JIDDA, Saudi Arabia — As with almost everything in the kingdom of Saudi Arabia, family standing in the royal court was what counted most in the rise and fall of Saudi business tycoon Ghaith R. Pharaon.
He is a central figure in the scandal surrounding the Bank of Credit and Commerce International's alleged secret purchase of three American banks, one of them Independence Bank in Encino. More important, in the Saudi social context, he is also the son of the late Dr. Rashad Pharaon, personal physician and senior adviser to three Saudi kings.
This powerful connection made the Pharaon family in this sultry Red Sea port city and business capital one of the most prominent, influential clans in the kingdom.
But when Dr. Pharaon, the Syrian-born patriarch of the family, died two years ago, the royal link--already strained by Ghaith Pharaon's high-flying lifestyle and Western habits--was finally severed.
"I think it is safe to say that Ghaith Pharaon is not one of the most popular people here these days," said an Australian businessman who has worked in the kingdom for years. "Too many people, including members of the royal family, lost money with him. We are talking telephone-number-sized amounts--telephone numbers with area codes and country codes and everything."
After graduating from Harvard Business School in 1965, Pharaon used the family connection to build a business empire with international interests ranging from Pakistani cement to a suburban Paris theme park.
As son of the "physician to the court," he was a much-sought-after business partner for foreign firms trying to make inroads in the emerging, oil-rich Saudi economy. As one of a handful of Western-educated Saudis of that time, he was trusted with the money of many prominent families.
And during the incredible boom years of the late 1970s and early 1980s, suave, multilingual Pharaon--equally at home in Paris or the Pakistani Punjab--made and spent millions. His 1983-84 entry in the reference book "Who's Who in Saudi Arabia," published by a company he still owns, listed him as "chairman of board of 22 local and international corporations."
He used some of his fortune to build a block-long, walled marble palace in the exclusive Rawdah section of Jidda. The home, equal in grandeur to the palaces of the upper-elite princes in the Wahabite dynasty here, features massive carved wooden doors, a domed entry hall and eight turreted towers like those found on medieval crusader castles. The grounds are planted with date palms and brilliantly colored bougainvillea bushes.
