Nelson Bunker Hunt

Nelson Bunker Hunt (February 22, 1926 to October 21, 2014) was the second son of the Dallas oil producer H.L. Hunt and his first wife, Lyda Bunker Hunt. He held the Libyan concession that contained the Sarir field and was for a time described as the richest man in the world, with a fortune put at 16 billion dollars. With his brother William Herbert Hunt he was indicted for wiretapping and for obstruction of justice in the 1970s, accumulated some 200 million ounces of silver by 1980, and was found by a federal jury in 1988 to have conspired to manipulate the silver market. He sat on the national council of the John Birch Society, was president of the Council for National Policy in 1983 and 1984, and in 1985 gave 475,000 dollars to the tax-exempt foundation through which Oliver North raised money for the Nicaraguan Contras. He went through personal bankruptcy in 1988 and remained rich.¹²³

Libya

In December 1957 the Libyan government granted Hunt Concession 65 in Cyrenaica, and in 1960 he conveyed a half interest to British Petroleum, which supplied the capital and the drilling. The partners struck oil at Sarir in 1961. On December 7, 1971, Muammar Gaddafi's government nationalized BP's half in retaliation for Britain's failure to prevent Iran's seizure of three islands in the Persian Gulf. The decree left Hunt's half alone. A State Department memorandum to Secretary William P. Rogers eleven days later recorded that "Bunker Hunt is trying to cooperate with the Libyans to the extent of keeping production going but has refused a Libyan request that it market the ex-BP share of the oil as well as its own." The department decided against any public statement in support of Britain.⁴⁵

Hunt was a party to the Libyan oil sharing agreement, under which the companies operating in Libya pooled production so that none could be picked off singly. The Justice Department's Antitrust Division exempted the arrangement by business review letter, and it was administered by the companies' lawyer, John J. McCloy. Oil executives told State Department officials on March 16, 1973, that the agreement had "allowed Bunker Hunt Oil Company to 'stand firm' against Libyan demands." The department kept the agreement classified against requests under the Freedom of Information Act from the New York Times and Ralph Nader. A department officer, Warren Clark, wrote on March 23 that the Senate subcommittee then examining ITT and Chile "would fry the State Department if it was revealed that we classified these documents in order to protect the 'cartel.'" Libya had demanded a 50 percent share of Hunt's operation in December 1972, and he refused. On June 11, 1973, it nationalized the whole of his interest. On September 5 McCloy told Under Secretary of State William J. Casey that the compensation Libya was offering the other companies was "less than the Bunker Hunt proposal."⁶⁷

Hunt settled with Libya on May 19, 1975. He sued Mobil and the other major companies, alleging that they had manipulated the negotiations to have him eliminated from Libyan production, and the suit was dismissed in 1977 under the act of state doctrine. BP sued him in London for the value of its work on the field.⁸

The Dallas Advertisement and Willoughby

Hunt contributed to the 1,462 dollars that paid for the black-bordered advertisement "Welcome Mr. Kennedy to Dallas" in the Dallas Morning News of November 22, 1963. The money was collected by Joseph P. Grinnan, a Dallas oil broker and John Birch Society coordinator, and the other contributors included H.R. Bright and Edgar R. Crissey. The FBI questioned Hunt about it. He was represented by Ivan Irwin Jr., a lawyer for Hunt Oil interests. After Douglas MacArthur's relief in 1951, Bunker and Lamar Hunt had financed the International Committee for the Defense of Christian Culture, the private intelligence network of MacArthur's former intelligence chief, General Charles Willoughby, which published the Foreign Intelligence Digest. Larrie Schmidt, who organized the Dallas advertisement, met Willoughby more than once before the assassination.⁹¹⁰

The Wiretaps

In the autumn of 1969 Bunker and Herbert Hunt approached a man named Everett, the president of a Houston private investigation agency, about electronic surveillance of houses in Dallas. They told him they had been the victims of extensive embezzlement. Their father's food company, HLH Products, had absorbed tens of millions of dollars from Hunt Oil, and they suspected his security chief, the former FBI agent Paul Rothermel, and other aides. Everett's electronics man, Patrick McCann, built telephone transmitters, a man named Watson installed them on the poles, and an Everett employee, Jon Joseph Kelly, sat in rented cars outside the houses changing tapes, which were edited and delivered to the Hunts. The Hunts paid Everett's itemized bill. A neighbor in Richardson noticed the cars. On January 16, 1970, a Richardson policeman stopped Kelly, found a recorder under newspapers on the seat, and played the tape at the station.¹¹¹²

On February 3, 1970, FBI Assistant Director Cartha DeLoach reported to Clyde Tolson that Senator James Eastland had been called by the sons of H.L. Hunt, who told him they were trying to have their father declared incompetent. Kelly and McCann were convicted and sentenced to three years, and afterward named the brothers as the men who had ordered and paid for the taps. Three federal grand juries indicted nine men, among them both Hunts, in 1973. A fourth grand jury in Dallas spent nearly a year examining why three years had passed between the arrest and the indictments.¹²¹³

Bunker Hunt and his father attended the barbecue that John Connally gave for President Richard Nixon at Floresville in the autumn of 1972. People close to the Hunts said afterward that Bunker then met the new attorney general, Richard Kleindienst, at Eastland's plantation in Mississippi; that the administration promised the brothers immunity in return for a list of Al Fatah agents in the United States, which Bunker kept because he believed his Libyan position made him a target; and that the list helped the FBI stop a plot against Golda Meir in New York in March 1973. Kleindienst resigned in April 1973. Libya took the Sarir concession in June. The trial judge suppressed the tapes, and the Fifth Circuit reversed him on December 23, 1974, holding that men who hire others to tap telephones have no privacy interest in the equipment. The brothers were defended by Philip Hirschkop of Virginia and Travis Shelton of Lubbock.¹¹¹²

On July 21, 1975, a Dallas grand jury indicted the brothers, the Houston criminal lawyer Percy Foreman, the Dallas lawyers Ralph Shank, Charles Tessmer, and B.H. Timmins Jr., and Edward J. Hudson, a retired Houston industrialist, for conspiring between January 16, 1970, and February 28, 1973, to obstruct the grand jury "for the purpose of preventing the indictment" of the two Hunts. The means alleged were payments to the lawyers of prospective witnesses, warnings of harm, monthly payments to witnesses "if they went to prison and did not testify," promises that they would not be indicted "as a result of contacts with high government officials," and a secret payment of 100,000 dollars to Foreman "to guarantee the silence of prospective witnesses." Among the overt acts, Shank told a witness on March 6, 1970, to "hang tight" because the case was "being worked on at a higher level," and Bunker Hunt said that summer that he "would take care of the wiretapping case." The brothers called the prosecution "oppression of us because of our conservative views." They said that more than 50 million dollars had been embezzled from Hunt Oil by employees who "were secret Government agents," and that the trouble had begun after they refused a CIA request to place its officers in Hunt International Petroleum. The United States attorney, Frank McCown, acknowledged that "the CIA contacted the Hunts in the mid-1960s" and said he did not recall the nature of the contact. Shank said: "In more than 40 years of practice I have neither attempted to nor engaged in any obstruction of justice."¹⁴ The brothers were acquitted of the wiretapping charges at Lubbock that fall. In April 1976 the government dropped the obstruction charge against Herbert Hunt, and Bunker Hunt pleaded nolo contendere to a charge that he "did knowingly misbehave" by offering monthly payments to prospective witnesses, and paid a fine of 1,000 dollars. Tessmer and Timmins entered the same plea and paid the same fine. The charges against Foreman, Shank, and Hudson were dropped. Shank had been H.L. Hunt's lawyer since at least January 1942, when he negotiated the settlement with Frania Tye at the Adolphus Hotel.¹⁵

Soybeans and Sugar

Hunt International Resources bought the Great Western sugar company of Denver in 1975. On April 28, 1977, the Commodity Futures Trading Commission sued Bunker and Herbert Hunt, five of their children, and a family corporation in Chicago for holding soybean futures far in excess of the three-million-bushel speculative limit by trading through the accounts of family members. The Seventh Circuit upheld the commission in 1979.¹⁶¹⁷

Silver

The brothers began buying silver in the early 1970s. On July 15, 1979, they formed the International Metals Investment Company in Bermuda with two Saudi partners, Ali bin Mussalem and Mohammed Aboud al-Amoudi. Together with the accounts of Mahmoud Fustok, a Lebanese-born brother-in-law of Crown Prince Abdullah, and the Brazilian trader Naji Nahas, the group held about 200 million ounces by the end of the year, more than half the deliverable supply. The price rose from six dollars an ounce to fifty in January 1980. In early January the Commodity Futures Trading Commission met the exchanges in closed session, and Hunt, who arrived uninvited, was reportedly refused entrance. On January 21 the board of the Commodity Exchange barred new positions and restricted silver trading to liquidation. Confidential figures that the Commodity Futures Trading Commission supplied to Senator William Proxmire's banking committee, and that he made public, showed that nine dealers and traders represented on the exchange's board of 23 held net short positions of some 75 million ounces while the price was rising. Proxmire called it "an appearance of very substantial self-interest by the very people who were making the decisions as to margins and position limits." Henry Jarecki of Mocatta Metals, chairman of the exchange's margin committee, was accused within the exchange of a decisive part in the rule. His lawyer said: "The self part of self-regulation means there are going to be conflicts." The chairman of the Chicago Board of Trade, Ralph Peters, had disqualified himself from the corresponding vote there. The exchange refused a demand from Nahas's lawyer for the record of its meetings and the positions of the participants.¹⁸ Henry Jarecki, president of the bullion dealer Mocatta Metals, sat on that board. A commissioner said afterward that Jarecki had been "very vocal to the commission" and that the dealer "just had everything on the line with their banks." The brothers failed to meet their margin calls on March 27, 1980, and the market broke.¹³¹⁹

A consortium of thirteen banks then lent Placid Oil Company 1.1 billion dollars against the family's oil properties, with the personal guarantees of Bunker, Herbert, and Lamar Hunt. Federal Reserve Chairman Paul Volcker defended the loan before Congress.²⁰

Minpeco, the Peruvian state minerals company, which had been short silver, sued in New York. After a six-month trial a jury found in August 1988 that Bunker, Herbert, and Lamar Hunt, Fustok, and the Bermuda company had violated the Commodity Exchange Act and the antitrust laws and committed fraud, and that all but Lamar had engaged in racketeering. Judge Morris Lasker entered judgment for more than 132 million dollars and noted that the accounts of Bunker Hunt's children were among those the conspirators controlled. The brothers settled with the Commodity Futures Trading Commission in 1989, each paying ten million dollars and accepting a lifetime ban from the commodity markets.³¹⁹

The New Right

The Texas oilman T. Cullen Davis carried Paul Weyrich's plan for a council of conservative donors to Hunt, and the two recruited the membership of the Council for National Policy, which reached 400 by 1984. Hunt succeeded Thomas F. Ellis, the political manager of Senator Jesse Helms, as president for 1983 and 1984. He was a principal backer of the Western Goals Foundation of Representative Larry McDonald. Russ Bellant wrote in 1991 that "the oil billionaire Hunt brothers and Senator Jesse Helms" were members of the American branch of a Scottish eugenics society headed by Robert Gayre, the publisher of Mankind Quarterly, and organized in the United States by Lord Malcolm Douglas-Hamilton.²²¹

In September 1985 the fundraiser Carl "Spitz" Channell flew Oliver North to Dallas by private plane to dine with Hunt at the Petroleum Club. North described the needs of the Contras, put at five to six million dollars, and left the request to Channell, because, Channell testified, "he couldn't ask for money himself." Hunt gave Channell's National Endowment for the Preservation of Liberty 475,000 dollars. He told congressional investigators he did not recall any conversation with North at the dinner. Channell pleaded guilty in 1987 to conspiring to defraud the United States by using a tax-exempt foundation to buy weapons, and named North as a co-conspirator.²²

Bankruptcy

Placid Oil filed for bankruptcy in New Orleans on August 29, 1986, against 23 banks owed 1.5 billion dollars, and the Hunts sued the banks for 15 billion. Bunker Hunt and his wife, Caroline, filed for personal bankruptcy in September 1988 before Judge Harold C. Abramson in Dallas, where the Tax Division of the Justice Department appeared against them. That year he sold 580 thoroughbreds for 46,912,000 dollars. The trustees sued a hundred defendants, most of them members of the family, and the legal bills reached 20 million dollars. In 1994 the brothers paid about 160 million dollars, most of it to the Internal Revenue Service. The trusts their father had created for them in 1936 were outside the reach of the creditors. Bunker Hunt's was worth 175 million dollars in 1995, and it owned Hunt Exploration and Mining, with interests in Pakistan, Australia, the Philippines, and Nicaragua. He began buying racehorses again in 1999.¹²³²⁴