by Eamon Javers
What’s more, Lipset found that Maris, his wife, Lillian, and his father had similar Social Security numbers, each just one number higher than the last. He knew that couldn’t be a coincidence. But his team of investigators still had no idea who Maris was. They developed a working theory: he’d changed his name from something he felt sounded too ethnic, like Maresh or Mariscal.
So Lipset called Patrick Murphy, the former FBI investigator at Proudfoot, to find out what he knew. Over the phone, Murphy said he remembered Maris well, he’d checked Maris out, and everything was fine.
But, Lipset wanted to know, did the investigators check where Maris had gone to school?
Murphy said he had, and he’d spoken to a registrar at the school who confirmed Maris’s dates of enrollment.
Now Lipset knew that Murphy was lying: the schools did not have a record of Maris. But why would this private investigator be in on the cover-up? Lipset couldn’t figure it out.
The six-foot-six bodyguard who’d accompanied Creative Capital’s CEO had the final piece of the puzzle. The bodyguard’s name was Ed, and he was a former narcotics investigator with an entrepreneurial streak of his own. He knew Maris was a valuable prize, and he demanded that Creative Capital pay him thousands of dollars to reveal what he knew. The company paid Ed off, and he said he had heard from his buddies in the federal marshals’ service that Maris was actually a gangster from New Jersey. Years earlier, he’d testified against the Mafia, and he’d been offered a spot in the government’s witness protection program.
Maris, it turned out, did have a fake identity—one that had been created by the FBI itself. Eventually, Lipset found out that Maris’s real name was Gerald Zelmanowitz. The Mafia had a contract out on his life.
Zelmanowitz was a stock cheat who had been born in Brooklyn and whose testimony against the Mafia capo Angelo (“Gyp”) DeCarlo had put DeCarlo behind bars in 1970.15 Zelmanowitz, who described himself as a “securities analyst,” told the court that he’d seen DeCarlo’s associates brutally beating an insurance broker who had fallen behind in loan payments to the Mafia. The broker later died under suspicious circumstances, and the government thought he’d been murdered. Zelmanowitz’s testimony was one of the keys to the case. During the high-stakes proceedings in a courthouse in Newark, New Jersey, the feds went to great lengths to keep Zelmanowitz safe. He was escorted into and out of the courtroom by four federal marshals, and every person in the courtroom was screened for weapons by a metal detector. In those days, such screening was rare enough to be noted prominently in the newspaper.16
Still, Zelmanowitz exuded the confidence of a veteran con man on the witness stand. Under cross-examination, he said he’d earned $1 million over five years in a complicated Mafia-backed stock scheme. Zelmanowitz was used to living high. He and his wife drove new Cadillacs, his home was crammed with expensive furniture, and he was in the habit of flying back and forth to Europe to tend to his secret Swiss bank accounts.
He readily admitted that he’d filed no tax returns and paid no taxes on his ill-gotten gains. Asked why he hadn’t paid taxes, he responded blithely, “I didn’t file because I stole the money, and had no job, and couldn’t show how I earned it.”
The mobster DeCarlo and his associates weren’t about to forget Zelmanowitz, but by 1973, they had no idea where he was. That’s why “Maris” was so angry when Lipset’s operative took pictures of him in the hotel lobby in San Francisco. And it’s also why the private investigator Murphy had returned a clean, but unverifiable, report on Maris. Murphy was helping his former colleagues at the FBI maintain Zelmanowitz’s fictional identity lest the mob find him and kill him.*
In the end, Creative Capital got its company back, Lipset got out of the lawsuit, and Creative Capital was stuck with the bill for his extra investigation. “Maris” disappeared from sight in 1973, relying once again on the FBI to build a new life for him somewhere else. On the lam that year, Zelmanowitz called a reporter, but refused to say where he was calling from.
“My whole entire cover is being destroyed and torn apart,” Zelmanowitz said. “At this moment, I am traveling very far and very fast.”
Lipset noted that Zelmanowitz sued the FBI for $12 million for failure to protect his identity, but he lost that case, too.
IN THE CREATIVE Capital saga, Lipset had a client who had been wronged. But not all his clients were so virtuous. Like many of today’s corporate intelligence operatives, Lipset was happy to work for anyone who would pay. By his own account, he didn’t flinch when he was asked to work for Jim Jones, the founder of Peoples Temple, the infamous religious cult in San Francisco. At the time Lipset went to work for him, Jones was still masquerading as a Christian preacher, although there were already rumors that some of his followers were being held against their will.
This case would end in a spectacular tragedy in 1978, when the insane Jones ordered the followers who had come with him to the jungles of Guyana to kill themselves with poison. More than 900 church members—men, women, and children—died there. While the suicides were going on at the jungle settlement, some of Jones’s followers drove a truck to a nearby airstrip, opening fire and killing a United States congressman and several reporters who were trying to leave Guyana after conducting an investigation of the cult.*
The horrific tragedy didn’t seem to weigh on Lipset’s conscience. In an interview conducted for Patricia Holt’s biography, Lipset said his work for Jim Jones began in the late 1960s, when Jones began to feel that he was under threat of assassination. Lipset went to Jones’s facility in Ukiah, California, and offered some advice: how to set up a defensive perimeter around the church, how to avoid driving on the same roads twice, and how to avoid repetitive schedules. Lipset passed along other basic security tips to Jones, including how a security team could serve as bodyguards, each man responsible for keeping his eyes on a certain sector so the team could maintain 360-degree awareness of people around the preacher. Lipset said that Jones didn’t seem crazy in those early days.
But when pressed on whether he felt it was right or wrong to work for a man like Jones, who was facing allegations that he deprived his followers of their freedom, forced odd sex practices on them, and confiscated their money, Lipset responded with a blithe comparison of Jones to the U.S. Army, in which he’d served, and to the Catholic Church.
Asked if he would work for a group if he knew the people in it had lost their ability to make choices for themselves, Lipset said:
It’s a matter of degree. I see people giving up their choices every day…. If you’re a soldier in the Army, you give up even more freedom—that’s because you wanted to when you joined up. You made the decision. That’s your business. It’s certainly none of my business.
Applying that stunning moral analogy allowed Lipset to work for just about anybody who could afford his services. It’s a trend we’ll see over and over again in the corporate intelligence business. Though clients as evil as Jim Jones are rare, today’s operatives are selling the talents they developed in government intelligence careers to any client: corrupt companies, Russian oligarchs, Middle Eastern sheikhs—anyone, really, who can afford to pay.
Lipset put it this way: “I’m in it for the money.”
CHAPTER FOUR
The Man Is Gone
Hal Lipset began as a small-time private eye, presiding over a tiny firm operated out of his house in San Francisco, and his outfit was a far cry from those of his predecessors at Pinkerton and elsewhere. Later in the twentieth century, corporate sleuths would once again build much more elaborate intelligence empires—some would become intertwined with United States government intelligence, offer their services to the nation in times of crisis, work the opposite side of the street for foreign governments, ride the ragged edge of morality, and grow extraordinarily wealthy.
The first claimant to the Pinkerton legacy was International Intelligence, which was often referred to as Intertel and was known as the “private CIA” of the reclusive billionaire How
ard Hughes. Intertel terrified the Nixon administration, which worried that it was being used by the Kennedys to help elect Teddy Kennedy as president. In just a few years after it was founded by veterans of Robert Kennedy’s Justice Department, Intertel had extended its reach into the worlds of Hughes, the Kennedys, Richard Nixon’s incompetent plumbers, vicious Mafia figures, and the elusive CIA. As a result, its history has become something of a touchstone for conspiracy theorists, many of whom have concocted elaborate fantasies about Intertel and the dastardly deeds of elites controlling the world. Much of that is no more than fantasy, or fiction. But Intertel did exist, and for about a decade it was involved in some of the country’s most secret episodes.
Howard Hughes was an oilman, a Hollywood bon vivant, and an aviator. He lived in Texas, Las Vegas, and the Caribbean, among other locales around the world. But today, his last remaining secrets can be found in an unlikely place: the small town of Fairfield, Pennsylvania, amid the rural countryside just north of the Mason-Dixon Line. Here, alongside 400 acres of soybeans, sit a small brown farmhouse, two silos, and a barn. Intertel’s founder, Robert Dolan Peloquin, and his wife, Peggy, live here.
Peloquin, who is nearly eighty, is an imposing man: tall, with a firm handshake, swept-back white hair, a welcoming manner, and a deep voice edged with a southern Massachusetts accent. He relishes telling stories about the old days. Peloquin was once an intelligence officer at the National Security Agency and a Mafia hunter at the Department of Justice. In later years, there were Christmas-morning requests from Howard Hughes, sudden trips to Switzerland to track down a con artist, and jaunts to the Caribbean to play Twenty Questions with Merv Griffin. (Griffin, a famous entertainment executive and talk show host, kept the topics focused on Hollywood, and so usually won the games.) Robert Peloquin was one of the world’s greatest corporate spies.
He began his career, like so many other corporate spies, in the military. After graduating from Georgetown University at the beginning of the Korean War, Peloquin entered the navy. He figured it would be easier duty than slogging through the mud in the army. But after midshipman school at Newport, Rhode Island, he was assigned to Norfolk, Virginia, and a navy unit called the beach masters—an amphibious force designed to take charge of beachheads during the first wave of any invasion, making sure that the troops and matériel got forward as fast as possible. Peloquin didn’t like what he saw of the beach masters. This was a first-wave invasion force training to go to war in Korea. Its commanding officer, whose name was Peterson, had been a hero in World War II—wounded seven times in action. The unit drew many of its enlisted men straight from the brig at nearby Camp Allen: these men had been told that they could either rot in a navy jail or report to the beach masters. To Peloquin and his fellow ensigns, it seemed that the unit was being stocked with cannon fodder, and led by a man who wouldn’t hesitate to charge into the most brutal combat. Peloquin came to a conclusion: “If I hang around this place, I’m not gonna live long.”
But how to get out of this assault unit? Peloquin solved the problem by deploying two talents he would rely on for the rest of his life: an ability to curry favor with important older men and a talent for job hopping ever upward.
His boss, Peterson, had a problem that Peloquin could solve. The bad seeds and ex-cons in his unit were racking up courts-martial at an astonishing pace. And the Uniform Code of Military Justice—which was then new, and which governs the way military personnel should be tried and punished—was causing Peterson fits. He was of the old school and didn’t understand how the new rules worked. He sent Peloquin to the Naval Justice School in Newport, Rhode Island, far from the fighting in Korea. On returning to the beach masters, Peloquin helped solve Peterson’s backlog of court-martial cases. From then on, Peloquin recalls, “I was kind of his boy.”
After seeing some combat at Inchon in Korea, Peloquin took advantage of a navy loophole and went to law school without promising extra years of service in return. He spent a few peaceful years at Georgetown Law, and after graduation received orders to join a destroyer in Pearl Harbor. Peloquin protested to his superiors that the bar exam was just a few months away—why send him to Hawaii before he had passed the bar? The answer was clear. Navy rules required only that he graduate from law school to practice law in the navy. He didn’t have to be a member of any bar. Passing the bar, as far as the navy was concerned, was his own business, to be conducted on his own time.
Peloquin didn’t like that answer. He resigned from the navy. During his time in law school in Washington, Peloquin had reported to the same navy facility that also housed a supersecret code-breaking and electronic eavesdropping entity: the National Security Agency. It was so covert that its acronym, NSA, is still jokingly said to mean No Such Agency. The NSA happened to be just down the hall from Peloquin’s navy office. He worked his connections there, and landed a job in 1954.
Peloquin found the work fascinating. It was his first exposure to the world of intelligence. He worked in the security office, helping to vet and investigate the agency’s own employees suspected of being spies for the Soviet Union. While working there, he became familiar with the case of two American defectors: William Martin and Bernon Mitchell. In 1960, these two men defected to the Soviet Union, saying that they opposed U.S. policy on spy flights over enemy countries.
Martin and Mitchell had gotten advance word that Peloquin and other NSA investigators were snooping around. That prompted panic: the two men had long been selling information about the NSA’s code-breaking abilities to the Soviet Union, and getting caught could mean spending the rest of their lives in federal prison. They decided to make a dash for freedom, taking planes to Mexico City, then Cuba, and finally Moscow. All they left behind was an anti-American manifesto in a safe-deposit box at a bank.
But Peloquin says the NSA wasn’t nearly as close to discovering the truth as Martin and Mitchell thought. It was investigating the two men, but not for spying. The investigators were instead trying to figure out if Martin and Mitchell were gay. This was a time when even a suspicion of homosexuality created doubts about a person’s loyalty to the government—and could end a career. Peloquin says the NSA had no idea the two men were active spies for the Soviet Union. But rumors of their sexual orientation had prompted the NSA’s security people to start an internal investigation. If Martin and Mitchell had stayed, it is possible that they would have been drummed out of the NSA for being homosexuals instead of locked up for being spies.
At about the same time, Robert Peloquin hopped to a new job. His supervisor had a contact at the Department of Justice, and Peloquin went to work at its internal security unit. From there, he jumped, again, to the Justice Department’s Organized Crime and Racketeering section. This was the early 1960s, and John F. Kennedy had been elected president, naming his brother Robert as the attorney general of the United States. Bobby Kennedy was fascinated by the organized crime section, and Peloquin became Bobby Kennedy’s boy. Peloquin would spend most of the next decade tracking down high-level Mafia figures and putting them behind bars.
At one point, while Peloquin was in New Orleans on an investigation, Kennedy called to see how it was going. The phone rang, and a voice with a New England accent asked, “Is this Bob Peloquin? This is Bobby Kennedy and I just wanted to see how you’re doing.”
Not believing that the attorney general would call such a low-level investigator, Peloquin suspected that one of the other investigators was having fun with him.
“Sprizzo, cut that shit out,” he said.
“No, this really is Bobby Kennedy,” came the reply. Peloquin leaned back in his chair and saw that the man he suspected of playing the joke, John Sprizzo, was in the next room—and he wasn’t on the telephone. Peloquin was horrified. But Kennedy didn’t mind. The Kennedys invited the young criminal division investigators, FBI agents, and others involved in the fight against the Mafia to Hickory Hill, the family estate in suburban Virginia. On one evening, a nervous Peloquin sternly warned his wife not to
bring up certain topics in front of the boss. “Don’t embarrass me,” he told her. As he and Peggy settled their buffet dinners on their knees, though, Peloquin himself mishandled a piece of roast beef, sending it skittering onto the floor. That attracted the Kennedys’ enormous dog—a Newfoundland called Brumus—who came lumbering across the room, scattering tables and chairs. All eyes turned to the hapless Peloquin. Peggy leaned over and whispered, “Don’t embarrass me.” Her husband has never forgotten the lesson.
At the Justice Department, Peloquin learned another lesson he’d never forget: how to combine forces. While he was there, the department came up with an innovative structure for going after the mob. Using strike forces, the government pooled senior-level people from every agency that had a hand in the fight: the IRS, the bureau of narcotics, the FBI, the border patrol, and more. Each strike force would take a particular organized crime family and devote all its disparate resources toward taking that family down.
Peloquin headed up the first organized crime task force, and set his team on the Magaddino crime family in Buffalo, New York. Working with the Canadian Mounted Police, they broke up this long-reigning Mafia family, sending nine of its members to prison. Soon, the Department of Justice deployed similar organized crime strike forces across the country.
At the time, the Mafia was making inroads into all types of businesses. With a foothold in Las Vegas gambling, mob bosses were now poised to go big-time: into the National Football League (NFL). For owners of professional teams, the prospect of the Mafia influencing players to throw games or referees to make bad calls was a nightmare. Millions of dollars in future profits depended on the fans’ belief that the game was honest. The football commissioner, Pete Rozelle, knew that the league had to develop some defense. He brought in Peloquin’s boss, and Peloquin tagged along, jumping to a cushy job as associate counsel at the NFL.