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Photo by Vu NguyenFor a decade, George Argyros—the driving force behind the county's unpopular plan to build an international airport at El Toro—has kept his name off the annual Forbes list of the richest 400 Americans.
He won't succeed next year.
Though Wall Street experts have consistently estimated Argyros' wealth at less than $725 million, OC Weekly has learned that the controversial Newport Beach real-estate developer—whom President George W. Bush has nominated as the next U.S. ambassador to Spain—is likely worth more than $1.2 billion.
Had Forbes known of Argyros' fortune, the magazine likely would have ranked him as the 236 richest American in 2000. His net worth is equal to that of Steven Jobs of Apple computer fame. The former Air Cal and Seattle Mariners owner is substantially richer than Winthrop Rockefeller, Roy Disney, William Randolph Hearst III, Barry Diller, Michael Eisner, Mort Zuckerman, Helen Copley, Michael Milken, Oprah Winfrey and several Gettys.
Ironically, the source of the information is none other than the secretive Argyros. In May, federal ethics officials mandated that he, like all other executive-branch nominees, file a financial-disclosure report in Washington, D.C. The result is a 58-page document that offers the public its first glimpse at Argyros' staggering fortune.
Argyros controls assets worth no less than $800 million and possibly more than $1.8 billion, according to the federal Office of Government Ethics report. He has debts of at least $192 million. A conservative estimate of his personal income for the past year tops $90 million. The actual number might be much greater. Federal law requires nominees and executive-branch office holders to file an exhaustive list of assets but gives them wide latitude in revealing values and incomes.
Not surprisingly, the 64-year-old Republican Party power broker foiled a more precise accounting by failing to complete the public-disclosure form. Though the law requires otherwise, he didn't bother to divulge value or income for an overwhelming majority of his assets, including his Seattle-based HBI Financial Corp., which six years ago was worth more than $100 million.
Nevertheless, it is clear that Argyros has at least 121 assets worth a minimum of $1 million each. Ten of those are worth between $25 million and $50 million. He valued four assets at more than $50 million each. One of those—his 2.8 million shares of Apria, the mammoth Costa Mesa-based HMO company—is currently worth $76 million. Other key assets include Metro Pointe in Costa Mesa and the Puente Hills Business Center in City of Industry, as well as real estate holdings in Santa Ana, Carson, Norco and Torrance.
Noticably missing from the disclosure is any mention of Argyros' mansions in Newport Beach; Indian Wells; and Sun Valley, Idaho. They are worth more than $22 million. Nor does he list his 180-plus-foot yacht or his personal jet. However, he reveals unspecified investments in the Cayman Islands worth more than $51 million.
Argyros also reports investments in 31 states and more than 11 foreign countries. His business interests are diverse. Significant investments include military, high-tech, biotech, petroleum, manufacturing, publishing, e-commerce, aerospace, health care, data processing, insurance, energy, telecommunications, banking, automobiles, boating, jewelry, fitness centers, restaurants, convenience stores, clothing, cinema, pet products, drugs, waste management and Nevada gaming equipment.
Specifically, he owns sizable amounts of stock in Enron, Rockwell International, Pfizer, McDonald's, Del Monte, Coca-Cola, Dr. Pepper, Walt Disney Co., AMC Entertainment, American Express, Costco, Dole Food, Revlon, Estée Lauder, General Electric, Goldman Sachs, Intel, United Technologies, Metro-Goldwyn-Mayer, Loral Space & Communications, Johnson & Johnson, Microsoft, Home Depot, the Gap, and J. Crew, as well as in hip magazines Vibeand Spin.
His Southern California apartment empire is valued at between $166 million and $524 million and reportedly fetched him no less than $21.4 million in income last year. That total does not include Argyros' unknown cut from a secretive Argyros-owned shell company, Pacific Water & Power, which imposes questionable and unregulated extra fees on tenants for basic utilities.
The Detroit native is currently under investigation by the state attorney general's office for allegedly defrauding thousands of mostly Vietnamese and Mexican immigrants who have lived in his Arnel Management apartment complexes. In December, prosecutors in the Orange County district attorney's office concluded that Argyros should be held liable for operating a systematic "rip-off" scheme by illegally withholding tenant security deposits and fabricating cleaning expenses. DA Tony Rackauckas, who is an Argyros ally, attempted to thwart public disclosure of the case until after the Senate had considered Argyros' ambassadorial nomination. When his subordinates protested in March, Rackauckas kicked the case up to Attorney General Bill Lockyer.
The Senate—particularly Senator Barbara Boxer (D-California)—is reportedly awaiting the outcome of Lockyer's investigation before it finalizes its decision on whether Argyros is ethically fit for a high-profile public position overseas. In completing the necessary paperwork for the ambassadorship, Argyros guaranteed federal officials that if confirmed, he would be "committed to the highest standards of ethical conduct for government officials."
One of the duties of ambassadors is to use U.S. government resources and power to aid U.S. companies. To avoid potential conflicts of interest, Argyros claims he will resign his board positions with Rockwell International, First American Title Insurance Co., the Newhall Land & Farming Co., Arnel Development Co., and DST Systems.
As for the tens of millions he owns in corporate stock, Argyros—who has developed a ruthless image in business and politics—reassured officials that he will do everything in his power "to avoid the appearance of impropriety."