The Insider

The Parallax View
A preliminary hearing last week before U.S. District Judge David Hittner offered a sometimes fiery, sometimes fumbling dress rehearsal for the upcoming bribery-conspiracy trial of the Hotel Six. The often heated arguments over pretrial motions indicated that courtroom spectators will be in for a treat early next month when the defendants' dream team of top Houston criminal-defense attorneys squares off against a squad of elite Justice Department prosecutors from D.C.

The trial is the result of an FBI sting in 1995 and 1996 run by fake Latin American businessmen who called themselves the Cayman Group and offered bribes to city officials in exchange for help in obtaining a piece of the taxpayer-subsidized downtown hotel project. The Insider has learned that the sting was code-named Operation Parallax by the government.

"Parallax" is the displacement of objects as seen from different locations, a phenomenon utilized by astronomers to calculate the distances of heavenly bodies from earth (at least according to our dictionary). The term also figures in the title of a 1974 movie, Parallax View, in which an intrepid reporter portrayed by Warren Beatty seeks to unravel the conspiracy behind the assassination of a presidential candidate -- and in the process becomes a pawn for the conspirators.

Whatever the original inspiration for the FBI's christening of the sting, last week's courtroom action indicated the name is apt. Defense and prosecution perspectives on the operation are at least several light years apart.

Caught in the feds' net were City Councilmen John Castillo and Michael Yarbrough, ex-councilmen Ben Reyes and John Peavy Jr., former port commissioner Betti Maldonado and lobbyist Ross Allyn. Castillo, Reyes and Maldonado are Hispanic, while Yarbrough and Peavy are African-American. Allyn, who was a Council aide to Reyes, is the only Anglo among the defendants.

Defense attorneys Dick DeGuerin, Mike DeGeurin and Mike Ramsey spent a good portion of their time last week painting the FBI as a posse of bigots for whom wrongdoing at City Hall only comes in shades of black and brown. Jut-jawed prosecutor Mike Attanasio blew his short-fused Wayne Dolcefino-like temper over those accusations, angrily labeling them an affront to the Justice Department.

The hearing allowed several lead players in the production the opportunity to try out their routines on the stand. Maldonado did her best blubbering Betty Boop impersonation, but on the evidence of her preliminary performance, it needs a lot more work. Her insistence that she never realized that slipping envelopes of cash to elected officials could be a serious crime just doesn't jibe with her sophisticated resume as a port commissioner, lobbyist for the government of Mexico and political consultant.

Other portrayals rang truer. The iconoclastic Hittner insisted on asking witnesses more than his share of questions while occasionally pacing around behind his chair like a fidgety penguin. FBI special agent Ron Stern demonstrated a penchant for sarcastic responses, as when Ramsey asked why the feds didn't simply seek Reyes's permission to wiretap his conversations rather than petition a judge for authorization. "Never thought of that," deadpanned Stern from the witness stand. "Maybe we'll try that next time."

Hittner batted away several defense motions that could have made the testimony even more interesting. He quashed a subpoena to force Gaynelle Griffin Jones, who was the U.S. Attorney for the Houston area while the sting was under way, to testify why she declined to pursue charges against those caught in the sting. Likewise, Hittner refused to allow FBI cooperating witness Carlos Montero, whose real name, it was revealed, is Julio Molineiro, to take the stand. Ramsey, who represents Reyes, had sought to question both in an effort to prove that Hispanic and black political figures were selectively targeted by the FBI.

Still, the hearing revealed new details of the investigation, particularly regarding Maldonado's behavior in early May 1996, shortly before the sting operation went public, as she veered erratically between cooperating with the FBI and seeking counsel from some of Houston's politically powerful.

After months of secretly filming and recording local elected officials, the FBI disclosed the existence of the sting to Maldonado on Thursday, May 2 and secured her cooperation in the operation. By the following Monday, however, Maldonado apparently was having second thoughts, and that morning she sought advice from Port Commission Chairman Ned Holmes. According to Maldonado's testimony last week, she called Holmes and then went to the office, where she told him, "I hate to lie to you, but I've got a friend who's in trouble with the FBI and needs an attorney."

Holmes remembers the visit a bit differently. He told The Insider that he walked out of his office and was surprised to see Maldonado sitting next to his secretary. "A friend of mine is in trouble," Holmes recalls Maldonado telling him once they were alone in his office. " 'She is in a lot of trouble.'

"The she part came through pretty clearly to me," says the developer. "I thought, on the one to ten scale, ten being her and one being somebody else, it was somewhere north of five." Holmes says Maldonado did not give him any further details on the sting, "for which I am grateful." He provided her with a list of possible attorneys, including Dick DeGuerin, Mike DeGeurin, Ramsey, David Berg and Rusty Hardin. Holmes also placed a call to Dick DeGuerin on Maldonado's behalf.

On that Tuesday, Maldonado met with Wayne Duddlesten, whose downtown hotel project had been infiltrated by the FBI. During her testimony, Maldonado gave no indication she had alerted Duddlesten to the details of the sting. The developer did not return an Insider inquiry about his side of that conversation.

The next morning, Maldonado dropped in unannounced on Mayor Bob Lanier and wife Elyse. According to her testimony, Maldonado told Lanier she was torn between cooperating with the FBI and getting herself a lawyer, but she did not tell him the details of the investigation. After visiting Lanier, Maldonado then called on Jarl Molander, a Montgomery Watson executive who worked as a supervisor in the city's Greater Houston Wastewater Program. At the time, Maldonado had a pending contract to recruit minority contractors for the Wastewater Program -- one that was scuttled when the FBI investigation became public.

When contacted by The Insider, Lanier was reluctant to describe his conversation with Maldonado in detail, since he's been subpoenaed to testify for the trial. "She came in while we were having breakfast and got my toast wet," says Lanier, indicating Maldonado had a good cry. He recalls that Maldonado was distraught and kept apologizing "about any problems she would cause us, which was really fairly minor alongside the problems she had."

Maldonado's testimony raised one potentially intriguing subplot that might be fleshed out at the upcoming trial: While Maldonado was talking to Holmes, Lanier, Duddlesten and others that week, she was still cooperating with the FBI. That relationship did not end until Thursday of the same week, the day that news of the sting broke after FBI agents visited and interviewed councilmembers at their homes. In fact, Maldonado was making and receiving calls involving various targets for the FBI right up until the operation's existence became public.

Just how compromising that dual activity by Maldonado may prove for her fellow defendants won't be known until the government begins playing its evidentiary hand in court next month.

Coppin' an Attitude
The arrest of Forward Times news editor Ed Wendt for criminal trespass outside the City Council's chambers is a clear warning, if any were needed, that the Brown administration needs to realize it is functioning in the relatively open-to-the-public vista of City Hall rather than Brown's old, closely guarded haunts at the police station.

Wendt is a colorful, confrontational character who has been outraging public officials for years with his in-your-face reportorial style, but nobody ever had the bright idea to arrest him until last week. Wendt had come to Tuesday's Council meeting to photograph Brown and Councilman Jew Don Boney, Brown's mayor pro tem, for another in a series of articles he's authored for the weekly Forward Times on insider profiteering from the city's affirmative action program. Wendt's articles incurred the wrath of local black elected officials even as they drew praise from the hyperconservative editorial writers at the Wall Street Journal.

One observer of the episode reports that Brown became irritated as Wendt snapped pictures and made a gesture to his mayoral agenda director, Dan Jones, who in turn gestured to a police officer who was working security for the Council meeting and sitting near Wendt. (Jones has denied that either he or the mayor had anything to do with directing the cops to hassle the reporter.)

The guard asked Wendt why he was taking pictures -- a rather unusual query, since photographers routinely do their work during Council sessions, with little notice. As the conversation between Wendt and the cop heated up, Brown asked them to quiet down.

A few minutes later, Wendt pursued Boney into the hallway outside the Council chambers to grill the councilman. Journalists covering Council routinely question officials as they leave the chambers. But not this time. Wendt says a plainclothes policeman who had been shadowing him since he began photographing Boney and Brown approached him and said, "The interview is over. You'll have to leave." Wendt claims that when he attempted to re-enter the chambers, officers pushed him against a wall and handcuffed him.

Wendt was taken to jail and booked on charges that he criminally trespassed in the Council's chambers. Keep in mind that is an area open to the public where citizens of questionable sanity routinely deliver diatribes during the Council's Tuesday sessions.

Wendt remained in jail until 3:30 the next morning, when, he says, his bail was arranged by Lark Blum, the wife of affirmative action opponent Ed Blum, and Harris County Republican Party Chairman Gary Polland.

Considering that two previous administrations have found a way to put up with Wendt without jailing him, perhaps Brown will instruct his security guards to lighten up before they inflict some serious bruises on the mayor's own media relations.

Limited Access
There seem be a number of control freaks prowling City Hall these days, and they're not all in the mayor's office.

Last week, after dropping by the office of Councilman Carroll Robinson for a chat, William Paul Thomas, the chief of staff for state Senator Rodney Ellis, made an unscheduled drop-in on Councilman Rob Todd's office. Thomas, a Democrat and a constituent of the District E councilman, wanted to tell Todd he didn't appreciate the remarks the councilman made to a Channel 13 reporter two weeks ago suggesting that all Democrats share the alleged low morals of President Clinton.

Todd wasn't in, and Thomas says an unidentified aide to the councilman got huffy after he explained the purpose of his visit. The aide retreated behind a closed door, and Thomas left. Thomas later got a call from Councilman Jew Don Boney, the mayor pro tem, who informed Thomas he'd created a diplomatic incident of sorts. Boney told Thomas an angry Todd was demanding that Boney enforce the City Hall rule requiring that visitors to Council offices be escorted in and out, with no serendipitous stops in between.

Todd says his complaint to Boney was prompted by a number of incidents in which unescorted lobbyists entered the Council office area. He also notes that Thomas is no longer a constituent of his, due to redistricting.

Judging by events last week, pretty soon citizens may need a pass and an escort just for the privilege of watching their elected officials spend their money in their public building.

No harm will come to you or your car if you call The Insider at (713) 624-1483 or e-mail him at


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