Mohamed al-Fayed: The outsider

It is hard to feel sorry for Mohamed al-Fayed, but then it is also hard not to. When a child dies, it leaves a parent with a grief so profound that it is hard for others to begin to comprehend. But the father of the man who died alongside Diana, Princess of Wales, in 1997 seems to have been driven so distracted that his bereavement has taken him into realms where most of us cannot follow.

This week, with the opening of the inquest into the death of Diana and Dodi, we have been exposed to the full wild force of a grief that a decade appears to have done little to assuage. The claims he makes are as bizarre as ever:

The couple were executed by British intelligence agents. A cabal of British royals, led by the Duke of Edinburgh, was at the heart of the conspiracy. Secret service operatives from MI6 engineered the bogus car crash. Diana had told him, only weeks before, on the basis of "threats" she'd been receiving, that something sinister was about to happen. The driver of the car was not drunk; his blood sample had been contaminated or switched.

Al-Fayed has made outlandish claims before, and then had to back down. The crash, he earlier said, occurred because the princess's Mercedes had been pursued by photographers "like a stagecoach, surrounded by Indians, but instead of firing arrows they were firing these lights into the eyes of the people". But then the photograph "proving" this turned out to have been taken some time earlier. The princess's "final words and requests" had been passed on to him by an unnamed close friend. But next a hospital investigation revealed that there were no last words and the nurse alleged to have heard them never existed. And so it went.

As time passed, al-Fayed tried to link the crash with the mysterious death of one of the photographers, James Andanson, whose charred body was found in the wreckage of a car in the south of France. Then he talked darkly about secret intelligence material gathered by the CIA and, three years after the deaths, filed a law suit in Washington demanding that the US government turn over its classified documentation.

One theory followed another. The only one he rejected out of hand was the one presented by an official inquiry into the deaths which interviewed more than 200 witnesses, ran to 7,000 pages and took more than two years to complete: his son died because he was not wearing a seat belt, in a car driven at 60mph over the speed limit, by a driver who had nearly three times the permitted amount of alcohol in his blood. The driver was one of al-Fayed's own employees.

The reasons for his insistence upon conspiracy lie deep rooted in his past. Controversy has dogged Mohamed al-Fayed all his life. Even his name and date of birth are disputed. Born Mohamed Fayed he added the aristocratic prefix "al" to his name only at the age of 45. His date of birth, as recorded in a Department of Trade inquiry into allegations of dodgy business dealings, was 27 January 1929. Yet his self-penned entry in Who's Who lists him as four years younger.

He was born in Egypt in the town of Alexandria where his father was a primary-school teacher (or professor of Arabic as his personal website now translates it). The young Fayed began his career selling Coca-Cola on the streets and then working as a sewing-machine salesman. After switching to the shipping industry, he met the international arms dealer Adnan Khashoggi, who gave him an import-export job in Saudi Arabia.

As his circles of influence widened in the Gulf, with his brothers he built up significant interests in construction in Dubai. He began to work with British construction companies and took a 30 per cent shareholding in the British civil engineering group Costain.

He arrived in Britain in 1974, announcing, "You can call me Al" and provoking Private Eye to nickname him "the Phoney Pharaoh". Within a year, he had joined the board of the controversial mining conglomerate Lonrho whose chief executive was Tiny Rowland. Four years later, he bought the Hôtel Ritz in Paris and slowly restored it to its former grandeur, for which President Mitterand awarded him the Légion d'Honneur.

It was then that al-Fayed embarked on the series of purchases which he hoped would buy him entry into the establishment in his adopted home. In 1985, he and his brother Ali launched a successful £615m takeover bid for the House of Fraser group whose flagship store was once a by-word for Britishness itself, Harrods.

But he upset Tiny Rowland in the process, beginning a bitter seven-year feud. Rowland, who owned The Observer, and had a senior Tory politician Edward du Cann on his board, campaigned for a Department of Trade inquiry into the takeover which, in 1990, damningly concluded that the Fayeds had lied about their background and their wealth. Mohamed al-Fayed responded by hanging a shark in Harrods' famous food hall with the word "Tiny" painted on its dorsal fin.

When al-Fayed applied for a British passport five years later, he was turned down by the Conservative government. Home Office regulations, it was pointed out, said an applicant must be over 18 years of age and "of good character".

He took his revenge. He paid two senior Conservative MPs, Neil Hamilton and Tim Smith, money in "plain brown envelopes" to ask questions in Parliament on Harrods' behalf. The act was not illegal but it was improper, and the MPs failed to declare the payments in the register of members' interests. Al-Fayed then shopped the two men to the press. The ensuing " cash for questions" affair resulted in a political firestorm which fatally damaged the credibility of John Major's "Back to Basics" government.

In this, and much else, al-Fayed came across as a fairly unpleasant individual, described in the High Court as "deeply dishonest and with an evil habit of vindictively pursuing those who he regarded as his antagonists". He was frequently accused of bullying his staff. In 1998 an unauthorised biography by Tom Bower portrayed him as a compulsive liar and inept social climber.

He did not give up. He bought another moribund British icon, Punch magazine, and relaunched it, but failed to see that modern Britain laughed at, not with, it. It folded in 2002. He bought a football club, the then lowly Fulham FC, vowing to get it into the Premiership within five years (which he did) and at one point offering the club's manager, Kevin Keegan, to England when the national team was coachless. He gave millions to charities such as Great Ormond Street Children's Hospital.

But the harder he tried for acceptance, the more he got brushed off. Somehow, he never quite got the tone right. Snobbish critics suggested he had "an Egyptian bazaar-trader's natural ignorance of ... the rules". He slipped a boxful of lobsters into the boot of Virginia Bottomley's ministerial motor car while she was inside the store. He appeared in an episode of Being Bobby Brown in which he gave Viagra to Whitney Houston. He went on Ali G's show and duetted a rap on the topic of theft from Harrods with a song called "Can I Nick it?". He turned Harrods from a store for toffs to one for moneyed vulgarians, eventually losing its royal warrants.

That move came after his public allegations of a royal conspiracy in the deaths of Diana and Dodi, to whom he erected a shrine in the Knightsbridge store.

In all this, al- Fayed's cultural and religious background as a Muslim is a significant factor. He is not alone in his conspiracy theories. Within days of the crash, sinister stories were circulating in newspapers throughout the Arab world and being repeated by political leaders such as the Libyan president, Colonel Gaddafi. Diana had been murdered to ensure that she didn't marry a Muslim. It all played into the same mindset that later led a large proportion of Muslims to tell UK opinion pollsters that they did not believe their co-religionists were involved in the 9/11 or 7/7 attacks.

Just because you're paranoid doesn't mean they're not out to get you. The tabloids reported how Prince Philip had made no secret of his feelings about his former daughter-in-law's liaison with Fayed Jnr, referring to him as an "oily bed-hopper". The Royal Family was reported to have had a meeting at Balmoral to which MI6 presented a special report on the Fayeds. Similar sou rces leaked to Diana's most recent biographer, Tina Brown, that the princess "had no intention of marrying Dodi Fayed but had a dalliance with him merely to annoy Charles and the Royal Family".

Whatever the truth of all that, two years after Diana's death Mohamed al-Fayed, despite employing thousands of people in the UK, had his application for British citizenship turned down for a second time. The disgraced ex-MP Neil Hamilton called for him to be deported as an " undesirable alien". In 2003 al-Fayed, man with a fortune of somewhere between $880m and $7.7bn – depending on which reports you believe – moved his domicile from the UK to Switzerland, and two years later to Monaco.

There is, in all this, the story of a man flailing around for meaning in the face of the unnatural and untimely death of his son. But there is also the saga of a man who sought acceptance and became only a loutish figure of fun.

It tells us, perhaps, as much about English society as it does about the foibles and failings of one peculiar individual. His son Dodi died riding pillion behind Diana the huntress as the hounds turned upon her. Hers was a Faustian pact with fame. She played with fire and she got burned. Perhaps in his own way Mohamed al-Fayed has done much the same thing.

A Life in Brief

Born 27 January 1933, Alexandria, Egypt.

Early life The eldest son of a teacher, al-Fayed did various jobs before making his money after marrying Samira Khashoggi and working for her arms dealer brother Adnan Khashoggi. Founded a shipping company and was financial adviser to the Sultan of Brunei in 1966. Arrived in Britain in 1974.

Career Bought the Ritz Hotel in Paris in 1979. In 1985, along with his brother Ali, bought House of Fraser group (including Harrods) for £615m. In 1994 House of Fraser went public, but he kept ownership of Harrods. Bought Fulham FC in 1997. Has a charitable foundation.

He says "You still find the upper class or the elite here who rule this country behind the scenes. You do not think you live in a real democracy, because still you have a special type of government department like the intelligence service that are above the law."

They say "I respected him then, and I respect him now. I lost my father when I was 17 and I feel sorry for him that he lost his son." Trevor Rees-Jones, Dodi's bodyguard