A professional investigator accused by Rep. John D. Dingell (D-Mich.) of misrepresenting himself as an agent of a subcommittee chaired by Dingell plans to claim in a hearing today that a member of the panel’s staff set him up with a series of falsified internal memos and an illegal tape recording.
At a stormy hearing last week, Dingell confronted the investigator, John C. Gibbons of Kroll Associates, a New York-based international corporate investigating firm, with what he called taped evidence of the alleged misrepresentation.
But within two days, Dingell decided to discipline the subcommittee staff aide who had, according to testimony before the subcommittee last week, asked that the conversation be taped as part of a subcommittee probe of the investment banking firm Drexel Burnham Lambert.
Brian McTigue, one of Dingell’s top investigators on the Energy and Commerce subcommittee on oversight and investigations, was transferred to a position on the full committee, which Dingell also chairs.
Now Gibbons, a former U.S. attorney in San Francisco, has sketched out a statement to be presented to the committee in which he says it was McTigue who initially telephoned Gibbons many months ago and sought his help in “tracing some trades that had occurred.”
At last week’s hearing, McTigue, with Dingell’s obvious approval, played a tape recording of a conversation involving Gibbons that had been surreptitiously recorded at McTigue’s request. In the tape, Gibbons told California lawyer William G. Bertain that a Dingell staff member “wanted us (Kroll) to try to confirm some trades, which we were unable to do.”
Dingell, who has been investigating Drexel’s financial operations for more than a year, had evidently hoped to extract a wealth of information from Kroll, which includes Drexel among its long list of Wall Street and financial world clients.
Gibbons, called to the Dingell panel last week by subpoena, had also been ordered to bring with him a huge mass of documents, memos, tapes and other material concerning Kroll’s relations with Drexel, jailed insider trader Ivan F. Boesky and other corporate clients involved in mergers.
Gibbons last week refused to turn over the documents or to testify. When subcommittee Republicans said Bertain had taped the conversation with Gibbons in apparent violation of a California law that makes it illegal to tape a conversation without permission of both parties, Dingell postponed by a week Gibbons’ testimony.
Will Discuss Memos
Gibbons, in a preliminary draft of the testimony he intends to give today, says: “In the summer of 1988, an individual representing himself as Brian McTigue called the office to ask help in tracing some trades that had occurred. We were unable to do so, and I so advised him. That is exactly what I said on the tape.”
Gibbons also plans to accuse McTigue of doctoring memos describing various conversations with Gibbons himself and with Kenneth Eichner, another Kroll investigator.
Attorney’s Ties Emerge
“At last Monday’s hearing,” Gibbons says in his prepared testimony, “official memoranda were introduced as though contempor aneously describing telephone conversations and meetings between Kroll staff and Brian McTigue. These memoranda were not contemporaneous records, but were written ‘after the fact’ and back-dated by McTigue.”
It also emerged last week that Bertain, who taped his interview with Gibbons, is attorney for a group of stockholders in Pacific Lumber, a San Francisco firm taken over more than three years ago in a merger whose financing was arranged in part by Drexel.
Subcommittee sources said lawyers for Kroll have formally offered to bring to today’s hearing only Kroll documents with which Gibbons himself has been directly involved. That would substantially limit the scope of what Dingell has sought, and it was not clear whether Dingell would accept the offer.