Operation Greylord (24 page)

After two weeks in Virginia, I returned to Chicago for the trial preparations. I spent a full weekend listening to the tapes again with prosecutors, going over questions they might ask me on the stand, and answering questions that might come up in cross-examination. But because of the enormity of our investigation, there was no way I could ever feel ready.

March 1984

During opening arguments in March 1984, defense attorney Sheldon Sorosky suggested that Harold Conn was only rainmaking with Agent David Victor Ries and me, pocketing the money without the judge knowing anything about it. “He just saw two young, naive attorneys with a lot of cash … and he figured, ‘Oh, my God! This is like taking candy from a baby' … [because] these lawyers were talking about cases that almost any lawyer would win.” Sorosky conceded that in taking the money his client wasn't as bright as he thought he was. But the issue, he stressed, was whether Conn affected interstate commerce, a requirement for charges under the RICO anti-racketeering law, and further, “was the taking of this money induced under the color of official right?”

Then the prosecution called me to the stand. This was my first time testifying in a federal trial, and the courtroom looked nearly twice as large once I took the oath and sat down. In all, I had given the bagman seven hundred and forty dollars in three bribes. I told the jurors how I delivered one of them to Conn and then how Judge Laurie, to whom most of the money supposedly went, advised me to point out that the security guard involved in the arrest had neglected to bring the stolen items to court, which under the law was perfectly all right. I said that after the judge threw the case out, Conn told me that “Laurie done his job.”

Sorosky tried to suggest that in my undercover role I had been attempting to rack up as many judges as possible to please my superiors. Maybe thinking that because of my boyish face I would be rattled, he hammered at what constituted proper conduct in undercover work. He entered into the record the Illinois canon of ethics, including that a lawyer “shall not knowingly make a false statement of law or fact” and
shall not “participate in the creation or preservation of evidence when he knows or when it is obvious that the evidence is false.”

Then he asked me, “If a lawyer did what you did and he wasn't an undercover agent, he would certainly be guilty of the crime of subornation of perjury, right?”

U.S. District Court Judge John Nordberg sustained an objection and told the jury to disregard the question. But Sorosky merely rephrased what he had in mind and added, “Anywhere in the criminal code does it say that if you are doing a federal investigation that you are excepted from violating the criminal law?”

“No,” I answered.

“I have nothing further from Mr. Hake,” he said with a contemptuous flourish.

Under re-direct questioning, I assured the jury that Chief Criminal Court Judge Fitzgerald had been aware of my undercover work. When Sorosky took over for re-cross examination, he tried to make the jurors think that any kind of falsehood from a public servant was unethical and illegal.

“When I acted in my role in this case and told something untrue,” I said, “I told them because I was a law enforcement officer and I didn't consider that a lie. A lie is something you do for personal benefit.”

Rather than turn the case over to the jury as soon as the closing arguments were over, Judge Nordberg wanted a day to make sure each item in his instructions was legally permissible. “This is one of the first cases of its kind in the federal system,” he told the jurors. “We're sailing in uncharted waters.”

On the final day—while I was back at FBI training in Virginia—Nordberg refused to dismiss charges against Conn on his claim that Ries and I had introduced false testimony in our contrived cases. The judge said that “while the vast number of judges and court personnel are hardworking and underpaid, there are a few bad apples in the barrel…. It may be that the only effective way to root out corruption is a sting operation like the one used in this case.”

Megary called me in Quantico to say that after less than four hours of deliberations, the jurors came back with verdicts of guilty on both racketeering and extortion. Instead of celebrating by myself, I had to study late for a test on organized crime. A month later, Conn was sentenced to six years in prison and fined two thousand dollars.

For a while the U.S. Attorney's Office was as exhilarated as a sports team that feels invincible. But prosecutors were taking an even harder look at the next case coming up, Judge John Murphy's. They felt iffy about the outcome. We would be up against the natural reluctance of a jury to convict a sitting judge, especially one who looked as judicial and grandfatherly as the plump, white-haired Murphy. We needed a clincher but couldn't find one—until it walked through the door.

Jimmy LeFevour, the newly retired policeman who was called “Dogbreath” behind his back, entered the U.S. Attorney's Office with his lawyer and said, “I'll cooperate.”

It turned out that after serving as chief bagman in the municipal courts, Jimmy had been so shaken by Conn's conviction that he decided to jump the sinking ship. He was a fifty-three-year-old recovering alcoholic facing a long sentence, and perhaps in the back of his mind he wanted to get back at his domineering cousin.

We negotiated with Jimmy's lawyers and agreed that he would plead guilty only to misdemeanor tax charges. The pleas brought him two and a half years in prison but allowed him to keep his pension. In return, Jimmy gave us enough information to work out something with one of the “miracle workers” at Traffic Court, attorney Joseph McDermott. In time, McDermott pleaded guilty to tax violations and racketeering bribery for fixing cases with twenty-four judges. So much for just “a few bad apples.” In return, McDermott was fined thirty thousand dollars and ordered to serve one year in prison, a leniency granted because he was in his seventies.

But crooked judges remained our primary concern. U.S. Attorney Dan K. Webb decided that he would personally spearhead Murphy's prosecution. If I still seemed like a Boy Scout, as many people said, then Webb looked like a Cub Scout. His incredibly youthful face and enthusiasm made it easy to underestimate his intensity and cunning.

He pulled me out of my FBI training in Quantico to prepare me for my testimony. That was fine with me, because my academic exercises could not compare to experiences I was getting first-hand. Not knowing when the next trial would begin, I went back to finish my FBI training, which was almost over. But I could not stick around to take the oath with my classmates because I was being called to testify sooner than expected. Before I left Quantico, there was a small graduation party for me with Ed Hegarty, who just happened to be in Quantico, and the
head of FBI training, Jim McKenzie, later to be put in charge of the Chicago office. Flying back, I felt that I was now the person I had longed to be ever since I was a boy, but something was missing even though I was unaware of it.

During Judge Murphy's trial, we played more than two dozen tapes. There was a loudspeaker for the spectators, but each juror was given a stereo headset. On one of the tapes I recorded in his chambers, the jury heard him saying he would take the case and “throw the fucker out the window.”

Taking the stand again, I told of giving a total of twelve hundred and twenty dollars to the bagmen Trunzo brothers for cases before Murphy. Joseph Trunzo, who was cooperating with us after his indictment, was sworn in as a witness and said he had passed one of those bribes to Murphy in a handshake. Four ASAs testified that they always lost cases in front of Murphy when they were up against his favored defense attorneys. That included the time a defendant admitted under oath that she had been drunk at the wheel but the judge found her not guilty, anyway.

Jimmy LeFevour's first appearance as a government witness caused a stir when he said Murphy had fixed one hundred drunken driving cases as a favor to the presiding judge of the municipal courts, Judge Richard LeFevour. Jimmy added that his cousin received a total of ten thousand dollars for clearing the records of the dangerous drivers.

Mark Ciavelli testified that he gave Murphy seven hundred dollars in three bribes, beginning with three hundred dollars in an envelope after Murphy suppressed evidence in a case. “It was an arbitrary figure that I had picked out,” Mark said of the sum. “I didn't want to give him too little to insult him.” The next time Mark bribed Murphy in his chambers, he said, he felt he no longer needed to put the two hundred dollars in an envelope to thank him for referrals as the bar association attorney that day.

Murphy's lawyer, Matthias Lydon, rapidly asked Mark about when he learned I was working for the government and whether the U.S. Attorney's Office had agreed not to prosecute him for passing along a one-hundred-dollar bribe from me. Then Lydon badgered, “Has anyone suggested that you might have an income tax problem of any sort?”

“Through conversation with my own attorney, I know that I suffer a small possibility of an income tax problem for the years 1980 and 1981,” Mark replied rigidly, as if his usual energy were running out.

“Your agreement with the government is that you won't be prosecuted criminally, right?”

“Yes, that is correct.”

Lydon left it for the jury to decide whether Mark might have been lying to save himself.

When Murphy took the stand in a conservative blue suit, his perpetually gruff ways were replaced by meekness. Asked about Trunzo's testimony about a bribe, the judge answered, “Absolutely false; it never happened…. I never fixed a case for any human being, alive or dead.” The sixty-eight-year-old jurist also insisted that if Jimmy LeFevour had ever told him he could get money from a fixer, “I'd have thrown him out of the building.” Then he smiled and studied the jurors.

But the mask came off under cross-examination. Murphy turned red and pounded his fist on the witness chair while denying all our damning evidence. If the jurors had been leaning in his favor before, they probably were now sure that such an explosive man might be capable of all the charges against him.

On June 14, 1984, John Murphy became the first sitting judge in Illinois to be convicted of a crime associated with his duties. The fourteen hours of deliberations had concluded with verdicts of guilty on charges of mail fraud, extortion, and racketeering. In sentencing Murphy to ten years in prison, U.S. District Court Judge Charles Kocoras called him an “infidel to justice.”

Everyone involved in the prosecution held a little party in a bar across from the Loop Federal Plaza. FBI agent David Grossman who was the lead investigator on the Murphy case, even brought along the toy penguin that had presided at all our meetings in the crime academy. Grossman put the penguin on the counter and someone bought it a beer. We were happy and thought all our targets were going to prison. But we were wrong.

January 1984

That January Mark Ciavelli sent word to Dan Reidy that he wanted to meet me privately at the downtown Midland Hotel, near Federal Plaza. We said hello and acted like buddies, but awkward silences fell between our sentences. At first Mark assured me that he knew why I went undercover, but a few minutes later he asked, “Why did you do it? You got what you wanted on the judges. Why didn't you just let me go?”

It was difficult replying, with his searching for some ulterior motive that just wasn't there. “You tried to bribe me, Mark,” I said. “What was I supposed to do? You kept pushing and pushing.”

“You should have just said, ‘Hey, I don't want to talk about that' and changed the subject.”

“No, Mark,” I said, “I couldn't. I took an oath. You just misjudged me. I can't help that.”

“I'll never know why you did me in, Terry. Weren't we friends?”

“In my mind, we still are.”

“Yeah, Terry. The hell we are.”

It was too late. It had been too late for too long. There was heaviness in me but I wasn't upset, and I didn't feel guilty.

This was our last conversation, though I glimpsed him in Chuck Sklarsky's office while he was being prepared for his testimony in the Judge Devine trial. While delivering a transcript to another room, I waved enthusiastically and he waved back in a gesture that seemed to say he never wanted to talk to me again. I saw him a final time as we
were walking in opposite directions in the Loop some years later. I went to acknowledge him, but he turned away and kept walking.

Our investigations were having repercussions that none of us could have imagined. I've heard of a doctor who could tell from his concentration camp experience when people were going to die soon even if they seemed healthy. It had something to do with the spirit leaving first. That might explain why so many of our targeted attorneys and judges died of natural causes within two years of the initial disclosures.

First was seventy-six-year-old attorney Paul Ross, who was facing indictment on charges of taking a bribe to fix a case before Judge Hogan in Auto Theft Court and conspiring to bribe a judge in a divorce case. After Ross suffered a heart attack at home, friends said he had been deeply distressed over the investigation.

This was followed by the deaths of a court clerk we had evidence against and of the judge who had thrown me out of his chambers when I offered him a direct bribe. Two other judges on the take died before we could bring charges against them, including one Costello claimed would trade his grandmother for a bribe.

Any one or two of these deaths might have occurred without Greylord, but doesn't five within two years seem like more than coincidence? Such a rate among court people had not happened before the investigation, and it has not happened since then.

Even robust Judge Wayne Olson suffered a heart attack one day after going to his lawyer's office and hearing some of the government transcripts from the bugging in his chambers. But Olson was a fighter. He survived and decided, with his enemy Jim Costello, to challenge the legality of the bugging until every legal avenue was exhausted.

The only one of our targets known to have been seriously ill, Judge Alan Lane, continued hearing cases. However, in the midst of a rape trial in October 1982 he had asked three sheriff's deputies to accompany him to the bench for his protection. Everyone in the courtroom knew something important was about to happen. Lane sat down and
announced that he was withdrawing from the proceedings because of a state investigation into a possible one-thousand-dollar bribe from attorney Arthur Zimmerman.

Lane, only in his late thirties, had no idea the FBI knew a lot about him as well. A woman he had been dating, Marlene Friedman, had briefly been a citizen mole for us. In addition, there was the case where Lane sent Roth to the Cook County Jail to extort Henry Sutherland for overturning his rape conviction. But the U.S. Attorney's Office decided not to seek an indictment because Lane was dying of cancer, though we at the FBI thought that this should be no bar to an indictment.

Lane was taken off the bench by a vote of the circuit court judges and lived under open suspicion until he entered a hospital in March 1985 and died that same day. The following month, Zimmerman was acquitted of state charges in the 1982 rape case. But eventually he pleaded guilty in federal court to two tax counts arising from Greylord and was sentenced to three years in prison.

Some of our targets began drinking more heavily, and at least one tried to lose himself in cocaine. How much the lawyers drank, I can't say. But a news report said that a month or so before Jimmy LeFevour went over to us, he was staving off his panic with twenty-four cans of beer and two quarts of whiskey a day for two weeks. As he recovered in a hospital, he realized that his life depended on going straight.

Mark's partner, Frank Cardoni, sought medical help from the stress and then arranged to plead guilty on two counts of mail fraud. His mild ninety-day term was later revoked, so he got off with probation and a one-thousand-dollar fine.

With all these deaths, convictions, and plea deals, you can understand our confidence that there would be no stopping the Greylord sweep. We should have remembered that in trials, nothing is ever certain.

The next judge to be tried was John Laurie. His attorney was the formidable Patrick Tuite (pronounced TO-it), an imposing man who held the respect of state and federal prosecutors even though his list of clients read like a crime commission's watch list. Tuite had a knack for sensing which strategy would work best and then using his juror challenges to pack a panel of men and women likely to consider the evidence that way. Next he would present a defense that might not seem rational to an outsider but made perfect sense to those jurors.

In hearings before the trial began, Tuite contended that several of our tape transcripts did not reflect what actually was being said. He sent over his own versions, but these sheets were really inaccurate, and they even omitted Laurie's coarse language.

Deciding to leave no room for doubt, I went to the FBI's electronic surveillance room and took out the original tape of my conversation in Laurie's noisy chambers in a court at police headquarters. Until now I had been using my memory and a faint duplicate tape. There was so much background noise on the original that I had to scrutinize practically every word. I discovered that Laurie had not really said “We'll see” when I asked for a not-guilty. He had told me “Sure.”

Sure! I couldn't believe it. I had put my name to “We'll see” on the government transcript, and that's how I had testified at the Conn trial. Since this was something I absolutely wanted the jury to hear clearly, I flew back to FBI headquarters and had the experts enhance this recording along with tapes that would be used in several upcoming cases. I was eager to get back to Chicago.

Newspapers had been playing up the prosecution as a sure thing even though Tuite's presence in the courtroom on the twenty-third floor of the Dirksen Federal Building gave the proceedings a make-or-break atmosphere. Respected Judge Prentiss Marshall contended out of the presence of the jury that of all the trials in his long career, this one could most be characterized as being tried by the news media. Marshall ordered both sides not to use the word “Greylord” in front of the jurors, to avoid influencing the outcome.

In opening arguments, prosecutor Scott Lassar said fixers put their bribes in Laurie's desk, in a coat hanging in his chambers, and in his palm. In his usual one-note drone, Lassar added that Peter Kessler, who by then had pleaded guilty to mail fraud, gave Laurie two thousand dollars in kickbacks for referrals. Having learned from the Murphy trial, Lassar assured the jury that in my undercover work I had portrayed myself as a corrupt attorney “legally under the law.” He also explained Judge Richard LeFevour's practice of replacing honest judges with corrupt ones, and said that this was why Laurie took over for a judge who had barred hustlers from his court.

When the electric Tuite took over, he said that if you go to a ballgame expecting a fix, you will think that each strike, each error, and each hit is rigged. He emphasized the relative youth of the thirty-eight-year-old
Laurie and said the new judge did not want to be disciplined as Judge David Cerda had been in 1975 for barring hallway hustlers on his own authority. Tuite neglected to bring up that it was only after Cerda's reprimand that regulations outlawed hustling.

Tuite also described Jimmy LeFevour as a drunk for twenty years who could no longer tell reality from fiction. Jimmy, he said, “must have a melon for a brain by now with all the alcohol it has absorbed.” He added that Jimmy shook down the lawyers to set up the hustlers' bribery club “and that not one dime went to Judge Laurie.” The phrase “not one dime” came again and again, no doubt to make sure jurors kept thinking about it. As for why bagman Jimmy LeFevour would testify against Laurie, Tuite said the answer was simple: the former officer wanted to save his thirteen-hundred-dollar-a-month police pension.

Touching on my role, he told the jurors that “Hake uniquely and very disturbingly believes that you can commit perjury if you are doing it for the government.” He claimed that the tape they would be hearing would show what could happen when a “voodoo expert” in Washington got his hands on an ordinary conversation.

When I took the stand, I testified that Laurie had agreed to see me after getting a call and told me “I talked to Harold,” meaning Conn. My tape let the jury go back in time to when Laurie advised me how to handle a case, even telling me to “scream” when the prosecutor asked to have a charge reinstated.

“And then we can get an NG [not guilty]?” I had asked.

That was when, I am certain, Laurie gave me a “Sure.”

As brought out in testimony over the next couple of days, Laurie went back in court and found my undercover FBI “client” innocent of shoplifting, completely ignoring testimony that he had been arrested with a candle snuffer and a pair of salt and pepper shakers in his pockets. Instead, Judge Laurie said the arresting guard was unreliable because he had testified that all the exits at Water Tower Place had heavy doors. What? Laurie claimed that he, himself, had recently been there and did not believe that this was true. Even if the doors were made of matchsticks or diamonds, or there were no doors at all, the issue was immaterial. It was just a tactic to obscure the facts.

The prosecution testimony also concerned a later illegal gun case the FBI and I had concocted. So I decided to talk to Laurie about the gun case when he was alone in a hallway, when judges are more amenable to
defense attorneys. Our conversation continued on the way to the elevator and then into his chambers.

“I want to show my appreciation for my case coming up on Thursday,” I had said.

“Just do a good job and don't worry about it,” Laurie told me.

But contradicting the FBI account I had written just hours after the conversation, Laurie insisted he lectured me about how I should not be engaged in bribery and then threw me out of his chambers. He testified he never reported my bribe attempt because he did not want to ruin my career. I had no proof he was lying because the tape recorder had failed to record our conversation. I conceded that when I returned to Laurie's chambers a third time to get more evidence against him, he really did throw me out.

Unfortunately, Lassar could not ask me to speculate on what might have been behind Laurie's turnabout. I would have said that in the intervening time the judge might have heard the longstanding rumor about my being a mole, and that both the
Chicago Tribune
and the
Sun-Times
were carrying rumors of an investigation.

Throughout my direct examination, I was dreading cross-examination. Tuite always presented himself as a pleasant gentleman to the jury but could be nasty on attack. Hardened police officers who had done nothing wrong were known to bead with perspiration under his questions.

Tuite had often seen me around the Criminal Courts Building, and for months he would have had a chance to talk to Greylord targets such as Bob Silverman to learn the best way to turn inside out everything I did. Whether Tuite actually did this, I don't know, but he seemed determined to portray me as someone crazed with ambition. He started out by having me admit that I lied in my work for the government. “Well,” he said, “do you think that as you testify now, you are doing it for the government?”

“I'm doing it for the people of the United States, I believe.”

“So that if you tell an untruth, in your mind it's not wrong, even here on the witness stand?”

“Here, under oath, it's wrong,” I answered. “Yes, it is.”

Although we had been cautioned never to mention the name of Greylord in the trial, minutes later I made a slip while explaining our precautions and said I had discussed such issues “before I ever entered into the Greylord project.”