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Profile: Maurice Stans

Maurice Stans was a participant or observer in the following events:

ITT logo.ITT logo. [Source: Private Line.com]International Telephone and Telegraph (ITT) acquires three smaller corporations, prompting the US Justice Department to file suits against ITT charging that the mergers violate antitrust laws. Between 1969 and April 1971, ITT officials meet with several Nixon administration officials, including Vice President Spiro Agnew; White House aides John Ehrlichman, Charles Colson, and Egil Krogh; Cabinet secretaries John Connally and Maurice Stans; Justice Department officials John Mitchell and Richard Kleindienst; and others, in attempts to persuade the administration to drop the lawsuits. (Wallechinsky and Wallace 1981)

President Nixon orders chief of staff H. R. Haldeman to finalize the creation of a second secret campaign fund (see February 17, 1969). The purpose of this particular fund is to support candidates in the November 1970 midterm elections that Nixon believes are loyal to him. The idea is not necessarily to support Republicans, but to support Nixon loyalists—party is a secondary consideration. “One of our most important projects for 1970 is to see that our major contributors funnel all their funds through us,” Nixon writes. “[W]e can see that they are not wasted in overheads or siphoned off by some possible venal types on the campaign committees… we can also see that they are used more effectively than would be the case if the candidates receive them directly.” The candidates’ fund, eventually dubbed the “Townhouse Operation” or “Town House Project” (so named because all of its dealings must take place in private offices and not in the White House or any campaign offices (see Early 1970)), is to be operated by Haldeman, Secretary of Commerce Maurice Stans (himself a veteran campaign fund-raiser), Senator Strom Thurmond (R-SC)‘s aide Harry Dent, and Dent’s assistant John Gleason. The list of contributors includes Chicago insurance tycoon W. Clement Stone, PepsiCo’s Donald Kendall, and Texas electronics millionaire H. Ross Perot. “Townhouse” is not the only secret campaign fund run from the White House; another is run by Nixon’s close friend millionaire Charles “Bebe” Rebozo, and features $50,000 secretly flown to Nixon’s beach home in Key Biscayne, Florida by an employee of billionaire Howard Hughes. (Reeves 2001, pp. 153)

President Richard Nixon writes an action memo to senior aide H. R. Haldeman saying, “One of our most important projects for 1970 is to see that our major contributors funnel all their funds through us.” Haldeman and Commerce Secretary Maurice Stans set up a secret fund-raising enterprise, the “Townhouse Operation,” designed to bypass the Republican National Committee. By doing so, Nixon intends to ensure the GOP will field candidates suitably loyal to him, and reliably opposed to the GOP’s traditional Eastern Establishment base that Nixon so resents. Although George H. W. Bush is a charter member of that Eastern Establishment, Nixon likes and trusts him. Bush is “a total Nixon man,” Nixon once says. “He’ll do anything for the cause.” Bush is the main beneficiary of the slush fund, which is made up of about $106,000 in contributions from Texas GOP sources, but up to 18 other Republican Senate candidates also receive money from the fund. The Wall Street Journal will later lambast Townhouse, calling it a “dress rehearsal for the campaign finance abuses of Watergate, as well as for today’s loophole-ridden system.” (Werth 2006, pp. 115-116)

Maurice Stans.Maurice Stans. [Source: Southern Methodist University]In a last campaign fundraising swing before April 7, when the new campaign finance laws go into effect, Maurice Stans, the financial chief for the Committee to Re-elect the President (CREEP), launches a final fundraising swing across the Southwest on behalf of Richard Nixon. Stans solicits contributions from Republicans and Democrats alike, and tells reluctant contributors that if they do not want their donations traced back to them, their anonymity can be ensured by moving their contributions through Mexican banks. Mexico does not allow the US to subpoena its bank records.
Laundering - “It’s called ‘laundering,’” Miami investigator Martin Dardis later tells Washington Post reporter Carl Bernstein on August 26, 1972. “You set up a money chain that makes it impossible to trace the source. The Mafia does it all the time. So does Nixon.… This guy Stans set up the whole thing. It was Stans’s idea.… Stans didn’t want any way they could trace where the money was coming from.” The same money-laundering system allows CREEP to receive illegal contributions from corporations, which are forbidden by law to contribute to political campaigns. Business executives, labor leaders, special-interest groups, even Las Vegas casinos can donate through the system. Stans uses a bank in Mexico City, the Banco Internacional; lawyer Manuel Ogarrio Daguerre handles the transactions. Stans keeps the only records.
Confirmed by Lawyer - Lawyer Robert Haynes confirms the setup for Bernstein, and says breezily: “Sh_t, Stans has been running this operation for years with Nixon. Nothing really wrong with it. That’s how you give your tithe.” Haynes calls the fundraising trip “Stans’s shakedown cruise.” Stans uses a combination of promises of easy access to the White House and veiled threats of government retaliation to squeeze huge donations out of various executives; Haynes says: “If a guy pleaded broke, [Stans] would get him to turn over stock in his company or some other stock. He was talking 10 percent, saying it was worth 10 percent of some big businessman’s income to keep Richard Nixon in Washington and be able to stay in touch.” Haynes represents Robert Allen, who runs the Nixon campaign’s Texas branch; Allen is merely a conduit for the illegal campaign monies. It is from the Banco Internacional account that Watergate burglar Bernard Barker is paid $89,000 (see April-June 1972) and the “Dahlberg check” of $25,000 (see August 1-2, 1972). (Bernstein and Woodward 1974, pp. 54-56)

The Nixon administration spends $8,400 on fake telegrams and advertisements to create a false impression of public support for the US mining of Vietnam’s Haiphong harbor. This will not come to light until March 1973, when a disaffected official of the Nixon campaign (CREEP) tells Washington Post reporter Bob Woodward of the operation. The false telegrams are sent to the White House and publicly presented by press secretary Ron Ziegler and other Nixon officials. In addition, CREEP purchases an advertisement in the New York Times purporting to be from a group of “concerned citizens” that attacks the Times for its opposition to the mining operation. “The [Times] ad was paid for by CREEP with 40 of those $100 bills in [CREEP finance director Maurice] Stans’s safe,” the official will say (see Before April 7, 1972). Another CREEP official will tell Woodward that the Haiphong public relations offensive “put the entire staff in overdrive for two weeks,” between creating false telegrams, busing supporters to Washington, organizing petition drives and phone campaigns, and getting supporters to call Congress. After the Post prints the story, Woodward learns that CREEP also rigged a poll conducted by Washington television station WTTG. The poll was based on sample ballots printed in the local newspapers. CREEP has ten people working for days purchasing newspapers, filling out ballots in different handwriting, and mailing them in. The fake ballots radically skew the poll in favor of the mining operation. A CREEP spokesman will confirm the ballot-stuffing operation and say, “We assumed the other side would do it also.” Frank Mankiewicz, a senior campaign aide for the presidential campaign of Democratic candidate George McGovern, will respond incredulously: “It didn’t occur to us, believe me. Those guys are something. They assume we have the same sleazy ethics as them.” (Bernstein and Woodward 1974, pp. 265-267; Pike 2008)

Vernon Walters.Vernon Walters. [Source: Medal of Freedom (.com)]White House counsel John Dean meets with Vernon Walters, the deputy director of the CIA, to ask if the agency can provide “financial assistance” to the five Watergate burglars. Two days later, after checking with his boss, CIA director Richard Helms, Walters refuses Dean’s request. Dean informs his White House and Nixon campaign associates, John Mitchell, Frederick LaRue, and Robert Mardian. On June 29, Dean meets with President Nixon’s personal lawyer, Herbert Kalmbach, and tells him that Mitchell, along with Nixon’s two top aides, H. R. Haldeman and John Ehrlichman, want Kalmbach to raise money for the Watergate burglars. Later that day, the finance chairman of the Nixon re-election campaign, Maurice Stans, gives Kalmbach $75,000 for the burglars. Over the next months, money will continue to be raised and disbursed to the burglars in what may be part of a blackmail scheme orchestrated by one of them, E. Howard Hunt (see March 21, 1973). (Spartacus Schoolnet 8/2007)

White House counsel John Dean meets with President Nixon’s personal lawyer, Herbert Kalmbach, in Lafayette Park near the White House. Away from possible eavedropping, Dean tells Kalmbach that his job is to secretly raise money for the Watergate defendants (see June 20-21, 1972). The money is to be delivered by former New York policeman and Nixon campaign operative Tony Ulasewicz (see March 20, 1971). Kalmbach checks into a room at the Statler Hilton, where campaign finance chairman Maurice Stans gives him a briefcase containing $70,000 in $100 bills. (Reeves 2001, pp. 572) Kalmbach will distrubute $187,000 in “hush money” to the burglars over the next three months; after that, the distribution will be handled by former Mitchell aide Frederick LaRue, who will hand out another $230,000. Nixon will claim he knew nothing of this until informed by White House counsel John Dean in March 1973 (see March 21, 1973), but author James Reston, Jr will later write that Kalmbach’s involvement is “strong circumstantial” evidence “that Nixon must have known about the process from the beginning. Had the president’s lawyer been caught at this task, it would have associated the president with the break-in in the summer of 1972, and no one but Nixon would logically have authorized such a risky procedure.” (Reston 2007, pp. 34)

The Washington Post reports that a $25,000 cashier’s check, apparently earmarked for the campaign to re-elect President Nixon, found its way into the Miami bank account of one of the Watergate burglars, Bernard Barker (see 2:30 a.m.June 17, 1972). (Gerald R. Ford Library and Museum 7/3/2007)
Origin of Check - The check, drawn on a Boca Raton, Florida bank, was made out to Kenneth H. Dahlberg, the finance manager for the Committee to Re-elect the President (CREEP). Dahlberg says that in early April, he gave the check to “the treasurer of the Committee [Hugh Sloan, who has since quit the committee and is cooperating with the FBI investigation] or to Maurice Stans himself.” Stans, formerly Nixon’s secretary of commerce, is CREEP’s finance chief. The money is made up of “[c]ontributions I collected in my role as Midwest finance chairman,” Dahlberg explains. “In the process of fund-raising I had accumulated some cash… so I recall making a cash deposit while I was in Florida and getting a cashier’s check made out to myself. I didn’t want to carry all that cash into Washington.”
Watergate Connections - Barker withdrew much of the money from the same Boca Raton bank account, in $100 bills. 53 of those bills were found on the five Watergate burglars after their arrest. Clark MacGregor, who replaced former Attorney General John Mitchell as the head of CREEP (see July 1, 1972), says he knows nothing about the check or the money found on Barker and the other burglars: “[T]hese events took place before I came aboard. Mitchell and Stans would presumably know.” The Post also learns that another $89,000 in four separate checks were deposited in Barker’s Miami bank account in May (see June 23, 1972). The checks were originally made out to Mexican lawyer Manuel Ogarrio Daguerre, on an account at Mexico’s Banco Internacional. While looking over the story before publication, Post editor Barry Sussman says: “We’ve never had a story like this. Just never.” (Bernstein and Woodward 8/1/1972; Bernstein and Woodward 1974, pp. 43-44)
GAO Will Investigate Nixon Campaign Finances - Stans’s secretary says her boss cannot comment on the story because he is “agoniz[ing] over the confusing circumstances” and does not want to say anything that might compromise his integrity. Philip S. Hughes, the director of the Federal Elections Division of the General Accounting Office (GAO, the investigative arm of Congress), says that the story reveals “for the first time [that] the bugging incident was related to the campaign finance law.… There’s nothing in Maury [Stans]‘s reports showing anything like that Dahlberg check.” Hughes says his office intends to fully audit the Nixon campaign finances. (Bernstein and Woodward 1974, pp. 45-47)

Nixon campaign finance manager Kenneth H. Dahlberg, the subject of a Washington Post article that shows he handled a check that was found in the account of a Watergate burglar (see August 1-2, 1972), confirms to Post reporter Bob Woodward that he gave the check to Nixon campaign finance chief Maurice Stans on April 11. Dahlberg says he knows nothing about any improprieties. “Obviously I’m caught in the middle of something,” Dahlberg says. “What it is I don’t know.” (Bernstein and Woodward 1974, pp. 45-47)

The General Accounting Office (GAO) completes its preliminary report on financial irregularities inside the Nixon re-election campaign (see August 1-2, 1972). According to the report, the campaign has mishandled over $500,000 in campaign contributions, including an apparently illegal “slush fund” of over $100,000—perhaps more than $350,000. The report lists 11 “apparent and possible violations” of the new campaign finance law (see Before April 7, 1972), and refers the matter to the Justice Department for possible prosecution. The GAO agrees to delay its public issuance of its report after the committee’s finance chairman, Maurice Stans, asks GAO chief investigator Philip Hughes to come to Miami, where the Republican National Convention is in full swing, to receive more information. Another GAO investigator tells Washington Post reporter Bob Woodward that the Nixon campaign does not want the report to be made public on the same day that Richard Nixon accepts the Republican nomination for president. (Bernstein and Woodward 1974, pp. 48-56)

US District Court Judge Charles Richey, presiding over the Democratic Party’s lawsuit against the Committee to Re-elect the President (see June 20, 1972), reverses his own ruling and orders all pre-trial statements and depositions to remain sealed until after the lawsuit has run its course. This ensures that court statements by Nixon campaign officials such as John Mitchell, Maurice Stans, and others will not be made public until after the November election. Richey makes the decision unilaterally; no motion for such a decision has been made by campaign lawyers. Richey explains his extraordinary decision by saying he is concerned for the constitutional rights of those involved in the lawsuit. After issuing the ruling, Richey himself calls Washington Post reporter Carl Bernstein to explain his decision. He tells Bernstein, “I want it to be very clear that I haven’t discussed this case outside the courtroom with anyone, and that political considerations played no part whatsoever.” Bernstein is astounded at the call; he has never met Richey, and had not contacted Richey for comment. (Bernstein and Woodward 1974, pp. 49) In November 1972, sources tell Post reporters Bernstein and Bob Woodward that “someone from the government got to Richey through the back door and got him to help the administration; a Republican governor said he could get to Richey and word came back that there was no need, it had already been done.” In their subsequent testimony, White House aides John Dean and H. R. Haldeman and Nixon campaign chairman John Mitchell all confirm that Richey was approached by Roemer McPhee, a close friend of Mitchell’s who, Dean will testify, pressured Richey into siding with the administration in the lawsuit. Richey will deny that McPhee tried to influence him. (Bernstein and Woodward 1974, pp. 206)

President Nixon responds to the report by the General Accounting Office (GAO) alleging possible illegal campaign finances in his re-election campaign (see August 22, 1972). Nixon tells reporters, “[W]e have a new law here in which technical violations have occurred and are occurring, apparently on both sides.” When asked what illegalities the Democrats have committed, Nixon says: “I think that will come out in the balance of this week. I will let the political people talk about, but I understand that there have been [violations] on both sides.” The financial director of his re-election campaign, Maurice Stans (see Before April 7, 1972), is an honest man, Nixon says, and is currently investigating the matter “very, very thoroughly, because he doesn’t want any evidence at all to be outstanding, indicating that we have not complied with the law.” Between the GAO’s and the FBI’s investigations, Stans’s own internal investigation, and an internal White House investigation by White House counsel John Dean, Nixon says there is no need for a special Watergate prosecutor, as some have requested. Of the Dean investigation: “I can say categorically that his investigation indicates that no one on the White House staff, no one in this administration, presently employed, was involved in this very bizarre incident [the Watergate burglary—see 2:30 a.m.June 17, 1972]. What really hurts in matters of this sort is not the fact that they occur, because overzealous people in campaigns do things that are wrong. What really hurts is if you try to cover it up.” (Bernstein and Woodward 1974, pp. 57; Gerald R. Ford Library and Museum 7/3/2007) A Washington Post story on the press conference highlights Nixon’s use of the phrase “presently employed,” and notes that several people suspected of campaign wrongdoing—G. Gordon Liddy, E. Howard Hunt, Maurice Stans, Hugh Sloan, and John Mitchell—no longer work for the administration. (Bernstein and Woodward 1974, pp. 57) An assistant attorney general is convinced that the Dean investigation is “a fraud, a pipeline to [White House aide H. R.] Haldeman.” (Bernstein and Woodward 1974, pp. 206) In April 1973, an associate of Dean tells Washington Post reporter Bob Woodward that there was never any such investigation, that Dean had not even discussed anything to do with Watergate as of August 29. “There never was a report,” the associate says. “Dean was asked to gather certain facts. The facts got twisted around to help some other people above him.” (Bernstein and Woodward 1974, pp. 297-298) Dean later tells Watergate investigators that he never conducted any such internal White House investigation (see June 3, 1973). (Bernstein and Woodward 6/3/1973)

Washington Post reporter Carl Bernstein interviews a reluctant source, a bookkeeper for the Committee to Re-elect the President (CREEP). In All the President’s Men (see June 15, 1974), Bernstein and co-author Bob Woodward merely identify her as “The Bookkeeper” (Bernstein and Woodward 1974, pp. 63-68) , but she will later be identified as Judy Hoback. Hoback tries to persuade Bernstein to leave her apartment, but Hoback’s sister, who is also present, seems supportive of Bernstein, and the reporter tries to find ways to stay and winkle information out of Hoback. But Hoback seems willing to play along with Bernstein to an extent. She will not provide damaging information against her boss, Maurice Stans, but otherwise she says she wants the truth to come out. She says the top officials at CREEP have decided to try to pin the blame for everything on former CREEP treasurer Hugh Sloan, for whom she feels great sympathy. She confirms that documents have been destroyed to prevent investigators from finding the truth behind the financial improprieties, and confirms the existence of a secret campaign “slush fund,” saying that CREEP deputy director Jeb Magruder was one official in charge of managing the fund. In a subsequent interview conducted by both reporters, Hoback confirms that G. Gordon Liddy received cash from the fund, as well as CREEP scheduling director Bart Porter. She confirms that several CREEP officials, including personnel director Robert Odle, lied to the investigating grand jury. Like so many other CREEP employees, Hoback has no faith that the FBI is conducting any sort of impartial investigation: “My feeling is that the FBI turns the information in and it goes upstairs,” presumably to the White House. Although Hoback’s information is more tantalizing than useful at the moment, Bernstein and Woodward will use her statements as confirmation for other, subsequent allegations. (Bernstein and Woodward 1974; Woodward 2005, pp. 228)

Carl Bernstein, Katherine Graham, and Bob Woodward discuss the newspaper’s Watergate coverage.Carl Bernstein, Katherine Graham, and Bob Woodward discuss the newspaper’s Watergate coverage. [Source: Southern Methodist University]The Washington Post reports that John Mitchell, the former attorney general and former head of the Committee to Re-elect the President (CREEP), personally controlled a secret Republican “slush fund” used to finance widespread intelligence-gathering operations against the Democratic Party (see Early 1970). (Gerald R. Ford Library and Museum 7/3/2007) Mitchell had authorized expenditures from the fund beginning in the spring of 1971, while he was attorney general. (Bernstein and Woodward 1974, pp. 98-103) The fund was originally conceived by White House aide G. Gordon Liddy, who in 1972 came up with what he called “Operation Gemstone,” a $1 million plan to carry out a series of covert and often illegal actions against President Nixon’s political enemies (see January 29, 1972). Mitchell scaled back the budget to $250,000 (at first) to launch a scaled-down version of Gemstone. (Spartacus Schoolnet 8/2007) Mitchell personally approved a number of withdrawals from the fund, which swelled in size from around $350,000 to $700,000 at any given time. Four others besides Mitchell were later authorized to approve payments from the secret fund. One is Maurice Stans, the former commerce secretary who is now finance chairman of CREEP; the fund was kept in a safe in Stans’s office. A second is Jeb Magruder, the former manager of CREEP who is now deputy director of the organization. A third is a senior White House official involved in the campaign, and the other is a campaign aide based outside of Washington. (Bernstein and Woodward 9/29/1972) (Washington Post reporters Carl Bernstein and Bob Woodward are all but convinced that the “senior White House official” is H. R. Haldeman, but they cannot get anyone to go on record to confirm their assumption, and therefore do not print Haldeman’s name in the story.) (Bernstein and Woodward 1974, pp. 100)
Mitchell's Explosive Reaction - Mitchell is outraged by the allegations. When Bernstein calls to confirm the story, he explodes: “Jesus!… All that crap, you’re putting it in the paper? It’s all been denied. Katie Graham [Katherine Graham, publisher of the Post] is gonna get caught in a big fat wringer if that’s published. Good Christ! That’s the most sickening thing I’ve ever heard.” (The actual quote, which Post executive editor Ben Bradlee cleans up for public consumption, is, “Katie Graham’s gonna get her t_t caught in a big fat wringer if that’s published.”) (Bernstein and Woodward 9/29/1972; Bernstein and Woodward 1974, pp. 105; Woodward 2005, pp. 72) Mitchell continues: “You fellows got a great ball game going. As soon as you’re through paying Williams [Edward Bennett Williams, whose law firm represents the Democratic Party, as well as the Post], we’re going to do a story on all of you.” When Bradlee hears of Mitchell’s reaction, he asks if Mitchell was drunk. When Bernstein replies that he doesn’t believe so, and Bradlee confirms that Bernstein properly identified himself as a reporter, Bradlee tells Bernstein to print Mitchell’s reaction. CREEP spokesman Powell Moore tries to persuade Bradlee not to run the Mitchell quote, saying that it wasn’t fair to run the quote because Bernstein woke Mitchell up, and therefore Mitchell’s “composure [was] not guarded.” Bradlee refuses to delete the quote. (Bernstein and Woodward 9/29/1972; Bernstein and Woodward 1974, pp. 105-108)
CREEP Denials - Moore later states that neither Mitchell or Stans knows anything about “any disbursement from an alleged fund as described by the Post and neither of them controlled any committee expenditures while serving as government officials.” One of the planners of the Watergate burglary (see 2:30 a.m.June 17, 1972), G. Gordon Liddy, withdrew well over $50,000 from the fund. Although records of the fund’s disbursements have been destroyed, other sources indicate that some of the other recipients of the fund include Magruder; Herbert L. “Bart” Porter, CREEP’s scheduling director; several White House officials; and other unidentified persons not officially part of either CREEP or the Nixon administration. Magruder denies ever receiving any such funds. The General Accounting Office has said that such a fund is a “possible and apparent” violation of a new, stricter campaign finance disclosure law. (Bernstein and Woodward 9/29/1972)

Washington Post reporter Bob Woodward is phoned by a Post reporter in Los Angeles, Robert Meyers. Meyers has spoken with a fraternity brother of Nixon campaign operative Donald Segretti (see June 27, 1971, and Beyond). The fraternity brother, Larry Young, told Meyers that the FBI learned of Segretti and his campaign operations through the phone records of Watergate burglar E. Howard Hunt (see 2:30 a.m.June 17, 1972). Hunt had called Segretti numerous times to give Segretti instructions about something Young does not know, but “it wasn’t the [campaign] bugging.” Woodward had not known of any Segretti-Hunt connection. Young told Meyers that Segretti admitted working for “a wealthy California Republican lawyer with national connections and I get paid by a special lawyer’s trust fund.” Woodward believes the lawyer in question is Herbert Kalmbach, President Nixon’s personal lawyer; Meyers had asked Young about Kalmbach, but Young did not recognize the name. He does identify the lawyer as having an office in Newport Beach, where Kalmbach has his office. Young believes that Segretti met with both Hunt and White House aide Dwight Chapin (see October 7, 1972). Segretti often talked of going to Miami—the home of most of the Watergate burglars—to meet with Hunt and Chapin. Segretti told Young that when he was in Miami, someone Segretti didn’t identify asked him to organize a group of young Cubans to mount an assault on the Doral Beach Hotel, the location of the Republican National Convention, and make it look as if the Cubans were McGovern campaign workers. Segretti refused to carry out this particular idea, calling it blatantly illegal and violent. Woodward is aware that just such an assault had indeed taken place at the hotel, and that many suspected that there were Republican provocateurs in the crowd of protesters.
Segretti Worried about Being the Fall Guy - When the FBI first contacted Segretti, two weeks before the July convention, Young says that Segretti was shocked that he had not been given advance warning. Segretti worried that he was being set up as a fall guy. In his testimony to the FBI and before the Watergate grand jury, Segretti told them about his connections with Hunt and Chapin, and named the lawyer who paid him. So, Woodward muses, the Justice Department had known of the connections between Segretti, Hunt, and Chapin since June and had not followed up on them. Young agrees to go on the record as a source, and Woodward confirms the story through a Justice Department lawyer. The FBI didn’t consider what Segretti did to be strictly illegal, the lawyer tells Woodward, but “I’m worried about the case. The Bureau is acting funny… there is interest in the case at the top.… [W]e’re not pursuing it.” The lawyer refuses to be more specific. Chapin carefully denies the story. He admits he and Segretti are old college buddies, and does not directly deny that he was Segretti’s White House contact.
Haldeman Connection - A former Nixon administration official tells Woodward, “If Dwight has anything to do with this, it means Haldeman,” referring to Nixon’s chief of staff H. R. Haldeman. “He does what two people tell him to do: Haldeman and Nixon.” The Post story runs on October 15, without naming Kalmbach. The story breaks two new areas of ground: it is the first of its kind to rely on on-the-record sources (Young), and it is the first to directly allege that the Watergate conspiracy reaches into the White House itself and not merely the Nixon re-election campaign. A Time magazine follow-up adds that Chapin had hired Segretti, and names Gordon Strachan, a political aide to Haldeman, had taken part in hiring Segretti as well. Most importantly, Time names Kalmbach as the lawyer who paid Segretti. Irate at being scooped, Woodward quickly confirms Kalmbach’s status as paymaster with a Justice Department attorney, and in a conversation with former campaign treasurer Hugh Sloan, confirms that Segretti was paid out of the campaign’s “slush fund” managed by campaign finance chief Maurice Stans (see September 29, 1972). Kalmbach had distributed far more money than was given to Segretti, Sloan says. (Bernstein and Woodward 1974, pp. 150-159)
Verified - On October 18, the New York Times runs a story that uses telephone records to verify Segretti’s calls from Hunt. (Bernstein and Woodward 1974, pp. 167)

Clark MacGregor, the head of the Committee to Re-elect the President (CREEP), admits to the existence of a CREEP cash fund (see September 29, 1972). MacGregor disputes its secret nature, and says that it was not knowingly used for anything illegal—it was merely to learn of, and counter, possible efforts to sabotage Richard Nixon’s primary campaign. He says five people were authorized to disburse or receive payments from the fund: John Mitchell, Maurice Stans, Herbert L. “Bart” Porter, Jeb Magruder, and G. Gordon Liddy. The day before, press secretary Ron Ziegler had denied the fund’s existence. CREEP officials have testified that the fund had paid out over $900,000. (Bernstein and Woodward 1974, pp. 194-195)

Hugh Sloan.Hugh Sloan. [Source: Bettmann / Corbis]Former Nixon campaign treasurer Hugh Sloan testifies during the trial of the “Watergate Seven” (see January 8-11, 1973). Judge John Sirica becomes impatient with the diffident questioning of the prosecutors, excuses the jury, and grills Sloan himself. Sloan admits to disbursing $199,000 in secret campaign funds for G. Gordon Liddy’s covert campaign espionage operations, and that the transaction had been approved by both campaign director John Mitchell and campaign finance director Maurice Stans (see January 23, 1973). (Reeves 2001, pp. 563-564; Spartacus Schoolnet 8/2007)

Artist’s rendition of McCord’s testimony before the Senate Watergate Committee.Artist’s rendition of McCord’s testimony before the Senate Watergate Committee. [Source: Franklin McMahon / Corbis]The New York Times reports that convicted Watergate burglar James McCord told the Senate Watergate Committee (see March 28, 1973) that the cash payoffs for the burglars came directly from the Nixon re-election campaign (CREEP). McCord’s testimony is the first confirmation that CREEP bought the silence of the burglars during their trial (see January 8-11, 1973). Washington Post reporter Bob Woodward, attempting to confirm earlier information that the CREEP “slush fund” had continued to operate well after the Watergate burglaries (see 2:30 a.m.June 17, 1972), speaks to a CREEP official; the official explodes about the reaction among his colleagues to McCord’s testimony. “John Mitchell [the former head of CREEP] still sits there smoking on his pipe, not saying much… I used to take that for wisdom—you know, keeping your mouth shut. Now I realize that it’s ignorance.… God, I never thought I’d be telling you guys that I didn’t hate what you did. It’s the way the White House has handled this mess that’s undermined the presidency.… I’ve got friends who look at me now and say, ‘How can you have any self-respect and still work for CREEP?’ I’m sick.” Former CREEP treasurer Hugh Sloan confirms that at least $70,000 of the “slush fund” money (see Early 1970 and September 29, 1972)was used to pay off the burglars, all with the approval of CREEP financial director Maurice Stans. Woodward and colleague Carl Bernstein will later write: “That tied the knot. The secret fund had brought the reporters full circle—first the bugging, and now the cover-up.” (Bernstein and Woodward 1974, pp. 282-284)

Henry Petersen.Henry Petersen. [Source: Spartacus Educational]Former Attorney General Richard Kleindienst and Assistant Attorney General Henry Petersen testify before the Senate Watergate Committee. Both say they had been disturbed by the amount of White House interference they had gotten over their attempts to investigate the Watergate burglary, particularly from White House aide John Ehrlichman. Kleindienst tells of a phone call from Ehrlichman to Petersen demanding that the Justice Department stop “harassing” Maurice Stans, the former Nixon re-election campaign finance chairman. Kleindienst recalls that he told Ehrlichman he was flirting with an obstruction of justice charge, and threatened to resign “if the president tells me that you have the authority and the power to give specific instructions to people in the Department of Justice.” Ehrlichman reassured Kleindienst that “it will never happen again.” Kleindienst also recalls Ehrlichman coming to him in early 1973 asking for “technical” advice about securing lenient sentences or even presidential pardons for the Watergate burglars (see 2:30 a.m.June 17, 1972). Ehrlichman “did not have much of a knowledge of the criminal justice system,” Kleindienst says, and asked such questions as “What happens when somebody is convicted of a crime?… When are you eligible for a pardon? When do the circumstances arise for executive pardon?” (Ehrlichman has already testified that he never sought any executive clemency for one of the burglars, E. Howard Hunt.) Kleindienst testifies that when he told Petersen of the conversation, Petersen declared that the defendants would almost certainly do “jail time,” and said he would strongly oppose any efforts to grant anyone clemency. Petersen testifies that Kleindienst replied, “Tell those crazy guys over there [at the White House] what you just told me before they do something they will be sorry for.” For his part, Petersen says it struck him most how suspiciously everyone at the White House and the re-election campaign were acting. “There were no records,” he recalls. “Things were destroyed. They didn’t act like innocent people. Innocent people come in and say: ‘Fine, what do you want to know?’ It was not like that.” Petersen says that he and the Justice Department could and would have solved the entire case, and that they had the case 90 percent solved when Archibald Cox was appointed to take over the investigation (see May 18, 1973). “Damn it!” he cries, “I resent the appointment of a special prosecutor!” (Time 8/20/1973)

The Justice Department’s Office of Planning and Evaluation (OPE) submits a report on the role and actions of the FBI in the Watergate investigations. The report finds that, even with the attempts of former Attorneys General John Mitchell and Richard Kleindienst, White House aides John Dean and Jeb Magruder, and others to “mislead and thwart the Bureau’s legitimate line of inquiry,” and the “contrived covers” used to direct attention away from the White House, the FBI investigation was “the ultimate key to the solution of not only the Watergate break-in (see 2:30 a.m.June 17, 1972) but the cover itself.” The report continues: “There can be no question that the actions of former Attorneys General Mitchell and Kleindienst served to thwart and/or impede the Bureau’s investigative effort. The actions of John W. Dean at the White House and Jeb S. Magruder at the Committee to Re-elect the President were purposefully designed to mislead and thwart the Bureau’s legitimate line of inquiry. At every stage of the investigation there were contrived covers placed in order to mislead the investigators.” The OPE notes the following problems in the investigation, and provides explanations of some:
bullet Providing information concerning ongoing investigations to the White House, and allowing Dean to actually sit in on interviews of White House personnel (see June 22, 1972).
bullet Failing to interview key members of CREEP, the Nixon re-election campaign organization, as well as allowing CREEP attorneys to sit in on interviews of CREEP employees and allowing those attorneys access to FBI investigative materials. The report says that the investigation initially focused on James McCord and E. Howard Hunt, and interviewed CREEP officials tied directly to them. The net was widened later on. However, the report acknowledges that many CREEP employees undoubtedly lied to FBI investigators, “most notably John Mitchell, Jeb Magruder, Bart Porter, Sally Harmony, and Maurice Stans.” Porter and Magruder in particular “lied most convincingly.” Another CREEP employee, Robert Reisner (Magruder’s assistant), was not interviewed because Reisner successfully hid from FBI investigators. The FBI believes it was Reisner who cleaned out the “Operation Gemstone” files from Magruder’s office (see January 29, 1972 and September 29, 1972). Numerous other financial and other files were also destroyed after being requested by the FBI, most notably Alfred Baldwin’s surveillance tapes and logs from the Democratic offices in the Watergate (see May 29, 1972). Many of these files were destroyed by G. Gordon Liddy. “It is apparent that most [CREEP] people in the summer of 1972 were quite willing to lie and/or tell us considerably less than the full truth,” the report notes.
bullet An untenable delay in searching and securing Watergate burglar E. Howard Hunt’s desk in the White House, putting the contents of that desk at risk of being removed, and the “[a]lleged activities by former Acting Director [L. Patrick] Gray to limit, contain, or obstruct FBI investigation of Watergate” (see June 22, 1972). Gray is known to have destroyed materials from Hunt’s desk given to him by Dean, and is known to have extensively interfered with the FBI’s investigation (see June 28-29, 1972 and Late December 1972). The report notes that while it cannot find specific evidence that Gray broke any laws in his attempts to impede the FBI’s investigation into the Watergate conspiracy, it is clear that Gray cooperated with the White House, specifically through Dean, to ensure that the White House was always aware of what avenues of investigation were being pursued. The OPE says that Gray’s destruction of files from Hunt’s safe did not necessarily impede the FBI’s investigation, because it has no way of knowing what was in those files. The report says that it is unfortunate that “many people make no distinction between the FBI’s actions and Mr. Gray’s actions.”
bullet Failure to interview key individuals with knowledge of the suspicious monies found in the burglars’ bank accounts.
bullet Failing to secure and execute search warrants for the burglars’ homes, automobiles, and offices. The OPE says that many of those issuing this criticism “should know better,” and claims that the FBI agents involved did their level best to obtain search warrants within the bounds of the law. The report notes that after the burglary, the assistant district attorney prosecuting the case, Earl Silbert, did not believe there was probable cause to search burglar James McCord’s home or office until after July 10, 1972, when Baldwin told the FBI that he had taken surveillance equipment to McCord’s home (see June 17, 1972). Even then, Silbert decided that because of the amount of time—23 days—that had expired, a search warrant would have been pointless.
bullet Failing to identify and interview a number of people listed in the burglars’ address books. The OPE report notes that the decision to interview far less than half of the names in the books was made by FBI agents in the Miami field office, and due to the “fast moving extensive investigation which was then being conducted,” the decision to only track down a selected few from the books was right and proper. The report notes that subsequent interviews by reporters of some of the people in the address books elicited no new information. The report also notes that Gray refused to countenance interviews of the remaining subjects in the address book while the trial of the seven burglars (see January 8-11, 1973) was underway.
bullet Failing to find and remove a surveillance device from the Democratic National Committee headquarters (see September 13, 1972). The OPE calls this failure “inexplicable.”
bullet Failure to thoroughly investigate CREEP agent Donald Segretti (see June 27, 1971, and Beyond) and other CREEP operatives. The OPE finds that because Segretti was initially uncooperative with FBI investigators, and because an “extensive investigation” turned up nothing to connect Segretti with the Watergate conspiracy, the agents chose not to continue looking into Segretti’s actions. Only after press reports named Segretti as part of a massive, White House-directed attempt to subvert the elections process (see October 7, 1972) did the FBI discuss reopening its investigation into Segretti. After reviewing its information, the FBI decided again not to bother with Segretti. The OPE finds that the decision was valid, because Segretti had not apparently broken any federal laws, and the FBI does not conduct violations of election laws unless specifically requested to do so by the Justice Department. The report also says that politics were a concern: by opening a large, extensive investigation into the Nixon campaign’s “dirty tricks,” that investigation might have impacted the upcoming presidential elections.
bullet Media leaks from within the FBI concerning key details about the investigation (see May 31, 2005). The report finds no evidence to pin the blame for the leaks on any particular individual. The report notes that New York Times reporter John Crewdson seemed to have unwarranted access to FBI documents and files, but says it has turned that matter over to another agency inside the bureau.
bullet Failing to interview, or adequately interview, key White House officials such as H. R. Haldeman, Charles Colson, Dwight Chapin, and others. The report justifies the decision not to interview Haldeman because the FBI had no information that Haldeman had any knowledge of, or involvement in, the burglary itself.
bullet “Alleged attempt on part of Department of Justice officials to limit, contain, or obstruct FBI investigation.” The report is particularly critical of Kleindienst’s concealment of his contact with Liddy about the burglary (see June 17, 1972).
bullet “Alleged attempt by CIA officials to interfere, contain, or impede FBI Watergate investigation.” The report notes that during the Senate Watergate Committee hearings, Republican co-chairman Howard Baker (R-TN) tried repeatedly to assert that the CIA was behind the burglary. The report calls Baker’s theory “intriguing” but says no evidence of CIA involvement on any operational level was ever found. The report notes that there is still no explanation for the discussions regarding the CIA paying the burglars (see June 26-29, 1972), or the CIA’s involvement with Hunt before the burglary—loaning him cameras, providing him with materials for a disguise, and helping Hunt get film from the first burglary developed. According to the report, Gray stopped the FBI from pursuing these leads. The FBI report says that the CIA involvement apparently had nothing to do with the Watergate burglary, but was more in support of Hunt’s activities with the Ellsberg break-in (see September 9, 1971).
bullet “Alleged activities on part of White House officials to limit, contain, or obstruct FBI Watergate investigation (Dean, Haldeman, Ehrlichman, Colson, et cetera).” The report notes, “There is absolutely no question but that the president’s most senior associates at the White House conspired with great success for nine months to obstruct our investigation.” The report says it was “common knowledge” throughout the investigation that the White House was paying only “lip service” to investigators’ requests for honest, complete answers; the report cites Dean as a specific offender. (O.T. Jacobson 7/5/1974 pdf file)


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