When he’d originally convened this inquiry, he’d done so reluctantly. He knew full well that any inquiry having a direct effect on the pocketbooks of Californians was a political plus. The only problem was that less than 5 percent of the population of the state carried earthquake insurance. Since the inquiry, when conceived, was intended to address itself to that single issue, it seemed to the senator that less than 5 percent of the people would be interested. Hardly enough.
Now, however, the thrust of the inquiry was taking a decidedly different turn. There was to be talk of earthquakes, skulduggery, possibly murder. Much meatier stuff. The stuff that made the front pages of newspapers and the lead items in television news broadcasts. His visage would be seen by millions, not only in California, but throughout the country.
Much better. Much better, indeed.
“Originally,” the senator intoned, his voice modulating in the lower octaves, “I had intended to begin this session with an opening statement. However, in view of recent developments that have already been widely reported in the media, I will dispense with my statement and instead have it entered into the record as having been read, if there is no objection.”
There was none.
“Very well. As you know, we had planned to present witnesses in the order they appeared on the original agenda; however, some late changes have been made and a new agenda has now been prepared. As these are being distributed, I will call the first witness. Will Mr. Peterson come forward and be sworn.”
As two men moved from the rear of the chamber and took positions at the table facing a semicircular dais behind which sat nine other representatives and senators, Simpson leaned back and practically licked his lips in anticipation.
The witness had been sworn. The room almost crackled with electricity.
“Mr. Peterson,” Simpson began, “I note that you are represented here by counsel and that, sir, is perfectly all right. Do you have an opening statement?”
“Yes, Senator, I do.”
“Before you begin, would you be kind enough to introduce yourself, giving us your position, and explain your interest in this inquiry and how it relates to everything we’re about to discuss. If you would, sir.”
“I’ll be happy to, sir.”
“Please proceed.”
Senator Simpson leaned back and fought back a grin. The man at the witness’s table, Felix Peterson, was a thin, wiry man in his thirties. His flat, black hair was combed straight back, emphasizing a bony face that seemed oddly out of kilter. The eyes were very close to each other and the lips thin and tight. He wore a blue suit that seemed two sizes too large for him.
“My name,” he said, in a frail voice that matched the body, “is Felix Peterson. At the present time, I am unemployed. Previously, I was executive director of Dalton Research, Incorporated, of Menlo Park, California. I was employed there for ten years.”
He stopped speaking, took a drink of water, then continued. Clearly, he was nervous.
“During my tenure, I had the opportunity to work on a project that was one of the most important ever undertaken by any research-oriented facility. A project that researched the practicability of successfully predicting earthquakes, using some newly discovered techniques that had shown promise elsewhere in the world, particularly in the Soviet Union.
“I should note that Dalton Research is a company that is … was … funded by the American Association of Insurance Specialties, which is based in Hartford, Connecticut. Dalton Research was formed purely for the purpose of exploring all aspects of earthquake research, especially the field of earthquake prediction.
“The insurance industry was financing the company because they were concerned that a very large earthquake would strike somewhere in California within the next twenty or thirty years, and they wanted to know if it was possible to more accurately predict its magnitude, epicenter, and general time frame.
“In any case, we were given almost a blank check to pursue our research and initially, there were indications that the research might prove fruitful, if enough effort — by that I mean money — was expended. The numbers were truly impressive.”
He stopped and took another drink, then continued.
“In fact, we spent some sixty million dollars over the ten-year period.”
He waited to allow that figure to sink in.
“The end result of all of this research was … total failure. While it is true that we were able to successfully predict one small quake in the Hollister region, we were unsuccessful in predicting others, despite our best efforts.
“Two years ago, just after the announcement of our first and only success in predicting an earthquake, our president, Mr. Daniel Dalton, was approached by an agency of the federal government and told that the work we were doing would have to be classified. It was the position of the government that if we were able to successfully predict earthquakes, they should be the first to know, in the interest of national security. They wanted to set up contingency procedures.
“Naturally, Mr. Dalton was outraged. The company was using private funds for research and was being told that the people paying for the research couldn’t have access to the results. After some discussion, an agreement was made whereby the company would have access to the material, but would be required to keep it private until such time as its release was deemed appropriate by the federal government. That meant that the information would remain classified and no members of AAIS would have access to the information until such time as the government had blocked out the procedures to be taken. It wasn’t the best of arrangements, as far as the company was concerned, but the only alternative was to close up shop, so we carried on. Later, it became apparent to me why we did so.
“Three months ago, Mr. Vance Gifford, with whom I worked closely, was preparing a final report that disclosed our failure in the area of earthquake prediction. He was approached by the president of the company, Daniel Dalton, and told that the company wanted to produce a report that would indicate success in the area of predicting earthquakes. In other words, a complete fabrication. He was told that such a report was considered necessary for several reasons. One, if the report he intended to produce was allowed to stand, the one suggesting that earthquake prediction was impossible, Dalton Research would cease to exist due to lack of funding.
“Two, the client, AAIS, wanted a report that would eventually allow them to justify both present and anticipated increases in earthquake insurance premium costs. And three, I was given to understand that pressures were being exerted on the federal government with a view to getting them to cover a percentage of loss in the event of a major earthquake. I was given to understand that another report was to be issued later that would state, most emphatically, that a major earthquake was imminent. It was felt that these reports would force the government to capitulate.
“Mr. Gifford discussed the matter with me and I recommended that he refuse to produce a false report. Not only was it dishonest, but it was also illegal. For reasons of his own, he rejected my recommendation and decided to go along with the request. He changed much of the data to make it appear that we were well on the road to making the prediction of earthquakes a reality.
“At that time, I found myself in complete disagreement with what was going on. I reported these activities to the Federal Bureau of Investigation. They requested that I remain in my position and gather evidence for a possible legal action. They said they needed an insider, since what was being done was completely illegal, and charges would be forthcoming at some time in the future. They said I had a duty to stay on and I took it as such. So I did.
“Two months ago, Mr. Gifford appeared to have second thoughts about what he was doing. He went to Mr. Dalton and threatened to expose this travesty. That very day, he suffered an apparent heart attack and died. Another colleague, Mr. Thomas Wilson, was then asked to complete the report, unaware of the fact that it was a fabrication. After examining the data, he realized the true nature of the report. Wit
hout discussing his discovery with anyone, he produced a report of his own, which stated that it was impossible to predict earthquakes. On the day that he presented his report to Mr. Dalton, he too threatened to go to the authorities if his report was not accepted as the official document. That very evening, he was involved in a one-car automobile accident and died.”
He cleared his throat and took another drink of water.
“I think both Mr. Gifford and Mr. Wilson were murdered.”
The room erupted.
Senator Simpson banged his gavel repeatedly until order was restored. Then he asked, “So, if I understand you correctly, Mr. Peterson, you are saying that ten years of research proved that earthquakes cannot be predicted, is that not so?”
“Essentially, that’s correct, sir.”
“And there was pressure on Mr. Gifford and Mr. Wilson, in fact … everyone at the company, to produce a report that indicated otherwise?”
“That’s true, sir.”
“And that when they did not do so, Mr. Gifford suffered a heart attack and Mr. Wilson died in an accident?”
“Yes, sir.”
“And the reports they were working on are classified?”
“Not any more, sir. They have been declassified by the government. In fact, I have brought copies with me for your perusal. The rest of the members as well.” As he said it, a man rose from his seat in the back of the room, came forward and started handing out copies of the report to the members of the committee.
“As you can see,” Peterson droned on, “the report bears the signature of Thomas Wilson and is dated the day of his death. The report clearly states that there is no way to predict earthquakes.”
Again, there was pandemonium. Simpson banged his gavel some more. Then, for a few moments, all of the men on the committee leafed through the thick report. Finally, Simpson looked up and asked, “Now, Mr. Peterson, aside from your suspicions, do you have any direct evidence that Mr. Wilson was murdered?”
“No, sir. But I know that the FBI is conducting a full investigation. I have given them the same statement I’ve given you today.”
Again, the place was in an uproar.
After a few more minutes of gavel-banging, Simpson said, “Very well, sir. We’ll get to that in a moment or so. Now … just so I have this right, your testimony is that this association … this AAIS, was funding this project. They wanted a report produced that would initially suggest that earthquake prediction was a viable scientific enterprise and then later, they intended to make some sort of prediction concerning a major earthquake. At the same time, they were raising their rates on earthquake insurance and refusing to write new policies. In other words, they were trying very hard to make it look like they were getting out of the earthquake insurance business altogether, is that right?”
“Yes, sir.”
“And if this report had said that a big quake was coming, they would appear somewhat justified, since the earthquake insurance policies are a year-to-year thing. They never actually cancelled a policy that was in force, as far as we can determine, but we’ll hear more about that later. In any case, if the fake report was allowed to stand, they wouldn’t have appeared to have done anything illegal. That’s what I’m getting at. Is that not the case? After all, this is America. Nobody expects a big company to lose its shirt if it can possibly be avoided.”
“True.”
“But the report said otherwise, which would make them look a little stupid, wouldn’t it?”
“Yes, sir.”
“How is it, sir, that you weren’t subject to the same problems that Mr. Gifford and Mr. Wilson were?”
“As I said, Senator, I appeared to be working with them. In actual fact, after the death of Mr. Wilson, I was given a copy of the report and asked to change the data myself. That’s how I got my hands on it. I contacted the FBI as soon as the report was given to me and turned the report over to them. Then, thank God, I was allowed to leave.”
“And what have you been doing since that time?”
“I’ve been hiding, sir. In fear of my life. I’ve been protected by the FBI, thank God, but I must tell you, I have been very concerned.”
“And this copy of the report that you are submitting … this is a true copy of the actual research done over that ten-year period?”
“Yes, it is.”
“Thank you very much, Mr. Peterson. I’m sure some other members of the committee will want to ask you some questions. We’ll try to do it as quickly as possible. I think Senator Ballard is first. Senator?”
Senator Harold Ballard switched on his microphone and leaned forward. He was twenty years younger than Simpson and not nearly as good-looking. He had just a hint of hair left on his skull, and a narrow face, the features of which were less than outstanding. He seemed a plain man and, in fact, he was. But he was respected for his mind, which was sharp, and his attitude, which was of the no-nonsense type.
At the moment, his face was red with anger which he seemed to be struggling to contain.
“Mr. Peterson,” he began. “You have testified that you were the executive director of Dalton Research.”
“Yes, sir.”
“And you have stated that Daniel Dalton was the president.”
“Yes, he was.”
“Are both of you scientists?”
“Yes. I am a geophysicist and Mr. Dalton is a geologist.”
“I see. And besides the people you’ve mentioned, who else worked at Dalton Research?”
Peterson looked up at the ceiling for a moment and then said, “There were two secretaries, three technicians and … I guess that’s all.”
“So there was Mr. Dalton, yourself, Mr. Gifford, Mr. Wilson, two secretaries, and three technicians, is that right?”
“Yes.”
Ballard scratched his forehead for a moment and then asked, “Where are they?”
Peterson tugged at his already loose shirt collar and said, “I don’t know, sir.”
Ballard looked at his notes and said, “Well, I see here that the company was placed in Chapter 7 bankruptcy last week. This committee issued subpoenas to every person that worked there and you, sir, are the only one we can find. Doesn’t that seem rather odd to you, Mr. Peterson?”
“Not really, sir. I imagine they are all aware they are in some sort of trouble.”
“They all knew of this sham and went along with it?”
“Yes, sir.”
“And of the entire group, you were the only one who saw fit to bring this matter to the attention of the authorities? That’s quite commendable, Mr. Peterson, but I find it a little difficult to believe.”
“I can’t speak for the others, Senator.”
“Of course. But you did say that you suspect everyone who was in disagreement with the idea of producing a false report was murdered. Is it possible that the others were also murdered?”
“I can’t say.”
Again, the room echoed with the buzz of conversation as those in the audience expressed their shock.
“But you are convinced that Mr. Gifford and Mr. Wilson were murdered.”
“Yes, I am.”
“And you seem to be suggesting that the AAIS is somehow responsible for the murders. Is that right?”
Peterson took another drink of water and wiped his lips with the back of his hand. “I don’t know that to be a fact. All I know is that they were the ones with the motive.”
“I see. You said you went to the FBI. Who did you talk to there?”
“Resident Agent in Charge George Belcher.”
“I see.” Ballard turned to Senator Simpson and asked, “Has the committee issued a subpoena for Mr. Belcher?”
Simpson made a note and said, “It will be looked after, Senator.”
“Thank you.” Then, turning back to the witness, Ballard said, “You have testified that the report we now have in our hands represents ten years of research. Is that right?”
“Yes, sir.”
“And up
until now, the report was classified. By whom?”
“The government, sir.”
Ballard smiled. “I am the government, sir. As are the other members of this committee. You testified that Dalton Research was approached by an agency of the federal government and told that the work was classified. I am asking you what specific agency.”
“That part is still classified, Senator.”
“I see. And this report, according to your testimony, indicates that there is no possible way to predict earthquakes. Is that right?”
“Yes, sir.”
“And it is your testimony that the AAIS was aware of this report.”
“Yes, sir.”
“Well then, if the member companies, which is to say the insurance companies … were aware that there was no way to predict earthquakes, and were in fact unaware of any impending disaster, why were they so anxious to get out of the business?”
“They weren’t,” Peterson said. “At least, not long-term. They were interested in making it appear as though they were getting out, which would bring pressure from various government officials. Then they planned to reenter the business, but with much higher rates. That would allow them to build up reserves for damages they felt would be incurred at some time in the future. At the same time, they felt that their actions would serve to exert more pressure on the federal government to accept at least some of the risk for earthquake damage. Right now, the government refuses to accept any of it.”
“I see,” Ballard said. “Your testimony is based on your own personal knowledge?”
“Well … yes. I was told these things by various people.”
“Mr. Dalton, Mr. Gifford, Mr. Wilson, a secret government agency, and assorted others who are unable, for a variety of reasons, to appear before this committee. In other words, Mr. Peterson, what you are testifying to is actually hearsay evidence. Every word of it.”
The Big One Page 22
