A Bronx judge ruled today that a controversial series of FBI tapes was legally obtained and could be used in the prosecution of former Labor secretary Raymond J. Donovan and nine associates.
The decision apparently clears the way for trial with a date expected to be set Jan. 6.
In approving use of the tapes, however, the judge castigated the Federal Bureau of Investigation for its handling of "Operation Tumcon," the 1978-1979 investigation that produced the recordings and led to Donovan's indictment last year here.
"There was no coverup in the Tumcon investigation, just plain disorder and a lack of leadership," New York Supreme Court Judge John P. Collins concluded after more than 50 days of hearings.
"The New York 'flagship' office of the FBI ran aground in the winter, spring and summer of 1979," Collins said. "Until now, for a variety of well-intentioned reasons, the chaos was shielded from public view."
Despite the shortcomings, Collins found there was ample evidence to support the FBI's electronic surveillance and no grounds to conclude that it was irrevocably tainted by the actions of a "renegade informant," as defense lawyers had claimed.
Accordingly, the judge said, he intended to proceed to trial "forthwith." He said he would hold a final pretrial conference Jan. 6.
Donovan, his former business associates and their two companies have been accused in a 137-count indictment of defrauding the New York City Transit Authority of some $7.4 million in building a still-unopened subway tunnel in mid-Manhattan. The FBI's surveillance was aimed at the warehouse office and phones of reputed Mafia soldier William P. Masselli who was a subcontractor for Donovan's company on the subway project and is now a codefendant.
The tapes involving Donovan, Masselli and the others revolve around conversations about an allegedly phony minority business enterprise (MBE) that Masselli set up as a subcontractor for Donovan's firm, the Schiavone Construction Co. Schiavone Construction and its executives have been accused of using phony billings from Masselli to steal money that the Transit Authority thought was being paid to a legitimate MBE.
Collins' 39-page ruling concluded what he said were the lengthiest suppression hearings held in the Bronx with praise for Lawrence Sweeney and Robert Levinson, the two FBI agents who bore the brunt of the investigation, and with sharp words for their superiors.
Levinson and Sweeney, the judge said, began the inquiry with the help of Michael Orlando, an admitted Mafia courier and enforcer who got close to Masselli at the FBI's behest and told the agents of a hijacking ring operating out of the warehouse.
"Informants are rarely pious, pristine individuals," the judge said. "Orlando was no exception . . . . The agents had problems in dealing with him . He was overheard on the wiretap and, to put it mildly, he was becoming too close to the criminal activity about which he was informing. The agents sought help and guidance from middle management and high-echelon FBI supervisors and the U.S. attorney's office" in Manhattan.
"The assistance they got within the FBI was little and late, with few exceptions," Collins found. "Some of the intermediate-level personnel were incapable of meeting the task. In some instances, they lacked the ability and in others, they lacked the necessary information, cooperation and authority. The high-level FBI personnel appear to have gone into a state of paralysis."
Collins also criticized FBI headquarters officials for spending more time and effort on post-mortems of the Tumcon investigation than in trying to make it a success.
"The post-Tumcon years," Collins said, "resulted in repeated investigations of what went wrong and why. Those investigations continue down to this very day. Recrimination followed. Paper flowed. Individuals sought to protect themselves and their turf. They sought to defend their action or lack of action. It is unfortunate that the time, effort and money spent to investigate the failures were not originally spent in adequately supervising and managing the investigation."
Defense lawyers had claimed that Orlando set up a Nov. 30, 1978, hijacking to provide the two FBI men with probable cause for a Jan. 4, 1979, federal court order authorizing electronic surveillance. The defense also claimed that Levinson and Sweeney knew Orlando was the culprit and withheld that knowledge from their superiors and the court.
Collins rejected both charges. He said the FBI eavesdropping had ended "before any significance was given to the notion that Orlando may have been involved" in the 1978 hijacking and "down to this very day, in this court's view, there is no reliable evidence that he was involved." Similarly, the judge said, there was no evidence that Levinson or Sweeney had any doubts about Orlando's denials to them.