The Strong Man: John Mitchell and the Secrets of Watergate (35 page)

Seen in historical perspective,
the ITT scandal was a dry run for Watergate, which erupted soon afterward and eventually subsumed the ITT case under its massive investigative aegis. The Age of Scandal was now upon Nixon and his men—and the country. The president, for one, glimpsed the bleak future. “At the present time,” he told his aides during the ITT hearings, “you just gotta figure that they’re gonna be investigating us in all things.”
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When it was all over, the central premise of the ITT scandal—that John Mitchell fixed the antitrust cases in exchange for the conglomerate’s financial support for San Diego’s bid for the 1972 Republican convention—remained unproved, if not outright refuted. Even the
Washington Post
, which published Jack Anderson’s columns and hardly saw eye to eye with Nixon and Mitchell on antitrust policy, or much else, conceded—in late July 1974, less than three weeks before Nixon’s resignation—that the “connection” between ITT’s convention pledge and the disposition of the antitrust suits “has never been made convincingly.”
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Consequently, Mitchell’s perjury at the ITT hearings was either unnecessary or calculatedly protective of the president, who had far more to conceal. A similar pattern would emerge in Mitchell’s behavior in Watergate. The irony is that while the episode revealed Mitchell’s willingness to break the law as a private citizen—he was no longer a public official when he testified falsely before the Judiciary Committee—it also confirmed his integrity as an attorney general, in which capacity he repelled countless attempts over a three-year span by White House figures, from the president on down, to tamper with the ordinary processes of the Justice Department, most specifically in the enforcement of antitrust policy.

In denying he had ever talked with Nixon about the ITT case, Mitchell’s lie concealed his secret honor in the conduct of public office, and Nixon’s corresponding iniquity. This trade-off left Mitchell the poorer—as had his willing collusion, throughout his tenure as attorney general, in the false, sternly authoritarian public image Nixon assigned him—but Mitchell never seemed to mind; instead he seemed to regard it as a reasonable price to pay in the service of some greater good. Asked once about his role in the ITT scandal, he replied, “It would take me about an hour to explain it.”
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PETTY THIEF

John Mitchell is not a terribly responsive man, sometimes.

—John Dean, 1974
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ON FRIDAY NIGHT,
March 12, 1971, Mitchell stood on a receiving line in New Jersey, honoring a debt to the man beside him: Harry Sears, the retiring Republican majority leader of the New Jersey State Senate, in whose honor the evening’s $100-a-head testimonial dinner, at the Chanticler Restaurant in suburban Milburn, was being held. Sears’s political muscle had helped deliver eighteen of New Jersey’s contested delegates at the ’68 convention; he was Mitchell’s man in the Garden State. In 1970, at his party’s request, Sears had run in the GOP gubernatorial primary; lacking in money and name recognition, however, he finished third in a field of five and plunged $50,000 into debt. Mitchell’s appearance at the Chanticler was meant to help pay off that debt.

As the reception line snaked along, the sight of one face caused Sears to stop the procession. It belonged to his most generous financial contributor, a wealthy young businessman from Boonton, tall with slick black hair and a pencil mustache, a bulbous nose, and puffy little eyes. “John, I would like you to meet my friend Bob Vesco and his wife, Pat,” Sears said to Mitchell. “This is the friend I have been telling you about.”

Mitchell and the man exchanged brief pleasantries. Later, during the dinner, Vesco offered hellos to Sears and Martha Mitchell, seated together, then slipped round their table and spoke briefly—for “less than a minute”—with Mitchell and Sears’s wife Emma. Asked later if he remembered meeting Vesco on this occasion, Mitchell said no. All he recalled was that the man reminded him, in appearance, of his long-deceased brother, Scranton. Vesco, however, was determined to make a more lasting impression.
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Born to first-generation Americans
in Detroit in 1935, Robert Lee Vesco always wanted to get rich quick. A voracious reader and fast learner, he dropped out of a technical high school to lay brick and repair cars. Married at seventeen, soon a father of three, Vesco held middle-management jobs in the automobile industry and juggled other odd pursuits: small-time gambling, bingo parlors, a highway bar called the Powder Mill Inn. A relentless exaggerator and namedropper with “an uncanny ability to find people who were weak,” Vesco managed to acquire controlling interests in some failing machine parts companies, which, in 1965, he consolidated and incorporated as International Controls Corporation (ICC); within a year, he achieved his childhood dream of becoming, at least on paper, a millionaire, and by 1970, he oversaw thirteen subsidiaries and five thousand employees.
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But one goal remained elusive: respect. So Vesco went international. The aggressive financier—who drew the attention of federal regulators as early as 1968—naturally gravitated to the largely unregulated world of offshore mutual funds, then an inviting source of practically unlimited, nontaxable risk capital. With characteristic grandiosity, Vesco set his sights on Investors Overseas Services (IOS), the Geneva-based mutual fund empire that dominated offshore finance in those years. Undermined by legal woes and a “chaotic management structure,” IOS was ripe for takeover. The company’s battle with the Securities and Exchange Commission (SEC) hardly helped. SEC staff lawyers had been demanding access to IOS client lists, both in America and overseas. IOS refused, citing Swiss secrecy laws. By 1967, a shaky truce—or “consent order,” as the lawyers called it—was forged: The feds would leave IOS alone as long as the company did no business in the United States. Eyeing IOS’s internal chaos and enormous assets from afar, Vesco worried little about the technicalities of the consent order. He insinuated himself into the IOS hierarchy, and, through a complex series of transactions cloaking his ownership, purchased 6.6 million of the company’s shares. In February 1971, IOS’s board of directors elected Vesco its chairman.
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On March 18, six days after Vesco shook Mitchell’s hand at the Chanticler restaurant, the SEC launched an investigation of ICC, Vesco’s mothership company. At issue—initially—was whether Vesco’s takeover of IOS violated the 1967 consent order. SEC subpoenas began piling up, demanding thousands of internal ICC documents. A profane man with a “short fuse,” Vesco grew enraged, cursing the government’s “witch hunt.” Against his lawyers’ advice, he impulsively countersued the SEC, its chairman, William J. Casey, and Attorney General Mitchell.
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To the garrulous nouveau riche entrepreneur from New Jersey, an audience with the SEC chairman, remote and patrician, became a kind of holy grail: If he could just meet Casey personally, Vesco thought, he could talk his way out of SEC’s crosshairs. He made several approaches to Casey through various routes, but each time the wily Office of Strategic Services (OSS) veteran, later CIA director under President Reagan, rebuffed him. So Vesco turned to Harry Sears, whose failed gubernatorial campaign Vesco had lavishly supported, and whose chumminess with John Mitchell had been on vivid display at the Chanticler two months earlier. On May 16, Vesco wrote a personal letter to Casey and asked Sears to steer it to Mitchell for forwarding. Sears in turn penned a “Dear John” letter.

Bob’s concern is that the suit may be viewed out of context by the administration. Basically he is trying to get past the [SEC] staff level to the chairman and apparently has been unable to do so to date…. Bob is a good friend, otherwise Iwould not trouble you with this information, which, as I said, is for the sole purpose of insuring that there can be no misunderstanding with regard to his motives and purposes.

Sears’s note drew only a boilerplate response, drafted a month later by Mitchell’s secretary, Susie Morrison. A week later, a group backed by the Rockefeller family expressed interest in acquiring IOS. Sears again wrote to Mitchell, alerting him to the potential deal. “I have no way of knowing whether your conversation with Bill Casey may have encouraged this,” Sears wrote. Mitchell later testified he did not recall seeing any of Sears’s letters, and never talked to Casey about the Vesco case at that time. Asked why Sears would have invoked “your conversation with Casey” if Mitchell had not, in fact, had such a conversation and recounted it to Sears, Mitchell pleaded ignorance and suggested Sears was only trying to mollify his demanding patron.
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On November 30, 1971,
in between calls with Henry Kissinger, the House and Senate minority leaders, the secretary of state, and the president’s personal secretary, Attorney General Mitchell took his first affirmative step on Vesco’s behalf. It started with a return call to Sears. Normally understated, Sears sounded agitated: Vesco was in a Swiss jail cell, being held without bail on charges filed by a disgruntled IOS stockholder. What’s more, Sears fretted, “Nobody had been able to get through to the United States Embassy.” “Are you positive Vesco cannot get bail under any circumstances?” Sears recalled Mitchell asking. Yes, Sears replied. Mitchell then offered to contact the U.S. ambassador to Switzerland, Shelby Davis, a friend for thirty years. But the ambassador was out of town. So Mitchell spoke with Richard Vine, deputy chief of mission at the embassy in Bern. A career Foreign Service officer who had met Mitchell in passing, Vine later testified he told Mitchell that Vesco’s jailing was “warranted in Swiss law” and would probably be resolved the following day. Mitchell asked a few questions, Vine recalled, and asked to be kept apprised of developments.
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Mitchell called Sears back. According to Sears, Mitchell reported that he had managed “to get some word through to the Embassy and he hoped that it would be of some assistance.” Recounting this call to the grand jury, however, Mitchell said nothing about being “of some assistance.” Instead, he told the grand jurors he simply “called Mr. Sears back and told him they were working—looking into the subject matter.” Mitchell added at trial: “I didn’t do anything in the Swiss matter except make a phone call.” That was untrue. W. Mark Felt, the number-two man at the FBI—later revealed as Bob Woodward’s infamous Watergate source, Deep Throat—testified Mitchell summoned him to the attorney general’s office, and there asked Felt to ascertain the facts surrounding Vesco’s jailing. Confronted with Felt’s testimony, Mitchell conceded: “I must have completely forgotten about the occasion of my meeting with Agent Felt [
sic
].” As Vine predicted, Vesco was released the next day, after posting $125,000 bail. Upon his return to the United States, he presented Sears with a check for $10,000. When Sears protested that his call to Mitchell had been a favor, Vesco insisted Sears keep the check: “It may seem like a lot of money to you, but it’s small change to me.”
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Buoyed by Mitchell’s show of concern during the Swiss jailing incident, Vesco revived his campaign to get the attorney general to rein in the SEC. “See if you can get John Mitchell to give you some help…with the commission,” Vesco again ordered Sears, who by January 1972 had joined the payroll, serving on the boards of ICC and the Vesco-controlled Bahamas Commonwealth Bank. Sears tried gently to discourage further exploitation of the Mitchell connection. “Bob, we didn’t do too much good last year,” he pleaded. But Vesco continued to see Mitchell as a route to Casey, and harbored, too, a weird fascination with Mitchell himself. “On occasion,” a biographer noted, Vesco “impressed visitors by asking them to step outside a moment so he could take a confidential call from John N. Mitchell.” There were no such calls.
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