FBI Director Hoover reported Bobby Kennedy’s revelation of the Castro plot in a memo dated May 10, 1962: “He stated he had been advised by CIA that CIA had hired Maheu to approach Giancana with a proposition of paying $150,000 to hire some gunmen to go into Cuba to kill Castro. I expressed astonishment at this in view of the bad reputation of Maheu and the horrible judgment in using a man of Giancana’s background for such a project. The attorney general shared the same views.” Less than three months earlier, Hoover had ended John Kennedy’s White House affair with Giancana’s mistress Campbell by bringing a report on her to the president, according to the Senate Select Committee on Assassinations.
Bobby Kennedy’s fears that the Castro plot had led to the assassination of his brother were reported by Arthur Schlesinger, Jr., in Robert Kennedy and His Times (Houghton Mifflin, 1978, pp. 615–16). According to Kennedy aide Walter Sheridan, Bobby asked CIA Director John McCone, “Did the CIA kill my brother?”
Kennedy called Nixon’s Hughes scandal a “decisive factor” in the 1960 election in a New York Times interview reported November 13, 1960. Justice Department files leaked to the Times January 24, 1972, revealed that as attorney general Kennedy considered criminal prosecution of Hughes, Nixon, and members of Nixon’s family over the “loan.”
The scene of Hughes watching RFK assassination reports is based on his own memos, on interviews with his aides, and on television videotapes. Teddy Kennedy’s eulogy is quoted from press reports of the funeral rites.
O’Brien’s “long, sad, emotional journey” on the RFK funeral train is recounted in his No Final Victories (Doubleday, 1974, pp. 245–46) and was further detailed in interviews. “After the funeral services,” he wrote, “I went home and remained there for several days. It was a mood I had never known before. Following President Kennedy’s assassination I had been swept along by Lyndon Johnson, but now I had nothing to do and nothing I wanted to do.”
Maheu told the Senate Watergate Committee that Hughes ordered him to hire O’Brien within minutes of Bobby’s death, but that he “had the decency to wait some time” before making contact. Maheu finally reached O’Brien on June 28, 1968.
O’Brien described his job negotiations with Maheu in his book (pp. 255–56) and in interviews. “Suddenly Bobby was dead and I had nowhere to go,” he said. “There’s a cold reality that sets in, and it’s very simple. I had to earn a living.” But after being shown a copy of the memo Hughes wrote the night that Bobby died, O’Brien added, “Now you make me wonder whether I’d forsaken everything to go to work for a bum like Howard Hughes.”
O’Brien discussed his work for Hughes in two four-hour taped interviews, but claimed not to recall many matters detailed in Maheu’s reports, often went off the record and demanded that the recorder be shut off, and refused access to his own reports to Maheu and all other records relating to O’Brien Associates.
O’Brien confirmed that he had been contacted by Hagerty to represent the three television networks at about the same time he first met with Maheu, but claimed not to recall any discussion with Maheu of Hughes’s bid to take over ABC, as reported in Maheu’s memos. O’Brien also claimed he was not aware of the Hughes/ABC deal, although it was widely reported in the national press starting July 1, 1968, three days after Maheu first called, and three days before he came to Las Vegas to discuss the Hughes job.
O’Brien’s associate Claude DeSautels told the Senate Watergate Committee that Humphrey called while O’Brien was in Las Vegas. O’Brien said in an interview that shortly after he returned to Washington, he agreed to take over Humphrey’s campaign and told Maheu he could not go to work for Hughes until after the convention.
O’Brien confirmed that he met again with Maheu in Washington on July 31, 1968, received $25,000 promised to the Kennedy campaign, which he passed on to Smith the next day, and agreed to represent Hughes through O’Brien Associates for at least two years at $15,000 a month.
O’Brien became Democratic national chairman on August 30, 1968, and that same day became chairman of Humphrey’s campaign. He confirmed that he met a third time with Maheu in Las Vegas shortly after the November election and made final arrangements to begin work for Hughes on January 1, 1969.
O’Brien confirmed that he “maintained contact” with Maheu while he managed Humphrey’s campaign but said that he did not recall discussing Hughes’s attempt to take over Air West. He said that he discussed Hughes’s TWA battle with Maheu on several occasions but did not recall the plan for a congressional probe of the bankers, which Maheu said he discussed with O’Brien in a memo to Hughes dated October 9, 1968.
O’Brien also said he did not recall having arranged Maheu’s August 1968 meeting with Johnson at the LBJ Ranch, but Maheu told the Senate Watergate Committee that O’Brien set up that meeting, and Johnson’s appointments secretary Jim Jones confirmed that O’Brien arranged it. Jones recounted LBJ’s reaction in an interview.
Maheu confirmed in an interview that Hughes ordered a second million-dollar bribe to Johnson. O’Brien claimed not to recall any “direct contact” with the president in December 1968 regarding the bomb test. “It gets perilously close to suggesting that Maheu’s reports to Hughes might not have been accurate, in terms of my opinions and views and activities, and that wouldn’t have been the case,” said O’Brien. “Because if Maheu told Hughes that O’Brien says Lyndon Johnson’s view on the bomb test is this or that, I’m sure I told Bob that was the president’s position, and I wouldn’t have told him unless some effort was made to find out what the president’s position was.”
O’Brien claimed that he never discussed with Maheu any offer of money to Johnson, or indeed any political contributions at all, but Maheu told the Senate Watergate Committee that he kept O’Brien informed of “all political matters.” Maheu refused in an interview to confirm that he told O’Brien about the proposed million-dollar bribe to Johnson, as he stated he did in his memo to Hughes. “That’s none of your business,” said Maheu.
An O’Brien associate, who declined to be identified, said in an interview that O’Brien told him that Hughes had once ordered that a million dollars be given to Johnson, but that he refused to get involved.
Colin McKinlay confirmed in an interview that two Hughes representatives, Tom Bell and Jack Entratter, “tried to buy me off not to run the story about Ted Kennedy,” and also confirmed that it was Entratter who brought Kennedy to room 1895 at the Sands where the showgirl was seen by a bellhop, a room service waiter, and two detectives assigned to protect Kennedy. Entratter died in 1971, but another Sands executive corroborated McKinlay’s account in an interview. Senator Kennedy refused repeated interview requests.
Both Napolitan and DeSautels confirmed their work for Hughes, and both also confirmed that they consulted regularly with O’Brien, as did O’Brien himself. “During my period on Wall Street,” said O’Brien, “there were occasions when Claude and/or Joe would check with me on some aspects of their activities with Maheu, and I’m sure I also talked with Maheu directly.” However, O’Brien said that he did not recall any involvement with the Air West CAB hearings or seeking congressional support for the fight against nuclear tests, as reported by Maheu.
O’Brien confirmed that he met again with Maheu in Las Vegas in August 1969, after quitting his Wall Street job, and arranged to go to work for Hughes for two years at $15,000 a month starting October 1, 1969. It was not publicly known at the time that O’Brien was working for Hughes, and the fact that O’Brien was on retainer while he was Democratic Party chairman was not reported until July 1974, when leaked by the Senate Watergate Committee.
O’Brien confirmed Maheu’s report that his firm played a central role in altering the 1969 Tax Reform Act. “I’m sure that’s true,” said O’Brien. “Obviously there was involvement on the tax bill through my contract with Hughes, and I’m sure that DeSautels was very active on that. He knew just about everybody on the Hill.” O’Brien defended his role but added, “I know I’m going to look a
bit illiberal on the tax bill.”
The account of Patman’s probe of the Hughes Medical Institute was drawn from reports of the House Banking Committee and the hearing record. The account of HHMI’s finances was drawn from IRS files and internal documents of the Hughes organization, as well as congressional reports. O’Brien said that he never contacted Patman for Hughes, but that DeSautels probably did.
The Senate Finance Committee revised the Tax Reform bill to allow the Hughes Medical Institute to escape its “private foundation” status by affiliating with a hospital, and the House-Senate conferees gave HHMI a full year to make the change and become a “public charity.” The House version of the bill, however, forbid the change unless the foundation repaid with interest all the back taxes it would have paid had it not been tax-exempt as a “private foundation.” The Senate Finance Committee revised the bill to allow the change without any tax penalty, and the House-Senate conference adopted the Senate version. The Senate Finance Committee also softened the rules on “self-dealing” in a clause that seemed tailored for Hughes, and in another clause tailored for Hughes allowed foundations to hold 100 percent of stock in a corporation for fifteen years if the foundation already held more than 95 percent of the stock.
Senator Paul Fannin, who received campaign contributions from the Hughes Aircraft Company’s “Active Citizenship Fund,” confirmed in an interview that he worked with Hughes representatives to revise the Tax Reform Act in the Senate Finance Committee, and also confirmed that committee chairman Russell Long helped push through the Hughes amendments. Both Gillis and Russell Long declined interview requests.
O’Brien confirmed his meeting with Wilbur Mills, but denied that he discussed HHMI with him. Mills, however, supported the Hughes loophole in the House-Senate conference, and two years later opposed an IRS attempt to force HHMI to spend at least 4 percent of its assets each year on medical research.
Nixon’s attempt to get a tax break for donating his papers, the backdating of his deed, and his failure to pay $467,000 owed the IRS while he was president was reported by the House Impeachment Committee. Harlow recounted his talks with Nixon about O’Brien in an interview.
The fact that Hughes paid no personal income taxes for seventeen years, from 1950 through 1966, was established by copies of his federal income tax returns. The Hughes Tool Company became a “subchapter S corporation” in 1967, and as a “small business” with ten or fewer shareholders paid no corporate income taxes starting in 1967.
Larry O’Brien continued working for Hughes until February 1971, three months after Maheu was ousted and just a month after the Nixon White House began investigating his Hughes connection. He confirmed that he received $325,000 from Hughes, including a $75,000 severance payment, and that he received at least $165,000 from Hughes while he also served as chairman of the Democratic National Committee for eleven months starting on March 5, 1970.
The Nixon quote regarding Hughes and O’Brien is from volume 2 of his memoirs (RN: The Memoirs of Richard Nixon, Warner, 1978, p. 172).
10 Nixon: The Payoff
Dr. Harold Feikes, a Las Vegas heart specialist who administered the transfusions, described Hughes’s medical condition in a sworn deposition and in two interviews. Feikes said he first saw Hughes early in November 1968 and memos sent to Hughes by his aides establish that it was on Election Day. One of the Mormons recalled Hughes watching TV reports of the election after receiving his transfusion.
“His life was certainly in danger,” said Feikes. “He was anemic enough to be on the verge of congestive heart failure. But even though he was critically ill, he had a very keen understanding of anemia and transfusions. He chose who he was going to take blood from very carefully. His aides said Hughes knew everything about the donors—what they ate, who they slept with, etc., and he only wanted blood from Mormons.”
The description of Nixon’s election watch was drawn from interviews with his aides, from his memoirs, and from Theodore H. White, The Making of the President 1968 (Pocket Books, 1970, pp. 484–89). Garment’s quote is also from White (p. 484).
Noah Dietrich confirmed in a series of interviews that Hughes backed Nixon in every race since his first run for Congress in 1946, as did an associate of Hughes’s political lawyer Frank Waters, who handled most of the contributions until 1960. Waters refused comment. Maheu described in court testimony the 1956 covert operation to save Nixon.
Nixon refused two interview requests submitted in writing.
The known Hughes money to Nixon and his family includes the “loan” of $205,000 to brother Donald in 1956 (which was never repaid); $50,000 contributed to the Nixon campaign in 1968; $100,000 in cash secretly passed to Rebozo in 1969 and 1970; and $150,000 to the Nixon campaign in 1972. How much Hughes contributed to Nixon’s other campaigns remains unknown, including the “all-out support” Hughes himself said he gave Nixon in 1960.
The “loan” of $205,000 was detailed by Noah Dietrich in several interviews, and in his book Howard: The Amazing Mr. Hughes (Fawcett, 1976, pp. 282–87). According to Dietrich, Waters told him that Nixon personally called to request the money—“I’ve been talking to Nixon. His brother Donald is having financial difficulties. The vice-president would like us to help him.”—and that Hughes personally approved the transaction. An associate of Waters confirmed Dietrich’s account.
Nixon later told both his chief of staff, Haldeman, and his confidant Rebozo that the Hughes loan scandal caused his defeats in 1960 and 1962, according to Rebozo’s Senate Watergate Committee testimony and Haldeman in both interviews and his book The Ends of Power (Times Books, 1978, p. 20). Bobby Kennedy also called the Hughes scandal a “decisive factor” in the 1960 election, according to a November 13, 1960, New York Times report. Nixon’s complaints about media coverage of the scandal are quoted from his memoirs, RN: The Memoirs of Richard Nixon (Warner, 1978, vol. 1, pp. 300–301).
Danner recounted the 1968 Nixon-Rebozo request for Hughes money in sworn testimony before the Senate Watergate Committee. Maheu testified that Hughes approved the hundred-thousand-dollar contribution in a telephone conversation and that he withdrew $50,000 from Hughes’s personal bank account on September 9, 1968, arranging to pick up the balance at a later date. Nadine Henley, Hughes’s personal secretary, confirmed Maheu’s account.
The meeting between Danner, Rebozo, and Morgan at Duke Zeibert’s took place on September 11, according to Danner’s diary. “At that time, Morgan relayed the information from Maheu that a contribution would be forthcoming,” Danner told the Senate committee. “Rebozo was willing or agreeable to handle it.”
Rebozo did not respond to an interview request but in testimony before the Senate Watergate Committee gave his own account of events leading to his receipt of the Hughes $100,000. “Morgan, I presume, had the money with him,” said Rebozo, “but he wanted to hand the money to the president, himself, and I told him that the president would never accept it.” Morgan told Senate staff investigators that he merely wanted some formal acknowledgment of the transaction, which Rebozo refused. Danner confirmed Morgan’s account.
“The atmosphere just didn’t seem appropriate to accept the contribution,” Rebozo testified. “I recalled, vividly, the 1956 loan to the president’s brother, and the fact that Drew Pearson had made a lot of that in the 1960 campaign … the fact that Ed Morgan represented Drew Pearson, and the fact that I just did not want to be responsible for anything that might create embarrassment. I declined.”
In Senate testimony Rebozo recounted the attempt by John Meier and Donald Nixon to deliver the Hughes money: “I was concerned about the possibility of some more embarrassment, such as he had showered on the president in 1960 and 1962 … I just didn’t think that Don Nixon should be consorting with a representative of Hughes.”
In a Senate interview and in court testimony, Maheu recalled the attempt to deliver the money directly to Nixon in Palm Springs on December 6, 1968: “Through Governor Paul Laxalt arrangements were made for an appoin
tment with president-elect Nixon, at which time Governor Laxalt and I would deliver the money personally to President Nixon. Unfortunately something happened during the day that scuttled the president-elect’s schedule.”
Just before his trip to Palm Springs, Maheu withdrew another $50,000 from Hughes’s personal bank account in two installments on December 5 and 6 “for Nixon’s deficit,” and on December 5 also apparently received $50,000 from the cashier at the Sands casino. That same day Danner flew to Las Vegas to meet with Maheu and agreed to go to work for Hughes. A week later both Maheu and Danner were down in the Bahamas, but there is no direct evidence that they passed any money to Nixon, as indicated on the Sands withdrawal slip.
Bank records show that Maheu withdrew another $50,000 from Hughes’s personal bank account on June 27, 1969, and Hughes lawyer Tom Bell testified that on Maheu’s instructions he gave Danner $50,000 from the Silver Slipper on October 26, 1970. Danner denied receiving the money.
In conflicting statements to the IRS, the Senate Watergate Committee, and in court testimony, Maheu at one time or another claimed that each of the withdrawals was the source of the $100,000 eventually passed to Nixon through Rebozo. In any event, Rebozo, Danner, and Maheu all confirmed in sworn testimony that Nixon did receive $100,000 from Hughes in two deliveries of cash to Rebozo.
Danner joined the Hughes organization in February 1969. He testified that in April and May Rebozo began “needling me” about Hughes contributions to Humphrey, and that in May and June Rebozo asked for $100,000, telling him “the president was interested in beginning to raise funds for the 1970 congressional elections.” Rebozo, who kept the money past the 1970 elections, denied Danner’s account and testified that “it was money that was intended for the president … it was for the president’s 1972 campaign.” In fact, Rebozo admitted that he put the cash in his safe-deposit box, did not use it for any campaign, and kept it until the IRS came after him in 1973.
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