The incoming Reagan White House was informed by the FBI last year, on the first day of Secretary of Labor Raymond J. Donovan's Senate confirmation hearings, that Donovan had "close personal and business ties with known La Cosa Nostra figures."
The FBI report, dated Jan. 12, 1981, was hand-delivered that day to White House counsel Fred F. Fielding, who was then the Reagan transition team's conflict-of-interest counsel. According to informed sources, the report also stated that "this information was corroborated by independent interviews of confidential sources."
In New York, meanwhile, it was learned that the corpse of a potential witness in the Donovan investigation was found Friday in the trunk of his own car in downtown Manhattan with a bullet through his head.
The victim of the gangland-style slaying, Fred Furino, 52, had been interviewed several times by special prosecutor Leon Silverman before Furino's disappearance on June 3, sources said. According to a confidential FBI report at the time of Donovan's confirmation hearings, a bureau informant said Furino served as a sometime "bagman" for a New Jersey mobster named Salvatore Briguglio and, in that capacity, occasionally "picked up money from Donovan."
The FBI officials stepped into the case over the weekend at Silverman's request to investigate for possible obstruction of justice. New York police said Furino had been dead for at least six days when his body was found.
"We have asked the FBI to conduct an intensive investigation, and an intensive investigation was begun immediately," Silverman said yesterday. He declined to say whether Furino had appeared before the federal grand jury assigned to the Donvan inquiry and said he would have no further comment.
In Washington at the same time, the contents of the brief Jan. 12, 1981, FBI report alleging links between Donovan and organized crime raised fresh questions about last year's confirmation process in the Senate. Apparently, the Senate committee that considered Donovan's nomination was not sent the report until last week, when the panel's ranking members say they first became aware of it.
Copies were supplied to Senate Labor Committee Chairman Orrin G. Hatch (R-Utah) and Sen. Edward M. Kennedy (D-Mass.), the committee's ranking minority member, Friday afternoon at their request.
"I've never seen that before and neither has Kennedy," Hatch said yesterday. Asked whether it would have "made a difference" in the confirmation process, Hatch replied:
"Are you kidding? It sure would have. At least we'd have asked a lot more questions and we'd have asked who those reports were coming from."
Donovan could not be reached for comment. He went to Europe Friday with his wife for a combination work-vacation trip, including an address to the 68th session of the International Labor Organization in Geneva.
The chronology of last year's Senate hearings suggested strongly that the incoming administration had no plans to provide Hatch's committee with the Jan. 12 report prior to a scheduled vote on Donovan's nomination.
This was the sequence: Donovan testified on Jan. 12, primarily about the hiring of a no-show Teamsters foreman on a New York City subway project by his company, Schiavone Construction of Secaucus, N.J. He denied any wrongdoing on the part of his company in this matter and in another case involving allegedly phony invoices.
The committee's Republican leadership, evidently satisfied, scheduled a final markup session for Jan. 15 to report out Donovan's nomination. That was postponed, according to Hatch, because of the unexpected surfacing on Jan. 13 of a new witness, Ralph Picardo, whom an FBI agent in Newark, John Marshall Hersh, called on the off chance that he might know something about Donovan.
A protected government witness, Picardo said he recognized Donovan's picture from the papers and identified him as the Schiavone executive from whom he periodically picked up $500 checks in the mid-1960s to pay for labor peace.
At the time, Picardo, once a truck driver in a mob-dominated Teamsters local, said he was working for a company that Briguglio secretly owned, O. K. Trucking. Picardo said one of the chores the now-dead Briguglio gave him was to deliver fake invoices to Schiavone Construction, ask for "Ray" and pick up $500 checks made out to O. K. Trucking or XYZ Leasing, a dummy company.
Apprised of Picardo's allegations, the Senate committee canceled the Jan. 15 hearing, called for a thorough FBI investigation, and called Donovan back to testify on Jan. 27, 1981.
For that hearing, the FBI submitted an ostensibly comprehensive report, dated Jan. 23, 1981. It included the substance of the Jan. 12 report, with added detail, but it was presented by FBI executive assistant director Francis M. Mullen in much more negative terms.
Under questioning by Hatch at one point, for instance, Mullen said none of the sources the FBI checked out provided "any information at all" about any alliance or associations with organized-crime figures on Donovan's part.
Fielding could not be reached for comment on what he did with the FBI report when he got it on Jan. 12. Repeated efforts to reach him Friday were unsuccessful and his office said yesterday that he has since gone on a two-week vacation.
According to sources, the Jan. 12 report came with a cover letter signed by Charles P. Monroe Jr., then assistant FBI director for the criminal investigative division, and was hand-delivered to Fielding by "AA," evidently Anthony Adamski, the FBI official immediately in charge of the Donovan background investigation.
Neither Monroe nor Adamski, who have since been shifted to other posts, could be reached yesterday for comment.
Fielding, however, told The Washington Post earlier this month of another report he got from Adamski, by telephone on Jan. 11, in which the FBI official told of the existence of "a tape recording" linking Donovan to "hoodlums" and of a separate allegation, from an FBI informer, stating that Donovan had gone to Miami for the 1979 Super Bowl with a reputed Mafia "soldier."
Fielding said he did not get the impression from Adamski "that it was anything to be concerned about" but he said he did tell Reagan transition team chief Edwin Meese III about it.
Hatch's committee did not learn until six months later that there was any information concerning Donovan that could be gleaned from any of the FBI's organized-crime wiretaps.
The FBI's four-paragraph report of Jan. 12 was less specific and it was accompanied by the caveat that "the degree of Mr. Donovan's association with knowledge of the LCN La Cosa Nostra figures has not been determined." It also stated that "none of the information available indicates any criminal wrongdoing on the part of Mr. Donovan."
At a news conference last week, however, FBI Director William H. Webster said the purpose of a background investigation is to assess a federal appointee's "character, associates, reputation and loyalty."
Webster also indicated that the Jan 12 FBI report, with its talk of "corroboration," was "passed to the White House and it is my understanding it was given to the Senate." In a statement later that day, Fielding also said that the Jan. 12 report "was subsequently turned over to the Senate committee."
Hatch emphasized yesterday that this was incorrect. "I've chatted with one person at the White House," he said. "They realize they didn't send that to us.
"At the very least, there's been a breakdown in procedure here. Frankly, it's alarming to us that we didn't see that the day of the first hearing," Jan. 12.
Meese, now counselor to the president, said yesterday that he had no recollection of hearing about or receiving the Jan. 12 report, although "that doesn't mean I didn't."
He said his recollection was that "we asked the FBI to make all information available to us and to the Hatch committee."
Asked whether he would be surprised if the Jan. 12 report had not been supplied to the Senate panel, Meese said: "I don't know enough about procedure to say whether I'm surprised or not. That was all handled by Fred Fielding and his office."
Furino, a onetime Teamsters official who also was associated with Briguglio, was mentioned in unexpurgated copies of the Jan. 23, 1981, report to the Hatch committee but the passage was censored, apparently to protect the source of the information.
According to sources, it said in part that Furino had once described Picardo and another man, Al Cohen, as "bagmen" for Briguglio and said they "made pickups from Ray Donovan." According to the report, Furino, once an official in a New Jersey Teamsters local, also asserted that "while Briguglio was in jail, he, Furino, picked up money from Donovan, and when Briguglio and Furino were in jail, a Vic Alteri acted as the 'bagman.' "
Alteri reportedly died in 1972. Briguglio, a reputed Mafia hit man and once a suspect in Jimmy Hoffa's murder, was gunned down in New York's Little Italy in 1978.
Furino was interviewed by the FBI on Jan. 22, 1981, and stated that he did not know Donovan and was "unaware of Briguglio, Picardo or Cohen receiving payments from Mr. Donovan or SCC Schiavone Construction Co. . He advised that he would be willing to submit to a polygraph in this matter."
Despite all that, sources say, Silverman interviewed Furino several times this year. According to New York police, he was last seen by his son, Felice, on the evening of June 3, leaving the FP Carting Co. that they ran together in Elizabeth, N.J.
"Maybe some people thought he was being cooperative with Silverman," one government source said. "But he may have been involved in an awful lot of other things, too. It's just too early to tell."
Furino's body was found in the locked trunk of his 1979 Oldsmobile at Fifth Avenue and 18th Street after passersby complained of an odor emanating from it. A New York police emergency services crew forced it open at 12:30 p.m. Friday.