Mohamed al-Fayed, buccaneering Harrods owner notorious for his conspiracy theories about the Royal family – obituary

Mohamed al-Fayed, who has died aged 94, was an Egyptian-born business buccaneer and proprietor of Harrods who became a controversial figure in British public life – both for his dealings with MPs in the “cash for questions” scandal and as the father of Dodi Fayed, who died in the Paris car crash which ended the life of Diana, Princess of Wales.

Al-Fayed was a showman, a fantasist and, though incapable of concealing his own faults, a man of secrets. The scale and sources of his wealth were mysterious; he habitually falsified his age and ancestry, unilaterally aggrandising his birth name to Al Fayed; and he was twice refused British citizenship on grounds of lack of probity. His collaborators – including the Saudi arms dealer Adnan Khashoggi, the Haitian dictator Papa Doc Duvalier and the Lonrho tycoon Tiny Rowland – had a habit of turning into enemies.

His greatest business coup, the 1984 acquisition of Harrods department store in Knightsbridge, was achieved by outfoxing Rowland – the man Edward Heath called “the unacceptable face of capitalism”, and the most menacing corporate operator of his era – who did his utmost to blacken al-Fayed’s name during a subsequent decade-long fight in which both sides resorted to every dirty trick in the book.

The public sympathy al-Fayed might have garnered when his son Dodi died in Paris with Diana, Princess of Wales, in August 1997 was largely dissolved by his crazed insistence that the fatal accident had been engineered by the British secret service and the royal family to prevent Diana from marrying the Muslim Dodi.

But beneath the grotesqueries, al-Fayed was a razor-sharp businessman who over 40 years consistently outmanoeuvred some of the hardest money-men in London and the Middle East. What eluded him was social acceptability: though his money attracted courtiers, his coarse manners and mercurial temper largely excluded him from polite society. It was a snub which he bitterly resented.

In the summer of 1997, however, al-Fayed at last found an opportunity to achieve the recognition he craved: Diana, Princess of Wales, an enthusiastic customer of Harrods, accepted his invitation to bring the young princes William and Harry to the South of France for a holiday at his St Tropez villa and on his yacht. Dodi – who was engaged at the time to an American underwear model, Kelly Fisher – was summoned to entertain the princess, and romance evidently blossomed. The couple’s assignations in Paris and the Riviera over the following weeks were eagerly supervised by al-Fayed.

On the fateful evening of August 30, when Dodi and Diana were besieged by paparazzi at the Paris Ritz (which al-Fayed owned), even the details of the getaway plan – in a Mercedes driven by the hotel’s security manager, Henri Paul, who was later found to have been drunk – were approved by Fayed by telephone from his home in Surrey.

In the aftermath of the tragedy, al-Fayed’s reactions became increasingly intemperate. He claimed to know Diana’s last words and insisted on passing them to her family, though doctors said she was too injured to have spoken before she died; he refused to accept the evidence of alcohol in Paul’s blood; and he persisted with his bizarre conspiracy theory, enriched by the suggestion that the mastermind behind the plot had been none other than the Duke of Edinburgh.

Ostracised on all sides – Harrods had its royal warrants removed – the only grain of comfort to come his way in later years was the dismissal of a High Court libel action against him by the former MP Neil Hamilton, who had denied receiving bundles of cash to support al-Fayed’s campaign against Rowland. In greeting the verdict as a victory which merited “champers and hampers” – having brought personal ruin on Hamilton and his wife Christine – Fayed skated over the real meaning of the jury’s finding: that he had systematically corrupted members of parliament by bribing them.

The son of a school inspector, Mohamed Abdul Moneim Fayed was born in a poor district of Alexandria on January 27 1929. After his mother died when he was four, Mohamed and his younger brothers, Salah and Ali, were brought up by a stepmother. Mohamed was enrolled at Alexandria’s Old Secondary School but acquired little formal learning. In his late teens he was selling Coca-Cola in the street, and at 21 he was a door-to-door salesman of Singer sewing machines.

His first real break came in 1952, when he was offered a job by the Saudi entrepreneur Adnan Khashoggi – the then 17-year-old son of Saudi Arabia’s secretary general of public health. The Khashoggis were involved in a venture supplying equipment for Egyptian doctors setting up practice in Saudi Arabia, and Fayed became their salesman and factotum in Jeddah.

He produced profits of $300,000 in the first year. Relations with the Khashoggi family were cemented in 1954 by Fayed’s marriage to Adnan’s sister, Samira – who in due course gave birth to a son Emad, known as Dodi. Khashoggi money backed the next stage of al-Fayed’s career as a forwarding agent, but both the marriage and the business relationship fell swiftly and acrimoniously apart.

Al-Fayed moved into shipping, offering himself as a local partner to foreign businessmen who were at risk of expropriation of Egyptian assets by the Nasser regime. When conditions became difficult in Egypt in 1961 he moved to Geneva, where his extravagant lifestyle gave a convincing impression of wealth.

As he continued to reinvent himself, his account of his own past became increasingly remote from the truth. Arriving in Haiti in 1964 looking for opportunities for oil exploration, he was Sheikh Mohamed Fayed, a relative of the ruling Sabah family of Kuwait. As a confidant of the dictator Papa Doc Duvalier – and an intimate of his equally notorious daughter Marie Denise – he won a contract to redevelop the harbour of Port-au-Prince and was even issued with a Haitian diplomatic passport.

But before long he was on the move again, having refused to pay adequate bribes to Papa Doc and, according to the latter (who was said to be searching the world for him, dead or alive), having absconded with the harbour company’s funds.

Next al-Fayed set up in Park Lane in London, announced himself as a descendant of Egyptian pashas and allied himself with the rulers of Dubai and their Bahraini adviser Mahdi Al Tajir, for whom he became the middleman in multi-million-pound contracts to develop Dubai’s harbour and waterfront.

The commissions from these deals made him, at last, seriously rich. He acquired Balnagown Castle, ancestral home of the Ross clan in the Scottish Highlands; a chalet in Gstaad; and a 65ft schooner which he renamed Dodi and sometimes claimed had been built for his wealthy Egyptian grandfather. It was Al Tajir who encouraged Fayed to add “Al” to his name, indicating aristocratic lineage.

He became a shareholder in Costain, a British engineering firm involved in the Dubai contracts, and it was through this connection that he met Rowland of Lonrho, who warmed to him and called him “Tootsie”, but was in due course to become the worst of his numerous foes. In 1975 al-Fayed swapped his Costain shares for a stake in Lonrho and joined the Lonrho board, only to reverse out again the following year, taking a profit of £8 million.

Over a decade, his dealings connected with Dubai are estimated to have netted al-Fayed some £60 million – and one trophy acquired as a result was the Ritz in Paris, for £9 million in 1979. But as so often, he eventually fell out with Tajir – and fell in once more with Rowland, who was conducting a vendetta of his own against the Bahraini. Rowland was also by then stalking House of Fraser, the company which owned Harrods.

The Monopolies Commission had ruled Rowland’s first bid as being against the public interest, but Rowland persisted and wanted al-Fayed to help him. Al-Fayed obliged in 1983 by buying one million shares in House of Fraser in the name of his brother Salah’s wife.

In the following year, Rowland – thwarted by the takeover authorities and the hostility of the Fraser board – agreed to sell his 29.9 per cent holding to the Fayed brothers for £138 million. Rowland saw this as a temporary arrangement, until he could launch another bid; but al-Fayed thought otherwise and moved on to buy the whole company.

The press and the City were intrigued to know where he found £600 million to fund this coup. Al-Fayed was by now associated with the Sultan of Brunei, whom he had represented in transactions such as the purchase of the Dorchester Hotel in London; but he denied that the Sultan was behind the Harrods bid, presenting an imaginative dossier of evidence for a billion-pound fortune of his own.

Whatever the truth, al-Fayed was known to the British government simply as an Egyptian businessman who had been helpful in dealings with the Sultan of Brunei and was offering cash for the Fraser shares. Furthermore, he was not Tiny Rowland. So there was no reason at the time to block him. Rowland’s fury at this outcome was uncontained, and the battle which ensued between the two men brought poison into British public life.

Rowland – who had succeeded in tapping al-Fayed’s Park Lane telephones – used his newspaper, The Observer, to smear Fayed at every opportunity; he also provided files on al-Fayed’s business dealings to the DTI and the Inland Revenue. 

When the DTI eventually produced a report highly critical of al-Fayed’s conduct in the Harrods takeover, Rowland published a leaked version of it in a special mid-week edition of The Observer headlined “The Phoney Pharoah”. Al-Fayed had in turn retained a lobbyist to find sympathetic MPs who would ask questions in the House of Commons about Rowland’s abuse of his proprietorship of The Observer – among them the up-and-coming Right-wing Tory MP for Tatton, Neil Hamilton.

Despite Rowland’s venom, al-Fayed was never in danger of losing Harrods and became very much the hands-on proprietor of the store, which he managed, as one observer put it, “by convulsion”, firing staff at will if he judged them insufficiently attractive or obsequious.

He was in the habit of offering cash to female staff members he hoped to seduce and of sending them to his private doctor for Aids tests – later attracting allegations of sexual harassment. Obsessed with germs, he had to be given a perfumed paper handkerchief every time a shopper shook his hand. Obsessed with security, he commuted to work in an armed motorcade.

His £4 million private army codenamed him “Lion” and he called them “donkeys”. Their presence may have had more to do with prestige and his own insecurity than any real threat to his life; when he at last ordered them to kill a ginger cat in the garden of his fortified Surrey mansion – which had gilded statues of naked women everywhere – they killed the wrong cat.

Al-Fayed occasionally made large charitable gestures to Great Ormond Street Hospital and other children’s charities, and achieved some local popularity through his ownership from 1997 of Fulham Football Club. Another of his ventures was a 1996 relaunch of Punch, the humorous magazine, but it folded in 2002 after heavy losses.

Meanwhile he had some success through his Ritz proprietorship in ingratiating himself with the French establishment, and was granted a lease on the Duke and Duchess of Windsor’s mansion in the Bois de Boulogne, which he lavishly restored.

But his attempts to present himself as a patriot in his adopted British homeland continued to fall on stony ground. He acquired with Harrods the sponsorship of the Windsor Horse Show, an annual opportunity to be seen entertaining members of the royal family; but the sponsorship was terminated, royal advisers having apparently become wary of al-Fayed’s habit of breaking the ice by making jokes about his own lack of sexual prowess.

Al-Fayed excelled himself at the inquest into the deaths of Dodi and Diana, Princess of Wales, for which he had campaigned for a decade and which was finally held in 2007-08. When he gave evidence before Lord Justice Scott Baker, it was difficult to avoid the conclusion that he had lost his mind.

His allegations of murder and subsequent cover-up embraced the Princess’s sister, Lady Sarah McCorquodale, and brother-in-law, Lord Fellowes (the Queen’s former private secretary); the former prime minister, Tony Blair; and the former Commissioner of the Metropolitan Police, Lord Stevens. Directing all these conspirators, al-Fayed insisted, was the figure of the Duke of Edinburgh, whom he accused of being a Nazi who should go “back to Germany”. “You want to know his original name?” al-Fayed went on. “It ends with Frankenstein.”

He had repeatedly denied rumours that Harrods was for sale, notably in 2003 when he announced that he was moving to Switzerland after a row with the Inland Revenue. Finally in 2010 the store was sold to Qatar Holdings, the investment arm of the Gulf state’s royal family, for £1.5 billion.

In 2013 (to a Pakistani-American businessman, Shahid Khan, for a reported £150-200 million) he also sold Fulham FC, having funded the club’s rise from the third tier of English football to the Premier League under nine successive managers including Kevin Keegan and Roy Hodgson.

Al-Fayed’s later years of fading health passed in seclusion. He married secondly, in 1985, Heini Wathen, a Finnish model who had once been crowned Miss Viking Princess; she had first entered the Fayed household in 1977 as a companion of Dodi, who had offered to launch her in a film career. She survives him with their two sons and two daughters.

Mohamed al-Fayed, born January 27 1929, died August 30 2023