Maryland Gov. Marvin Mandel's explanation for thousands of dollars in payments he received from businessman W. Dale Hess was called into question today by Hess himself, who testified that he would still be paying Mandel today had the two not been indicted.
Testifying in his own defense, Hess said the governor "was having a lot of perosnal and financial problems. Probably, in all honesty, if I wasn't sitting here today he would still be receiving the money."
Mandel had testified that the payments of $15,000 were legal fees his close friend Hess owed him for legal services performed before Mandel was governor, not bribes for favorable gubernatorial actions, as federal prosecutors have alleged. While saying that he did owe legal fees to the governor which the payments were to cover, Hess said the amount of the debt had never been computed and the payments were, in effect, open-ended.
During his first day on the witness stand, Hess gave the jury at Mandel's political corruption trial explanations different from Mandel's not only for those payments but for political actions and for another gift, a $4,500 diamond bracelet Hess gave Mandel's former wife, Barbara.
What Mandel described as a bracelet his wife won from Hess on a political wager. Hess said today was a gift - the bet was made "in jest" - meant not to influence the governor but "to influence Bootsie" the former wife.
The value of the benefits Mandel received from his codefendants is one of the two basic issues being argued in these final weeks of the retrial. The prosecution contends that Mandel received some $350,000 worth of gifts and benefits as his share foan alleged scheme to defraud the citizens of Maryland.
In return, the multi-count indictment charges, Mandel promoted legislatin to benefit the Marlboro Race Track while he allegedly knew that it was secretly owned by codefendants Hess, Harry W. Rodgers III, William A. Rodgers, Ernest N. Cory Jr. and Irvin Kovens.
During his six days on the witness stand, which ended this morning Mandel disputed the price tag placed on the benefits by the prosecution. He claimed he only received a few free suits, a vacation, some birthday and Christmas gifts and little else. The other items, like his inclusion by Hess in Security Investment Co., (which produced the $15,000 payments), another real estate deal and loans, were characterized as straight business propositions not be construed as benefits or gifts.
Besides adding a different nuance to the explanations for the payments and the bracelet, Hess' descriptions of some important events in the history of Marlboro racetrack - which he and other Mandel friends secretly owned - differed from the governor's testimony which ended today after six days.
Hess was Mandel's suitemate in Annapolis when both were legislators during the 1950s and '60s. They became extremely close friends, vacationing together often in Florida, as Hess helped raise millions of dollars for Mandel's political campaigns. The variations in their testimony thus surprised trial watchers.
Hess testified that in 1972 he signed over a share of his interest in Security Investment Company to the governor to pay back legal fees, payments that finally totaled $15,000.
But, unlike the governor, Hess said a figure for the fees hadn't been computed. He said he signed over a 4/9 interest to Mandel because: "the governor had been very good to me. . . and he was having a lot of personal and financial problems. . . "There really was no question about the figure."
Prosecutors contend that agreement was worth some $140,000.
Last week, Mandel told the jury that his former wife Barbara had predicted that R. Sargent Shriver would not oppose Mandel in the 1970 gubernatorial primary and won a diamond bracelet from Hess who bet that she was wrong.
That bet, Hess said today, was made "in jest. . . like I was kidding her or something." Later she would "joke and kind of put a needle in . . . saying 'Dale, I haven't got my bracelet, yet.'"
It wasn't until the governor himself mentioned the bracelet - following his December, 1972, automobile accident that resulted in the death of a Bowie man - that Hess made arrangements to purchase it, Hess said.
Hess said he then made arrangements for Barbara Mandel to choose a bracelet at the governor's mansion from samples brought by a New York jeweler. Hess said he had "a feeling" that he would be the one to pay. Ultimately, he said, he and codefendant Harry W. Rodgers III, paid for the diamond bracelet.
Hess gave his testimony in his own distinct style. A Harford County native and farmer, dubbed "country boy" in the secret code kept by the Marlboro Race Track owners, millionaire Hess gave his testimony in a smooth comfortable narrative.
Unlike Mandel, who often gave lengthy explanations to simple questions, Hess kept his answers short, delivered in his nasal tones.
Hess' friendship with the governor dates back to 1955, he said, when he was first elected to the General Assembly of Maryland. Through 15 years of political service together, the men developed close personal and business ties and Hess gained an appreciation of government.
"The two most knowledgeable people on racing legislation was the governor and myself," he claimed at one point. That knowledge, he later testified, held him good stead during an important juncture in the Marlboro Race Track venture.
Mandel testified earlier that he was surprised by a 1972 legislative override of his veto of a bill that brought overnight profits to the Marlboro Race Track owners by doubling the track's racing days.
"I was not surprised," Hess said today, pointing to several issues he said made the outcome inevitable. "I knew that if everybody just sat still, the veto would be overridden."
Hess also said he knew that in 1972 the governor was "having a lot of personal problems, personal and financial problems."
This was enought reason for Hess to give Mandel the 4/9th interest in security investment which leases two buildings to the U.S. Social Security Administration in Woodlawn, Md.
Hess said he owed Mandel money from legal consultations during the 1960s. Those legal services included "looking over documents, contracts of sale, writing letters of commitment on mortgages, deeds, partnership agreements, corporation papers."
Although the sex years of Mandel's legal help ended in 1968, Hess said he had never paid the governor. An offer of an option in a motel Hess partly owned was rejected by Mandel as payment because the motel proved unprofitable.
Hess had become a partner in Security Investment and he oftered Mandel a share because he said "the governor had been very good to me . . . and there was no question I had an obligation to pay him."
Contradicting Mandel's testimony that the arrangement was a precise payment of $15,000 in legal debts, Hess said that there was no figure determined for the debts and he didn't care if he paid more than $15,000 to the governor.
"I thought it was only fair to treat him well," Hess said.
Before Hess took the stand today Mandel concluded his six days of testimony with alternate reasons for a series of telephone calls that the prosecution alleged yesterday showed that the governor was in close contact with his codefendants while they made important decisions about the Marlboro racetrack.
Mandel has repeatedly denied that he knew at the time his friends bought the racetrack that they were the secret owners.
Today, while glancing through his desk calendar, he gave other reasons why his friends might be calling from their business office at Tidewater Insurance Company to his office at the State House. He said, for instance, that 10 placed calls the day before the track was purchased might easily have dealt with an Eastern Shore real estate venture.
A telephone call placed on May 1, 1972, not only coincided with the day that the Marlboro track received the approval of the Racing Commission to run 18 days at the more profitable Bowie track but also with an arrangement for a breakfast meeting the next day. Again glancing at his desk calendar Mandel said that four calls in February, 1973, that the prosecution noted were made around an important date for the profitable merger of the Marlboro track with Bowie race course also coincided with a flurry with conversations he had with his codefendants about the Eastern Shore venture.
Finally Mandel said a phone call the prosecutor noted was made the day that the Racing Commission gave final approval for the merger of Marlboro's racing days with Bowie was also around the time that a major campaign fund raising event was being set up "that was the Four-Star Salute . . . Six thousand people attended, I might add," Mandel said.
At the end of Mandel's final direct testimony, his attorney asked him if looking back he came to any conclusions about the issues raised in his trial.
"Perhaps if I had to do it today under today's circumstances, what I did in those days I might have reached a different decision.