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As U.S. Battles Computer Company, Writer Takes Vision of Evil to Grave

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As U.S. Battles Computer Company, Writer Takes Vision of Evil to Grave
By B. DRUMMOND AYRES JR.,
Published: September 3, 1991

The death of a freelance writer in West Virginia on Aug. 10 has added an air of intrigue to a complicated, long-running court case that has become known in Washington circles simply as “Inslaw.”

The case involves accusations that Justice Department officials were involved in fraud and theft. It was moving quietly through the Federal courts, and a Congressional investigating panel was holding hearings even before the death of Danny Casolaro, a 44-year-old magazine writer and novelist from Fairfax, Va.

But because Mr. Casolaro had been openly delving into the case and saying he believed it was part of a huge Government-wide scandal, and because there is considerable mystery about how he died — he either committed suicide or was murdered, depending on whom one listens to — the case has suddenly attracted major attention. Agreement and Denial

It involves allegations that some Justice Department officials schemed to steal advanced record-keeping computer programming from a small Washington computer company, Inslaw Inc. Even those who assert that a theft occurred have not agreed on whether it was from simple greed, a vendetta by department officials or something even more sinister, like the use of the purloined system to generate money for paying off political debts and to finance secret spy operations.

The Justice Department does not dispute that it contracted with Inslaw for use of the computer software, specifically developed to track the Government’s huge, complicated load of criminal cases. But the department flatly denies Inslaw’s accusations that it bargained in bad faith and withheld payments from Inslaw on the false pretext of contract violations, thereby driving the company to the brink of insolvency shortly before it could complete installation of the system and leaving the department in effective control of the software.

But Elliot L. Richardson, the lawyer for Inslaw, has called upon the Justice Department to hire someone to investigate the Inslaw case and Mr. Casolaro’s death. Mr. Richardson, who resigned as Attorney General during the Watergate scandals rather than do President Richard Nixon’s bidding, says he knows a Government scandal when he sees one.

“I propose to pursue the matter,” Mr. Richardson said. “There is more than enough out there to raise suspicions.”

The owner of Inslaw, William Hamilton, has been in and out of court for more than eight years, fighting to recover his investment and full control of his programming, designed to straighten out a record-keeping system that had defied the software of much larger computer companies. Two courts have upheld his contention that the department conspired to steal his system and drive him out of business, leaving him with a loss of more than $6 million. But an appeals court has held that the case should be retried because it was out of the jurisdiction of the first two courts. Action in Congress

A Senate committee looked into the Inslaw case several years ago but said it was unable to reach a conclusion because the Justice Department refused to hand over pertinent documents.

More recently, the Economic and Commercial Law Subcommittee of the House Judiciary Committee began holding hearings. But House investigators, like the Senate investigators, say they have been hampered by the Justice Department’s refusal to hand over all documents, and also by the refusal of the Bush White House to order the department to acquiesce.

Representative Jack Brooks, the Texas Democrat who is chairman of the Judiciary committee, has warned that he will take “whatever steps are necessary” to compel the department to comply when hearings resume after the Congressional recess.

Justice Department officials contend that they have given House investigators all pertinent documents. “We’ve made everything available,” said Doug Tillett, a department spokesman. Saw a Wide Plot

Mr. Casolaro saw the Inslaw case as part of broad conspiracy by officials of the last two Presidential administrations. He referred to the case as “the octopus” and said it involved a tangled series of shady doings involving everything from Inslaw to the Iran-contra scandal to tampering with a Presidential election to money laundering by the scandal-ridden Bank of Credit and Commerce International.

Under his theory, according to some of his acquaintances, Reagan Administration appointees in the Justice Department stole the Inslaw computer system to give to some friends as a political payoff. The friends, Mr. Casolaro said, had been responsible in 1980 for persuading Iranians who were holding American Embassy hostages in Teheran not to release them until after that year’s Presidential election.

According to that theory, backers of Ronald Reagan in 1980 wanted to block an “October surprise” by President Jimmy Carter — a release of the hostages just before Election Day that would have greatly enhanced Mr. Carter’s chances of re-election. As it turned out, Mr. Carter was soundly defeated, and the hostages were not freed until Ronald Reagan was inaugurated as President in 1981.

Mr. Casolaro also believed, his friends say, that the money gained through sale of the computer system, purportedly marketed to other governments that paid for it with American aid money, was funneled through the B.C.C.I. Some of the money, Mr. Casolaro contended, went into private accounts and the rest was put into hidden United States intelligence accounts for use by both the Reagan and Bush administrations for secret operations in Central America and elsewhere.

Mr. Casolaro was divorced and had a son. A gregarious former high school boxer who wrote a novel, “The Ice King,” and a number of magazine articles on computers before devoting full time to his “octopus” investigation, never succeeded in proving his theory. On Aug. 10, not long after he told friends that he had received several threats on his life, he was found dead, with his wrists slashed, in the bathtub of his hotel room in Martinsburg, W.Va.

Was Mr. Casolaro, who, according to relatives was in West Virginia to talk to a “major source,” on to something? Or was he chasing his imagination?

West Virginia authorities, pending medical tests and further investigation, say he apparently took his own life. The latest round of tests, the office of the state medical examiner announced Tuesday, found evidence of a pain killer and an anti-depressant in his blood, but neither in a quantity that could have rendered him unconscious nor that would suggest foul play.

Spurning reports that he was given to bouts of despondency, Mr. Casolaro’s family and friends say he may have been murdered. “Danny was dealing with some people who were pretty bad players,” said his brother, Dr. Anthony Casolaro, a critical-care specialist from Arlington, Va. “It’s hard in my heart to believe that he killed himself.” ‘Even More Bizarre’

Officials at the Justice Department and the Federal Bureau of Investigation say they have seen nothing regarding the death that would impel them to become involved in investigating it.

“Conspiracy theories are normally bizarre, but this one is even more bizarre than most because it has no basis in fact,” Mr. Tillett of the Justice Department said.

The White House refuses to comment on the Casalaro case or the “octopus” conspiracy allegation other than to point out that President Bush has repeatedly denied involvement in any scheme to delay release of the hostages in Iran. “This is basically a matter for the Justice Department,” said Judy Smith, a White House spokeswoman.

Congressional investigators have not yet decided whether to look into Mr. Casolaro’s death when they resume hearings on the Inslaw case.

Terry Miller, who was a friend of Mr. Casolaro, says he spoke frequently with him about his work. “He told me he was beginning to get threatening phone calls, and I was concerned for him,” said Mr. Miller, a Washington-based consultant on government contracting.

Inslaw’s owner, Mr. Hamilton, says he does not know how close Mr. Casolaro was to proving his theory. But Mr. Hamilton said he was making progress, particularly in recent months. “I think he was murdered,” Mr. Hamilton said.

But several people who have looked at the notes and papers Mr. Casolaro compiled say they are mostly a rehash. “There was nothing in them, essentially, that had not previously been in the news, that you had not heard before,” said Roger Donald, the publisher of Little, Brown & Company, a New York publisher whom Mr. Casolaro once approached with a book suggestion.

“There was no book there, only an on-going investigation,” Mr. Donald added. “There was no real evidence that he was about to uncover some huge governmental conspiracy.”

Ultimately, it appears, Mr. Casolaro saw the Inslaw case as the key element in his investigation, if for no other reason than that courts and Congressional committees have confirmed a number of his suspicions.

For example, the second court to consider the case, the United States District Court for the District of Columbia, concluded: “The Government acted willfully and fraudulently to obtain property that it was not entitled to. . . . There is no evidence that the Government ever negotiated in good faith.”

What no court has found is the sort of conspiracy seen by Mr. Casolaro.

http://query.nytimes.com/gst/fullpage.html?res=9D0CEED6143FF930A3575AC0A967958260&sec=&spon=&pagewanted=all

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Written by nuganhand

September 2, 2008 at 1:38 am

Posted in Uncategorized

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