Enemies: A History of the FBI (56 page)

Kelley should have known this day would come. He knew from his own experience—his two decades as an FBI agent—that “
very little bad news was passed along to J. Edgar Hoover.” As Kelley recalled it, almost everyone at the Bureau was “afraid to tell Hoover the truth”; the boss had been “so domineering and his power over his people so intimidating” that agents concealed harsh facts from him. He attributed the deception he had suffered to “an arrogant belief at high levels in the infallibility and appropriateness of
FBI activities and policies”—an unquestioning belief in the public image of the Bureau.

Three days after his public confession that he had been fooled by some of the FBI’s most experienced con men, Kelley announced that he had taken two dramatic steps toward reforming the Bureau.

First, he created a new force to handle internal inspections; under the watchful eyes of Justice Department prosecutors, FBI agents opened dozens of criminal investigations into their own ranks.

Second, he cut out the heart of the Intelligence Division. Apart from its work against the spies of foreign services, the FBI would henceforth handle national security cases no differently from common crimes. Secret intelligence
investigations against subversive Americans would cease. It was his strongest blow against the ghosts of Hoover’s past.


Attorney General Edward Levi had questioned the FBI’s infallibility from his first day at work.

Levi was one of the most respected lawyers in America. Balding, bespectacled, bow-tied, the son and grandson of rabbis, Levi had been president of the University of Chicago before returning to the Justice Department, where he had worked throughout World War II. Like his predecessor Harlan Fiske Stone, who had made Hoover the director half a century before, he revered the rule of law more than the power of politicians. He believed that a secret police was a menace to a free society.

Levi was just settling into his leather chair, admiring the rich wooden paneling in his new surroundings, when “
an FBI agent appeared at my door without announcement,” as he recalled. The agent introduced himself as Paul Daly. “He put before me a piece of paper asking my authority for the installation of a wiretap without court order and he waited for my approval.”

You’re going to have to let me think about it,” Levi said. “The agents might get caught going in.”

“It’s already in,” Daly replied. “The microphone’s in.” That was the time-honored procedure: first the break-in to install the tap, then the approval to turn it on. The traditions of the FBI differed from the rules of criminal procedure.

Levi was astonished. “His bow tie spun around,” Daly remembered.

The attorney general did not approve of warrantless searches and seizures and surveillances. In the wake of Watergate, he thought the nation would not stand for them. He was mortified to learn that the FBI’s leaders had lied to Congress and the courts about the continuing practice of black-bag jobs.

He began to draft guidelines for FBI investigations, the first in the Bureau’s history, governed by the principle that the government should not break the law to enforce the law. He established a clear chain of command within the Justice Department to look into criminal misconduct by agents. He gave Kelley a direct order to report on the FBI’s improprieties.

We don’t ask our agents to squeal on one another,” Kelley had said. But that tradition was eroding too.

The tensions at headquarters had been building ever since the FBI opened a criminal investigation of Mark Felt, the dismissed deputy director, during the denouement of the Watergate investigation. In the final days of the Nixon administration, Felt stood accused within the Bureau of smuggling documents out of the FBI and feeding them to
The New York Times
. The charge of stealing the Bureau’s records was punishable by up to ten years in prison. Felt was confronted by FBI agents and advised of his constitutional rights. He had lied about his role in the leaks, skillfully, first to the agents, then in a personal letter to the director.

Dear Clarence,” he had written. “To be treated as a prime suspect in a sordid example of crass disloyalty to the FBI is a humiliating and degrading experience.” He added: “Incidentally, I am not ‘Deep Throat.’ ”

Kelley correctly surmised that there had been a concerted effort by a group of senior agents to leak the secrets of Watergate, and he had good reason to suspect that Felt had led the secret campaign. But Felt also had been his friend for two decades. Kelley’s loyalties—to the FBI and to Felt—compelled him to protect Felt from prosecution. He would not embarrass the Bureau. Kelley ensured that the leak investigation was closed, and he eventually fired the man who had opened it for unspecified abuses of power. But by then, Felt’s troubles had multiplied tenfold. His wife was becoming ill, physically and mentally; she later committed suicide. His daughter had disappeared into a hippie commune in California. He became the subject of a second criminal investigation by the FBI. This one could not be quashed.

On August 19, 1976, the FBI raided its own headquarters. Two teams of FBI agents, led by criminal investigators from the Civil Rights Division of the Justice Department, executed the searches in Washington. A separate FBI squad went through the New York office of the Bureau. They discovered a cache of documents no outsider had ever seen. Hoover’s “Do Not File” filing system, first created before World War II, was designed to keep evidence of FBI burglaries and bugging concealed forever. It required FBI agents to destroy the original records of their secret intelligence investigations. But even Hoover occasionally erred in matters of national security. He had kept a folder in his office, labeled “Black Bag Jobs,” containing a detailed description of the “Do Not File” regulations. It had somehow survived the bonfire of his personal files after his death.
It led the investigators in New York to discover twenty-five volumes of original records that had, inexplicably, been preserved. The investigation began to focus on a series of burglaries in the New York apartments of relatives and friends of the fugitive members of the Weather Underground. The break-ins had been conducted in 1972 and 1973 by the FBI’s Squad 47, led by John Kearney.

Kearney, recently retired after twenty-five years at the FBI, opened his daily newspaper. He read about “a special unit being set up in the Department of Justice investigating Squad 47,” he remembered. “They were interested in the unusual investigative techniques that had been used in trying to apprehend the fugitives. I had heard directly that a number of the agents had gone to testify in a grand jury, and then I had a call, an unidentified caller, who said, ‘I had to give you up, John.’ ”

Kearney was about to be indicted for conspiracy. He was the first ranking agent in the FBI to be charged with committing crimes against the United States.

At headquarters, Clarence Kelley told a few trusted agents to run a counterinvestigation—to find out where the Justice Department was taking the case. They quickly learned that Kearney was a prime target for a criminal indictment. But he was not the only one. On August 26, a week after the initial raids, Mark Felt and Ed Miller, the FBI’s retired intelligence chief, were summoned to testify in secret before a federal grand jury. The two men decided on a dangerous legal strategy. They swore that they had authorized the black-bag jobs carried out by Squad 47. They said they had had the approval of the acting director of the FBI, Pat Gray.

Their testimony made their prosecutors stop and think and argue among themselves, a debate that went to the highest levels of the Justice Department. If they indicted Felt and Miller, they would have to indict Gray as well. They would have to make a felony case against the man who had succeeded Hoover.

The charge would criminalize the FBI’s traditions in the realm of intelligence. In effect, it would indict the FBI as an institution.

Felt and Miller believed that, if they went to trial, they could convince a jury that the FBI had the power to bend the law in pursuit of national security, a power that flowed directly from the president of the United States. They thought they could prove that the president’s sworn duty to protect and defend the Constitution gave him to power to break and enter a citizen’s
door. They would assert that a president could violate the rights of an individual to preserve the interests of the nation.

They would face one more hurdle: a burden of proof. Under law, they would have to show that they carried out the break-ins to defend the United States against the agents of a foreign power. Felt and Miller both suspected that the Weather Underground fugitives received direct support from Cuba and Vietnam. The FBI in Chicago drafted an affidavit of more than one hundred single-spaced pages trying to make that argument. It was not supported by the evidence. Presidents Johnson and Nixon had demanded over and over that the FBI find the proof that the Weathermen were secret foreign agents, financed by the enemies of the United States. But the FBI had no such smoking gun.

Felt went on the Sunday morning talk show
Face the Nation
to tell the world what he had told the grand jury: he had authorized the break-ins. They were intelligence operations vital to national security. “You are either going to have an FBI that tries to stop violence before it happens or you are not,” he said. “I think this is justified, and I’d do it again tomorrow.”

Ed Miller put it more elegantly years later. He took his argument from the common law of centuries gone by.
A man’s home is his castle, he conceded. But no man can maintain a castle against the king.

The argument went back to the beginnings of the United States. “
Safety from external danger is the most powerful director of national conduct,” Alexander Hamilton had written in 1787. “Even the ardent love of liberty will, after a time, give way to its dictates. The violent destruction of life and property incident to war, the continual effort and alarm attendant on a state of continual danger, will compel nations the most attached to liberty to resort for repose and security to institutions which have a tendency to destroy their civil and political rights. To be more safe, they at length become willing to run the risk of being less free.”


Until September 21, 1976, no one had ever seen a terrorist killing carried out by a foreign power in the United States.

That rainy morning, an explosion shook Sheridan Circle, about half a mile from the White House. Orlando Letelier, once Chile’s ambassador to
the United States, had been murdered in the streets of the capital by a powerful bomb hidden in the undercarriage of his car. His twenty-six-year-old American aide, Ronni Moffitt, died with him. Letelier and Moffitt were driving past Embassy Row when the bomb went off.

Letelier had served in the government of President Salvador Allende—first as ambassador, then as foreign minister, and finally as the minister of defense. His left-wing government was freely elected in 1970, despite the best efforts of the CIA, which had been ordered by President Nixon to keep Allende from power by any means necessary. Allende lasted three years before he died in a coup led by the far-right general Augusto Pinochet. The military junta imprisoned Letelier for a year on a freezing island. Then it expelled him.

Soon after he came to Washington to campaign against the Pinochet regime, Chile’s intelligence service, DINA, made plans to assassinate him.

Pinochet and his allies—the right-wing leaders of five South American nations—had undertaken a global effort to exterminate their left-wing enemies. It was code-named Operation Condor. DINA employed murderous anti-Castro Cubans and an American soldier of fortune named Michael Townley as members of an international death squad. Before the assassination of Orlando Letelier, Henry Kissinger’s State Department and George H. W. Bush’s CIA were both well aware that Operation Condor contemplated political assassinations. But both expressed deep doubts that General Pinochet would risk the consequences of carrying out a terrorist act in Washington. Most American intelligence officers seemed to agree. One took exception.

“Operation Condor involves the formation of special teams from member countries to carry out sanctions up to assassination,” the FBI’s legal attaché in Buenos Aires, Robert Scherrer, wrote in a secret four-page report to headquarters seven days after the murders. He argued that it was possible that Pinochet and his agents had carried out the assassination.

Owing largely to the efforts of the FBI, the killing of Orlando Letelier would become a unique case: a proven act of twentieth-century state-sponsored terrorism in America.

The patient and painstaking pursuit of the case also owed something to the November 1976 election of Jimmy Carter, the first political leader to make human rights a central principle of his presidency. Carter had an unusual take on the enemies of the United States. “Peace is not the mere absence of war,” Carter said when he received his nomination. “Peace is action to stamp out international terrorism.”

But the new president had a hard time getting control of the instruments of American intelligence and law enforcement. The congressional inquiries of the CIA and the FBI—and the criminal investigation inside the Bureau—had led to upheavals and bitterness at both agencies. Neither was prepared to collaborate on counterterrorism. The Nixon and Ford administrations had tried to come up with a coordinated response to the threat of terrorism from abroad. Carter fared no better. Terrorism abroad was an act of war to be answered by soldiers and diplomats; terrorism at home was a crime for the FBI to solve. The United States was still years away from a strategy that would combine its law enforcement and intelligence capabilities to stop terrorists before they acted.

FBI headquarters went into a state of limbo after Carter took office in January 1977. It remained there for more than a year. The president had made it clear that he wanted a new leader for the FBI, but he could not seem to choose one. Clarence Kelley, like Pat Gray before him, twisted slowly in the wind.

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