Moles and Bugs

3 minute read
TIME

Spying in the Donovan case

When Frank Silbey, chief investigator for the Senate Labor and Human Resources Committee, was probing Labor Secretary Raymond Donovan’s alleged links with mobsters two years ago, he knew that he was also being investigated: in an unorthodox move that infuriated Capitol Hill, the New Jersey-based Schiavone Construction Co., which is partly owned by Donovan, hired private detectives to find out who, according to Schiavone Lawyer Theodore Geiser, was “deliberately leaking information to the media.”

What Silbey probably did not realize was that many of his conversations were being secretly recorded by Ralph Sharer, a freelance sleuth paid by Schiavone. Sharer, a former Government auditor, says he spied on Silbey and other staffers for more than two months in 1982. “I taped [Silbey] every time I talked to him,” he claims. During that period, Sharer was working with the committee on two investigations unrelated to the Donovan case, a role that permitted him to act as a mole.

Sharer claims his undercover work was ordered by Ronald Schiavone, the chairman of the construction firm, who met with the detective in a Washington hotel bar and asked him to find out everything about the Senators and staffers investigating Donovan. “He wanted it all,” says Sharer. “Marriages, divorces, girlfriends, sex—whatever we could dig up. Schiavone was angry. He felt he was being unfairly maligned and slandered.” Sharer claims Schiavone once produced a large bundle of $100 bills as a down payment on the job. In all, Sharer says, he spent 260 “billable hours” working for Schiavone at $250 an hour, services worth a total of $65,000.

Sharer used a mike concealed in a briefcase or under his clothing to record conversations in the Senate office, including Silbey’s words when he was on the phone with reporters. Sharer claims there were other moles in the committee’s midst: three Republican staffers routinely passed confidential FBI reports and committee memos to Schiavone detectives. Sharer recalls one of them saying, “Ralph, we’re all working for the same people.”

TIME has learned that Special Prosecutor Leon Silverman, who headed the Donovan inquiry in 1982, was on the Schiavone spies’ list of targets. Silverman said last week that he was “appalled” to hear Schiavone’s agents had designated him for investigation and that he considered such actions to be “perilously close to obstructing justice.” Sharer says Schiavone boasted of getting material from Silverman’s staff. Schiavone Lawyer Geiser denies that the company received leaks from that office.

The FBI and the Brooklyn Organized Crime Strike Force are now investigating charges that Sharer or other Schiavone investigators used illegal wiretaps against the Senate committee. The inquiries came after Frank Smist, a University of Oklahoma graduate student, gave federal officials information about the case he had gathered during a two-year study of congressional investigations. Smist and a Washington journalist said Sharer admitted using an “infinity transmitter,” which makes it possible to listen in on bugged conversations illegally from a distant phone. Sharer denies that he engaged in wiretapping but charges that another Schiavone spy did so. He says he will turn over his tapes to the FBI. Schiavone’s chief investigator, Robert Shortley, denies that any wiretaps were used. “I did nothing illegal,” he avows.

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