Friday, October 30, 2009

Begelman was a crook. So what's new?

"I have always felt that gathering gossip is similar to being an investigative reporter. You have to try to get to the truth, the real facts of what you write. The following story is my biggest story as an investigative reporter." - Bill Dakota

I had a scoop that headlined in the Los Angeles Herald-Examiner newspaper, regarding three safes that allegedly disappeared from the Burbank Studios. The information came to us through employees at the studio. Although it is now an old item, we have had requests to print all of the information we have on it. The following is transcribed from a taped conversation between an employee of Columbia Studios (which at that time was located at the Burbank Studios), and myself. The first sentences from the informer were missed because the tape recorder hadn't been plugged into the phone. The Burbank Police department was given a copy of the tape for their investigation of the matter, but when the tapes were returned, there was a large portion that had been deleted. The parts that were deleted will be noted. One of the missing safes was alleged to have been from David Begelman's office. The informant is relaying information he had from either a studio employee or law enforcement officers.

Informant: It seems that sometime in the early part of the year, sometime around April or May, they got one safe from Begelman's office and one safe from Wells office (that was at Warner Bros.), which were not reported to the police department at all.

Dakota: I thought there were police reports made on those?

Inf: Not on those two, no. Subsequently, sometime during that period in August, that I'm referring to, he states another safe was taken out of Begelman's office. (The "he" he mentions, is his informant). Very definitely an inside job...with keys... they moved the desk, pounded it out of the wall, vacuum cleaned the floor up. The only thing they had to photograph for evidence was the tire tracks of the truck going down the hall as they carried it out of the building. That was one reported because studio security got in...onto it for some reason or other. (the following conversation was deleted when the tapes were returned by the Burbank police) "the estimated value of one safe was something like eight or nine hundred thousand dollars. That was the guess they made then. *Wells would...then the whole thing came to light that it was laundered Mafia money and Wells would never divulge the amount of money in that safe, that was lost in that. There have been estimates, that is it somewhere around $3 million total loss for the three safes.
*(Wells was the former President of Warner Bros. studios).

Dakota: Three million dollars?

Inf: And all of it laundered Mafia money. Now that's the story I got from the Sheriff's department.

Dakota: If the Sheriff thinks that it is laundered Mafia money, why don't they do something about it?

Inf: I guess they can't prove it, one way or the other, it's just hearsay and they just had to drop it." (end of the deletions made to the tape taken by a detective for the Burbank police department. It was later learned that the detective's wife worked for Lorimar Pictures).

Dakota: Why would they have that much money in safes?

Inf: That's a good question.

Dakota: How many safes were reported to the police?

Inf: When the last one went, they finally admitted that three of them had gone. I guess the studio security department admits that they lost three of them and like I say, Wells would never admit to how much was taken out of his safe or how much was in the safe. He remained totally quiet on the thing. Said it was of no consequence, or something like that.

Dakota: There was no publicity on it?

Inf: No, none whatever. Further when the Begelman expose started, there were two gentlemen working, at that time, in the accounting department...one Lou Phillips, who is assistant underneath Johnson, that's the head of accounting, and a worker out in the office, I guess controller of the office, Dick Caudillo. I don't know how to spell his name. Dick was apparently the bookkeeper keeping track of all these things and hiding them along with the fact that he was hiding Lou Phillips house payments in excess of $640, I'm told, a month and his own house payments that ran close to $600, plus Diner Club cards for both men...airline fare. Dick did quite a lot of flying at that time and apparently charged the airline tickets also to the company. Subsequently, when the Begelman thing broke loose, they just quietly asked Dick Caudillo to resign and he went elsewhere for employment and no one has seen him since...Lou Phillips is still there.

Dakota: Someone said that "The Walton's" was backed with Mafia money.

Inf: I've heard that said but I really don't...the whole Lorimar Production Company is reputed to be Mafia...a Mafia Empire. I can't vouch for it, one way or the other.

Dakota: Who would be saying that? Someone who would know what they are talking about?

Inf: It's apparently just people around the studio. I don't know where the source comes from, I've never heard a direct line source on that one, just to who's making the statement. But, it seems a universally accepted thing that Lorimar is Mafia. My first knowledge of any Mafia within our industry, for sure, was David Charnay who took over Four Star Productions. He's Mafia. I don't think he's with Four Star Productions anymore. It's become Four Star International. I don't believe he's with them anymore.

Dakota: How do you know he is Mafia?

Inf: He's in the Congressional record.

Dakota: Oh, really?

Inf: Yeh.

Dakota: Somebody said there was somebody there (Columbia) busted for dope...Spiegleman?

Inf: That's one I haven't heard either. I think everyone knows that drugs are abundant all over the city, let alone the studios.

Dakota: There's supposed to be a green card worker there, a girl who was supposed to have bought her second Rolls Royce with money she made from narcotics.

Inf: Ha-ha-ha. But, nobody can prove it. That's the problem. She apparently is not a peddler. The story I got is that she apparently has some connection to it. But, no one has said, one way or another, whether or not she is involved.

Dakota: Those large amounts in the safe. Don't they have auditors or someone who keeps track of that money?

Inf: There again, it's a mystery why?

Dakota: These safes that were reported to the police. There would be a police report available, if someone should go down there?

Inf: If you could find out what department it's actually in. Yes, I understand...like I said...the information I got came from the Sheriff's department.
But, who can prove it, unless you've got some way of getting it.

Dakota: Would that be the city of Burbank?

Inf: No. I don't think the city of Burbank did anything on that one. At least to my knowledge.

Dakota: Who would be the one who had the police complaint other than the Sheriff?

Inf: They'd be the one. Either Burbank or the Sheriff's department. It could be Burbank, then trickled down to the Sheriff's department. I'm left in a kind of mystery there.

Dakota: Your information...did you hear it through the studio or do you have a definite source?

Inf: I had a definite source on that but I really don't want to divulge his name because it would come back to me and I really don't want my name implicated in any of it. If you can find some way of bringing it out through the records, that would suffice I think. You mentioned the Rolls Royce. That particular party, her husband is a second assistant cameraman or camera operator and he had originally been fired from TBS for theft himself. He was told,"we no longer need your services." It was about that time they acquired the other or second Rolls Royce. It's hard to say. The two of them obviously didn't make enough money to be buying those..also they're both Bentleys not Rolls...same difference, we're still talking about the same price range. And they're both green cards. (Immigrants with a work permit).

Dakota: Have the police done anything about the safes?

Inf: That safe thing is so quiet it's unbelievable. The few times I have mentioned it to people in security, a few would acknowledge it happened but most of the time they would be very unhappy that I knew about it. On the Diner cards or the house payments you'd have to go back and find where the check was actually credited to and who got it. And the only way you are going to do that, is to get the man and get him up there and say here's where the check actually went, and then go down to the Diner's club and say let's check out the checks for that day and see who paid it and whose account it was credited to.

Dakota: There's nobody who they can get in accounting who will talk?

Inf: They're all running scared because they were concerned with losing their jobs.

Dakota: Jesus. That's a bad situation.

Info: Yes it is bad and the way I look at it now, it's still uncorrected. There's information I can't give you because it would pin-point me. I would have to deny it to protect my job.

Dakota: I'll have to try the Sheriff's department to see what I can dig up. Who gave you the information?

Inf: I can't tell you that. The comment the man made to me was, "I have this report on my desk and I thought you might be interested in knowing about it."

Dakota: Who is the one who had the report at the Sheriff's department? Would he know that?

Inf: Yeh. But that one I'm not going to give out.

Dakota: That's the only way I can trace it.

Inf: Yeh, but I can't really do it. I really can't give out his name. It really would be dynamite. He just happened to chance on it. It really didn't have anything to do with his office or capacity in the Sheriff's department. He just became aware that it was down there and said he had seen the report and told me about it. Honestly, I would give you his name but I think it would be improper, it would be creating a problem for him a well as myself. There's jobs involved too, maybe not not for his, but it sure as hell would involve mine. And I would lose a valuable friend too. He has given me a lot of information that has helped me.

Dakota: Are you the only one he talked to about this?

Inf: He talked to others but again he has one other friend in the company who is a friend of the Schneider (sic) family. Again it would pin-point this thing.

Dakota: Someone told me that you used to work in security.

Inf: I didn't work in security. I used to work in the police department.

Dakota: Then you know what you are talking about.

Inf: There's a gal in accounting that might talk. The problem is she thinks a lot of Dick Caudillo who was part of the cover-up. The relationship there is Dick Caudillo and Lou Phillips are gay. There's quite a few gays working in the accounting department at Columbia. She thinks a lot of Dick Caudillo and that's where the problem comes in.


(I talked with Begelman's secretary).

SECRETARY: Mr. Begelman's office.

Dakota: Is Mr. Begelman in?

S: No, he's out of town.

D: Where can he be reached?

S: Well, he can't be. Who's calling?

D: Bill Dakota from the Hollywood Star newspaper.

S: No. There's no way he can be reached.

D: It's very important.

S: I'm awfully sorry...hold on just a minute...let me get to my desk.

D: (I played a portion of the taped phone call, regarding the stolen safes.)

S: I have one comment to make. We have never had a safe any place in our office, so someone is pulling your leg....I'm sorry. And everyone else is. There's never been a safe in there, ha-ha-ha...which everyone knows. So whatever you wanna do sir, I'm sure he won't want to get back to you on that. There has never been a safe.

Dakota: That was supposed to have come from security.

S: He's "never" had a safe. Well, I don't know. I think someone is phonying up something or other. It could not have come from security.

Dakota: He's never had a safe?

S: Never...had a safe, never. There's no safe. There's no built-in safe anyplace as far as I know, in the whole building. I'm sure accounting must have one, I would assume, to lock up money. I've never heard of a safe, vault or anything in that building. But, certainly there was none in our office.

Dakota: I'll leave my number in case he wants to call me.

(I immediately phone studio security)

Operator: Burbank Studios.

Dakota: Security please.

Operator: Just a moment (phone rings).

Officer: Security.

Dakota: Could I speak to the head of security please?

Officer: Who's calling?

Dakota: Bill Dakota from the Hollywood Star newspaper.

Officer: Hollywood Star newspaper..Bill Dakota? Hold on. (puts me on hold)..he's tied up in a conference, can we take your number and get back with you?
D: (I give him my phone number) How long will he be tied up?

Off: That's a good question, maybe ten minutes, maybe a half hour.

D: Is there someone else I can talk to?
(switches me to another line..missed the officer's name)

Off: Can I help you?

D: This is Bill Dakota from the Hollywood Star newspaper and I understand that last year, three safes were stolen from the Burbank studios and Columbia Pictures. One was supposed to have been in Begelman's office. Do you know anything about this?

Off: Your source is better than mine.

Dakota: You have nothing on that?

Off: Uh-uh.

D: There was no police report made out on a stolen safe, to your knowledge?

Off: Now wait...let's not play on words. You said three safes and one was Begelman's. And I'm telling you your source is better than mine. I have no information along those lines.

D: No safes were stolen?

Off: Yes. But, that wasn't the question.

D: All right.

Off: Ha-ha-ha.

D: Was there three safes stolen at Warner Brothers?

Off: Now wait a minute. You said Columbia first, now you're asking Warner Brothers?

D: Yeh. Warner Brothers and Columbia. I mean THE BURBANK STUDIOS, period, last August or September. Was there a report that a safe was missing?

Off: A safe...yes.

D: Now whose office was that?

Off: Ah-h-h, I don't know the name of the party. I'll tell you why...don't think I'm shining you on. I just came on the security department three months ago, and what you are asking me about happened prior to my coming on. It seems to me that I heard something along those lines of a safe being taken from an office and I don't recall the name of the party. I don't know whether it was Columbia and I don't think it was Warner Brothers as opposed to TBS or Columbia.

D: The news media never printed it?

Off: There was a Burbank police report made on it.

D: But, it never made the press?

Off: Sometimes the press picks up on some items and some they don't.

D: Do you remember the amount missing?

Off: I don't think there was any money. I think there was just some documents, like bonds, and that type of thing as opposed to actual cash.
(Other conversation is unrelated to this issue. Conversation ended).

I received a phone call from the Chief of Security a few minutes after the above conversation with the security officer. I learned that the conference call he was in, "was with Begelman's secretary" who called immediately after I talked to her.

Security: Mr. Begelman's office called me.

Dakota: What was your name again?

Security: John Reeves, R double E v-e-s and that you played a tape to them that was allegedly...one voice was a security guard here at the studio.

D: Was...in security.

Reeves: That was? Are you at liberty to...not that I want to take any action...but are you at liberty to tell me who he was?

D: Oh no. I can't do that. That was a source that came in, giving me a tip that three safes had been stolen, last April and May and then one in August. And one was supposed to have been taken from Begelman's office. And everything was all covered up but the tracks of the safe going down the hallway. And security was supposed to have spotted that and that's the one that was supposed to have been turned over to the police department.

Reeves: Uh-huh.

D: But the other safes I guess, there were never any police reports made on those. In one of the safes, there was supposed to be $900,000 and there were two other safes and the total of the three safes was like three million dollars that disappeared.

Reeves: Let me put it this way. There was one safe that was taken. It was reported to the Burbank police department. There was a good calculated guess that there was about $41,000 in cash and other valuables that weren't negotiable but would raise the loss...up into the $300,000 area. But that was all that was reported to secret service, you know and everything else and all taken care of. And if there was any other safe that was taken, it never came to the attention of security and I don't believe David Begelman ever had a safe and I, as Chief of Security would certainly be informed of anything....ah-h-h..there was never anything reported to me and if there was a cover-up I feel they would have to come to me to try to do that. Because in all of our thefts, here at the Burbank Studios, that are reportable items, are turned into the Burbank police department.

D: Hold on. I'll play you a part of the tape. (I played part of the tape for him).

Reeves: There were no tracks ever photographed of a safe being removed from anybody's office here. And the only safe that we had was the one from Warner Brothers. It was reported...that there would be no wheel marks because it was a small enough safe that it could be carried. It is still unsolved at this time. However, it is fully reported and all its contents, to the Burbank police department. As far as any theft out of Begelman's office, or tearing a safe out of a wall, this is untrue.

Dakota: "Was the safe in Begelman's office broken into?"

Reeves: NO SIR.

Dakota: It was fully intact then?

Reeves: Yes sir.

Dakota: I just talked to his secretary and she said there never was a safe in Begelman's office.

Reeves: Now...they did have a..whatever you want to call it...safe. There was never any wall safe or floor safe. And he didn't normally have a safe but..ah-h-h..he had a file cabinet...like you have in a government deal, you know, that you lock up and they're pretty hard to get into, that you put into the "classification of safe." That's the only thing that he has ever had in his office. And to my knowledge, there was never a safe, per se, as we think of one on rollers and so forth, that was ever in Begelman's office. There never was never any report either by Mr. Begelman or anyone else..the safe, if there was one in there and allegedly stolen, there certainly was no mention to anybody on this lot. So, I would say somebody is trying to sell you a bill of goods and take you for a couple of bucks on some untruths.

Dakota: There's nobody being paid. It's just somebody that wanted justice in this thing and trying to expose some stuff, allegedly, going on here.

Reeves: I would say you've got someone vindictive or crack pot informant here. And as I say, if I knew who the security man who was supposed to be involved, I would know a little bit more what to tell you, but ah-h-h...I know you have to treat this with confidence...

D: Yeh, because his job would be in jeopardy and if it is true, I have to protect my sources too.

Reeves: Oh sure. It's not up to us in security to divulge information concerning any of our Executives, unless they so desire and request it. Like you have to protect your sources and so forth, we have to protect "our bread and butter too." But, ah-h- Mr. Begelman, I know him and I know of many falsehoods that have been reported and alleged....and ah-h-h there have been some truths but in this particular case I would say it is not a security man here...at the Burbank Studios. I sure wouldn't print anything like that because it would bring embarrassment to the Hollywood Star. It's up to you. You're the guy who has the information and if you believe it is strong enough, I can't tell you not to print it.


I phoned Ed Ashworth, former Captain of Burbank Studios Security who had been fired the previous January. I wanted to check the credibility of my informant. The informant's name will be deleted. This was after the Herald Examiner headlined my story.

Dakota: How long did you work at the studio?
Ashworth: Well, I had over 13 years in.
Dakota: Do you know_______________then?
Ash: Yeh______________is a good job (Job title).
D: _______________is the person who gave me the information about the safes.
Ash: Well_________works strictly down at Columbia. He's a hell of a swell guy. I've known him for ten, twelve years. Maybe as long as I'd worked at the studio.
D: He's an ex-policeman.
Ash: Yeh...I worked with_________on a lotta cases. He was one of the guys who I could go and say, "_______________, there's something going down and I want to know...." and I'd get a call. He's the kind of guy, that in security, you gotta have guys like______. I worked with him on a lot of cases. He's been very helpful to me.
D: Well, then he wouldn't lie about the Warner's safes then?
Ash: Well he wouldn't lie about the Warner's safes because I know about that.
D: But, he told me about the Begelman thing. Why would he lie about that?
Ash: I'll tell you what. The Begelman thing was handled with such a tremendous amount of security, that Reeves was the only one who knew anything was going on until the story broke. I read it in the paper like everyone else. I still, was never openly brought into it...and many times from 1973 until up to January when I was asked to depart, I was always brought in, if it was a $20.00 digital clock taken off someone's desk, or if it was $1,000 ripped off from a petty cash box. I was always brought into it. The first thing I always done..if there was a possibility of a case, I would pick up the phone and bring the Burbank police in on it.


Dakota: Another informant regarding the missing safes is _____do you know him?

Ash: Oh yeh. He's an ex-Colonel out of the Air Corps.

D: How would he know about the missing safes, if security didn't?

Ash: The building he works out of, we had a lot of things going on there. I've heard they've been hit for quite a few things. A dozen typewriters, disappeared, an IBM machine and a lot more. Even a Movieola machine disappeared. Because he works in the Columbia building he can pick up on a lot of things that I wouldn't know about. If there was a safe and it was brought to my attention and I never went to make an investigation.....there's several convictions being made at the studio that people don't know about. People that were stealing and we proved a case on them and got them put in jail. The first thing I got involved in was a big film theft of over $200,000...raw film stock. The guy didn't get much time out of it, but at least we caught the crook and he got convicted, fined and a small sentence out of it.

There was more to the taped conversation but this was the pertinent part of the story. I did get a call from Security after the story ran. During the conversation, I was asked if I still lived on Orchid Avenue. I said I did when in reality I had moved way across town. Reading this again, many years later, it scares me more now than it did then. I wonder what would have happened if I had still lived there? Also Denis Hamill had never mentioned the call from Nevada telling him not to do the story. I wasn't aware of it until I read it in the paper myself. Also he had a phone call from Frank Rothman who was Begelman's attorney, saying there were no safes in Begelman's office and tried to get the story quashed. On the tape my informant said, "....things could get very rough if I were identified and I don't just mean my job...put it this way, there's a lot of heavy duty people from Nevada involved."

Burbank police detective, Bob Kight, was the person who had received the tape that had been altered when it was returned. When Denis tried to reach him, he was told he was on vacation. Kight's immediate superior, Sgt. Peter Lowry, when asked if Kight's involvement had constituted a conflict of interest since his wife, Roberta Kight worked for Lorimar Productions at the Burbank Studios? Lowry answered, indignantly, "No. And I don't like your insinuations. Bob Kight happens to be the best burglary detective we have. I wish there were ten more like him. There is no way there is a conflict on interest."

Denis further investigated the matter at the Burbank police department. The Burbank Police department identification number 77-0352, which stated, "the thief or thieves apparently used a key to enter Wells office and a dolly to remove the safe, which was kept in the clothes closet." Didn't Reeves say the safe was so small it would have been carried out and there were no dolly tracks?

We thank Denis Hamill for investigating and writing the story and the Herald-Examiner newspaper for printing it.

Not to bore readers further, but I have to include a synopsis of David Begelman, by Paul Donnelly in "Fade To Black" -Omnibus Press.

Big Con. David Begelman was head hunted to be president of Columbia Studios. He was credited with saving the studio from bankruptcy with box-office hits such as "Shampoo," (1975) and "The Deep," (1977, His annual salary was said to be $250,000, with another $150,000 in perks. However, by 1976 he was deep in financial trouble. His prolific gambling ensured that his expenditures always exceeded his income. On February 25, 1977, the actor Cliff Robertson was informed by the accounts department that on September 2, 1976, he had received a check for $10,000 for services rendered. Robertson was puzzled because he had not worked for the studio recently and so was not owed any money. Investigating further, he discovered the check had been signed and banked by David Begelman. Robertson knew about "omerta" Hollywood's code of silence, that could result in blacklisting if he broke it. Still, he informed the police and FBI of the discrepancy, though nothing was done. Robertson waited a while before going public and eventually Begelman confessed he had forged the signature. Robertson was black-listed from the industry for four years for blowing the whistle. On October 3, 1977, Begelman confessed to the board at Columbia Pictures that he had embezzeled over $84,000 from the company by forging $61,000 in checks and fiddling his expenses to the tune of $23,000. He was ordered to pay back the money and to take a six month leave of absence. (Begelman had previously been evaluated by a psychiatrist who reported his behavior was due to a "temporary period of self destructive behavior" and that now he was completely cured. All of this occurred "before" Robertson had gone public about the check). Yet, meanwhile, Begelman had been responsible for another hit, "Close Encounters Of the Third Kind," (1977). His expertise had made the studio around $100 million and they didn't want that kind of talent go to waste. It was only when Robertson publicly revealed what happened, that Begelman resigned as President on February 9, 1978. The company then offered him a lucrative three year $1.5 million deal as an independent producer. Begelman, was charged with fraud and theft and then pleaded no contest. He was fined $5,000 and placed on probation for three years. In December 1978 he once again became President of Columbia Pictures. In the second week of February 1979 after a public outcry, he resigned and accepted a job as associate producer, but with the same salary. On June 27, 1979, his felonious crime was reduced to a misdemeanor when he appeared before the Burbank Municipal Court. The charges against him were dropped, as were the two remaining years of his probation. In December of that same year he was appointed President of MGM.

It was not the first time that Begelman, who at one time was married to Lana Turner, had been involved in financial irregularities. In the Sixties, he had been Judy Garland's agent. Between May and October 1962 Begelman had cashed 13 checks ranging from $500 to $6,000 totaling $35,714. Also part of a quantity of money paid to blackmailers had also ended up in Begelman's bank account and a car due to Garland for an appearance on the Jack Paar Show also turned up as registered to Begelman. On January 30, 1964 Sid Luft, Garland's then husband sued Begelman and his partner claiming they had defrauded Garland of $450,000, and also asked for $1 million in punitive and exemplary damages. On March 15, 1967, Garland filed suit against Begelman and his partner claiming financial mismanagement.

Justice was around the corner. Begelman committed suicide in 1991 at the age of 73.

In our "missing safe" story, Denis Hamill had also been told by a studio employee about the code of secrecy (silence) that existed at the studio. He told Denis "talking to the press could mean losing his job." And the studio kept a black list among the studios so that any security guard persons who talked publicly about anything at the studio, they will never work for any studio in Hollywood again."
In the recent Winona Ryder shoplifting case, a potential juror asked to be dismissed because she was a studio employee and thought being a juror may affect her employment. Why do studios have such tremendous power over their employees? Is there so much crookedness going on that they fear being exposed? When the studios had contract actors and actresses, they often paid off the police and others, to keep bad publicity from reaching the press. I guess this mentality of cover-up continues in other areas as well.

 "I find Bill Dakota very funny and gutsy. Professionally, I think he is appalling. I wouldn't dare print a lot of stuff I know, but he's got total freedom. As bizarre as it sounds, I would never call Bill Dakota a liar." - Jack Martin, former columnist for the New York Post and now with Beverly Hills 213.



DISCOUNTS Available at Amazon, Barnes & Noble, and all other sites selling books
Retailers may order at INGRAM book Distributors.
ISBN  967-0-615-37758-2

(link:the-gossip-columnist-32.blogspot.com) Charles Manson's letter