Indecent Exposure (33 page)
- The sense of siege felt by the officers and staff of the Columbia studio during the
Begelman
investigation also was felt by the investigators. For Peter Gruenberger and his team, the days were long and lonely. Gruenberger fell into a routine of getting up early in the morning, driving from the Beverly Hills Hotel over Coldwater Canyon to The Burbank Studios, having breakfast at the commissary, and arriving at his command post in Begelman's office by around eight. He rarely left before ei
ght in the evening. The World Se
ries— the first Yankee-Dodg
er se
ries since 1963—had given him something to look forward to for a week in the middle of October. With games starting at 5
p.m.
Pacific time, Grue
nberger and his group would turn on the big color TV set in Begelman's office and monitor the games as they continued with their work. The work itself was tedious and grew more so as the days and weeks passed. Except for an occasional enlightening interrogation, it consisted of examining documents— thousands and thousands of documents—upwards of twenty thousand checks alone, front and back. It was not work a computer could do. Someone actually had to peruse each check—payee, signers, endorsers, dates, and other information. Some checks were parts of complex and often twisting documentary trails through particular transactions—film deals and the like. Other checks stood alone— single payments for thousands of individual services that had been rendered to the studio. - Nearing the end of the fourth week of October, the lawyers and accountants had compiled a list, still lengthening, of expense account abuses totaling thousands of dollars. They had determined that
Begelman
had misrepresented the terms of the lease of his two automobiles for which the studio paid. They had determined that he had not been forthright about the terms under which he leased his house, payments for which were also made largely by the studio. - In nearly four weeks of searching, however, the investigators had found no other forgeries or embezzlements comparable to the Cliff Robertson, Peter Choate, and Pierre Groleau thefts which had come to light even before the investigation began. Could incriminating documents have been removed before the start of the inquiry? Anything was possible, but there was no indication that files had been tampered with.
- Late in the afternoon of Friday, October
28, Nancy Barton, a young Weil
Gotshal lawyer and the junior member of the investigative group, sat in
Begelman
's office staring at a Columbia Pictures check for $5,000 that had been drawn in 1975 to the order of Martin Ritt, a film director best known for
Hud. The Spy Who Came In from the Cold,
and
The Long Hot Summer.
Barton turned the check over. There were two endorsements. The first was "Martin Ritt." The second was "David Begelman." The handwriting looked familiar. Nancy Barton had become the team's expert on
Begelman
's handwriting. She knew his nuances. She knew that he wrote differently with a felt-tip pen than with a ball-point, and that his signature differed from other forms of his writing. The endorsements on the Martin Ritt check appeared to be in
Begelman
's handwriting. Moreover, the check had been ca
shed at the Wells Fargo Bank in
Beverly Hills and approved by Joe Lipsher, just like the Robertson and Groleau checks. - Barton passed the check around the room. The studio's file on Martin Ritt was summoned and revealed that Ritt's handwriting was different from that on the check. Further research revealed that at the time the check was drawn, Marty Ritt had begun work for Columbia Pictures on
The Front,
a film about the blacklist, starring Woody Allen. It was logical that the studio would have been making various payments to Ritt at that time—payments that could easily have helped camouflage a single forged check. - Peter Gruenberger telephoned Ritt and asked him to come in for questioning. Ritt agreed, and after hanging up, immediately called Ray Stark. Stark immediately called Begelman. Begelman immediately called Gruenberger and, in a very agitated state, expressed his profound apology and regret. He had simply forgotten about the Ritt check. He had totally blocked it from his mind.'"
- Gruenberger said he would be in touch.
- TWENTY-THREE
- Andrew Tobias, the author and
Esquire
columnist, was one of the wittiest and most insightful writers on money and business in the country, and was always alert for intriguing stories. But he hardly expected to hear such a story in the East Harlem pizzeria where he dined on Sunday evening, October 30. Tobias's initial concern that evening was East Harlem itself. It seemed a needlessly remote and dangerous place to go just for pizza. Perfectly good pizza was available in safer districts of Manhattan. East Harlem, however, was where Tobias's friend, The Unimpeachable Source from Hollywood, wanted to go. And so it was in East Harlem that Andrew Tobias - *
Like Robertson,
Ch
oate, and Groleau, Ritt had no knowledge of Begelman's use o
f his name. - became the first journalist anywhere to learn the inside story of the David Begelman scandal.
- The Unimpeachable Source from Hollywood did not get around to the subject of Begelman and Columbia Pictures immediately, but the details eventually poured forth. Aside from his enjoyment of the intrigue, the Unimpeachable Source had grown concerned that the secrecy cloaking Begelman's crimes—secrecy that had been imposed for reasons that had seemed valid a few weeks earlier—was now being manipulated in Hollywood to the detriment of the source's friend Alan Hirschfield. The false but plausible story that Hirschfield was using minor indiscretions as weapons in a power play against Begelman was hurting Hirschfield. And the source had concluded that the only effective way of countering the false story was somehow to get the true story—the facts of Begelman's forgery and embezzlement—into the public domain. He had urged Hirschfield to talk directly to Andrew Tobias, but Hirschfield had refused. The Unimpeachable Source felt compelled, therefore, to take the first step himself. He had to be careful. If it became known that he had leaked the story, or even that he was a
Hirschfield
partisan at heart, it would damage his relationships in Hollywood, where his circle of friends included Ray Stark and indeed David
Begelman
himself. So it was with the understanding that Tobias could never disclose the identity of his source that his friend revealed the essence of what he knew: Columbia Pictures' investigation of
Begelman
for "unauthorized financial transactions" was much more serious than outsiders generally realized; the "transactions" were hardly "gray areas of personal judgment," as
Variety
had speculated;
Begelman
had embezzled thousands of dollars from Columbia Pictures; he had forged Cliff Robertson's name on a check. - Andrew Tobias was riveted. It clearly was a major and sensational story. The Unimpeachable Source hinted that if Tobias could ferret out the details from other sources, Alan Hirschfield might be persuaded to confirm them privately and perhaps even furnish additional information. Tobias vowed to look into the Begelman affair as soon as he could, but there were two potential problems: he was preoccupied with other projects and could not begin work on
Begelman
immediately. And he worked for a magazine.
Esquire,
whose cumbersome editing and production processes, like those of most monthly publications, consumed two or three months. Even if he researched and wrote a
Begelman
article within a few weeks, it probably could nol be in the hands of readers until February. Suppose someone else broke the story in the meantime?
At
Esquire's
request Tobias decided to take the chance and not publish the story elsewhere. But his fears of being scooped were well grounded. His friend was not the only person who had considered leaking the Begelman story. Another was a man who had hated David Begelman for many years—Sid Luft. Luft had been in the last stages of his tumultuous marriage to Judy Garland when David Begelman had become Garland's agent in 1960. The two men had clashed repeatedly. Luft had become convinced that
Begelman
was mismanaging Garland's career, that Begelman was sleeping with Garland, that Begelman was stealing Garland's money. Eventually. Luft began a lawsuit against Begelman, who denied all the allegations. Luft did not pursue the suit aggressively, but even after Garland's death in 1969, the suit technically remained alive. It was mentioned in a widely
read biography of Garland by Ge
rold Frank, published in 1975. The suit, however, had never received the public attention that Sid Luft believed it deserved. In the fall of 1977, nearly a decade and a half after the activities covered by the suit, Luft felt that perhaps the time was finally right. Though Sid Luft did not know the nature of Begelman's misdeeds at Columbia, he decided that he might be able to interest the press in the proposition that the Columbia affair was not the first time that David Begelman had been accused of financial chicanery. In late October, at about the time that Andrew Tobias's friend was arranging the pizza rendezvous in East Harlem, Sid Luft telephoned the
Los Angeles Times.
His calls were not returned. He called
Rolling Stone.
It was not interested. He called
New West
magazine, the Los Angeles-bascd sister publication of
New York. New West,
it seemed, had already assigned a reporter, Jeanie Kasindorf, to look into the
Begelman
affair, and she took Luft's call. They agreed to meet on Friday. November 4. - An unexpected magazine article ruined Monday, October 31, for Alan
Hirschfield
and a lot of other people at 711 Fifth Avenue and The Burbank Studios. The article did not involve Andrew Tobias or Jeanie Kasindorf and was not a
Begelman
expose,
which Hirschfield secretly would have welcomed. Instead, the article purported to be an expose of
Close Encounters of the Third Kind
and predicted that the movie would be a commercial failure.
New York
magazine had sent one of its columnists. William Flanagan, who normally wrote about personal finance, to Dallas on October 19 to try to sneak into one of the invitation-only
Close Encounters
screenings. The task proved easy. Flanagan's article, published twelve days later, was entitled "An Encounter With 'Close Encounters.' " - "I can understand all the apprehension," Flanagan wrote. "In my humble opinion, the picture will be a colossal flop. It lacks the dazzle, charm, wit, imagination and broad audience appeal of
Star Wars
—the film Wall Street insists it measure up to.
..."
A six-panel drawing showed a space ship landing atop Devil's Tower in Wyoming and, with a roar of flatulence, laying an egg. - The article sent Hirschfield into a frenzy. His normally soft, friendly speaking voice became a hard, desperate whine as the day spun out of control into a random sequence of frantic meetings and telephone calls exploring the possibility of legal action against
New York
magazine and various ways in which the damage might be repaired. Columbia's stock, which had closed on Friday in trading on the
New York Stock Exchange at $18.
375, its high for the year, began to deteriorate soon after the appearance of the Flanagan article on Monday morning. The stock had risen over the past several months from around $7, in part because of anticipation that
Close Encounters
would be a big and profitable hit.
Characteristically, the only person who remained outwardly calm that Monday was Herbert Allen, who had always taken pride in his ability to maintain equanimity in the face of dramatic news, good or bad. "This is a test, Herbert,"
Hirschfield
insisted into the telephone. "We're going to get that magazine for this, and you people are going to have to choose between Columbia Pictures and
New York
magazine." He referred to an investment banking relationship between the owner of
New York,
Australian publishing tycoon Rupert Murdoch, and Allen & Company, which had aided Murdoch's seizure of control of the New York Magazine C
ompany from its founder, Clay Felke
r, less than a year earlier. - Herbert ridiculed
Hirschfield
's concern. "It's only a movie review, Alan. It doesn't mean anything." - "How can you say that? The stock's sinking beneath the waves!"
"It'll balance out," Herbert said.
"We're going to sue that fucking Murdoch!" - "You can't sue. Alan. Haven't you ever heard of freedom of the press?"
- "They have no right to do this. This isn't freedom of the press, it's abuse of the press. We'll pull our advertising."
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