"Mr. Stans, Here Is Your Currency"

Day after day, while beads of sweat slowly formed on his great bald head, the Government's witness told an absorbing story of how big money could buy influence at the highest levels of Richard Nixon's Administration. Harry L. Sears, head of Nixon's re-election drive in New Jersey and onetime majority leader in the state senate, was testifying in a Manhattan courtroom against the men with whom he claims to have done shady business: John Mitchell, 60, the former U.S. Attorney General; and Maurice Stans, 65, the former U.S. Secretary of Commerce. They are the first Cabinet officers since the scandals of Warren Harding's Administration to be charged with criminal offenses.

Sears was called to the stand by federal prosecutors, who are attempting to prove that Mitchell, once Nixon's top political strategist, and Stans, who raised the money that made the campaigns purr, had struck the sleaziest of bargains with a notorious financial manipulator, Robert Vesco. The Securities and Exchange Commission has charged that Vesco was the central figure in perpetrating a $224 million stock fraud, the largest single case in SEC history. In its case against Mitchell and Stans, the Government argues that Vesco made a secret, illegal contribution of $200,000 in cash to the President's campaign in 1972, and that in return, the two Nixon lieutenants used their political clout--though both had left the Government by that time to work on the President's re-election campaign--to try to ease Vesco's troubles with the SEC.

In His Pocket. Vesco was also named in the 46-page indictment, which charged the defendants with conspiracy, obstructing justice and perjury, but he is a fugitive living in Costa Rica. The fourth man named was Sears himself, but he has been granted full immunity in return for testifying as a witness for the prosecution.

Sears was Vesco's man--"he was in Vesco's pocket," as a federal prosecutor bluntly put it. Vesco had contributed $20,000 to Sears' unsuccessful attempt to win New Jersey's Republican gubernatorial primary in 1969, then helped him to pay off his campaign debts. Vesco also put Sears on a $60,000-a-year retainer as part-time counsel and a director of his International Controls Corp., which had taken over Investors Overseas Services, the rickety mutual-fund empire glued together in Switzerland by Bernard Cornfeld.

The SEC began in 1971 to nose into Vesco's operations abroad. Sears said that he tried for months to persuade his old political friend John Mitchell to help Vesco get access to William Casey, then the SEC chairman, so that the financier could plead his case in person. Mitchell appeared sympathetic, but nothing happened, though Sears pointed out that Vesco had made a substantial contribution to Nixon's 1968 election campaign and that "he represented himself as being close to the Nixon family."

Indeed, Vesco was acquainted with the President's two brothers, Edward, 43, and F. Donald, 59, and the latter's son, Donald A. Nixon, who has worked as an aide to the moneyman.

On March 8, 1972, said Sears, Vesco met with Maurice Stans and offered to give $250,000 to the President's reelection campaign--$200,000 secretly to Stans and $50,000 openly. Sears testified that Stans wanted the money before April 7. On that date, a law came into effect that for the first time required a fund-raising committee--like the one headed by Stans--to publicly report contributions of $100 or more. Stans also wanted the $200,000 in cash, which proved to be awkward for Vesco to raise. In late March, said Sears, Edward Nixon visited the financier in New Jersey. During the visit, Vesco learned that Stans was on a flight to New York City's LaGuardia Airport. Vesco dispatched Nixon by helicopter to intercept the fund raiser and ask permission for the gift to be made by check. But, said Sears, Stans still insisted upon cash.

Wants Help. On April 10 Sears and Laurence Richardson, president of Vesco's company, called on Stans at his office at the Committee for the Re-Election of the President. Sears testified that Richardson plunked down a dark leather briefcase, opened it, tilted it forward, and said: "Mr. Stans, here is your currency." He added: "Mr. Vesco wants me to deliver a message. He wants help." Replied Stans, according to Sears: "Tell him that's not my department . . . That's John Mitchell's department."

Sears went on to relate how Mitchell immediately began to perform services for Vesco. At a meeting with Mitchell that very afternoon, the witness testified, Sears reported that Stans had taken the money even though secret contributions were no longer legal. According to Sears, Mitchell said that Stans "knows his business." Reminded that Vesco still had not seen Casey, Mitchell picked up the phone and called the SEC chairman. Testified Sears: "I heard Mr. Mitchell say, 'Harry Sears is here. He would like very much to sit down with you for a few minutes."

Only three hours later, said Sears, he was accorded the privilege of a private meeting with Casey and G. Bradford Cook, then the SEC counsel. The meeting did not go well; neither official was willing to make any concessions for Vesco. In September SEC staffers subpoenaed Vesco to testify. According to Sears, Vesco feared that he would be asked about his campaign contribution and declared: "Those bastards would like nothing more than to nail me and the President to the wall together."

Sears called on Mitchell for help, he said, and Mitchell later phoned back to report that he thought Vesco's subpoena would be withdrawn. Far from it. Vesco was called before an SEC hearing in October--only a few weeks before the election. He pleaded the Fifth Amendment right against selfincrimination. According to the witness, Mitchell said:"Please tell Bob I'm grateful or words to that effect." Sears said that Mitchell did not want word of Vesco's secret contribution to get out before the election.

Asinine Thing. Later in October, Sears said, he asked Mitchell to quash SEC subpoenas for four of Vesco's aides. Sears testified that Mitchell told him: "This time I'll go to the White House and talk to John Dean." (Dean was then the President's counsel.) Whatever happened, the four aides were forced to appear at an SEC hearing; like their boss, all took the Fifth. After the election, Vesco, according to Sears, threatened to reveal his secret $200,000 gift unless the SEC got off his back. Sears said that Vesco told him that he had phoned Donald Nixon, the President's brother, because "I want to get a message to the top that this whole SEC thing is asinine." The Government has also charged that Vesco wrote a memo to Donald Nixon threatening to disclose his contribution unless the SEC was directed to drop all charges against him.

Ultimately, all of Vesco's money and Sears' efforts proved to be fruitless. On Nov. 27, 1972--three weeks after the election--the SEC charged Vesco and his associates with looting $224 million from four overseas mutual funds that they controlled, causing huge losses to tens of thousands of investors.

This week Harry Sears will go back on the stand to finish his story and be cross-examined by defense lawyers. Then, to complete its case, the prosecution is expected to call a number of other witnesses, including G. Bradford Cook, John Dean and possibly Edward and Donald Nixon.

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