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The Saturday Profile
An Arms Dealer Returns, Now Selling an Image

Shawn Baldwin for The New York Times
"My personal philosophy is I don't regret matters that happen, good or bad."
ADNAN M. KHASHOGGI

By MICHAEL SLACKMAN
Published: November 13, 2009
CAIRO

He was a small man, with a very neatly trimmed black mustache, seated in a
corner, leaning forward on his walking stick, smiling, sipping Scotch from a
glass that seemed too large for his frail hands. His face brightened with a
smile as he reminisced about the dictator's wife who once locked herself in the
bathroom of his private jet and the star-studded, five-day extravaganza he threw
for his 50th birthday.

Oh, the memories of a fallen billionaire arms trader.

"My personal philosophy is I don't regret matters that happen, good or bad,"
said the man, Adnan M. Khashoggi, who is 74 years old and these days prefers to
be remembered as "Mr. Fix It," rather than the arms dealer involved in the
Iran-Contra scandal. "I just accept this as my destiny. It's a personal
attitude."

Mr. Khashoggi has been linked to - but never convicted in - almost every major
scandal of the late 20th century: Wedtech, B.C.C.I., the indictment of the
Marcoses in the Philippines, as well as Iran-Contra. He is a favorite of
conspiracy buffs, who have connected him to such things as the death of Princess
Diana (her boyfriend at the time, Dodi al-Fayed, was his nephew) and to voting
irregularities in Florida in the 2000 presidential election (a former employee
was a local election official).

Now, he is trying to make a comeback. After a lifetime spent using his
connections to make deals for himself, he is working as a consultant, selling
his connections.

Instead of commissions he gets "incentive pay." He flies commercial now (at his
clients' expense), which is a big change for a man who once had his own DC-8,
and he lives in Riyadh, Saudi Arabia, the only property he still owned after the
collapse of his empire. But he is far from broke, or at least manages to appear
far from broke, which has always been the magic of Mr. Khashoggi.

"It is all part of the mechanism for impressing people, with your talk, with
your views and with your appearance," he said of his once-profligate ways.

Mr. Khashoggi was born into opportunity, if not outright privilege. His father
was the personal physician to King Abdul-Aziz ibn Saud, the founder of the
modern state of Saudi Arabia. He made $150,000 the summer after his first year
at California State University, Chico, selling heavy trucks to Muhammad bin
Laden, Osama bin Laden's father. He attended Stanford but never graduated. The
lure of business was too great.

The kingdom had oil money and wanted to build up its military. Mr. Khashoggi
showed it the way, becoming the link between American weapons manufacturers and
the kingdom. He was a young man earning huge commissions. At one point he was
called the richest man in the world, though on reflection it appears the more
accurate title may have been the biggest spender in the world.

"Opportunity, when it knocks, you have to be able to open the door, and it
knocked, what can I tell you," Mr. Khashoggi said in his typically understated
manner.

Mr. Khashoggi became world renowned because he saw extravagance as a calling
card - personal jets, yachts, estates around the world - all of which won him
powerful friends and lucrative deals. He hired the rock band Queen to perform at
a birthday party once, and they wrote a song about him called "Khashoggi's
Ship."

But his behavior also won him notoriety. He was the arms dealer in the
Iran-Contra scandal, in which senior Reagan administration officials sent arms
to Iran in violation of an arms embargo to secure the release of hostages and
financing for the American-backed forces in Nicaragua. He also was indicted -
and acquitted - on charges that he helped the Marcos family loot hundreds of
millions from the Philippine treasury before fleeing Manila. He had a reputation
as a playboy and as someone who hired high-priced prostitutes to win over some
of his clients and benefactors.

It was all part of his game, one that he ultimately lost.

"What happened is very easy," he said. "We were on the top, business wise. We
were doing very well and suddenly they got us involved in this Marcos story."

HE admits that he never paid attention to what he was spending. And he spent a
lot.

At one point in 1987, Mr. Khashoggi appeared on the cover of Time magazine. The
article said that he was laying out $250,000 a day to maintain his lifestyle.
Less than two weeks later, on Jan. 29, Mr. Khashoggi's holding company in the
United States filed for bankruptcy, listing liabilities of $197.5 million and
assets of $9.5 million.

His informal way of business was based on connections, a handshake - and a lot
of cash. He never really built a business; it was all him. Mr. Khashoggi
portrays himself as a passive player in a world where rich, powerful and greedy
people were more than happy to have someone like him around. He is not ashamed
to say that the end justified the means, and that making money was a noble end
in itself.

"If you want to furnish a house, you need money; if you want to buy a car, you
need money; if you want to have lunch, you need money," Mr. Khashoggi said. "You
know what Napoleon said: 'Money is not everything, it's the means to
everything.' "

Last we heard about Mr. Khashoggi, he was still in a slide, under suspicion in
several countries, including the United States, where he was being investigated
by the Securities and Exchange Commission for stock manipulation (he says he
will soon be cleared in that case).

Mr. Khashoggi agreed to meet at an outdoor restaurant at a hotel in downtown
Riyadh. He has trouble walking these days, and a tough time lifting himself out
of a chair. When he speaks, he leans in close and grasps the arm of whoever he
is talking to in a warm, disarming way.

"There is a lot to straighten out," he says, a phrase intended to enlist and
disarm.

He did not have long to talk, so he hoisted himself up, promised to meet again
and hobbled off to a chauffer-driven Cadillac.

A week later, he was seated in the bar at the Four Seasons in Cairo, his back to
the Nile. A man seated by his side referred to him as "Your Excellency," took
his calls and arranged his appointments. Mr. Khashoggi was wearing a pink
button-down shirt, the top few buttons open enough to expose a still shiny scar
from open-heart surgery five years ago.

He does not appear to be an introspective man. In fact, he sounded a bit like a
real estate broker who thought he was a brilliant businessman because he grew
rich during the real estate bubble, only to lose it all after the crash.

"Where did I go wrong?" he asked "Nowhere."

Mr. Khashoggi speaks slowly and calmly, paying great attention to appearance,
only once allowing his frustration to slip through. He feels, it seems, that
those who criticize his ways, his ethics, are hypocrites. He recalled with pride
a story of how he helped a major American arms dealer who was under
Congressional investigation on accusations of paying $400,000 in bribes to Saudi
generals.

A company executive, he said, asked if he would tell investigators that the
money was given to him, not to the generals, as a commission. "I said, give me
the money and I will say I received it," he recalled. The company, he said, gave
him the money. Then the executive asked if he would tell investigators he
received the money and never paid any bribes. "Of course I will say that. What
do you think you paid me $400,000 for?" he said, slapping his knee.

The story had a moral: Helping friends and making money are what matters. "O.K.,
I behaved unethically, for ethical reasons," he said.

Mr. Khashoggi was ready to leave; he was to fly back to Riyadh on Egypt Air. He
rushed off to his room and returned in his Saudi robes. He was escorted to the
front of the hotel where a large, shiny black Mercedes limousine waited. He
waved, then lowered himself gently into the back seat for the ride to the
airport.

"With my style of life, I don't need to retire," he said before he left the
hotel.


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