Herbert Kalmbach, who for the last five years has been Nixon's personal attorney, has emerged as one of the central figures in the Watergate affair. He has been entrusted with the secretive and sensitive duties that a president's financial dealings require. For example, he personally supervised the purchase and renovation of the San Clemente estate. This urbane, mysterious "Mr. Moneybags" of the cover-up was also deputy chairman of the Nixon 1968 and 1972 campaign finance committees under Maurice Stans. He has been credited with raising $6 million for the 1968 campaign (out of a total $35 million), much of it from Nixon's powerful group of Southern California friends in the Lincoln Club (see Lincoln Club box). The Kalmbach-Stans fundraising was so successful that $1.7 million was left over after the 1968 campaign. And this money was the basis of Kalmbach's deep Watergate involvement. Kalmbach distributed the extra campaign funds into num- erous bank accounts he controlled with two other men: Francis M. Raine, Jr., (H.R. Haldeman's brother-in-law) and Thomas W. Evans (Nixon's law partner - see "Law Partners in Washington" box). By 1972 only $500,000 of the $1.7 million was left. A full account of what happened to the remaining $1.2 million still remains to be given. Significant chunks were utilized in a program of political sabotage against Nixon enemies. For instance, $200- $400,000 was funneled to Albert Brewer, who opposed George Wallace in the 1970 Alabama gubernatorial race - an obvious attempt to sabotage Wallace's 1972 presidential aspirations and remove him as a threat to Nixon's re-election. Kalmbach gave some $40,000 to Los Angeles lawyer Donald Segretti, to finance a campaign of political sabotage against Democratic front-runners, primarily Edmund Muskie. Kalmbach had hired Segretti on the advice of presidential assistant Dwight Chapin. Prior to April 7, 1972, the date set by the new campaign financing law for beginning to report donations, Kalmbach solicited millions of dollars from such groups as the dairy industry and numerous large corporations. Since he destroyed all his campaign finance records once the heat was on, we have no complete record of the secret donors. After the Watergate "plumbers" were caught in June 1972, the real criminals - Nixon and his most trusted aides - moved quickly to hush their hired operatives. Kalmbach, with his considerable acumen for behind-the-scenes financial deals, took on the sensitive job of collecting and distributing the hush-money. He gathered up to $500,000 for the Watergate defendants from various sources. Some of it was again money left over from 1968 campaign funds; some $350,000 was CREEP (Committee to Re-Elect the President) money that had been transferred to Haldeman's White House safe and then funneled to Kalmbach; $75,000 was from Thomas V. Jones, Chairman of the Northrop Corp., a large defense contractor and a client of Kalmbach's law firm. Kalmbach's association with Nixon grew out of his friend- ship with Robert Finch, Secretary of Health, Education and Welfare in Nixon's first administration, and a classmate of Kalmbach's at the University of Southern California Law School. In 1958 Finch had enlisted Kalmbach's aid as Orange County Chairman of his successful campaign for Lieutenant Governor of California. Up to that time, Kalmbach had been a vice-president of the Security Title Insurance Company in Los Angeles. In the late fifties and early sixties, Kalmbach prac- ticed law in Newport Beach, California, except for a brief stint in Arizona where he was the president of the Arizona Title & Insurance Company. In 1962 he worked in Nixon's unsuc- cessful California gubernatorial bid against Pat Brown. From 1964-67 he served as a vice-president and director of the Macco Realty Corp., a firm which eventually merged into Great Southwest Corp., a Penn Central subsidiary (see Maurice Stans article). In 1967 Kalmbach joined a group of lawyers in establishing the Newport Beach, California firm of Kalmbach, DeMarco, Knapp & Chillingworth. It is clear from the following list of clients that Kalmbach's new firm received numerous lucrative accounts as a result of his relationship with Nixon. Much of the firm's clients' business is dependent on the rulings of federal regulatory agencies. This raises obvious conflict of interest situations for a lawyer whose clients include the President of the United States as well as some of the nation's largest corporations which are regulated by the federal bureau- cracy which he oversees. Among the firm's numerous clients listed in the Martindale-Hubbell Law Directory for the years 1969-72 (when Nixon was president) appear the following names: 1969: Atlantic Richfield (ARCO): Donald Kendall, a close Nixon friend and chairman of Pepsico, is an ARCO director and gave the Nixon campaign $60,000 in 1972. Coldwell Banker: this real estate firm had a suit charging them with barring Blacks from their housing dropped by the Justice Department. Great Southwest Corp.: this giant real estate firm was a subsidiary of Penn Central (see article on Stans). Glore Forgan-Staats: the New York investment. bank headed by Stans. 1970: Flying Tiger Line: according to Business Week (May 22, 1971) "The reason that Tiger has done so well is that in August 1969 it began flying a new route across the Pacific which it won through skillful maneuvering in Washington. ... Mrs. Chennault (Tiger VP for Inter- national Affairs) is not only a formidable member of the top Republican social set in Washington, but she retains a lot of clout in the Orient.... Mrs. Channault is extremely close to the present regime in Saigon.... .This was a key to Tiger's surge to profitability." Nixon Foundation: Kalmbach is secretary of its board oftrustees. The foundation plans to build a Presidential library adjacent to the Nixon's San Clemente estate. Stans Foundation: (See box on Stans Foundation in Thailand). 1971: Dart Industries: (Rexall Drugs) headed by Nixon Foundation trustee Justin Dart. Marriott Corp.: this firm's president, J. Willard Marriott has been close to every GOP president since Hoover; he headed both of Nixon's inaugural committees; he em- ploys the President's brother, Donald Nixon, as inter- national representative of the hotel and food firm; and has contributed $150,000 to Nixon's last two cam- paigns. MCA (Music Corp. of America): its president, Taft Schreiber, served on CREEP's Finance Committee, gave $50,000 to Nixon's 1972 campaign, and is a trustee of the Nixon Foundation. United Airlines: Kalmbach received a hefty $112,000 retainer from this firm when it was fighting the merger of Western and American Airlines. One of United's newest officers is Nixon's former aide, Dwight Chapin. Justin Dart (see above) sits on the United board. 1972: Morrison-Knudsen: this firm, a member of the four company consortium which contracted for the bulk of all U.S. war effort construction in South Vietnam, now controls 40% of the construction market there. Other clients of Kalmbach's firm include such corporate giants as Travelers Insurance, Pacific Lighting, Western Bancorporation, and Northrop Corp., a prime defense contractor. -Bert Knorr The principal sources for this article include: Los Angeles Times, March 8, May 20 and July 7, 1973. New York Times, May 24 and 29, July 16 and September 23, 1973. Washington Post, April 29 and June 7, 1973. 0S ". . . Four more years! ... Four more years! .. ." 27 Nixon's West Coast Booster Club In 1963, when we all thought we "wouldn't have Richard Nixon to kick around anymore," a small ex- clusive club of Southern California millionaires long close to Nixon established itself in the Orange County seaside community of Newport Beach. Its members enjoy boasting that without their continued generosity, Richard Nixon would not be in the White House today. Several of the Lincoln Club's older figures are original Nixonites who helped launch the President on his poli- tical career 26 years ago. Though the Lincoln Club's 126 carefully selected members pay modest dues of $500 a year, their contributions to the GOP political campaigns amount to millions of dollars. Perhaps the most prominent member of the club is Nixon's close friend and "San Diego Connection," C. Arnholt Smith - a man who is currently in deep trouble. His Westgate California Corp. is under heavy attack from the Securities and Exchange Commission, his bank recently became the largest bank to go under in U.S. history, and his links to the National Crime Syn- dicate are becoming clearer all the time. Other leading members of the club include: Arnold O. Beckman of Beckman Instruments; . Herbert Kalmbach; J. Simon Fluor, of Fluor Corp. (see Stans article), the club's current president; and C. A. Smith lieutenant Clement Hirsch, a Nixon fundraiser who has been rewarded with several visits to the White House. Sources: "Exclusive Coast Club Spurs Gifts of Millions for Nixon and GOP," The New York Times, February 16, 1972. "Millionaires in Coast Club Ardent as Ever for Nixon," The New York Times, June 9, 1973. "For a useful article on C. Arnholt Smith, see Lowell Bergman, "Nixon's San Diego Connection," Ramparts, September 1973.
