He became known as “The Great Gatsby of The Middle East”, and once claimed to be the richest man on Earth.
From facilitating lucrative business deals between the West and Saudi Arabia to his lavish lifestyle and controversial ventures, in this episode, we'll explore the intriguing life of Adnan Khashoggi.
[00:00:05] Hello, hello hello, and welcome to English Learning for Curious Minds, by Leonardo English.
[00:00:12] The show where you can listen to fascinating stories, and learn weird and wonderful things about the world at the same time as improving your English.
[00:00:21] I'm Alastair Budge, and today we are going to be talking about a man called Adnan Khashoggi.
[00:00:27] He was a businessman, a hyper connector, a lavish spender, and an arms dealer, who made his fortune in the late 20th century through facilitating connections between the West and Saudi Arabia, earning himself the nickname of “The Great Gatsby of The Middle East”..
[00:00:42] His was a fascinating, if not controversial life, and I’m thrilled to tell you more about it today.
[00:00:49] OK then, let’s get started and talk about the life of Adnan Khashoggi.
[00:00:56] Between the years of 1984 and 1995 there was a popular American TV show called Lifestyle Of The Rich And The Famous. The show involved, as the title suggested, a look inside the lives of rich and famous people.
[00:01:15] And in one of the first episodes, from February of 1985, the show opened like this:
[00:01:23] How lavish a lifestyle would you lead if you were the richest man on earth? In this world exclusive edition of Lifestyles, we'll explore the fabulous private domains of Adnan Khashoggi whose globetrotting existence is so unbelievably lush. It has inspired blockbuster movies and novels, which only pale in comparison to the true story you will see in the next 60 minutes.
[00:01:47] In case you didn’t get that, the host said:
[00:01:50] “How lavish a lifestyle would you lead if you were the richest man on earth? In this world exclusive edition of Lifestyles, we'll explore the fabulous private domains of Adnan Khashoggi whose globetrotting existence is so unbelievably lush it has inspired blockbuster movies and novels, which only pale in comparison to the true story you will see in the next 60 minutes”
[00:02:18] The next 60 minutes went on to describe the “mysterious mogul”, how excessive his life was, the houses, the yachts, the private aeroplanes, the royal friends, and how he had an estimated wealth of $10 billion, making him the richest man on Earth.
[00:02:38] This was in 1985, so $10 billion is around $30 billion in inflation adjusted terms.
[00:02:46] In today’s age of tech billionaires he would only just sneak into the top 50 richest people in the world, but back in 1985 this would have put him firmly in first place.
[00:02:59] But, just a year later, he was said to be down to his last few dollars, with creditors chasing him for everything from unpaid jet fuel to staff at his houses complaining that they hadn’t been paid in weeks.
[00:03:13] And this all begged the question, where did the money go? Was he ever the richest man on Earth, or was it all one great lie?
[00:03:25] Adnan Khashoggi was born in 1935, in Mecca, in Saudi Arabia.
[00:03:31] When he was born, Saudi Arabia was a poor country, for the most part an agricultural subsistence economy.
[00:03:39] In 1938, three years after Khashoggi was born, oil reserves were discovered, but this didn’t mean that the country’s economy went from poor and underdeveloped to swimming in oil cash overnight.
[00:03:53] It took a long time, with the majority of the country not seeing the benefits from the oil until the late 20th century, debatably even the start of the 21st century.
[00:04:04] But Adnan Khashoggi was not born into regular Saudi society.
[00:04:10] His father was the king’s personal doctor, and the young Khashoggi was afforded privileges and opportunities that most of the kingdom’s citizens did not enjoy.
[00:04:23] He was educated in Alexandria, in Egypt, at an exclusive private school where his classmates would include the future king of Jordan.
[00:04:32] It was at this exclusive school, where he rubbed shoulders with the sons of the region’s rich and powerful, that he would come to understand the power of connection, of brokering a deal between two parties.
[00:04:45] According to his obituary on his personal website, “It was at school that Khashoggi first learned the commercial value of facilitating a deal, bringing together a Libyan classmate whose father wanted to import towels with an Egyptian classmate whose father manufactured towels, earning USD $1,000 for the introduction.”
[00:05:07] Now, whether this is folklore or not, a carefully curated story that served to plant the idea of Khashoggi having some god-given ability to create advantageous deals, that is anyone’s guess.
[00:05:22] What does seem to be true is that this is how he would make most of his money, becoming, if you believed him, the richest man in the world.
[00:05:33] He went to university in the United States, but left before he graduated. After all, there was money to be made, and Khashoggi sensed that this was his time.
[00:05:45] To quote his personal website again, “In one of his first big deals, a large construction company was experiencing difficulties with the trucks that it used on the shifting desert sands. Khashoggi, using money given to him by his father for a car, bought a number of Kenworth trucks, whose wide wheels, like a camel's foot, made traversing the desert considerably easier. Khashoggi made his first $250,000 leasing the trucks to the construction company, and became the Saudi Arabia-based agent for Kenworth.“
[00:06:21] That $250,000 would be something like $3 million in today’s money, by running a desert-based car rental company, essentially.
[00:06:32] If this story is to be believed, it must have seemed almost too easy.
[00:06:39] Khashoggi was in this unique position not only of having powerful contacts in Saudi Arabia but of speaking fluent English and understanding Western business culture.
[00:06:50] He crafted this reputation for himself as a man who could straddle both cultures, who could put Saudi buyer and Western seller together, taking a small percentage for himself, of course.
[00:07:02] A small percentage, when we are talking about deals worth tens or hundreds of millions of dollars, well these end up being quite significant.
[00:07:12] And deals for towels, or deals for large desert trucks, well these can be large, but Khashoggi would later discover something that was more expensive, and therefore more lucrative, than anything you would need for a good night’s sleep or for crossing the desert: war, or rather, the threat of war.
[00:07:35] Let’s return to his obituary again, and remember, this is on his “personal website”. “Khashoggi became an advocate and negotiator for the defence relationship between Saudi Arabia and the West. Khashoggi provided advice, strategy, and structures for government defence contracts. In the 1960s and 1970s, Khashoggi helped develop the Saudi defence sector during a period in which the young Kingdom felt threatened by the rise of nationalist movements in the region.”
[00:08:07] Now, “defence” in this context is somewhat of a euphemism for arms, weapons, guns, bombs, planes, tanks, everything that a country needs to defend itself from attack, or if it so desires, to attack another country.
[00:08:25] Saudi Arabia didn’t have the capacity to make its own arms, but there were plenty of Western companies with great expertise in the area that were more than willing to supply the Middle Eastern kingdom with the goods that it needed.
[00:08:40] And this was something encouraged by Western governments as well.
[00:08:45] After all, Saudi Arabia had and still has vast oil reserves, so it was in Western interests for the kingdom to remain a close ally, and a stable one at that.
[00:08:57] So, who did the kingdom turn to?
[00:09:00] Or rather, who did Western arms companies turn to to sell their wares to the Saudis?
[00:09:06] The man who had made a name for himself as having impeccable connections, and a foot in both camps: Adnan Khashoggi.
[00:09:16] Khashoggi became the agent for a variety of different Western corporations, representing them in deals with the Saudi government. One is a company that is still around today, and you may have heard of: Lockheed, or Lockheed Martin as it would come to be known.
[00:09:34] Khashoggi was deeply involved with the company, becoming its agent in the region when he was a mere 26 years old, selling billions of dollars of weapons and equipment to Saudi Arabia in the 1970s.
[00:09:46] And it made him a very rich man.
[00:09:51] His commission varied, from 2.5% up to a reported 15%, and he ended up earning $150 million dollars from the company as Saudi Arabia went on an arms-buying spree after the 1973 Arab-Israeli War.
[00:10:10] If there was ever an example of the value of connection, of putting two parties together, well this was it.
[00:10:18] Now, Lockheed would say that this was simply commission, a price the company was willing to pay for someone to sell its goods and services in a different market.
[00:10:29] But for all of this money, $150 million, for it all to go to one person, one individual, it seemed…excessive.
[00:10:41] It would turn out that this money would go through Khashoggi, but it wouldn’t all end up in his pocket.
[00:10:48] In 1975, when forced to testify in front of a US Senate Subcommittee about bribery, the chairman of Lockheed was forced to admit that a proportion of Khashoggi’s fees would be earmarked for bribes to high-ranking Saudi officials.
[00:11:06] In other words, Lockheed would pay Khashoggi, Khashoggi would transfer Saudi officials a kickback, a bribe, into their Swiss bank accounts and they would sign off on the multi-million dollar arms purchases.
[00:11:19] And the money wasn’t the only perk of doing business with Khashoggi, and this is where this story is going to get slightly sordid, I’m afraid.
[00:11:29] He was married, he had five children of his own, but he kept a dozen or so “pleasure wives”, mistresses who would be taken around the world and put up in five star hotels, lavished with gifts and a five star lifestyle, but part of the deal was that they would need to acquiesce to Khashoggi’s every wish, which would often include sleeping with his business associates and government contacts.
[00:11:58] This might be gross and immoral, it might be a dereliction of his duty and of the duty of the corrupt officials and businessmen. You could even argue that it resulted in a buildup of arms in the region.
[00:12:11] But for many years it was great business.
[00:12:15] It was great business for Lockheed, the arms company. It was great business for the Saudi officials who received huge bribes for choosing Lockheed, and it was great business for the man in the middle, Adnan Khashoggi.
[00:12:30] Khashoggi took this money and invested it all over the world, speculating in real estate, oil refineries, car rental companies, all and any commercial enterprise that he could.
[00:12:43] The problem was, according to someone who would later do business with him, Donald J. Trump, Khashoggi was a rubbish businessman.
[00:12:53] He was great at facilitating connections, he was great at bringing people together, as well as cultivating his own brand as a hyper connector and power broker, but when it came to investing and operating businesses, this wasn’t where his skills lay.
[00:13:11] Trump got to know Khashoggi, at least from a business perspective, after he bought his yacht.
[00:13:18] Khashoggi had bought this yacht in 1980, and it cost a reported $100 million to build, almost $400 million in today’s money.
[00:13:29] It was the peak of luxury, complete with its own patisserie, even hospital with an operating theatre.
[00:13:36] And of course, it had all of the usual toys and features of the ultra-rich: helipads, a cinema, and large enough fridges and freezers to carry a three-month supply of food for 100 people.
[00:13:50] It was so opulent that it even featured in the James Bond movie Never Say Never Again.
[00:13:57] For Khashoggi, it was a tool of business, and he would use it to entertain business executives and government officials, prospective clients, far away from the prying eyes of the media.
[00:14:10] On one occasion there were a reported five heads of state being entertained on it at the same time.
[00:14:17] It was a business expense, helping Khashoggi seal deals, but it was a serious expense.
[00:14:25] After he ran into financial difficulties in the late 1980s, he was forced to sell it, and this is where he came into contact with Donald Trump, who would go on to buy the yacht.
[00:14:38] According to a story that Trump would happily tell anyone who asked, Trump managed to get $1 million knocked off the asking price because Khashoggi didn’t want Trump to continue using the yacht’s original name, Nabila, because it was Khashoggi’s daughter’s name.
[00:14:55] What Khashoggi didn’t think about, or didn’t know, and this was what Trump thought made him a bad businessman, was that Trump had no intention of keeping the original name.
[00:15:08] If there is anything anyone knows about Donald Trump, it’s that he likes to stick his name on everything he owns, and sure enough, he took the $1 million reduction in price, and immediately changed the name to “Trump Princess”.
[00:15:24] Now, back to Khashoggi.
[00:15:26] If you remember the start of the episode, the programme claimed that he was the richest man in the world, with a fortune of $10 billion.
[00:15:36] How did he get there, you might be asking yourself, if he was a lousy businessman and made his money merely as a facilitator between Western companies and Saudi government officials, taking a small percentage in commission?
[00:15:51] The simple answer is, most probably, he didn’t.
[00:15:55] He never had anywhere near the riches that he said he had.
[00:15:59] Khashoggi never was the richest man in the world, far from it, but he was exceptionally talented at making people believe that he was.
[00:16:09] Sure, he was very rich, but a lot of what he said he owned was either paid for with credit or rented.
[00:16:18] He would be given large loans, people would extend huge credit lines to him.
[00:16:24] After all, he was good for it, the richest man in the world always paid his bills, did he not?
[00:16:31] It turned out that even making huge commissions on arms sales was not enough to pay for a lifestyle that was, at one point, costing him a reported $250,000 every single day.
[00:16:45] And from his heyday in the 1970s and 1980s, things started to go downhill for Adnan Khashoggi. He was forced to sell the planes and yachts, and to revise his spending.
[00:17:00] He was even arrested in 1988 in Switzerland on charges of racketeering and conspiracy, with US federal prosecutors claiming that he had helped the former president of the Philippines and his wife run away with over a hundred million dollars that they had stolen from the country.
[00:17:18] He fought the extradition order, and only agreed to be extradited when the more serious charges were dropped.
[00:17:26] But the good days were over for this international playboy.
[00:17:31] He never officially declared personal bankruptcy, but he would be chased by his creditors for the rest of his life, before dying in 2017, at the age of 81.
[00:17:43] Now, you have heard the story of Adnan Khashoggi, and how a man became spectacularly wealthy, or at least managed to live a life of vast luxury, as a middleman between the West and the Middle East.
[00:17:57] You might also recognise his surname, Khashoggi, because of Jamal Khashoggi, the Saudi journalist and dissident who was murdered in the Saudi consulate in Istanbul in 2018, with the CIA concluding that this was done on the orders of the Saudi crown prince, Mohammed Bin Salman.
[00:18:16] Jamal Khashoggi and Adnan Khashoggi are not, in fact, strangers that share a common surname. They were related. Adnan Khashoggi was Jamal Khashoggi’s uncle.
[00:18:29] As you might remember, the then US president Donald Trump, was under pressure to publicly criticise Saudi Arabia for the murder of the dissident journalist, especially after his own government agency concluded that this was a state-sponsored murder.
[00:18:45] But he did not, instead citing the value of US weapon sales to the country.
[00:18:52] Adnan Khoshoggi died in 2017, a year before his nephew, Jamal.
[00:18:59] But the two men couldn’t have been more different.
[00:19:03] One spoke out against the Saudi regime’s weapons purchases and military intervention.
[00:19:09] The other facilitated it.
[00:19:12] One sold his yacht to Donald Trump, the other was metaphorically abandoned at sea by him.
[00:19:19] One partied with kings and queens in Monte Carlo, and died peacefully in a London hospital at the age of 81.
[00:19:27] The other ended up cut into pieces with a bone saw.
[00:19:32] There are certainly a few conclusions that you can draw from that.
[00:19:38] Okay then, that is it for today's episode on Adnan Khashoggi, a controversial but certainly colourful character.
[00:19:46] As always, I would love to know what you thought about this episode.
[00:19:49] This show is actually quite popular in Saudi Arabia, so for the Saudi Arabian listeners, what do you know and think about the life of Adnan Khashoggi?
[00:19:57] You can head right into our community forum, which is at community.leonardoenglish.com and get chatting away to other curious minds, or you can always email us at hi@leonardoenglish.com.
[00:20:09] You've been listening to English Learning for Curious Minds, by Leonardo English.
[00:20:14] I'm Alastair Budge. you stay safe, and I'll catch you in the next episode.
[END OF EPISODE]
[00:00:05] Hello, hello hello, and welcome to English Learning for Curious Minds, by Leonardo English.
[00:00:12] The show where you can listen to fascinating stories, and learn weird and wonderful things about the world at the same time as improving your English.
[00:00:21] I'm Alastair Budge, and today we are going to be talking about a man called Adnan Khashoggi.
[00:00:27] He was a businessman, a hyper connector, a lavish spender, and an arms dealer, who made his fortune in the late 20th century through facilitating connections between the West and Saudi Arabia, earning himself the nickname of “The Great Gatsby of The Middle East”..
[00:00:42] His was a fascinating, if not controversial life, and I’m thrilled to tell you more about it today.
[00:00:49] OK then, let’s get started and talk about the life of Adnan Khashoggi.
[00:00:56] Between the years of 1984 and 1995 there was a popular American TV show called Lifestyle Of The Rich And The Famous. The show involved, as the title suggested, a look inside the lives of rich and famous people.
[00:01:15] And in one of the first episodes, from February of 1985, the show opened like this:
[00:01:23] How lavish a lifestyle would you lead if you were the richest man on earth? In this world exclusive edition of Lifestyles, we'll explore the fabulous private domains of Adnan Khashoggi whose globetrotting existence is so unbelievably lush. It has inspired blockbuster movies and novels, which only pale in comparison to the true story you will see in the next 60 minutes.
[00:01:47] In case you didn’t get that, the host said:
[00:01:50] “How lavish a lifestyle would you lead if you were the richest man on earth? In this world exclusive edition of Lifestyles, we'll explore the fabulous private domains of Adnan Khashoggi whose globetrotting existence is so unbelievably lush it has inspired blockbuster movies and novels, which only pale in comparison to the true story you will see in the next 60 minutes”
[00:02:18] The next 60 minutes went on to describe the “mysterious mogul”, how excessive his life was, the houses, the yachts, the private aeroplanes, the royal friends, and how he had an estimated wealth of $10 billion, making him the richest man on Earth.
[00:02:38] This was in 1985, so $10 billion is around $30 billion in inflation adjusted terms.
[00:02:46] In today’s age of tech billionaires he would only just sneak into the top 50 richest people in the world, but back in 1985 this would have put him firmly in first place.
[00:02:59] But, just a year later, he was said to be down to his last few dollars, with creditors chasing him for everything from unpaid jet fuel to staff at his houses complaining that they hadn’t been paid in weeks.
[00:03:13] And this all begged the question, where did the money go? Was he ever the richest man on Earth, or was it all one great lie?
[00:03:25] Adnan Khashoggi was born in 1935, in Mecca, in Saudi Arabia.
[00:03:31] When he was born, Saudi Arabia was a poor country, for the most part an agricultural subsistence economy.
[00:03:39] In 1938, three years after Khashoggi was born, oil reserves were discovered, but this didn’t mean that the country’s economy went from poor and underdeveloped to swimming in oil cash overnight.
[00:03:53] It took a long time, with the majority of the country not seeing the benefits from the oil until the late 20th century, debatably even the start of the 21st century.
[00:04:04] But Adnan Khashoggi was not born into regular Saudi society.
[00:04:10] His father was the king’s personal doctor, and the young Khashoggi was afforded privileges and opportunities that most of the kingdom’s citizens did not enjoy.
[00:04:23] He was educated in Alexandria, in Egypt, at an exclusive private school where his classmates would include the future king of Jordan.
[00:04:32] It was at this exclusive school, where he rubbed shoulders with the sons of the region’s rich and powerful, that he would come to understand the power of connection, of brokering a deal between two parties.
[00:04:45] According to his obituary on his personal website, “It was at school that Khashoggi first learned the commercial value of facilitating a deal, bringing together a Libyan classmate whose father wanted to import towels with an Egyptian classmate whose father manufactured towels, earning USD $1,000 for the introduction.”
[00:05:07] Now, whether this is folklore or not, a carefully curated story that served to plant the idea of Khashoggi having some god-given ability to create advantageous deals, that is anyone’s guess.
[00:05:22] What does seem to be true is that this is how he would make most of his money, becoming, if you believed him, the richest man in the world.
[00:05:33] He went to university in the United States, but left before he graduated. After all, there was money to be made, and Khashoggi sensed that this was his time.
[00:05:45] To quote his personal website again, “In one of his first big deals, a large construction company was experiencing difficulties with the trucks that it used on the shifting desert sands. Khashoggi, using money given to him by his father for a car, bought a number of Kenworth trucks, whose wide wheels, like a camel's foot, made traversing the desert considerably easier. Khashoggi made his first $250,000 leasing the trucks to the construction company, and became the Saudi Arabia-based agent for Kenworth.“
[00:06:21] That $250,000 would be something like $3 million in today’s money, by running a desert-based car rental company, essentially.
[00:06:32] If this story is to be believed, it must have seemed almost too easy.
[00:06:39] Khashoggi was in this unique position not only of having powerful contacts in Saudi Arabia but of speaking fluent English and understanding Western business culture.
[00:06:50] He crafted this reputation for himself as a man who could straddle both cultures, who could put Saudi buyer and Western seller together, taking a small percentage for himself, of course.
[00:07:02] A small percentage, when we are talking about deals worth tens or hundreds of millions of dollars, well these end up being quite significant.
[00:07:12] And deals for towels, or deals for large desert trucks, well these can be large, but Khashoggi would later discover something that was more expensive, and therefore more lucrative, than anything you would need for a good night’s sleep or for crossing the desert: war, or rather, the threat of war.
[00:07:35] Let’s return to his obituary again, and remember, this is on his “personal website”. “Khashoggi became an advocate and negotiator for the defence relationship between Saudi Arabia and the West. Khashoggi provided advice, strategy, and structures for government defence contracts. In the 1960s and 1970s, Khashoggi helped develop the Saudi defence sector during a period in which the young Kingdom felt threatened by the rise of nationalist movements in the region.”
[00:08:07] Now, “defence” in this context is somewhat of a euphemism for arms, weapons, guns, bombs, planes, tanks, everything that a country needs to defend itself from attack, or if it so desires, to attack another country.
[00:08:25] Saudi Arabia didn’t have the capacity to make its own arms, but there were plenty of Western companies with great expertise in the area that were more than willing to supply the Middle Eastern kingdom with the goods that it needed.
[00:08:40] And this was something encouraged by Western governments as well.
[00:08:45] After all, Saudi Arabia had and still has vast oil reserves, so it was in Western interests for the kingdom to remain a close ally, and a stable one at that.
[00:08:57] So, who did the kingdom turn to?
[00:09:00] Or rather, who did Western arms companies turn to to sell their wares to the Saudis?
[00:09:06] The man who had made a name for himself as having impeccable connections, and a foot in both camps: Adnan Khashoggi.
[00:09:16] Khashoggi became the agent for a variety of different Western corporations, representing them in deals with the Saudi government. One is a company that is still around today, and you may have heard of: Lockheed, or Lockheed Martin as it would come to be known.
[00:09:34] Khashoggi was deeply involved with the company, becoming its agent in the region when he was a mere 26 years old, selling billions of dollars of weapons and equipment to Saudi Arabia in the 1970s.
[00:09:46] And it made him a very rich man.
[00:09:51] His commission varied, from 2.5% up to a reported 15%, and he ended up earning $150 million dollars from the company as Saudi Arabia went on an arms-buying spree after the 1973 Arab-Israeli War.
[00:10:10] If there was ever an example of the value of connection, of putting two parties together, well this was it.
[00:10:18] Now, Lockheed would say that this was simply commission, a price the company was willing to pay for someone to sell its goods and services in a different market.
[00:10:29] But for all of this money, $150 million, for it all to go to one person, one individual, it seemed…excessive.
[00:10:41] It would turn out that this money would go through Khashoggi, but it wouldn’t all end up in his pocket.
[00:10:48] In 1975, when forced to testify in front of a US Senate Subcommittee about bribery, the chairman of Lockheed was forced to admit that a proportion of Khashoggi’s fees would be earmarked for bribes to high-ranking Saudi officials.
[00:11:06] In other words, Lockheed would pay Khashoggi, Khashoggi would transfer Saudi officials a kickback, a bribe, into their Swiss bank accounts and they would sign off on the multi-million dollar arms purchases.
[00:11:19] And the money wasn’t the only perk of doing business with Khashoggi, and this is where this story is going to get slightly sordid, I’m afraid.
[00:11:29] He was married, he had five children of his own, but he kept a dozen or so “pleasure wives”, mistresses who would be taken around the world and put up in five star hotels, lavished with gifts and a five star lifestyle, but part of the deal was that they would need to acquiesce to Khashoggi’s every wish, which would often include sleeping with his business associates and government contacts.
[00:11:58] This might be gross and immoral, it might be a dereliction of his duty and of the duty of the corrupt officials and businessmen. You could even argue that it resulted in a buildup of arms in the region.
[00:12:11] But for many years it was great business.
[00:12:15] It was great business for Lockheed, the arms company. It was great business for the Saudi officials who received huge bribes for choosing Lockheed, and it was great business for the man in the middle, Adnan Khashoggi.
[00:12:30] Khashoggi took this money and invested it all over the world, speculating in real estate, oil refineries, car rental companies, all and any commercial enterprise that he could.
[00:12:43] The problem was, according to someone who would later do business with him, Donald J. Trump, Khashoggi was a rubbish businessman.
[00:12:53] He was great at facilitating connections, he was great at bringing people together, as well as cultivating his own brand as a hyper connector and power broker, but when it came to investing and operating businesses, this wasn’t where his skills lay.
[00:13:11] Trump got to know Khashoggi, at least from a business perspective, after he bought his yacht.
[00:13:18] Khashoggi had bought this yacht in 1980, and it cost a reported $100 million to build, almost $400 million in today’s money.
[00:13:29] It was the peak of luxury, complete with its own patisserie, even hospital with an operating theatre.
[00:13:36] And of course, it had all of the usual toys and features of the ultra-rich: helipads, a cinema, and large enough fridges and freezers to carry a three-month supply of food for 100 people.
[00:13:50] It was so opulent that it even featured in the James Bond movie Never Say Never Again.
[00:13:57] For Khashoggi, it was a tool of business, and he would use it to entertain business executives and government officials, prospective clients, far away from the prying eyes of the media.
[00:14:10] On one occasion there were a reported five heads of state being entertained on it at the same time.
[00:14:17] It was a business expense, helping Khashoggi seal deals, but it was a serious expense.
[00:14:25] After he ran into financial difficulties in the late 1980s, he was forced to sell it, and this is where he came into contact with Donald Trump, who would go on to buy the yacht.
[00:14:38] According to a story that Trump would happily tell anyone who asked, Trump managed to get $1 million knocked off the asking price because Khashoggi didn’t want Trump to continue using the yacht’s original name, Nabila, because it was Khashoggi’s daughter’s name.
[00:14:55] What Khashoggi didn’t think about, or didn’t know, and this was what Trump thought made him a bad businessman, was that Trump had no intention of keeping the original name.
[00:15:08] If there is anything anyone knows about Donald Trump, it’s that he likes to stick his name on everything he owns, and sure enough, he took the $1 million reduction in price, and immediately changed the name to “Trump Princess”.
[00:15:24] Now, back to Khashoggi.
[00:15:26] If you remember the start of the episode, the programme claimed that he was the richest man in the world, with a fortune of $10 billion.
[00:15:36] How did he get there, you might be asking yourself, if he was a lousy businessman and made his money merely as a facilitator between Western companies and Saudi government officials, taking a small percentage in commission?
[00:15:51] The simple answer is, most probably, he didn’t.
[00:15:55] He never had anywhere near the riches that he said he had.
[00:15:59] Khashoggi never was the richest man in the world, far from it, but he was exceptionally talented at making people believe that he was.
[00:16:09] Sure, he was very rich, but a lot of what he said he owned was either paid for with credit or rented.
[00:16:18] He would be given large loans, people would extend huge credit lines to him.
[00:16:24] After all, he was good for it, the richest man in the world always paid his bills, did he not?
[00:16:31] It turned out that even making huge commissions on arms sales was not enough to pay for a lifestyle that was, at one point, costing him a reported $250,000 every single day.
[00:16:45] And from his heyday in the 1970s and 1980s, things started to go downhill for Adnan Khashoggi. He was forced to sell the planes and yachts, and to revise his spending.
[00:17:00] He was even arrested in 1988 in Switzerland on charges of racketeering and conspiracy, with US federal prosecutors claiming that he had helped the former president of the Philippines and his wife run away with over a hundred million dollars that they had stolen from the country.
[00:17:18] He fought the extradition order, and only agreed to be extradited when the more serious charges were dropped.
[00:17:26] But the good days were over for this international playboy.
[00:17:31] He never officially declared personal bankruptcy, but he would be chased by his creditors for the rest of his life, before dying in 2017, at the age of 81.
[00:17:43] Now, you have heard the story of Adnan Khashoggi, and how a man became spectacularly wealthy, or at least managed to live a life of vast luxury, as a middleman between the West and the Middle East.
[00:17:57] You might also recognise his surname, Khashoggi, because of Jamal Khashoggi, the Saudi journalist and dissident who was murdered in the Saudi consulate in Istanbul in 2018, with the CIA concluding that this was done on the orders of the Saudi crown prince, Mohammed Bin Salman.
[00:18:16] Jamal Khashoggi and Adnan Khashoggi are not, in fact, strangers that share a common surname. They were related. Adnan Khashoggi was Jamal Khashoggi’s uncle.
[00:18:29] As you might remember, the then US president Donald Trump, was under pressure to publicly criticise Saudi Arabia for the murder of the dissident journalist, especially after his own government agency concluded that this was a state-sponsored murder.
[00:18:45] But he did not, instead citing the value of US weapon sales to the country.
[00:18:52] Adnan Khoshoggi died in 2017, a year before his nephew, Jamal.
[00:18:59] But the two men couldn’t have been more different.
[00:19:03] One spoke out against the Saudi regime’s weapons purchases and military intervention.
[00:19:09] The other facilitated it.
[00:19:12] One sold his yacht to Donald Trump, the other was metaphorically abandoned at sea by him.
[00:19:19] One partied with kings and queens in Monte Carlo, and died peacefully in a London hospital at the age of 81.
[00:19:27] The other ended up cut into pieces with a bone saw.
[00:19:32] There are certainly a few conclusions that you can draw from that.
[00:19:38] Okay then, that is it for today's episode on Adnan Khashoggi, a controversial but certainly colourful character.
[00:19:46] As always, I would love to know what you thought about this episode.
[00:19:49] This show is actually quite popular in Saudi Arabia, so for the Saudi Arabian listeners, what do you know and think about the life of Adnan Khashoggi?
[00:19:57] You can head right into our community forum, which is at community.leonardoenglish.com and get chatting away to other curious minds, or you can always email us at hi@leonardoenglish.com.
[00:20:09] You've been listening to English Learning for Curious Minds, by Leonardo English.
[00:20:14] I'm Alastair Budge. you stay safe, and I'll catch you in the next episode.
[END OF EPISODE]
[00:00:05] Hello, hello hello, and welcome to English Learning for Curious Minds, by Leonardo English.
[00:00:12] The show where you can listen to fascinating stories, and learn weird and wonderful things about the world at the same time as improving your English.
[00:00:21] I'm Alastair Budge, and today we are going to be talking about a man called Adnan Khashoggi.
[00:00:27] He was a businessman, a hyper connector, a lavish spender, and an arms dealer, who made his fortune in the late 20th century through facilitating connections between the West and Saudi Arabia, earning himself the nickname of “The Great Gatsby of The Middle East”..
[00:00:42] His was a fascinating, if not controversial life, and I’m thrilled to tell you more about it today.
[00:00:49] OK then, let’s get started and talk about the life of Adnan Khashoggi.
[00:00:56] Between the years of 1984 and 1995 there was a popular American TV show called Lifestyle Of The Rich And The Famous. The show involved, as the title suggested, a look inside the lives of rich and famous people.
[00:01:15] And in one of the first episodes, from February of 1985, the show opened like this:
[00:01:23] How lavish a lifestyle would you lead if you were the richest man on earth? In this world exclusive edition of Lifestyles, we'll explore the fabulous private domains of Adnan Khashoggi whose globetrotting existence is so unbelievably lush. It has inspired blockbuster movies and novels, which only pale in comparison to the true story you will see in the next 60 minutes.
[00:01:47] In case you didn’t get that, the host said:
[00:01:50] “How lavish a lifestyle would you lead if you were the richest man on earth? In this world exclusive edition of Lifestyles, we'll explore the fabulous private domains of Adnan Khashoggi whose globetrotting existence is so unbelievably lush it has inspired blockbuster movies and novels, which only pale in comparison to the true story you will see in the next 60 minutes”
[00:02:18] The next 60 minutes went on to describe the “mysterious mogul”, how excessive his life was, the houses, the yachts, the private aeroplanes, the royal friends, and how he had an estimated wealth of $10 billion, making him the richest man on Earth.
[00:02:38] This was in 1985, so $10 billion is around $30 billion in inflation adjusted terms.
[00:02:46] In today’s age of tech billionaires he would only just sneak into the top 50 richest people in the world, but back in 1985 this would have put him firmly in first place.
[00:02:59] But, just a year later, he was said to be down to his last few dollars, with creditors chasing him for everything from unpaid jet fuel to staff at his houses complaining that they hadn’t been paid in weeks.
[00:03:13] And this all begged the question, where did the money go? Was he ever the richest man on Earth, or was it all one great lie?
[00:03:25] Adnan Khashoggi was born in 1935, in Mecca, in Saudi Arabia.
[00:03:31] When he was born, Saudi Arabia was a poor country, for the most part an agricultural subsistence economy.
[00:03:39] In 1938, three years after Khashoggi was born, oil reserves were discovered, but this didn’t mean that the country’s economy went from poor and underdeveloped to swimming in oil cash overnight.
[00:03:53] It took a long time, with the majority of the country not seeing the benefits from the oil until the late 20th century, debatably even the start of the 21st century.
[00:04:04] But Adnan Khashoggi was not born into regular Saudi society.
[00:04:10] His father was the king’s personal doctor, and the young Khashoggi was afforded privileges and opportunities that most of the kingdom’s citizens did not enjoy.
[00:04:23] He was educated in Alexandria, in Egypt, at an exclusive private school where his classmates would include the future king of Jordan.
[00:04:32] It was at this exclusive school, where he rubbed shoulders with the sons of the region’s rich and powerful, that he would come to understand the power of connection, of brokering a deal between two parties.
[00:04:45] According to his obituary on his personal website, “It was at school that Khashoggi first learned the commercial value of facilitating a deal, bringing together a Libyan classmate whose father wanted to import towels with an Egyptian classmate whose father manufactured towels, earning USD $1,000 for the introduction.”
[00:05:07] Now, whether this is folklore or not, a carefully curated story that served to plant the idea of Khashoggi having some god-given ability to create advantageous deals, that is anyone’s guess.
[00:05:22] What does seem to be true is that this is how he would make most of his money, becoming, if you believed him, the richest man in the world.
[00:05:33] He went to university in the United States, but left before he graduated. After all, there was money to be made, and Khashoggi sensed that this was his time.
[00:05:45] To quote his personal website again, “In one of his first big deals, a large construction company was experiencing difficulties with the trucks that it used on the shifting desert sands. Khashoggi, using money given to him by his father for a car, bought a number of Kenworth trucks, whose wide wheels, like a camel's foot, made traversing the desert considerably easier. Khashoggi made his first $250,000 leasing the trucks to the construction company, and became the Saudi Arabia-based agent for Kenworth.“
[00:06:21] That $250,000 would be something like $3 million in today’s money, by running a desert-based car rental company, essentially.
[00:06:32] If this story is to be believed, it must have seemed almost too easy.
[00:06:39] Khashoggi was in this unique position not only of having powerful contacts in Saudi Arabia but of speaking fluent English and understanding Western business culture.
[00:06:50] He crafted this reputation for himself as a man who could straddle both cultures, who could put Saudi buyer and Western seller together, taking a small percentage for himself, of course.
[00:07:02] A small percentage, when we are talking about deals worth tens or hundreds of millions of dollars, well these end up being quite significant.
[00:07:12] And deals for towels, or deals for large desert trucks, well these can be large, but Khashoggi would later discover something that was more expensive, and therefore more lucrative, than anything you would need for a good night’s sleep or for crossing the desert: war, or rather, the threat of war.
[00:07:35] Let’s return to his obituary again, and remember, this is on his “personal website”. “Khashoggi became an advocate and negotiator for the defence relationship between Saudi Arabia and the West. Khashoggi provided advice, strategy, and structures for government defence contracts. In the 1960s and 1970s, Khashoggi helped develop the Saudi defence sector during a period in which the young Kingdom felt threatened by the rise of nationalist movements in the region.”
[00:08:07] Now, “defence” in this context is somewhat of a euphemism for arms, weapons, guns, bombs, planes, tanks, everything that a country needs to defend itself from attack, or if it so desires, to attack another country.
[00:08:25] Saudi Arabia didn’t have the capacity to make its own arms, but there were plenty of Western companies with great expertise in the area that were more than willing to supply the Middle Eastern kingdom with the goods that it needed.
[00:08:40] And this was something encouraged by Western governments as well.
[00:08:45] After all, Saudi Arabia had and still has vast oil reserves, so it was in Western interests for the kingdom to remain a close ally, and a stable one at that.
[00:08:57] So, who did the kingdom turn to?
[00:09:00] Or rather, who did Western arms companies turn to to sell their wares to the Saudis?
[00:09:06] The man who had made a name for himself as having impeccable connections, and a foot in both camps: Adnan Khashoggi.
[00:09:16] Khashoggi became the agent for a variety of different Western corporations, representing them in deals with the Saudi government. One is a company that is still around today, and you may have heard of: Lockheed, or Lockheed Martin as it would come to be known.
[00:09:34] Khashoggi was deeply involved with the company, becoming its agent in the region when he was a mere 26 years old, selling billions of dollars of weapons and equipment to Saudi Arabia in the 1970s.
[00:09:46] And it made him a very rich man.
[00:09:51] His commission varied, from 2.5% up to a reported 15%, and he ended up earning $150 million dollars from the company as Saudi Arabia went on an arms-buying spree after the 1973 Arab-Israeli War.
[00:10:10] If there was ever an example of the value of connection, of putting two parties together, well this was it.
[00:10:18] Now, Lockheed would say that this was simply commission, a price the company was willing to pay for someone to sell its goods and services in a different market.
[00:10:29] But for all of this money, $150 million, for it all to go to one person, one individual, it seemed…excessive.
[00:10:41] It would turn out that this money would go through Khashoggi, but it wouldn’t all end up in his pocket.
[00:10:48] In 1975, when forced to testify in front of a US Senate Subcommittee about bribery, the chairman of Lockheed was forced to admit that a proportion of Khashoggi’s fees would be earmarked for bribes to high-ranking Saudi officials.
[00:11:06] In other words, Lockheed would pay Khashoggi, Khashoggi would transfer Saudi officials a kickback, a bribe, into their Swiss bank accounts and they would sign off on the multi-million dollar arms purchases.
[00:11:19] And the money wasn’t the only perk of doing business with Khashoggi, and this is where this story is going to get slightly sordid, I’m afraid.
[00:11:29] He was married, he had five children of his own, but he kept a dozen or so “pleasure wives”, mistresses who would be taken around the world and put up in five star hotels, lavished with gifts and a five star lifestyle, but part of the deal was that they would need to acquiesce to Khashoggi’s every wish, which would often include sleeping with his business associates and government contacts.
[00:11:58] This might be gross and immoral, it might be a dereliction of his duty and of the duty of the corrupt officials and businessmen. You could even argue that it resulted in a buildup of arms in the region.
[00:12:11] But for many years it was great business.
[00:12:15] It was great business for Lockheed, the arms company. It was great business for the Saudi officials who received huge bribes for choosing Lockheed, and it was great business for the man in the middle, Adnan Khashoggi.
[00:12:30] Khashoggi took this money and invested it all over the world, speculating in real estate, oil refineries, car rental companies, all and any commercial enterprise that he could.
[00:12:43] The problem was, according to someone who would later do business with him, Donald J. Trump, Khashoggi was a rubbish businessman.
[00:12:53] He was great at facilitating connections, he was great at bringing people together, as well as cultivating his own brand as a hyper connector and power broker, but when it came to investing and operating businesses, this wasn’t where his skills lay.
[00:13:11] Trump got to know Khashoggi, at least from a business perspective, after he bought his yacht.
[00:13:18] Khashoggi had bought this yacht in 1980, and it cost a reported $100 million to build, almost $400 million in today’s money.
[00:13:29] It was the peak of luxury, complete with its own patisserie, even hospital with an operating theatre.
[00:13:36] And of course, it had all of the usual toys and features of the ultra-rich: helipads, a cinema, and large enough fridges and freezers to carry a three-month supply of food for 100 people.
[00:13:50] It was so opulent that it even featured in the James Bond movie Never Say Never Again.
[00:13:57] For Khashoggi, it was a tool of business, and he would use it to entertain business executives and government officials, prospective clients, far away from the prying eyes of the media.
[00:14:10] On one occasion there were a reported five heads of state being entertained on it at the same time.
[00:14:17] It was a business expense, helping Khashoggi seal deals, but it was a serious expense.
[00:14:25] After he ran into financial difficulties in the late 1980s, he was forced to sell it, and this is where he came into contact with Donald Trump, who would go on to buy the yacht.
[00:14:38] According to a story that Trump would happily tell anyone who asked, Trump managed to get $1 million knocked off the asking price because Khashoggi didn’t want Trump to continue using the yacht’s original name, Nabila, because it was Khashoggi’s daughter’s name.
[00:14:55] What Khashoggi didn’t think about, or didn’t know, and this was what Trump thought made him a bad businessman, was that Trump had no intention of keeping the original name.
[00:15:08] If there is anything anyone knows about Donald Trump, it’s that he likes to stick his name on everything he owns, and sure enough, he took the $1 million reduction in price, and immediately changed the name to “Trump Princess”.
[00:15:24] Now, back to Khashoggi.
[00:15:26] If you remember the start of the episode, the programme claimed that he was the richest man in the world, with a fortune of $10 billion.
[00:15:36] How did he get there, you might be asking yourself, if he was a lousy businessman and made his money merely as a facilitator between Western companies and Saudi government officials, taking a small percentage in commission?
[00:15:51] The simple answer is, most probably, he didn’t.
[00:15:55] He never had anywhere near the riches that he said he had.
[00:15:59] Khashoggi never was the richest man in the world, far from it, but he was exceptionally talented at making people believe that he was.
[00:16:09] Sure, he was very rich, but a lot of what he said he owned was either paid for with credit or rented.
[00:16:18] He would be given large loans, people would extend huge credit lines to him.
[00:16:24] After all, he was good for it, the richest man in the world always paid his bills, did he not?
[00:16:31] It turned out that even making huge commissions on arms sales was not enough to pay for a lifestyle that was, at one point, costing him a reported $250,000 every single day.
[00:16:45] And from his heyday in the 1970s and 1980s, things started to go downhill for Adnan Khashoggi. He was forced to sell the planes and yachts, and to revise his spending.
[00:17:00] He was even arrested in 1988 in Switzerland on charges of racketeering and conspiracy, with US federal prosecutors claiming that he had helped the former president of the Philippines and his wife run away with over a hundred million dollars that they had stolen from the country.
[00:17:18] He fought the extradition order, and only agreed to be extradited when the more serious charges were dropped.
[00:17:26] But the good days were over for this international playboy.
[00:17:31] He never officially declared personal bankruptcy, but he would be chased by his creditors for the rest of his life, before dying in 2017, at the age of 81.
[00:17:43] Now, you have heard the story of Adnan Khashoggi, and how a man became spectacularly wealthy, or at least managed to live a life of vast luxury, as a middleman between the West and the Middle East.
[00:17:57] You might also recognise his surname, Khashoggi, because of Jamal Khashoggi, the Saudi journalist and dissident who was murdered in the Saudi consulate in Istanbul in 2018, with the CIA concluding that this was done on the orders of the Saudi crown prince, Mohammed Bin Salman.
[00:18:16] Jamal Khashoggi and Adnan Khashoggi are not, in fact, strangers that share a common surname. They were related. Adnan Khashoggi was Jamal Khashoggi’s uncle.
[00:18:29] As you might remember, the then US president Donald Trump, was under pressure to publicly criticise Saudi Arabia for the murder of the dissident journalist, especially after his own government agency concluded that this was a state-sponsored murder.
[00:18:45] But he did not, instead citing the value of US weapon sales to the country.
[00:18:52] Adnan Khoshoggi died in 2017, a year before his nephew, Jamal.
[00:18:59] But the two men couldn’t have been more different.
[00:19:03] One spoke out against the Saudi regime’s weapons purchases and military intervention.
[00:19:09] The other facilitated it.
[00:19:12] One sold his yacht to Donald Trump, the other was metaphorically abandoned at sea by him.
[00:19:19] One partied with kings and queens in Monte Carlo, and died peacefully in a London hospital at the age of 81.
[00:19:27] The other ended up cut into pieces with a bone saw.
[00:19:32] There are certainly a few conclusions that you can draw from that.
[00:19:38] Okay then, that is it for today's episode on Adnan Khashoggi, a controversial but certainly colourful character.
[00:19:46] As always, I would love to know what you thought about this episode.
[00:19:49] This show is actually quite popular in Saudi Arabia, so for the Saudi Arabian listeners, what do you know and think about the life of Adnan Khashoggi?
[00:19:57] You can head right into our community forum, which is at community.leonardoenglish.com and get chatting away to other curious minds, or you can always email us at hi@leonardoenglish.com.
[00:20:09] You've been listening to English Learning for Curious Minds, by Leonardo English.
[00:20:14] I'm Alastair Budge. you stay safe, and I'll catch you in the next episode.
[END OF EPISODE]
