Less Than Full Disclosure

FBI reports on Labor Secretary Donovan turn up--belatedly

When New York Attorney Leon Silverman was appointed in December as a special prosecutor to investigate Labor Secretary Raymond Donovan, he knew that gathering information about the business dealings of the former New Jersey construction executive would be difficult. But Silverman probably did not realize that he would also have to spend time trying to ferret out information from the FBI. The bureau conceded last week that it had failed to provide the special prosecutor, as well as the Senate Labor and Human Resources Committee, which originally looked into Donovan's appointment, with a set of reports that included unproved allegations by informants linking the Labor Secretary with organized-crime figures.

Silverman's investigation uncovered the existence of two of the FBI reports, which contained charges made by New Jersey informants. When Silverman requested the reports, Bureau Director William Webster promptly ordered subordinates to dig them out; during the search, five more files dealing with allegations by other sources against Donovan were discovered. Webster sent copies of the seven reports, along with a memorandum trying to explain why they had not surfaced sooner, to Silverman and the Senate committee. Had the committee been provided with the reports during its hearings 15 months ago, when they were available, Donovan's confirmation might have been delayed--if not rejected.

The Senate committee released a summary of the uncovered FBI information late last week. It included allegations by an informant in Newark that Donovan, when he was executive vice president in charge of labor relations for Schiavone Construction Co., was a friend and traveling companion of New Jersey Gangster Salvatore ("Sally Bugs") Briguglio. The informant said Briguglio, in return for payoffs, gave Donovan information about low bids on Government construction contracts, which he learned of through Government contacts, so that Donovan could underbid. At his confirmation hearings, Donovan three times denied ever meeting Briguglio, the victim of a Mob execution in 1978. Another FBI source said that a labor fixer, Jack McCarthy, worked for the Schiavone Co. McCarthy has been convicted of racketeering.

The charges against Donovan have not been substantiated. But the fact that serious allegations involving the Labor Secretary were buried in FBI files during two investigations is disturbing. Webster has launched an internal inquiry into why the reports were tucked away for more than a year. According to a memo by Webster, the probe has so far disclosed only a bureaucratic runaround: "The failure to disseminate this information was due in part to a belief on the part of the Newark division that the information had been furnished to the special section at FBI headquarters . . . Bureau managers of the special-inquiry section have advised that they did not receive the information." The bureau's computers and information systems are supposed to give top officials direct and immediate access to all information filed in field offices.

Indeed, the fitful investigation of Donovan has been prolonged not so much by discoveries of new information but by the uncovering of old information. Silverman was initially appointed to look into charges made by Mario Montuoro, a former New York construction worker, that Donovan was present at a lunch where one of his company's officials allegedly passed a $2,000 bribe to a union leader. Montuoro made this charge in 1978 and again after Donovan's nomination, but the Justice Department and FBI never reported it to the Senate committee. Nor was the committee informed about wiretaps on the telephone of an admitted Mafia "soldier," William Masselli, that raised questions about Donovan's relations with Masselli and his company. Silverman is also investigating these tapes.

Silverman, now presenting his evidence to a Brooklyn grand jury impaneled to consider the Donovan case, insisted last week in careful legalese that he did not think the FBI was being intentionally deceitful. "Whatever the FBI did," he said, "I have no reason to doubt their bona fides."

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