desperate bid to be an Englishman
BY MAUREEN ORTH
I love Britain . . . Ethics and morals count in Britain like nowhere else in the world.”

      -Mohamed Al Fayed, 1985.


One day this past May, Harrods chairman Mohamed Al Fayed, flashing a megawatt smile, was gleefully throwing his dough around. The flamboyant Egyptian owner of the London retail landmark, as well as of the fabled Ritz hotel in Paris, had put on a chef's toque to toss pizzas for the cameras in a public-relations doubleheader. He was inviting journalists to sample the wares in the new pizzeria in Harrods' famous Food Halls. At the same time, he was celebrating a victory in his ongoing battle with John Major's government to obtain British citizenship for himself and his brother Ali, since he had just gained the right to appeal the government's refusal to allow them to become citizens. A few days later Fayed (the "Al" was added in the 70s) was in media heaven again–photographed with the Queen herself at the Royal Windsor Horse Show, which Harrods sponsors. One can only imagine what certain officials in Major's scandal-rocked administration were thinking as they watched these antics of the man who has baldly announced that he is trying to overthrow them. Having been accused of accepting lavish payoffs from Fayed in return for favors rendered, the Conservatives remain mired in an embarrassing scandal stemming from their refusal to keep playing the game.

    Fayed became non grata with the Tories last October, when, in a fury over the stalled citizenship applications, he disclosed the names of three ministers in Major's administration who he alleged had taken cash from him to ask questions on his behalf in Parliament, or stayed free at the Ritz, or both. According to Andrew Neil, former London Sunday Times editor and a contributing editor of Vanity Fair, who is pro-Fayed, "He feels very bitter. The younger Tories were happy to take his largesse, to take his suites at the Ritz, but this government has stayed in power so long that they became ministers, and they stopped taking his phone calls. It got too dicey. They decided, 'We don't need Mohamed Al Fayed anymore.' " Neil adds that he thinks England needs "another hundred Al Fayeds. So he comes from the wrong side of the tracks; so does Mrs. Thatcher. Who cares who owns Harrods? It's a department store, not the Department of Defense. He's a great entrepreneur." Neil subscribes to the lovable-rogue theory. "With Mohamed, you sup with a long spoon." Film producer David Puttnam, who got half of the $6 million to produce the 1981 Academy Award winner Chariots of Fire from Fayed, agrees. "Mohamed is somebody who works on an old-fashioned system: favors done, favors received... For 10 or 12 years the government said, 'Anything goes. We live by our own ethics.' ... What I find unfair is that what Mohamed's accused of is an everyday occurrence in London".



    When I met Fayed last fall, in his heavily scented office at Harrods, which he shares with a giant teddy bear of the sort that is for sale on the fourth floor, he told me, "The more good you give, the more angels guide you, protect you. The more terrible you are, the more dishonor for you." Since then, the angels have more or less sat on the fence. The government's rejection in February of the Fayed brothers' petitions for citizenship-without explanation-was a stunning rebuff to someone who constantly invokes the importance of loyalty and respect. But if the affidavit of a onetime government chauffeur who allegedly read a privileged Conservative Party memo and overheard party whips discussing Fayed and his case in derogatory language is to be believed, the decision to grant him citizenship would have been "political suicide". It appears that the Establishment has made up its mind. Fayed can make numerous highly publicized donations to charities and play the jolly merchant prince for the press as much as likes, but those he wants most to impress-the British upper class-have decided to give him the cold shoulder. "Nobody quite accepts him," admits a friend of his, former Daily Express executive editor Alan Frame. "We're still a class-ridden society. He sponsors lots of things involving the royal family, and he's still not accepted."
    Ironically, 10 years ago, when Fayed purchased Harrods, he had the Conservative government in the palm of his hand. Since then, many members of Parliament have come to realize what a dangerous man he is to cross. Behind his bubbly facade, Fayed maintains an elaborate security apparatus and bugging system, wields the considerable advertising budget of Harrods to intimidate the press, hires and fires at will, and is perhaps the most litigious man in England. A decade ago, with the acquiescence of Margaret Thatcher and the Conservatives, he pulled off a coup to buy Harrods that was breathtaking in its audacity. Last fall, when he unleashed his "cash for questions" scandal, he aimed at nothing less than attempting to topple Major's government. As he later told me, "I make revolution." Fayed sees himself as the victim of the worst British snobbery. "The devastating thing is the class system, created of people who think they are above the rest of the human race. They think they can shit just on anyone," he told me. "They think I'm a wog."
On the Continent, Fayed's long-sought-for status is assured. On display in his office is a citation from the Italian government, and France gave him the Légion d' Honneur after he restored not only the Ritz but also the Duke and Duchess of Windsor's former home in the Bois de Boulogne. On the far wall are four "warrants" to supply boots and saddles, housewares, linens, and other goods to the British royal family. Harrods, after all, is the second-greatest tourist attraction in London after Big Ben, and Fayed has announced that when he dies he wants to be mummified and entombed on the roof.

    For two-plus decades, Mohamed Al Fayed, who is 66 but says he's 62, has lived in London as an unabashed Anglophile guided by a simple Middle Eastern motto: To give is to receive-whether it be presents, favors, or influence. Charming in public, he is privately phobic about germs and fanatical about loyalty. Surrounded by bodyguards, he often conducts business on a cellular phone in a tent pitched on the lawn of his country estate in Oxted, Surrey. His fervent love for Britannia goes hand in hand with his strings-attached mode of generosity: large charitable contributions, political payoffs, Parisian junkets for journalists, toys for their children, and Harrods Christmas baskets to half of Debrett's Peerage.

    Although Fayed lives luxuriously, he carries a staggering amount of debt and spends prodigiously. The losses on the Ritz through 1993, for example, totalled nearly 1.2 billion francs ($212 million). Nevertheless, Fayed prides himself on owning world-class status symbols and maintaining the highest level of service.

    Generations of English schoolboys have gotten their hair cut at Harrods, which will order anything from a castle to a Learjet for grown-ups. But before Fayed bought the vast Knightsbridge store-the largest department store in Europe-it was a fading institution, where toilet paper was sold on the first floor. Fayed has poured many millions into restoration, installing the "Room of Luxury" and the Egyptian Hall, with his own face carved on the sphinxes around the molding. He has upgraded the toy department, opened restaurants, and recently, as the British retail market has sagged, introduced a more affordable line of Harrods private-label apparel.

    At the Ritz-which was founded by the master hotel manager Cesar Ritz in 1898, and which has catered to Garbo and Hemingway, Rockefellers and royalty-no expense has been spared; indeed, the red ink has flowed to keep up the 187-room establishment as the finest hotel in the world. Leaky pipes were tom out, the antiquated heating system was replaced, every room was redecorated. Today, guests can luxuriate in theme suites - the Cocteau, the Chopin, the Chanel. The Imperial Suite, overlooking the Place Vendome, costs more than $10,000 a night. Fayed has also added an underground swimming pool, a culinary school, and a nightclub for the Ritz clientele: "people who care for nothing but the best."

    And just in case a foreign visitor might not intuit the level of aspiration which seeks to become reality here, Harrods' dashing director of public affairs, Michael Cole-his master's voice-is superb at interpreting. Tall, handsome, silver-haired, and silver-tongued, the one-time BBC-TV royal reporter-who lost his post after leaking the Queen's 1987 Christmas message during a festive holiday lunch-is quite a contrast to the short, balding Fayed, who, for all his ambition, struggles to read and write the language of his adopted land. Theirs is a symbiotic relationship: the one knows how to parse the one who holds the purse.

    Cole is a magician of royal spin. The first day I spoke with him, he introduced me to Harrods' most beloved veteran, an elderly green-suited messenger who delivers to all the little royals gifts from "Uncle Mohamed." Cole declared, "If it weren't for Rodney, the princes might not even know there was a Father Christmas!" Another time, Cole called me from his car phone and began speaking as if he were back filing a BBC report: "At a £200,000 [$312,000] party at Spencer House given by Lord Rothschild but paid for by Gulfstream, the Princess of Wales arrived, stunning in a beaded dress. She ignored everyone else and went straight up to Mohamed and said, 'I didn't know you were rich enough to have one of these planes!' Mohamed said, 'At your disposal, whenever you wish.' Diana is so easygoing with Mohamed... Mohamed is not one of those who's overwhelmed by her. They spark off each other very well."

    Cole encouraged me to call other friends of Fayed's, naming General Norman Schwarzkopf, New York Times chairman Arthur "Punch" Sulzberger, financier Ted Forstmann, and Estée Lauder, whom Cole claims Mohamed bounces on his knee. Many believe Fayed would like someday to be Lord Al Fayed. "I don't want that," Fayed protested when I spoke with him. "But they didn't also say thank you for everything I have done. It's the opposite. They just could shit on me, everyone."

    Fayed was perched restlessly on the edge of his seat, wearing ankle boots with zippers on the sides and a plaid sport coat. "I did it to take my revenge, to show people who really runs this country, what quality they are... These days it's only the trash people." He was referring to his disclosure last October of the names of ministers who he claimed had received favors from him. When Fayed made these charges, British newspapers reported that he might bring down the government. Several weeks before the "sleaze" scandal broke, Major had received a warning-via a newspaper editor-of Fayed's allegations against his government, and was told that Fayed wanted a meeting to discuss withdrawing or revising a report released in 1990 by the Department of Trade and Industry (known as the D.T.I. report) which accused Fayed of lying about his past and making fraudulent claims about his fortune.

    When a Member of Parliament asked Major if Fayed was attempting to blackmail the government, Major appeared to give credence to the charge by saying that the matter had been referred to the director of public prosecutions for investigation. Fayed was later cleared of any wrongdoing and demanded an apology, which has not been forthcoming. Today, Fayed continues to insist that the British government was indeed for sale-like selling me ice cream," he told me. Michael Cole quickly rushed in: "Mohamed said, 'I'm a merchant. They came to me. I sell ice cream. I sell sausages. They came selling MPs.' "

      "What he is, he's still an Arab street trader," says Alan Frame. "He still believes he can buy anybody. He really does believe that if enough government ministers-indeed, enough journalists-are given enough fine gifts, stay in his hotel enough times, get hampers at Christmas, he'll get what he wants."
    Fayed's fury was stoked, he says, because he was given assurances that his and his brother's applications would pass. The government calls that claim "rubbish." The British petition for citizenship requires, among other things, that the applicant be 18 or over, have up to five years' residence, and be of sound mind and "good character." Regarding character, the British civil service is bound to respect the conclusions of the D.T.I. report, which was written by two prominent "inspectors." Sir Henry Brooke, who is now a High Court judge, and Hugh Aldous, who is now the managing partner of a prestigious accounting firm. When Fayed and his two brothers, Ali and Salah, suddenly burst onto the scene in 1984 to buy Harrods, they said they came from an old, rich Egyptian cotton-growing family. The report later documented that Fayed was actually the firstborn son of a humble schoolteacher and grew up in the slums of Alexandria. The report also claimed that the Fayeds were not remotely wealthy enough to have us their own money to put up the $700 million cash bid to buy House of Fraser, Harrods' parent company, a vast department-store chain extending from Scotland to Scandinavia. The report suggested that the money had come from the Sultan of Brunei, without his knowledge. Fayed maintains that the money was his.
According to Fayed, the applications for citizenship were prompted largely by the discomfort his brother Ali feels every time he must part from his English wife and three English-born sons to pass through British customs from the "aliens" line. (Mohamed is married to a Finnish woman, with whom he has four children, aged 8 to 14.) Fayed blames Home Secretary Michael Howard, under whose jurisdiction the applications fell, for creating a convoluted conspiracy against him. So far he has failed to back up the charges with any hard evidence, but his wrath encompasses the whole ruling elite. "I can still hear the prejudice, the racists at the core of the upper class. They call themselves the so-called Establishment."

    "The people he turned on were his friends-nobody quite knows why he did it," says Lord McAlpine, a long-time confidant of Margaret Thatcher's who was Conservative Party treasurer and who used to visit Fayed regularly. Fayed says that McAlpine accepted £250,000 ($367,000) in political contributions from him between 1985 and the election year of 1987, when it was announced that the D.T.I. was going to investigate Fayed. British law does not require disclosure of political contributions from individuals. Lord McAlpine acknowledges several Fayed donations to Conservative causes but not specific amounts, adding, "He would have been sent a thank-you note and a receipt from me. Ask him to show you the receipts."

    Alistair McAlpine responds to the Fayed brothers' charges of snobbery and racism by saying, "Then why do they want to live here? I feel very sympathetic towards Al Fayed. I feel he's been very badly treated, but it's largely their own fault. They get misunderstood; they try too hard. I can't fathom why they want British citizenship."

    "Do you know what 'wog' stands for?" asks Lord Wyatt, another Thatcher confidant who has attacked Fayed in print. "Wily Oriental gentleman." Woodrow Wyatt calls the whole business "absolute nonsense." He says that Fayed's attacks are a result of his losing his case in a unanimous decision last September at the European Court of Human Rights in Strasbourg-the final stage in a futile attempt to have the D.T.I. report erased. "The government said no, and the Court of Human Rights said no, and it sort of drives them dotty. It remains a slur on their character."

    "The Fayeds dishonestly misrepresented their origins, their wealth, their business interests and their resources: the D.T.I. report states early on. More than 700 pages later, it ends by saying, "The lies of Mohamed Fayed and his success in 'gagging' the Press created ...a new fact: that lies were the truth and that the truth was a lie." A vehement denial issued by Fayed at the time said that the report was "worthless" and "shocking." The fact that no action was ever taken against him by the British government, he says, proves that there was no wrongdoing. His enemies, on the other hand, charge the government with a massive cover-up to protect him.
The D.T.I. investigation was ordered in 1987, a full two years after Fayed's petition to buy Harrods was hastily waved through by the Thatcher government in 10 days without careful scrutiny. Fayed believes the probe came about through the ceaseless, vengeful efforts of the man he had outwitted to win the store, the equally eccentric mega-tycoon Roland W. "Tiny" Rowland, then chairman of the conglomerate Lonrho, which is based on mining and agricultural interests in Africa. Rowland hired private detectives to comb the world to uncover whatever incriminating facts they could about Fayed. Using the best investigative reporting that his money could buy, including the resources of his own newspaper The Observer, he flooded the Establishment with a series of detailed reports depicting his rival as a liar who had bought off the government and a con artist who had used the Sultan of Brunei's money to buy Harrods.

    Fayed's life story is right out of Aladdin or Ali Baba. The characters include global fixers and dealers who think nothing of trying to destabilize countries, seduce the world's wealthiest man, sue whomever whenever, buy the press, and wage private wars. It takes place in the habitat of the offshore superrich, complete with yachts and jets, where friends become enemies, enemies become friends, and the enemy of my enemy is my friend. Truth here is rather like a Platonic ideal-it must remain an abstraction.

    Michael Cole, however, continues to define his boss as a wronged and selfless hero who has been consistently victimized. "He thinks he did the right thing for this country. He has a very developed sense of morality. Of course, he wouldn't call it that," Cole says. "He's so used to being slapped in the face he doesn't even think about it. ...All he's interested in is his good family name and reputation, his children, and his own health and happiness. He doesn't look for praise. He has his own foundation to relieve real suffering-he thinks it's his sacred duty. He has a very personal relationship with his God." Cole sighs. "I sometimes think this is a charity with a business attached."
"Enter a Different World," Harrods' long-time slogan beckoned. With Mohamed Al Fayed at the helm, it is a darkly suspicious world with laws unto itself. Fayed, who spent hundreds of millions of dollars refurbishing Harrods, has visibly tightened security and now even sells the display windows to vendors. He recently unveiled plans for a new hotel across the street, and he's designing a nearby Harrods village on the Thames. But in the 10 years of his ownership, Fayed has had five managing directors; he is embroiled in numerous cases brought for unfair dismissal, and he is accused of everything from racial discrimination and enforced H.I.V. tests to bugging employees' phones and maintaining a fleet of secretaries - "some who type and some who don't," according to a former employee. It is, says former Harrods deputy chairman Christoph Bettermann, "management by fear."
    Fayed has a personal security staff of 38-two teams that alternate, one week on, one week off, at his residence at 60 Park Lane, at his country house in Oxted, where his family lives, and at his castle in Scotland. His "close-protection team" consists of 8 or 10. One assumes that the millions of dollars this security costs and the level of his apparent paranoia, which extends to wearing only clip-on ties so that he cannot be strangled, must mean that Fayed's life is under constant threat. Not so, according to a half-dozen former guards I interviewed, who say that his security is mainly for show.

    "He modeled himself after whatever the prime minister of the day used," says Bill Dunt, a guard for three and a half years, who says he was fired after being accused of speaking to a female guest and who accepted an out-of-court settlement of his unfair-dismissal suit. "If the prime minister used a Rover fastback, he would. If they changed to a Ford Scorpio, he'd change. It's part of trying to get into the Establishment." Like the U.S. president, who has a military aide to carry nuclear-launch codes in a soft black leather bag, Fayed had guards travel back and forth between Switzerland and England with his hard silver box, which contained unspecified floppy disks.

    The guards point out that real protection was impossible, because they were rarely armed, they were not allowed to ride in his car with him, and he refused to tell the guards riding in the backup car where he was going. Anyway, nobody was going to take a bullet for "the fat bastard," the guards' cruel code name for their boss. "Compared to other people I worked for, he treated the team like second-class citizens," says former guard Terry Steans. For example, guards were not allowed to touch Fayed's children, who, they say, delighted in taunting them. Bill Dunt says various children "spit at the guards," hit them with sticks, and called them "donkeys." Steans adds, "Because Fayed's English is not sound, everything is the f-word. And when he goes, he's got a very short fuse, and it doesn't take much to set him off."

    Fayed's building at 60 Park Lane contains 50 apartments, which he uses for his family, staff, and guests. He also owns the adjoining No.55, consisting of apartments for rent, as well as a building around the corner on South Street. All three buildings are connected to the Dorchester Hotel-which Fayed purchased for the Sultan of Brunei-by a series of secret passageways and an elaborate alarm system. One man who was being interviewed for a job at Park Lane was ushered into a waiting room and heard the click of a lock as the secretary left the room and closed the door. After about 20 minutes, the man looked up to see some bookcases which he had thought were built into the wall suddenly swing open and Fayed walk through them, hand outstretched.

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