More than a year before FBI agents raided Anthony Pellicano's offices in West Hollywood, federal authorities were already suspicious that the private investigator was using illegal wiretaps, according to sources familiar with the inquiry.
In at least one case stemming from a dispute over control of a $40-million Internet business, the FBI was told in 2001 that Pellicano had secretly recorded one of their Los Angeles agents, the sources said Wednesday.
The disclosure suggests for the first time that the FBI was focusing on Pellicano long before a botched attempt to intimidate a Los Angeles Times reporter last year drew attention to the high-profile private investigator and the prominent lawyers who have employed him. In addition, court declarations made in connection with the battle for control of the Internet company provide the most detailed public look so far at Pellicano's alleged use of wiretaps.
Pellicano is at the center of an investigation into alleged illegal wiretapping in the entertainment business. FBI agents investigating the case have interviewed dozens of people to determine if Pellicano conducted illegal wiretaps on behalf of his clients, who often paid him six-figure fees for his services.
In several cases, the agents have told Hollywood figures that their conversations were apparently recorded. A federal grand jury looking into the matter is trying to determine whether any wiretaps were approved by -- or set up with the knowledge of -- lawyers who hired Pellicano. At least one prominent entertainment industry lawyer, Bert Fields, has been notified that he is a subject of the investigation.
FBI spokesman Matthew McLaughlin refused to comment on the case. "We have a continuing investigation to determine if additional federal violations have occurred and beyond that, it would be irresponsible for the FBI to comment on an open investigation," he said.
Pellicano could not be reached for comment Wednesday.
Previously, the investigation of Pellicano was thought to have started after he was implicated in an attempt to threaten Anita Busch, a reporter working for The Times who was investigating alleged ties between Steven Seagal, the actor, and a mob figure. Seagal was a client of Pellicano.
FBI agents raided Pellicano's office a year ago after Alex Proctor told a police informant that he had carried out the threat against Busch and that Pellicano had hired him to do so.
But the case that may have actually triggered the FBI's interest in Pellicano dated back more than two years.
The case pitted Daniel and Abner Nicherie against Ami Shafrir in a complicated business dispute over control of a company that provided Internet Web sites for movies and other uses. Pellicano worked for the Nicheries.
According to court documents, in 1998, Ami Shafrir's wife, Sarit, filed for a divorce. The next year, she befriended the Nicheries. Ami Shafrir alleged that the Nicheries used the friendship with his wife to illegally gain control of his five companies, which he valued at $40 million.
In February 2001, Ami Shafrir sued the Nicheries. After the suit was filed, Sarit Shafrir had a falling-out with the Nicheries and allied with her ex-husband. After she did, court records and interviews show, she told her ex-husband and authorities that Pellicano had secretly recorded conversations that Ami Shafrir had held with his lawyers and with others, including an FBI agent.
"In or about the fall of 2000, on a regular basis, I would drive Abner Nicherie to the Luckman Plaza to meet with Anthony Pellicano to review recent recordings of conversations that Mr. Pellicano had recorded," Sarit Shafrir said in one declaration, filed in connection with Ami Shafrir's suit against the Nicheries.
"Abner would call my cell phone during that meeting and allowed me to listen in on some of the tape conversations at the same time that Mr. Pellicano's office staff was replaying them," her declaration said. "I listened to conversations Ami had with the FBI and with his attorneys that had been recorded."
In an interview Wednesday, Ami Shafrir said that after he and his ex-wife reported the wiretaps to authorities, he had been interviewed several times by the FBI about Pellicano.
Sarit Shafrir said the FBI had questioned her as far back as August 2001 about the alleged wiretaps. She declined to comment about whether she had appeared before the grand jury investigating the alleged wiretaps. But Mark Estes, an attorney for Ami Shafrir, said Sarit Shafrir had received complete immunity from federal prosecutors in exchange for her statements.
Estes also said that court records show Pellicano was paid $154,000 by the Nicheries for his services.
Anthony De Corso, an attorney for the Nicheries until September, said a judge that month approved a settlement of the dispute between the Nicheries and the Shafrirs. Court records show a judgment was entered in favor of Ami Shafrir for $3.9 million against Daniel Nicherie and $100,000 against Abner Nicherie. De Corso would not comment on the allegations of wiretapping.
Although federal officials will not comment on the genesis of their investigation, at least one of Pellicano's intimates suggested Wednesday that without the case between the Shafrirs and the Nicheries, the FBI would have had no interest in Pellicano.
"If the Nicherie case had not happened," the associate said, "there would be no Hollywood investigation." FBI agents were upset that Pellicano had secretly recorded one of their own, the associate said.
Meanwhile, attorney Ed Masry, best known for his work with environmental activist Erin Brockovich, acknowledged Wednesday that the FBI had questioned him about Pellicano. Masry said he hired Pellicano while defending himself and his firm against a slander suit brought by a former employee, Kissandra Cohen.
A year ago, "two guys came to my office unannounced. They brought up Kissandra Cohen and asked me if I knew anything about wiretapping. I told them I didn't," Masry said.
Before leaving, Masry said, the agents asked for and received copies of checks written by Masry to Pellicano for his services. The entire visit by the FBI lasted less than 15 minutes, Masry said, adding that he has not since been contacted about Pellicano. Nor, Masry said, has he been asked to appear before the grand jury.
Also, Diane Dimond, an anchor for Court TV in New York, said Wednesday that she has been told by law enforcement officials that she was wiretapped by Pellicano in 1993, when she was working for the television show "Hard Copy."
At the time, she said, she was reporting on allegations of child molestation against Michael Jackson. Pellicano was working as a private investigator for the entertainer.
Dimond said that at the time, she became suspicious that her calls were being recorded. She said she started working the Jackson case in August 1993, and "by Thanksgiving my phone was crackling.... I'd call a source and they'd say 'I knew you were going to call me ... Anthony Pellicano told me,' " she said.
Dimond said she and her husband, Michael Schoen, a radio reporter, set up a test. "He would call me [and say], 'You still working on the Pellicano special?' "
She would say, " 'Oh, he's going to hit the roof. They're going to give me the whole half-hour.' "
"I swear," she said, "22 minutes later, I get a call from the legal department" of her show saying that Jackson's representatives had called to threaten legal action against the purported upcoming show.
Times staff writers Jeff Gottlieb and Paul Lieberman and Times researcher Nona Yates contributed to this report.