-Caveat Lector-
an excerpt from:
The Breaking of a President 1974 - The Nixon Connection
Marvin Miller, Compiler
Therapy Productions, Inc.©1975
LCCCN 7481547
--[12b]--
INTERNATIONAL INTELLIGENCE INC.
When Mary Carter Paint Company changed its name to Resorts International,
several attempts were made to give the impression that organized crime was
not involved in its gambling casinos despite all that had gone on. Some
well-known Lansky men were fired from the casinos, and Resorts International
put up $2 million to form International Intelligence Inc. (Intertel), an
agency which guaranteed to keep any legal gambling operation free from
or-ganized crime influence. Heading Intertel was the same Robert Peloquin who
as a Justice Department investigator had warned of the likelihood of a Lansky
skim at Resorts International's Paradise Island Casino. He resigned from the
Justice Department to become vice-president of Paradise Enterprises Ltd., the
corporation set up by Sands, Groves and Mary Carter Paint to organize
security at the new Nassau casinos. From Paradise Enterprises, Peloquin
shifted to Intertel, a 91 per cent - owned subsidiary of Resorts
International. It is believed that Howard Hughes owns the other 9 per cent.
Intertel describes itself as an organization devoted to "safeguarding
business from the hidden risks of vulnerability to organized crime, and
assisting states and cities in developing comprehensive crime control plans.
Intertel is a unique consulting organization created specifically to provide
businesses, industrial concerns and trade associations with expertly designed
management systems that would enable them to repel infiltration by organized
crime."
In a 1970 brochure which Intertel distributed to some interested
publications, the President's Commission on Law Enforcement and
Administration of Justice is approvingly quoted as saying in 1967: "There is
a disturbing lack of interest on the part of some legitimate business
concerns regarding the identity of the persons with whom they deal. This
lackadaisical attitude is conducive to the perpetration of frauds and the
infiltration and subversion of legitimate business by the organized criminal
elements."
The Intertel brochure, backed by the impressive experience Robert Peloquin
had acquired as one of the top governmental investigators of organized crime,
goes on to say what Intertel has to offer the legitimate businessman:
Wherever business succeeds, there is a threat of infiltration and subversion
by organized crime. The threat to corporate giants is gigantic. The effect on
smaller business is often devastating.
Organized crime's activity in the business community is more diverse than any
conglomerate's. Its members and associates are astute businessmen. They are
profit-oriented; they invest and manipulate billions of dollars in business.
Yet most businessmen know virtually nothing about the economic threat and
danger signals of organized crime.
Until now businessmen concerned about the problem have had no wholly suitable
place to turn for help. That is no longer true. A new company has been formed
to give that help: International Intelligence Inc. —INTERTEL.
Organized criminals who injure business today do not look like stereotyped
criminals. They are executives and technicians. Their forte is manipulation
of computer information, tampering with accounting procedures, theft of trade
secrets and invasion of confidential company files. They thrive on exercising
dangerous influence over key employees and executives in parent or subsidiary
companies, and the corruption of associates, suppliers, distributors,
customers and competitors.
Those are vulnerable areas through which organized crime can penetrate and
ultimately control a business or an industry. Those are the areas largely
overlooked by management in many businesses.
Organized crime can not be disregarded. Its influence will not disintegrate
on its own. Affirmative action must be taken by the business community.
Consideration must be given to the integrity of management and key officials
in companies with whom any business relationship is contemplated. Are their
money sources legitimate, or do they represent part of the $7 to $10 billion
profit organized crime nets every year from illegal operations and wants to
invest in legitimate business?
Intertel has the unique capability of studying your company, analyzing the
potential for such losses in its various divisions or subsidiaries, and
identifying the areas of vulnerability. We can recommend new management
systems, or improvement of existing ones. We can provide the necessary
intelligence about businesses and management with whom you are considering a
merger, acquisition, joint venture or other relationship. Management thus can
avoid loss of profits, dissipation of assets, and ruin of business reputation.
The Intertel brochure then goes on to detail what it can do for specific
types of businesses. For professional sports organization, Intertel will
provide intelligence services to prevent organized crime from influencing
sport results. For stock exchanges, banks, brokerage houses and credit card
companies Intertel will help prevent the theft of stocks, bonds and other
securities. It will assist in the rapid identification of stolen securities
and prevent the use of fraudulent or stolen credit cards. For legitimate
casinos, race -tracks or lotteries, Intertel will coordinate with U. S.
officials and foreign government officials to keep the gambling crime-free.
In order to accomplish all of this, Peloquin recruited an impressive group of
professional crime-fighters. Peloquin's law partner, William C. Hundley,
became secretary of Intertel. Hundley was formerly chief of the Organized
Crime and Racketeering Section of the U. S. Department of Justice. John D.
O'Connell, Intertel executive vice-president for New York operations, is a
former FBI agent with 24 years of specialization in organized crime
investigation.
Thomas J. McKeon, vice-president, was chief of the Justice Department's
Organized Crime Strike Force in Detroit. William A. Kolar, vice-president, is
another former FBI agent with extensive experience in the Internal Revenue
Service. David Belisle was deputy director of security for the U. S.
Department of State .
Intertel's list of experts goes on and on. Sir Ranulph Bacon, former
Commissioner of Scotland Yard and head of the 1967 Royal Commission of
Inquiry into Bahamian gambling, is on Intertel's board of directors along
with M.F.A. Lindsay, former Commissioner of the Royal Canadian Mounted
Police; Mortimer Caplan, former Commissioner of the U.S. Internatl[sic]
Revenue Service; Edwin McDonald, executive vice-president of the Metropolitan
Life Insurance Company; and Jerome S. Hardy, executive vicepresident of a
large mutual fund that supported Nixon, The Dreyfus Corporation of New York.
And then besides Peloquin there are a whole group who have been associated
with the gambling operations of Mary Carter Paint and Resorts International.
James Golden, already mentioned in this chapter as a former employee of Mary
Carter Paint, who also took care of security for Richard Nixon, now appears
as a staff member of Intertel. He is credited with also being director of
security for Resorts International. Intertel treasurer Raymond Gore, a
certified public accountant formerly with Price Waterhouse, is also
vicepresident of finance for Resorts International.
Warren Adams, chief casino security officer at Paradise Island, is also on
the Intertel staff. Adams was officer-in-charge of the gaming squad, Clark
County Sheriff's Department, Las Vegas, Nevada-not necessarily the best of
credentials, since he worked in Las Vegas in the years when organized crime
made some very profitable illegal skims from the casinos. Fenelon A.
Richards, director of enforcement of the United States Bureau of Customs,
with world-wide responsibility for 750 customs agents and investigators,
became director of security for Resorts International gambling operations
before joining Intertel.
WHO CONTROLS INTERTEL?
In 1971 the Las Vegas Sun did a series of articles on Meyer Lansky,
international gambling, Resorts International, and Intertel. In his
introduction to the series, publisher Hank Greenspun observed that his state,
Nevada, has had enough experience with legalized gambling to know that
resourceful organized crime often succeeds in illegally infiltrating that
business despite all the efforts of government. Greenspun went on to note
that when I. G. (Jack) Davis, president of Resorts International, testified
before the New Jersey State Legislature in favor of legalized gambling, his
testimony was echoed by William Kolar, a vice-president of Intertel. By this
time Intertel had taken over the security operation for the Howard Hughes
gambling operation in Las Vegas.
Greenspun, having already had the opportunity to see Intertel in action at
first-hand in his own city, then asked the interesting question: If Intertel
is supposed to be protecting Howard Hughes' large financial investment in Las
Vegas gambling, then why is it involved in promoting a competitor to Las
Vegas in New Jersey: (Resorts International had already taken options on
three hotels in the Spring Lake area, a fact which surprised the New Jersey
lawmakers when they learned of it). And Greenspun anticipated the following
series of articles by stating: "By whatever name the proponents, and however
cloaked, the moving finger still points to Meyer Lansky."
The Las Vegas Sun series was written by Allan Witwer, a journalist who had
previously written a manuscript entitled "The Ugly Bahamians." Witwer had
been head of public relations for Lou Chesler and Wallace Groves' Grand
Bahama Development Company. Later he was to work for Sir Stafford Sands as
news-bureau chief for the Bahamas Ministry of Tourism in Nassau. Peloquin's
Justice Department memorandum about a Meyer Lansky skim being implicit at
Paradise Island was based on material that Witwer had given him. Witwer says
of himself: "I was an eye-witness to the Mob's move from the cesspool of
Havana to those 'gin-clear' waters of the Bahamas."
Unfortunately Witwer's manuscript was suppressed. It was bought by a
publisher for $53,000 but never put into print. Interestingly enough, Witwer
received the $53,000 from the Manhattan law firm of Simpson, Thatcher and
Bartlett. Whitney North Seymour, a Wall Street friend of Nixon's when Nixon
was practicing law in New York, was a senior partner of this law firm. When
Nixon fired crime fighter Robert Morgenthau as U. S. Attorney for the
Southern District of New York, he replaced Morgenthau with Seymour-and that
change effectively ended an important federal grand jury probe into organized
crime, as well as Morgenthau's exploration of Swiss bank-laundering of mob
funds.
When Witwer took the $53,000 he knew it meant suppression of his manuscript,
and he had every reason to suspect that the money came from the Ugly
Bahamians themselves. The deal had been put together with the non-publisher,
Exposition Press, by Hill and Knowlton, the large public relations firm. Hill
and Knowlton had a $5 million contract with Sir Stafford Sands, then Minister
of Finance and Tourism for the Bahamas, to publicize the islands. Witwer was
also still working for Sir Stafford Hill and Knowlton told Witwer that actual
publication of "The Ugly Bahamians" would topple the government of Sir
Stafford and perhaps even inspire a revolt by the black majority. When others
threatened his life if he published the book, Witwer found that the Hill and
Knowlton proposal was an offer he couldn't refuse. In Witwer's own words:
"Valor dictated the publication of 'The Ugly Bahamians.' Survival said, 'Take
the money and run!'"
However, the manuscript didn't stay buried very long. Four months after the
deal set up by Hill and Knowlton, Robert Morgenthau subpoenaed both the
manuscript and Allan Witwer before a federal grand jury investigating
organized crime. Morgenthau may have learned about the material from
Peloquin, who had interviewed Witwer while still in the Justice Department,
or from John Reagan ("Tex") McCrary.
TEX McCRARY
McCrary had been a publicist for Lou Chesler, First he protected Chesler from
the charge that he had improperly taken $5 million from Seven Arts
Productions Ltd. to invest in the Grand Bahama Development Company without
notifying Seven Arts stockholders. Then McCrary did the public relations work
for Chesler to obtain the Certificate of Exemption permitting gambling on
Grand Bahama Island. Chesler put together a tour including Wallace Groves,
Chesler, and Sir Roland and Lady Symonette, which visited the Chesler-built
cities in Florida and ended with a party at the Fountainebleau Hotel in Miami
Beach. Sir Roland Symonette, soon to become Premier of the Bahamas and a key
factor in the Groves-Chesler plans, was so impressed with Chesler that after
the tour was over Groves exclaimed: "We're home free!"
After Chesler was removed from the Grand Bahama situation and the Bay Street
Boys failed to fulfill some promises they had allegedly made to McCrary, he
switched political sides and began supporting the oppositionist party of
Lynden Pindling. As mentioned previously, even Lansky wanted Pindling as
Premier by this time. McCrary began feeding documents on the corruption of
the Groves-Sands regime in Grand Bahama to Allan Witwer, the U. S. Justice
Department,, the New York Times, the Wall Street Journal and anyone else who
would listen. When Pindling was elected, McCrary got his reward. He and his
associate Bill Safire (later to become a speech-writer for Nixon) eventually
took over the large public relations contract previously held by Hill and
Knowlton for the Bahamas. Because of these intrigues, Witwer's manuscript and
information was not to be buried in the vaults of Exposition Press, even
though payment had been made for Witwer's silence. And Witwer found an
interesting ally in Hank Greenspun, who was by no means an innocent.
Greenspun had been Bugsy Siegel's publicity man atone time, and then was
publicist for and shareholder in the Desert Inn when the Cleveland Syndicate
controlled it.
In his series of I I Las Vegas Sun articles in 1971, Witwer chronicled the
corruption of the Bahamas by U. S. organized crime, from the Bay Street Boys
to the Pindling regime, from the Groves
Chesler gambling operation on Grand Bahama to Mary Carter Paint on Paradise
Island. And he pointed that although Resorts International and Intertel
claimed to have gotten rid of the Lansky. men running the casinos, this did
not really happen. When Dino Cellini left the Bahamas, his brother Eddie took
charge of the Paradise Island Casino and operated it for two years under
Peloquin's "security." And when publicity forced Intertel to fire Eddie
Cellini, the Dade County Sheriff's Offfice[sic] verified that he continued to
operate tours by gamblers to Paradise Island out of Resorts International's
Miami office, and on an almost daily basis continued to check the credit
given to gamblers at Resort's Nassau casinos.
The Lansky influence may have become less visible under Intertel, but many
competent journalists and investigators believe that organized crime still
continues to dominate the Bahamian gambling operation. They point out that
many gamblers in the Bahamas, particularly those who come on the supervised
tours arranged by Lansky men, do not pay their gambling debts with money but
with -markers," a form of IOU bookkeeping. These "markers" are often not
recorded on the account books of the casinos, but are transported to the
mainland U. S., where Syndicate men arrange for their collection. The
"markers" that do get put on the casino books are often written off as
uncollectable even if they are collected. This is one of the Syndicate's
"skimming" procedures which does not involve the well-known false count at
the end of the gambling day.
Another subtle "skim" method involves the payments of bonuses to Lansky men,
who then kick back a substantial part of the "bonus" to Lansky. And it is
known that when Lansky associates Courtney, Ritter and Brudner were deported
from the Bahamas, arrangements were made by Resorts International to continue
a $2 million payment to them for the next ten years, on the basis that they
had presumably left behind some of their private credit files necessary for
the casino operations on Paradise Island.
The day after Witwer's articles ended in the Las Vegas Sun, publisher
Greenspun wrote a strong concluding editorial entitled: "Warning to Hoods: We
Don't Want You in Our State!" The conclusions that Greenspun published after
the investigative articles by his newspaper are so startling that they are
worthy of at least partial reprint here so that the reader can have at hand
his opinions:
A WARNING TO HOODS
There was a time when the underworld attained its ends by violence and
payoff. Then, seeking respectability, organized crime looked for legitimate
fronts, but the take never really stopped.
"Now it has reached a new cycle ... Slick public relations, respectable front
men, new secret private policing is the pattern. The goal: an extension of
legalized gambling throughout the Western world ...
"I believe we are on the brink of the most ambitious and cleverest ploy of
all: the creation of an International Gambling Cartel with its own
intelligence service ... The Sun's series has revealed the complex pattern,
and what has emerged from this very complicated puzzle is that Intertel has
become the chosen instrument for the International Gambling Cartel.
"It has a good start. Staffed by the very people who were in the law
enforcement agencies designed to combat organized crime and using the
knowledge and prestige gained in these agencies, Intertel now represents the
other side. Financed by a corporation which is rooted in the suspect history
of gambling in the Caribbean, Intertel now operates a network of security for
gambling operations in such widely separated locations as the Bahamas,
Netherlands, West Indies and Nevada.
"Intertel executives have testified before the New Jersey Legislature in
behalf of legalized gambling. We have examined that testimony, laundered as
it was to serve their own purposes. They will certainly be on hand when
states like New York, Florida, Hawaii and possibly California are hypnotized
by the promises of fiscal Utopia.
"The International Crime Syndicate has Iong had the biggest cash flow of any
of the world's businesses. It does not give up easily, as we in Nevada know
from long experience. If Intertel's ambitions are realized, they will be
supervising that cash flow. They are willing to take risks, promise anything
for that prize. But an organization like Intertel can so cover its tracks
that none of its activities or interests can be learned unless it is willing
to make them public.
"Intelligence is power. It can be used for good or evil. Intertel executives
have had, and presumably continue to have access to the files of many law
enforcement agencies here and abroad. Its agents have worked for the FBI, the
IRS, the Royal Canadian Mounted Police, Interpol and even the Clark County
Sheriff's Office. But where do their loyalties lie now?"
INTERTEL'S STRANGE CLIENTS
Resorts International and Intertel have repeatedly denied all allegations of
involvement with organized crime. The reader must be the judge of whether or
not the facts linking these groups with Meyer Lansky are mere coincidences or
represent a pattern. And the reader must judge too if the prominent
appearance in the Bahamas of Richard Nixon and some of his wealthiest backers
is also mere coincidence, or part of a more sinister pattern showing the
desire of organized crime to involve itself with the highest reaches of
political power.
However, it is an undoubted fact that Intertel hires itself out to strange
clients for strange purposes. When Jack Anderson was exposing the Dita Beard
memo on ITT's volunteering of financial support to the Republican National
Convention in exchange for favorable action on an anti-trust suit by the
Nixon administration, ITT hired Intertel to snoop on Anderson. When Howard
Eckersley, one of the five men in regular attendance upon Howard Hughes, got
involved in a fraudulent mining deal in Canada through a broker with Mafia
connections, Robert Peloquin personally took him to the Securities Exchange
Commission and obtained immunity for Eckersley—even though the head of the
Canadian stock exchange was suspended for the scandal.
And while not being so bold and direct as Las Vegas publisher Greenspun, a
Department of Justice spokesman was quoted in the Los Angeles Times of
December 14, 1970 as saying: "They [Intertel] are becoming the spokesman for
organized gambling. I just wonder if that's a good thing; not that those boys
don't have impeccable credentials, they do; I just wonder how much temptation
a man can stand."
pps. 330-344
=====
<photo captions>
Map shows that Grand Bahama Island is closer to Florida than Cuba. When Cuban
gambling casinos were shut down by Fidel Castro in 1959, the geographic
position of the Bahama Islands was one reason why Meyer Lansky shifted his
gambling operations there.
Vice-President Nixon (right) has lunch with Evangelist Billy Graham in 1960.
>From 1961 to 1968 Nixon was not in political office, having been defeated
nationally by John F. Kennedy in 1960 and in the California gubernatorial
race in 1962 by Edmund G. Brown. During these years Nixon was a prominent
visitor in the Bahamas and lent his presence to the opening of several
gambling casinos controlled by Meyer Lansky.
Sir Stafford Lofthouse Sands, former Minister of Finance and Tourism for the
Bahamas, was approached by Meyer Lansky in 1960 and offered $2 million by the
National Crime Syndicate leader if he would help open the Bahamas to gambling
casinos. Sands says he turned down the offer, but later, after gambling was
firmly established on the islands, it was revealed that Sands had received at
least $1.8 million from the mob's front men. In the face of the scandal,
Sands left the Bahamas and retired in Spain.
Visitors relax at Paradise Beach, Nassau, one of the beauty spots of the
Bahamas. During Prohibition liquor from Canada and Great Britain was shipped
to Nassau and then smuggled into the United States.
American gangster Benjamin "Bugsy" Siegel visited the Bahamas during
Prohibition with Meyer Lansky to re-establish liquor smuggling into the
United States, after the Bugs and Meyer Mob had eliminated Chicago bootlegger
Sam Blum.
Sir Roland T. Symonette, the first Premier of the Bahamas, leads a band that
greeted him on his return from London in 1963, where successful negotiations
provided for internal self-government for the Bahamas in 1964. Symonette had
become wealthy in the 1920's by using his influence in the then British
colony of the Bahamas to facilitate liquor smuggling into the U. S. In the
1960's he was again to help Meyer Lansky use the Bahama Islands as a base for
organized crime.
Wallace Groves, multi-millionaire developer of Grand Bahama Island, leaves
the Supreme Court Building in Nassau in 1967. He had just testified before a
Royal Commission investigating casino gambling at Grand Bahama, that he had
never met nor had any dealings with the Mafia. With Groves is Miami public
relations man Robert Venn.
Arthur Desser, a real estate associate of Jimmy Hoffa and Meyer Lansky,
bought Florida land which Wallace Groves had allegedly obtained from Al
Capone interests, and resold several lots of this land to Richard Nixon at
bargain prices. Nixon tried to conceal from whom he bought these lots by
postponing the trust-deed filing.
Lynden 0. Pindling became Bahamian Prime Minister in 1967 after he defeated
the Bay Street Boys in an election, but Meyer Lansky had arranged in advance
for an accommodation with the new government.
Elliot Roosevelt (left), testified before the U.S. Senate Permanent
Investigations subcommittee in 1973 that he had been involved with organized
crime figures in various investment dealings but knew nothing of their stolen
stock transactions. He also denied offering a convicted securities swindler
$100,000 to assassinate Bahamian Prime Minister Lynden 0. Pindling (right).
Louis P. Mastriana, a convicted securities swindler, had previously told the
Senate subcommittee that he had received $10,800 from Roosevelt and Michael
McLaney, a Meyer Lansky lieutenant. Mastriano claimed the money was to
assassinate the Prime Minister because Pindling would not approve a gambling
license for the underworld despite a $1 million campaign contribution by
McLaney. Roosevelt acknowledged giving Mastriana, a former employee of his,
$10,800, but said it was to be used in obtaining a real estate loan from a
New Jersey labor union. Although another convicted securities racketeer,
Patsy A. Lepera, told the Senate subcommittee of providing Elliot Roosevelt
with stolen securities on three separate occasions, Roosevelt categorically
denied any such knowledge, and Sen. Henry M. Jackson (D -Wash.), chairman of
the subcommittee, did not refer the matter to the Justice Department.
Daniel K. Ludwig, one of the few billionaires in the United States, and a
strong financial backer of Nixon, helped Wallace Groves develop Grand Bahama
Island.
Thomas E. Dewey, shown here when he was special N.Y. prosecutor in 1937 and
had just convicted seven racketeers, was later to become a major stockholder
in the Mary Carter Paint Company, in which Meyer Lansky allegedly had
considerable influence.
A&P heir Huntington Hartford with his estranged wife Diane. Hartford didn't
have the right connections to develop gambling on Paradise Island in the
Bahamas until he got involved with Wallace Groves and Sir Stafford Sands.
Paradise Island Hotel is seen at right, while in foreground is the Britannia
Beach Hotel. When this photograph was made in 1970, the top floor of the
Britannia was under armed guard because of the presence of Howard Hughes.
Richard Pistell, a major stockholder in the Mary Carter Paint Company,
contributed$] 7,500 to Nixon's 1968 campaign.
The Bridge to Paradise. Workmen are shown putting the finishing touches on
the $2 million toll bridge connecting Nassau Island with the resort
development of Paradise Island.
Bernard Cornfeld former head of the large mutual fund, Investors Overseas
Service. His mutual fund became heavily involved in the financing of gambling
resorts all over the world, including those of Resorts International in the
Bahamas.
Publicist Tex McCrary worked for Lou Chesler, head of the Grand Bahama
Development Company, and then campaigned to overturn the government of the
Bay Street Boys so that Lynden 0. Pindling would come to power. McCrary then
took over the lucrative job of publicizing the Bahamas and its gambling
casinos.
William Safire, a publicist who worked with Tex McCrary to promote gambling
casinos in the Bahamas, worked on Nixon's 1968 campaign and later became
Nixon's main speech-writer. He is now a columnist.
--[cont]--
Aloha, He'Ping,
Om, Shalom, Salaam.
Em Hotep, Peace Be,
Omnia Bona Bonis,
All My Relations.
Adieu, Adios, Aloha.
Amen.
Roads End
Kris
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