Size of Shah's fortune a mystery

The late Shah Mohammed Reza Pahlavi once called himself no richer than 'an American millionaire.' But the regime of Ayatollah Ruhollah Khomeini claims he amassed one of the largest personal fortunes in the world by plundering Iran's coffers of billions of dollars.

Just how much money the late shah and his family succeeded in getting out of Iran before he was toppled from the Peacock throne in 1979 may take years to determine -- if it ever will be known.


But some financial sources suggest that the Pahlavi family did manage to accumulate a fabulous fortune comparable to the greatest family treasuries in the oil-rich Middle East.

The vexing question of the Shah's wealth -- a root issue in the U.S.-Iranian hostage crisis -- was raised by members of Khomeini's regime who charged that the shah diverted billions of dollars in official Iranian funds before being toppled from power.


The best guess of Iran's new rulers is that up to $36.5 billion is owed the Iranian people by the shah. By comparison the personal fortune of America's Rockefeller family has been estimated in the $1 to $2 billion range.

The Iranian government, in a New York lawsuit filed against the shah in November 1979, sought the $36.5 billion amount plus damages for a total of $56.5 billion.

On Dec. 21, 1980, Iran publicly demanded the U.S. deposit a 'guarantee' of $24 billion in the Algerian Central Bank to ensure recovery of the shah's wealth and its frozen and other assets in the United States for release of the hostages. The government said $10 billion of that sum was to cover 'properties of the Iranian nation plundered by the deposed shah and his relatives.'

But the revolutionary government, in charging the shah with massive corruption, admitted it had no accurate accounting on the Pahlavi family wealth or where it is located.

Iran's lawsuit against the shah placed only an 'approximate value' on the sums the shah allegedly 'misappropriated, embezzled or otherwise diverted to his own use.'

In addition, Tehran officials have claimed to have uncovered documents showing the Pahlavi family owed at least $1 billion to Iranian banks. The claim has not been substantiated independently.


Government officials have charged the shah with illegally diverting money from the nation's oil revenues to his own pockets and raking off cuts of the profits and special 'commissions' in industrial, arms and other deals. They have claimed his fortune is hidden in tangled web of worldwide investments and secret accounts protected by bank privacy laws. And they have charged many records of his fortune were lost or destroyed before his chaotic departure.

For his part, the shah scoffed at charges that he siphoned billions of dollars of Irans' wealth.

In a New York hospital interview months before his death in Cairo on July 27, 1980, the shah angrily denied claims that he was a billionaire. He said his personal fortune did not exceed $100 million and may have dwindled to nearer $50 million and described himself as no richer 'phan an American millionaire'.

Still, it is clear the shah and his family funneled tens of millions of dollars and perhaps much more into the international financial system before fleeing Iran. Some financial sources have suggested that his family wealth is rivaled in the Mideast only by the fortunes of the royal Saud family of Saudi Arabia and the ruling al-Sabah family of Kuwait.


American banks have declined comment on the size of the shah's U.S. bank accounts because private deposits were not involved in President Carter's freeze of the estimated $8 billion in Iranian government deposits. Some experts on Middle Eastern affairs said they do not believe all Iranian private holdings in the United States exceed $2 billion.

Chase Manhattan Bank, headed by the shah's friend, David Rockefeller, is believed to serve as his principal U.S. bank. Citibank, among other U.S. banks, also is reported to have Pahlavi family holdings.

In Switzerland, which Tehran officials charge is another haven for the Shah's wealth, authorities said total Iranian deposits in Swiss banks from all sources appear to be considerably below $1 billion. Swiss officials refused to breach their traditional secrecy beyond that, except to list several villas and other properties owned by the shah and his family in Switzerland.

Real estate owned by the shah and his family in the United States and Mexico is not believed to be worth more than $5 million.

The Tehran government has hired lawyers in several countries to unravel the mystery of the shah's wealth.

The shah was believed to have lost a substantial chunk of his holdings when the revolutionary government seized the Pahlavi Foundation in Tehran. He said he established the foundation in 1958 to finance grants to Iranian students abroad among other activities, but the revolutionary government has claimed it was really used as a conduit by which he could secretly funnel looted funds for his own use.


Another possibility was that much of the money allegedly transferred abroad by the shah was really spent previously to finance secret military and police operations and for domestic and overseas political activities omitted from the regular Iranian budget.

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