Prosecutors warned in a secret memo that the Federal Bureau of Investigation might have created problems that could, and ultimately did, permit Teamsters union President Jackie Presser to go free.
At the time, the prosecutors were struggling to keep their labor-fraud case against Presser alive and had not been told the truth about the FBI's role in the controversial affair.
Expressing concern that failure to indict Presser could tarnish the integrity of the Justice Department and the Reagan administration, the prosecutors raised the possibility that FBI agents might have overstepped their authority if they had promised the union boss immunity from prosecution.
Citing intelligence reports that Presser's influence was waning, the prosecutors dismissed as "specious" the FBI's contention that the government could use him to clean up the mob-influenced union, presumably a major reason for giving him immunity.
The confidential memo, a portion of which was obtained by the Los Angeles Times, was written last January and detailed evidence amassed against Presser during an almost three-year investigation. In major probes, such memos are submitted to the Justice Department before indictments can be sought. In this case, the memo indicated prosecutors' mounting fears that their long probe of Presser was being jeopardized.
Six months after the memo was written, David Margolis, chief of the Justice Department's organized crime and racketeering section, ordered prosecutors to drop the probe.
Although the FBI had twice denied to prosecutors that Presser was a government informer, subsequent events established that he was. FBI agents also had sanctioned his activities in illegally siphoning money to cronies from his hometown Cleveland union local. That led Presser to claim that he had been given immunity.
The decision not to seek an indictment drew charges of bureaucratic incompetence and political favoritism because of Presser's role as the only major labor leader to support President Reagan. These charges have sparked a federal grand jury probe in Cleveland and two congressional investigations.