A look at Maurice Stans is important not because he is a
particularly unique individual possessing rare quaalities – there
are probably hundreds of men in both the Republic and
Democratic parties able and willing to perform the Watergate
tasks he carried out. Rather, a study of Stans and the institutions he belongs to will help us understand how the U.S.
corporate/political system works. Stans’ particular political
role over the last years has been raising money for Republican
campaigns. As head of the 1972 campaign to Re-Elect the
President (CREEP), he was the architect of the most successful
($60 million) and illegal presidential fund raising campaign in
U.S. history.
A study of Stans must include a look at the institutions he
is tied to, for they are the power vehicles through which he
works and which provide him access to a wide network of
influential and wealthy contacts in the corporate and govern-
ment worlds. These institutions – in addition to the
Commerce Department, which he headed from 1969 to 1972
– include CREEP and the various corporations and banks to
which Stans has been related.
As with the other principal figures in the Watergate con-
spiracy, Stans was no novice at his job, which involved
soliciting and collecting donations, manipulating the books
and concealing the identity of the donors. In the 1950s he had
won several awards for being the nation’s top accountant, based on his performance as Eisenhower’s Budget Director
(1958-61), and earlier as a senior partner in one of the nation’s
largest accounting firms – Alexander Grant & Co. of Chicago.
Ironically, in 1960 Stans was elected to the American Ac-
counting Hall of Fame. Yet today this is tie same Stans who
claims to have “lost track” of over $10 million in campaign
contributions and who is under indictment for his role in the
Vesco affair.
Stans’ Watergate Role
The bill of particulars against Stans which has emerged
from the Watergate investigations to date includes the
following:
1. Stans was one of the links in the “laundering” of dollars
that found its way into the Nixon political war chests. To cite
the best documented example: the $89,000 that started in the
hands of Midwest soybean king Dwayne Andreas was chan-
neled to Gulf Resources & Chemical Chairman Robert Allen in
Texas, then to shady lawyer Manuel Ogarrio in Mexico City, to
Stans in Washington, and finally to the Miami bank account of
former CIA agent Bernard Barker – one of the Republican
spies caught breaking into the Watergate Democratic Party
office.
2. Stans kept a secret safe in his CREEP office containing
$350,000; this money was utilized by Bernard Barker to
finance various missions against Nixon opponents.
3. Stans bribed G. Bradford Cook at the time the latter was
Chief Counsel to the Securities & Exchange Commission’s
Investigative Unit. While goose hunting in Texas, Stans told
Cook that if Cook would halt an SEC investigation into Robert Vesco’s business affairs, Stans would “put in the good word” to Nixon for Cook to receive the position he wanted: the SEC Chairmanship. Nixon eventually named Cook SEC Chairman, but he had to resign in the wake of the Vesco-Stans- Mitchell
indictments. Vesco illegally dumped over $200,000 into the Nixon campaign coffers in the hope the investigations into his financial affairs would cease. As a result, two former
members of Nixon’s “law and order” Cabinet, Stans and Attorney General John Mitchell, were indicted for perjury, conspiracy, and the obstruction of justice. (Their trial starts in January 1974.)
4. Stans ordered CREEP Treasurer Hugh Sloan, and Herbert Kalmbach, head of CREEP-West, to destroy all rec- ords of incoming contributions. This was a blatant attempt to
hide the identities of all Nixon donors both before and after
the April 7, 1972 deadline requiring disclosure of all
donations.
5. Stans utilized numerous ploys in amassing $60 million
for the Nixon re-election campaign – the largest amount ever
raised for a U’S. political race. His tricks included the estab-
lishment of hundreds of “dummy” committees, including such
gems as “Active Friends of a Balanced Society” and “The
Committee for the Preservation of the American Dream,”
whereby a donor could circumvent the required gift tax on
contributions of $3,000 or more.22
V’t be recouped because it didn’t go to
ething like the Committee to Re-elect
President. It went direct.”
-Employee of Associated Milk Producers, Inc.
discussing possibility of retrieving a milk
lobby contribution to Nixon campaign.
(New York Times, November 11, 1973.)
aer CIA Director and now an I.T.T. director), (Kaiser Industries), Stephen Bechtel (Bechtel
and George Ducommun (Ducommun Engines).
rs of the Firestone family – Leonard, Harvey,
ve a total of $211,000 to Nixon’s campaign in
Levy: His position in one of Wall Street’s most
sh banking houses – Goldman Sachs – affords
ange of corporate and financial contacts. He is a
or not only to individuals such as Ambassador
berg (who entrusted his millions to Levy when hd him Ambassahdor to Great Rritain’ but also to
CREEP’s Untold Story: The Real Criminals
While Liddy, Magruder, Sloan and various other underlings
and small-time operatives face jail sentences, the rulers of the
Republican Party go free: men like Leonard Firestone, Thomas Pappas, Gustav Levy, Harold Helm, and the other
members of CREEP’s Finance Committee (see below).
For years these men have pumped millions into the GOP’s
political war chests. The multinational corporations and banks
headed by .these men and their associates are among the chief
beneficiaries of U.S. government policies: subsidies, quotas,
contracts, depletion allowances, loans, at home, and the
creation and support of repressive governments abroad to
maintain “favorable investment climates.”
The men listed below, all members of CREEP’s Finance
Committee under Stans’ command, would certainly qualify as
the real criminals in Watergate.
Thomas A. Pappas: This key supporter of the fascist Greek
junta is reportedly worth $200 million and has long been a
GOP fundraiser. Pappas was one of Eisenhower’s fundraisers in
1956, and nominated fellow Greek-American Spiro Agnew for
the vice-presidency in Miami in 1968, and is reported to have
made twelve CREEP trips to Greece during the 1972 cam-
paign, returning with hundreds of thousands in cash for the
Nixon cause.’ In addition, he chipped in $71,000 of his own.
Pappas is a leading investor in Greece through his large stake in
Coca-Cola Bottling of Greece and was instrumental in bringing
Standard Oil (N.J.) to Greece in 1962. His other large holding
is the giant Hellenic Steel Corp. Pappas has proudly admitted
to collaborating with the CIA, and has gladly loaned his three
foundations as CIA conduits for secretly funding cultural and
educational institutions abroad, particularly in Latin America. 2
Leonard K. Firestone: One of 26 trustees of the Richard M.
Nixon Foundation, Firestone runs the giant Firestone Tire &
Rubber empire, the 34th largest U.S. industrial company.
Firestone has been a director of the Wells Fargo Bank and
Western Airlines. To understand his vast contacts among the
wealthy and powerful, look at the men with whom he shares a
campsite at the exclusive Bohemian Club of California: John
governments, including Panama. 3 Goldman Sachs partners
often sit on the boards of the corporations they help finance;
hence Levy’s directorships include Hunt Foods, Braniff
Airlines, Ling-Temco-Vought, Keebler, and Deltec Panamerica.
Like all wise bankers, Levy has contacts with both the
Democratic as well as the Republic party. One of his recently
recruited partners is former Secretary of the Treasury under
President Johnson – Henry Fowler. Levy gave $70,000 to
Nixon’s 1972 campaign.
Daniel Hofgren: At age 33, he is the second Goldman Sachs
partner to turn-up on the CREEP Finance Committee.
Hofgren’s recent biography helps illustrate how the corporate
sector interacts with the government: In 1969, Nixon ap-
pointed Hofgren a Special Aide in charge of securities industry
matters at the White House. In the spring of 1970, Nixon sent
Hofgren to Panama as special U.S. representative for inter-
oceanic canal negotiations. While negotiating the U.S. position
in Panama, Hofgren was still a White House aide on securities
matters and was a member of Charles Colson’s three man staff.
(See article on Colson in this issue.) In the fall of 1970, Hofgren resigned his White House post and became a vice-
president of Goldman Sachs, the financial advisor to the
Panamanian government. Hofgren left Goldman Sachs in 1972
to join the CREEP Finance Committee. It was Hofgren who
“just happened to run into” a key Vesco aide in Europe while
on a plane and solicited the now infamous $200,000 Vesco
contribution. 4 Hofgren and Levy were among five Goldman
Sachs partners that contributed heavily to Nixon’s 1972
campaign.
Harold Helm: One of the most important bankers in the
nation, Helm is the chairman of the Rockefeller-affiliated
Chemical Bank of New York. A heavy contributor to GOP
causes, he is a director of several multinational corporations
including Bethlehem Steel, Ralston Purina, Commins Engine, Western Electric, Corn Products Company, Uniroyal, F.W.
Woolworth, and Colgate Palmolive.
* * * * *
Many observers of the U.S. political scene have wondered
about Nixon’s so-called uncanny ability to “bounce back”23
from political crises. The main reason a man like Nixon is able
to “bounce back” is that powerful elements of the U.S. ruling
class have stuck with him. It is not difficult to see how Nixon
has made a “comeback” after defeats in 1960 to Kennedy, and
in the 1962 California gubernatorial race, when we see that the
resources of men such as these are at his disposal. And Stans’
job was to coordinate their efforts in raising the funds for the
1972 presidential extravaganza.
Fundraiser and Corporate Man
Stans has been the GOP’s leading fundraiser since 1962.
According to Republican insiders, Maurice Stans was one of
four Republicans to establish the Nixon for President
Committee in 1967. The other key individuals were: Robert C.
Hill, former director of the United Fruit Company, and one of
the engineers of the overthrow of the Arbenz government in
Guatemala in 1954, as well as Eisenhower’s Ambassador to
Mexico; John Davis Lodge, Eisenhower’s Ambassador to Spain
and former Governor of Connecticut; and Fred Seaton,
Eisenhower’s Secretary of the Interior and GOP Senator from
Nebraska.s
To be a successful political fundraiser for a major U.S.
party, one must have direct ties to the powerful business
interests that finance the electoral campaigns. Maurice Stans
had those ties. He has been the president of a major western
bank (Western Bancorporation), the head of a New York
investment banking house (Glore Forgan), a director of six
corporations in five different states, and was a senior partner
in one of the nation’s leading accounting firms in Chicago.
These positions, combined with his government service as
Eisenhower’s Budget Director and Nixon’s Commerce Secre-
tary, qualified Stans to be the GOP’s leading fundraiser. The
following is a profile of Stans’ corporate past, with summaries
of the main institutions with which he has been affiliated.
Glore Forgan-Staats: Stans’ most important corporate affili-
ation was his presidency of this New York-based investment
banking house from 1965 until he assumed the Commerce
Post under Nixon in 1969. Now part of DuPont Walston,
Glore Forgan was formed after a merger in 1965 between the
Los Angeles firm of William R. Staats and Glore Forgan in
1965. An investment banking house, like a law firm, is one of
the less visible mechanisms in the overall capitalist structure. It
is a strategic link between those who need capital (corpo-
rations) and those than can provide it (e.g., banks). Investment
banks raise money for corporations by underwriting and
selling issues of stocks, bonds and other corporate securities.
Investment banking houses also act as financial advisors to
corporations and coordinate mergers and acquisitions.
Stans’ CIA Friends at Glore Forgan
The Forgan in Glore Forgan’s name is James Russell
Forgan, one of the original partners. His activities help illus-
trate how an investment bank is much more than a mere
financing institution and is actually a coordinating center for
implementing the political and economic objectives of the
bourgeois interest groups. During the latter years of World War
II, Forgan was a commander of European operations for the
OSS, the predecessor of the CIA. When he stepped down in
1946, he recommended that his close friend, Allen Dulles, take
over his post, thus providing Dulles with a key stepping-stone
to his eventual Directorship of the CIA (1953-61).’ Forgan
had close ties to European capital. His board position on a
large Italian corporation, “Italian Superpower,” for example,
was of use when the OSS was attempting to protect the
company from Nazi saboteurs retreating from Italy. After the
war, he and his firm founded the Eurofund, the first invest-
ment fund of its kind, to buy-up holdings in European
companies. The directors of the fund were such powerful men
as Philip Reed, Chairman of General Electric; Bankers Trust
Chairman S. Sloan Colt; mining magnate and apartheid sup-
porter Charles Englehard (the original “Goldfinger”); and
former Assistant Director of the CIA Kingman Douglas.
Another Glore Forgan partner with extensive CIA ties was
William Jackson. Before joining Glore Forgan in 1953, Jackson
had served on the commission that drew up the plans for the
formation of the CIA in 1947, had been a Deputy Director of
the CIA and a member of Eisenhower’s committee charting
the psychological warfare strategy and covert operations for
the Cold War. Also a director of Bankers Trust and the Great
Northern Railroad, Jackson was partner in one of Wall Street’s
most important law firms – Carter, Ledyard & Milburn.
Stans’ other partners at Glore Forgan included Richard
Millar, a director of Northrop Aircraft (a major client of
Herbert Kalmbach’s west coast law firm), and Charles Hodge,
Glore Forgan’s key intermediary to the Penn Central Railroad.
Besides hauling in a fortune from the business the Penn
Central’s subsidiaries provided for Glore Forgan (as we shall
see in the Penn Central section), Glore Forgan’s major clients,
in addition to various Penn Central subsidiaries, included:
Wynn Oil, Commonwealth Edison, Universal Oil, and the
Interstate United Corporation.
Fluor Corp. is “one of the two or three leading
refinery engineering and construction firms in the country.-
Stans was a Fluor director from 1963-69. J. Robert Fluor,
president of the company, was the 1964 Los Angeles County
Republican Finance Chairman and now heads the powerful
Lincoln Club. The Lincoln Club is a right-wing Southern
California power base located in Newport Beach, hometown of
one of its leading members – Herbert Kalmbach (see
Kalmbach article). Fluor has long been a supporter of the
GOP’s right-wing and gave at least $30,000 illegally to the
1964 Goldwater campaign, a contribution Stans most likely
arranged.” Another Fluor director, Thomas Pike, a former
Assistant Secretary of Defense under Eisenhower, was one of
Stans’ CREEP-West lieutenants. Fluor directors also sit on the
major California firms: Crown Zellerbach, Wells Fargo Bank,
Hewlett-Packard, and the United Financial Corp. of California.
Ogleboy Norton Corp.: Stans was also a director of this
large midwest corporation tied into the strategic iron and steel
industries. His fellow board members included such Cleveland
powers as George Karch of Cleveland Trust and Firestone Tire
& Rubber, and Courtney Burton, former head of the Ohio
Republican Finance Committee and who in the 1940s was an
Assistant Coordinator for Inter-American affairs under Nelson
Rockefeller.
Western Bancorporation: After leaving his post as Budget
Director under Eisenhower in 1961, Stans became the head of
the Los Angeles-based Western Bancorp., a holding company
for 24 banks in 11 western states. Among its holdings is the
large United California Bank. During Stans’ presidency at
Western Bancorp (1961-63), the board included John McCone,
past CIA Director, I.T.T. board member, and Standard Oil of
California director; and Sherman Hazeltine, Nixon’s former
law partner in the Los Angeles firm of Adams, Duque &
Hazeltine.
Thus Stans came to CREEP’s Finance Committee with
close ties to New York, Midwestern, and Southern California
interests in particular; and to U.S. big business and financial24
groups in general – contacts that were to prove highly useful
in his fundraising efforts. However, his job was not just one of
collecting funds from willing donors, but also included
squeezing funds from reluctant donors. For example, while
Commerce Secretary, Stans would approach potential donors
threatening that if they did not contribute the desired sum, he
would initiate unfavorable pollution action against their corpo-
rations. He would take this action, he said, through the
Pollution Council he helped establish at the Commerce
Department. The scope of Stans’ fundraising operations while
he was still Nixon’s Secretary of Commerce was revealed
recently by two oil company executives. They told the Senate
Watergate committee that a contribution of $100,000 each
was expected from all large corporations. Though corporate
contributions to national political campaigns are illegal, Gulf
Oil executive Claude Wild, Jr. told the committee the practice
is not unusual. He said that in his post as vice president for
governmental affairs he had also given in previous campaigns
to Democrats but observed, “the Republicans always cost you
twice as much as the Democrats.” 1 0
Watergate and the Wreck of the Penn Central
We have seen that Stans’ CREEP Finance Committee played a key role in one of the nation’s most notorious
political events: the Watergate conspiracy. What is less well
known is how his investment bank, Glore Forgan, played a
major role in one of the nation’s most significant economic
events: the June 1970 collapse of the Penn Central Railroad –
the 6th largest U.S. corporation. The wreck of the giant firm
was the largest bankruptcy in U.S. history. Since various financial institutions played major roles in the event, the
House Banking & Currency Committee initiated hearings to
investigate the causes. 1 1
By 1962, the railroad industry was weakening as a result of
the nation’s increasing dependency on trucking and air
freight. 1 2 At that time, in an effort to achieve greater financial
stability, the Penn Central decided to diversify its holdings by
investing in non-rail corporations. Subsequently, the Penn
Central bought into or acquired the following firms: Great
Southwest Corp,'” Tropical Gas Corp.,’ 4 Arvida Corp, and the
Kaneb Pipeline Company.
Glore Forgan played a key role in this drama as the Penn
Central’s chief investment advisor – the result of a close
friendship between Glore Forgan partner Charles Hodge and Penn Central Chief David Bevan.
Hodge and Bevan initiated part of the diversification pro-
gram in 1962 by establishing an investment firm called
Penphil. Penphil, according to the House Banking Committee, was one of the primary culprits in the wreck of the rail firm. An example of how the Penn Central was “looted” is provided
by Penphil’s investment in Executive Jet Aviation. Hodge and
Bevan dumped $21 million of the railroad’s money into the
firm – money that was supposed to be utilized by the railroad
for its own growth, not for jet planes. Even though the
investment proved a severe loss for the Penn Central, Stans’
Glore Forgan made a fortune off of the Executive Jet Aviation
transactions. The Senate Commerce Committee, which also
conducted investigations into the bankruptcy, charged that
Penn Central’s investment bankers (Glore Forgan), in collusion
with top directors and officers, must also share in the
responsibility’s
Glore Forgan and Hodge had several different links to the
Penn Central: (1) Principal investment advisor to Penn Central;
(2) investment advisor to and broker for the Penn Central
o,25
Supplemental Pension Fund and the Contingent Compen-
sation Fund; (3) investment banker for three Penn Central
subsidiaries: Tropical Gas, Great Southwest, and Kaneb
Pipeline; (4) director of Great Southwest, Arvida, and Tropical
Gas; (5) holder of investments in the above corporations.
As House Banking Committee Chairman Wright Patman
pointed
out,
How could Charles Hodge give sound, objective
investment advice to Glore Forgan clients con-
cerning their investments while being so personally
involved in the management and control of these
significant corporations? Similar questions can be
raised for other people involved with the Penphil-
Penn Central-Glore Forgan complex. 1 6
Stans also profited nicely from Glore Forgan’s relationship
with the Penn Central. As a finders’ fee for helping the Penn
Central buy into Great Southwest, Stans and several other
Glore Forgan partners each received 38,000 shares of Great
Southwest (a real estate firm) stock. Before taking office as
Secretary of Commerce, Stans’ shares in the Great Southwest
were worth more than $500,000. However, like all Cabinet
officers, Stans pledged to place the holdings in a “blind trust”
while he served as Commerce Secretary.
When the Penn Central went bankrupt, the Nixon admini-
stration’s highest aides, including Stans, began discussing
whether to bail out the firm with government loans. It was
disclosed during this time that Stans had failed to report his
Great Southwest holdings at the time of his confirmation as
Commerce Secretary. In short, Stans was involved in dis-
cussions about how to save the parent company of a corpora-
tion in which he held a large interest. In an obvious admission
as to how “blind” his trust was, Stans disqualified himself
from later meetings, saying his presence raised too many
questions about possible conflicts of interest!
Workers Hit Hard By Boss’ Greed
Who suffered from the wreck of the Penn Central? Not
Glore Forgan. Rather it was the workers, on the other hand,
who suffered the most as a result of these men’s greed and
mismanagement. Thousands of Penn Central workers were laid
off, and 7,000 workers who were investing their savings in the
company’s stock took heavy losses.
Ironically, it was the workers who had unknowingly pro-
vided Hodge and Bevan with part of the capital they used to
loot the Penn Central – and the workers’ pockets.
Stu Bishop
Footnotes
1. Pan Hellenic Liberation Newsletter, June 1973.
2. Andreas Papandreau, “Greece: Neocolonialism and
Revolution,” Monthly Review, Dec. 1972. See also
“Agnew’s Junta Ties Disturb NATO,” The Washington
Merry-Go-Round, Washington Post, Nov. 1, 1968; and “A
Bostonian Pappas Means ESSO in Greece,” New York
Times, May 4, 1969.
3. “The Honorable Mr.- Annenberg,” Parade Magazine,
Washington Post, August 16, 1970. Annenberg’s late
father, Moe, was a famous bootlegger of the Prohibition
Era. Walter heads Triangle Publications, publisher of
Seventeen and TV Guide. Annenberg held 180,000 shares
of Penn Central stock that he unloaded when he saw the
firm was in trouble. See New York Times, October 11,
1970 for an advertisement about Goldman Sachs being
financial advisor to Panama.
4. New York Times, March 2, 1973.
5. Stephen Hess and David Broder, The Republican Estab-
lishment, (New York, Harper & Row, 1967), pp. 185-86.
6. See R. Harris Smith, OSS: The Secret History of America’s
First Intelligence Agency, U. of California Press, 1972, p.
116. According to Smith, Forgan was the son of the
director of “Italian Superpower.” Smith is mistaken. It
was not Forgan’s father but Forgan himself who was the
director.
7. See “Fluor Flourisheth,” Forbes November 1, 1973. The
article details how Fluor will make a mint off of the
energy crisis because “The U.S. may not know where its
next barrel of oil is coming from, but one thing is certain:
without refineries, the oil won’t be of much use.”
8. Morton Mintz and Jerry Cohen, America Inc. (N.Y., Dell,
1971), pp. 211-212.
9. Jerry Vorhees, The Strange Case of Richard Milhous
Nixon, Paul S. Erikson, N.Y., 1972, pp. 112ff.
10. The New York Times, November 15, 1973.
11. The Penn Central Failure and the Role of Financial
Institutions, Staff Report of the House Banking &
Currency Committee, U.S. Government Printing Office,
Washington, D.C., February, 1971.
12. See, for example, the New York Times, February 11,
1973.
13. Great Southwest Corp. has long been identified as a key
firm in the financial nexus surrounding the persons
thought to have really assassinated John Kennedy. See
Peter Dale Scott, “From Dallas to Watergate: The Longest
Cover-Up,” Ramparts, November 1973.
14. Tropical Gas Corp. was originally formed in 1954 to
acquire the liquid propane gas business of ESSO-Standard
Oil in Cuba, and today operates in Central America, the
Caribbean, and Venezuela. The firm had three Glore
Forgan partners on the board at the time of the wreck of
the Penn Central, including Alfonso Manero of Mexico.
15. Mary Oppenheimer and Robert Fitch, “Who Rules the
Corporations?,” Part 2, Socialist Revolution, September-
October 1970, p. 111.
16. Staff Report of House Banking & Currency Committee,
op. cit., Part 3, “Penphil: The Misuse of Corporate Power”
(Note 10).
STANS FOUNDATION IN THAILAND
The Stans Foundation, incorporated in Illinois in 1945,
is a tax haven for Maurice Stans’ accumulated wealth and
also serves as an investment vehicle. One of the more
interesting Stans Foundation investments was in Thai In-
dustrial Estates, a partnership formed in 1968 to develop
real estate in Thailand. In addition to the Foundation, the
partners were Glore Forgan Staats, the New York invest-
ment bank headed by Stans at the time, and Stans’ close
friend Henry Kearns. Kearns has had a long association with
the GOP’s right wing and accompanied Nixon on
business trips to the Far East in the mid-1960s. A former
member of the Hoover Commission’s Task Force on
Intelligence Activities, Kearns is a director of Firestone Tire
& Rubber of Thailand and was Ass’t. Secretary of
Commerce for International Affairs under Eisenhower.
Nixon subsequently appointed Kearns to head the Export-
Import Bank. Eventually the partnership was dissolved and
the Stans Foundation was paid off in shares of Siam Kraft
Paper Company, a firm Kearns had set up in Thailand with
the help of a $14 million loan from the Export-Import
Bank. For Stans the disclosures of this investment were
particularly embarrassing since he was Secretary of
Commerce at the time and the transactions involved an
agency of the U.S. government – the Export-Import Bank.
(Source: New York Times, December 13, 1971)
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