BILLIONAIRES' BENIDORM

Philip Delves Broughton, in Monaco for the

trial of Ted Maher, finds that the principality is a rotten little retirement home for fat cats

IT was bucketing down in Monte Carlo and the casino was empty. Croupiers sat forlornly at the tables in the gilded Salle &Europe and in the large private rooms at the back, overlooking a sheer drop to the Mediterranean. Several of them were horsing around with the sticks they use to gather in chips. The restaurant tablecloths were starched and laid with silver, but the waiters had no one to serve. A few old birds in dodgy leather jackets pulled away at the one-armed bandits.

In the bar at the Hotel de Paris. I ordered a drink and listened to the pianist play 'Strangers in the Night'. The only others there were a Japanese couple, he in a dinner jacket, she in a sparkling gown, who sat edgily in their chairs like guests who had overdressed for a party. Earlier that evening, Dominick Dunne, Vanity Fair's aged society scribe, had sat in one corner drinking a Coke. He was in town for the trial of Edmond Safra's nurse, Ted Maher. In court, Dunne sat up with the defence lawyers, though his studiously superior image came undone when he wandered through the courtroom on the second day of the trial with his shirt poking out of his flies.

He, though, is the reason why the rest of us reporters were there. Dunne has written at length about the Safra case — Maher has been charged with arson resulting in his boss's death — ratcheting it up into the Riviera's answer to the O.J. trial. The ladies with whom he lunches on Madison Avenue want answers.

Safra was a Syrian-born private banker who made billions finding devious and discreet ways to handle Middle Eastern fortunes. Not long before he died, he tipped off the FBI to Russian money-laundering through Wall Street banks. He also sold his bank, the Republic Bank of New York, to HSBC for about £.6 billion. After Prince Rainier, he was probably the most powerful man in Monaco.

He had a controversial wife, Lily, who had been married three times, to her considerable financial advantage, before she married • Safra in 1976. From Dunne you get the sense that certain people are just desperate for her to be linked in some dark way with her husband's death. She is petite, with the kind of joyless eyes you see in people who go to too many benefit evenings.

But the real villain so far has turned out to be Monaco itself. It has come across as a rotten little retirement home, with all the glamour of hernia pants. You have never seen so many sad-looking billionaires. It is hard to foul up a series of rocky inlets along the Mediterranean, but Monaco has managed it, becoming a rich man's Benidorm, with tower blocks crowding down to the sea. Even at night, with the lights on, it's an eyesore. In Monaco surveillance cameras scan the streets and policemen are everywhere. When you check into your hotel, your passport is photocopied and filed; same at the casino.

Ted Maher got up on the second day of his trial and told the court that he had barely slept the night before. His guard, he said, had come by every 40 minutes to shine a torch in his face. His possessions had been rifled through the day before. One of his lawyers told me, 'There are lots of people who want to see him shaky on the stand.' Maher has already spent three years in prison waiting for Monaco's legal system, which must either be shambolic or corrupt, to get its act together.

Journalists, businessmen and lawyers working in Monaco have complained for years that their telephones are tapped. The government grants and rescinds Monaco's precious residency papers based on loyalty to its way of doing things. This has not stopped a new influx of Brits, who prefer Monaco to the rainy Channel Islands or the distant Caymans. Le Mande reported recently that the principality is encouraging British newcomers after its experience with men such as the Barclay brothers, who own the Ritz, the corporate raider Philip Green and the racehorse owner Michael Tabor. Provided you can show a few hundred million in cash or equivalents, there are banks such as HSBC Republic to help you with the complicated citizenship procedures in Monaco. The British are now the third most numerous residents of Monaco, after the French and Italians. Monaco likes the British because, unlike the Russians, they seem clean and the principality wants to shed its image as the world's money laundry. It flipped out over recent French government reports that called its banking system corrupt. It wants to be more like Luxembourg and less like Macao.

During his 53-year rule. Prince Rainier, 79, has turned Monaco into a tremendous earner for his family, who are reputedly richer than the Windsors. There is a National Council, elected by Monaco's 30,000 citizens, but the Prince calls the shots. Worryingly for his subjects, he has been in hospital twice this year, and his son Albert looks woefully ill-equipped to succeed him.

Albert likes his Grand Prix, his tennis tournaments, supermodels and luxurygoods launch parties. At 44, he is yet to marry or provide an heir. Earlier this year, Rainier took out an insurance policy by changing the constitution to allow his daughters and their children to succeed Albert if he dies childless.

Rainier's eldest daughter, Caroline, is the most presentable member of the family. Her two teenage children are already French paparazzi favourites. Her weak point is her third husband, Prince Ernst August of Hanover, a belligerent German aristocrat who was caught peeing against the Turkish pavilion at Expo 2000 in Hanover, prompting apologies from the German government to the Turks.

Then there is Stephanie, who has let her looks go from sexy Euro wild child to overworked welfare mum. For the past two years, she has shared a caravan with a circus elephant-trainer. But she left him this spring, moved back into the palace and started an affair with yet another of her bodyguards.

The Grimaldis' family problems, however, are nothing compared with the damage to Monaco's reputation done by the Safra trial. The police and fire services had nearly two hours to rescue Safra as fire crept through his flat. They bundled away his personal secretary, who was the only man with the keys to the flat, because he was carrying a gun. By the time they got to Safra, he was dead from smoke inhalation.

Georges Kiejeman, Lily Safra's lawyer and formerly Francois Mitterrand's, has been harrumphing and arguing against the judge in Monaco as if he cannot believe the travesty of justice unfolding before him.

Everyone involved thinks that Monaco is suppressing the truth because Monaco knows that it is nothing if not a place where rich old men can live safely in their penthouse flats. Otherwise, it is not just, as Somerset Maugham said, 'a sunny place for shady people', but an ugly, lifeless and dangerous one, too.