Agents and Agendas--All Too Secret

What did Peter Flanigan Know?
According  to the Washington Star article in Part One of this series of articles, the Nixon aide who first contacted the U.S. Attorney's office about the possible involvement of White House staff or attorneys in a call girl ring operating out of the Columbia Plaza Apartments was Peter Flanigan, whose biography is detailed in the archives of the Nixon Library in Yorba Linda:

1923 June 21 Born New York City
1943-1946 U.S. Navy
1947 B.A., Princeton University
1947-1949 Statistical analyst with the New York investment banking firm of Dillon, Read & Co., Inc.; Vice President since 1954
1949-1950 Assistant program (financial) analyst, Economic Corporation Administration Mission to the United Kingdom, London
1955-1959 Member of the executive committee, Ninth Assembly District Club, New York City
1959 Chairman, New Yorkers for Nixon
1960 National Director, Volunteers for Nixon-Lodge 

1968 Deputy campaign manager, Nixon for President

1969 January 20-April l5 Consultant to the President on administration staffing

1969 April l6-1973 Assistant to the President                                1972 January-1974 Assistant to the President for International Economic Affairs

1972 February-1974 Executive Director, Council on International Economic Policy, Executive Office of the President

1975- Managing Director and executive officer, Dillon, Read & Co., Inc., New York City

...Following Nixon's unsuccessful bid for the Presidency in 1960 and his subsequent move to New York City in 1963, Flanigan joined a coterie of Nixon supporters to devise a strategy for the former Vice President's return to elective office. During the 1968 Presidential campaign Flanigan was Nixon's deputy campaign manager. Nixon's victory in 1968 provided Flanigan an opportunity to enhance his power and influence within the incoming Nixon administration. During the transition period and for several months after the inauguration, he served as an unpaid consultant, advising on the recruitment of personnel for the new administration. By mid-April 1969, Flanigan formally joined the White House Staff as Assistant to the President. At a press conference to introduce him to the White House press corps, White House Press Secretary Ronald Ziegler disclosed to the assembled reporters that Flanigan's duties would center primarily on economic, commercial, and financial areas. He also announced that Flanigan would assume those duties relating to regulatory agencies and other domestic matters that had been previously assigned to Robert Ellsworth, who had been named Ambassador to NATO. As Flanigan's areas of responsibility gradually broadened to include international economic matters, he was appointed, in January 1972, as Assistant to the President for International Economic Affairs. A month later, President Nixon named him Executive Director of the Council on International Economic Policy (CIEP). Flanigan resigned his White House post on June 24, 1974, and left the administration in early July, returning to the New York investment firm of Dillon, Read & Co., Inc.

Peter Flanigan's father, Horace, was president of Manufacturer's Hanover Bank in New York, and his sister was married to Murray McDonnell, chairman of the Wall Street brokerage house, McDonnell & Co., of which Lawrence O'Brien had become president upon leaving his employment with the Democratic Party after Lyndon Johnson's term of office in January 1969. A merger that would have allowed the bank to diversify was prevented by the Flanigan shareholders, an event which prompted O'Brien to accept an alternative offer from Howard Hughes. [Source: Transcript, Lawrence F. O'Brien Oral History Interview XXVII, 9/23/87, by Michael L. Gillette, Internet Copy, LBJ Library.]

As O'Brien moved out of Johnson's administration, Flanigan moved in, working on the transition team that recruited Nixon's staff. In his oral history, O'Brien, in the oral history cited above, recounts in detail what happened in the aftermath to his leaving McDonnell and forming his own consulting firm, which dissolved even more rapidly than had his job on Wall Street, leaving him with virtually one client, Howard Hughes.

Whose Secret Agenda?

Hughes was of great interest to Peter Flanigan, whose family had derailed Larry O'Brien's job with the McDonnell investment company, forcing him to work for Howard Hughes. Flanigan from the very beginning (as far back as 1959 a supporter of Nixon and Henry Cabot Lodge) had an extremely critical role in the Nixon White House--recruiting and hiring its staff. He undoubtedly knew the name of the unidentified woman attorney described by Jim Hougan in Secret Agenda:

Among the business that he mixed with pleasure was a vest-pocket investment corporation that Bailley claims he founded in a Washington bar. According to Bailley, the firm was created as "an excuse to have parties"--meetings of the board of directors at which little business seems to have been transacted. All of the firm's officers, except one, were personal friends of Bailley's--young professionals who enjoyed a good time. The exception was a man who, Bailley says, happened to be in the same bar drinking with his friends when the firm was conceived and its articles of incorporation discussed. "Everyone thought [he] was someone else's friend," Bailley told me, "so we just included him [as an officer of the firm]." In fact the young man was an employee of the Defense Intelligence Agency (DIA).     

According to Bailley, the man was present at a meeting of the "board of directors" that quickly became controversial. The cause of the controversy was a handful of pornographic photos that Bailley passed around the conference table while the minutes of the previous meeting were being read. The woman reading the minutes was a beautiful young attorney employed in the Office of the President. She enjoyed the parties that often followed the board meetings, and occasionally performed secretarial chores for the firm. The photos snickered at by the men around the table were of her, though she was unaware of that. When the pictures reached the DIA man, Bailley says, he reacted violently, protesting that the woman posing in flagrante delicto was an employee of the President in one of the most sensitive components of government. The photos were therefore a national security matter, and, as a DIA employee, he would have to report the incident. It was this report, Bailley believes, that led to the FBI investigation that was to ruin his career.

The names of the DIA agent and the woman attorney have not been revealed to this day. The date of the "board meeting" is unknown, although it would have to have been prior to April 6, 1972, in order to have alerted the U.S. Attorney with information necessary to acquire search warrants of Bailley's home and office. The staff attorneys working in the U.S. Attorney's office were already familiar with Philip Bailley since his practice since entering the D.C. Bar as an attorney in 1969 had consisted exclusively of defending young women accused of prostitution.

What was the sensitive component in which Bailley's fellow female board member worked in the White House? Was she working with the DIA agent in some manner to make use of Bailley's call girls?

According to the official history of the DIA:
In 1970, Department of Defense created the Assistant Secretary of Defense (Intelligence) (ASD/I) to supervise Defense intelligence programs and to provide the principal point for coordination with the Director of Central Intelligence as well as other intelligence officials outside DoD. President Nixon also reorganized the national Intelligence Community and designated DIA's Director as the program manager for a newly established General Defense Intelligence Program (GDIP), a budget and management program that coordinated defense intelligence as a whole. In 1972, DIA also began putting more emphasis on exploiting technology for intelligence analysis and processing. It began developing networked computerized intelligence databases and modernizing the National Military Intelligence Center in the Pentagon.

John Meier talks about Howard Hughes.

In the September 1976 issue of Playboy, there was an article entitled "Puppets and Puppet Masters". It was a story about the secret story of the CIA involvement in Watergate that arose because of the fact that seemed to be involved in every branch of Nixon's life, from financing Nixon's brothers in business and funneling suitcases full of cash to Bebe Rebozo to hiring Larry O'Brien (who had run the Democrats' campaign for Hubert Humphrey in 1968) to work for Hughes at the same time Nixon was running for reelection. But that's all old history, right? What does that have to do with the call girls?

We shall see....