THE PRESIDENT'S PRIVATE EYE

Terry Lenzner's résumé-Harvard Law, civil rights, the Watergate Committee-may be classier than that of most private investigators. But even in the $4 billion business of digging up dirt, his firm, whose clients have included the Clintons, Mike Tyson, and Big Tobacco, is disliked and feared

JUDY BACHRACH

Politics

What's the worst thing you've heard about me?" demands Terry Lenzner. The head of Washington's most feared and vilified private-investigation firm is tense and faintly intimidating. "Terry's a deeply paranoid, suspicious guy. It ruins a productive business relationship," explains a former employee of Lenzner's Investigative Group International (I.G.I.). "But, at the same time, it makes him a great investigator."

Bill Clinton, Lenzner's client, clearly agrees. I.G.I., also employed by Hillary Clinton and the Democratic National Committee, has been labeled "the White House secret police" by former presidential adviser Dick Morris, who flatly states, "The president should have nothing to do with people of this sort. It will get him into more trouble than Whitewater."

In Lenzner's comfortably large house on a tree-lined street in Washington's Cleveland Park, the light glints off his hair, boot-polish black. One of his hands grips an electronic notepad. A rim of moisture rests on his upper lip. "I think it's hard to make moral judgments," he says in a rare moment of reflection.

"Terry decided the only way to do it is to try and not make judgments—that if you go for facts, the facts will speak for themselves," says Margaret Lenzner, his wife of 30 years. Every election year they debate about his clients. "It's like lawyers representing bad people," she tells me.

"There are gray areas of my life," Lenzner himself adds. "And I see a lot of gray in different worlds."

According to a former employee, Lenzner is not ambiguous about his most famous client. "Clinton's a fool!" the investigator has declared. Another old friend recalls Lenzner's dismissing White House staffers as "a bunch of fumbling idiots [who] need me now." (Lenzner denies making both statements.) Despite all this, the Clinton connection remains I.G.I.'s most valuable, and perhaps most dangerous, asset.

Lenzner's firm is believed to have scrutinized the lives of the president's most troublesome acquaintances, including Monica Lewinsky and Paula Jones, whose financial backers and sexual history were major areas of inquiry, say two former employees. Lenzner's involvement in the cases has, in fact, drawn the attention of independent counsel Kenneth Starr, whose people have summoned a number of former I.G.I. employees to explain the firm's methods of "opposition research." They are also curious about whether Lenzner's people have probed the lives of Kathleen Willey, the former White House aide who accused the president of groping her, and Linda Tripp, the former White House employee who unleashed the Lewinsky scandal.

he ethical investigator," as Lenzner is billed, backtracks through his laudable past: Harvard Law School; his three years as a junior Justice Department attorney braving violent segregationists during the civil-rights movement; his time on Sam Dash's Senate Watergate Committee's staff. (Dash told me earlier: "Terry—I couldn't have done it without him.")

Yet certain old friends consider Lenzner's days as an idealist and reformer long gone. At 59, he has worked for some of the very sorts of people and companies he once attempted to derail or indict. These include the tobacco giant Brown & Williamson, when the company was eager to discredit whistle-blower Jeffrey Wigand, a scientist with serious ethical concerns about his former employer. Lenzner also worked on behalf of prizefighter and convicted rapist Mike Tyson, who, says a former I.G.I. staffer, hired Lenzner to turn the tables on his accusers during his appeal. (Lenzner says that "I.G.I. was not hired to investigate women who claimed to be raped or abused by Tyson.")

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According to former colleagues, other clients on Lenzner's considerable list include an electronics executive with an alleged vendetta against an ex-employee; a foreign government tracking a terrified dissident; a food company with suspicions about a tenacious consumer advocate; and a lottery corporation with a reputation for bribery. I.G.I. has also, says another exstaffer, looked into the activities of Richard Branson, founder of Virgin Atlantic Airways, who had had the temerity to sue the chairman of that lottery corporation.

"Everyone has good and bad, and Terry was on balance good, noble," says a onetime friend. "And now he's slimy. I see something Shakespearean in all this."

Certain journalists find Lenzner's more recent history considerably less classic. A former employee says that around 1992, I.G.I. scrutinized a California reporter who had attacked its client the National Enquirer. The press felt targeted, and not for the first time.

Lowell Bergman, the senior investigative producer for CBS News, tells me, "I believe it is true that some people who work for Lenzner will, as a matter of course, go to information brokers ... who get access to telephone toll records [which detail phone numbers of sources]." Lenzner denies that he investigated Bergman. But when asked about reporters' fears that he might expose their sources, he responds, "Well, they should worry about it. We have a right to protect our client."

Welcome to the gray, ambiguous world of Terry Lenzner and his competitors, a thriving, growing universe involving secrecy, power, money, and information. By the year 2000, according to Fortune magazine, the business of investigation is expected to total revenues of $4.6 billion. These days, everyone wants an investigator: corporations planning mergers; victims of smear campaigns; attorneys for wronged, practical wives. Ivana Trump used I.G.I. during her divorce from the errant Donald.

In this expanding field, Lenzner's firm attracts the splashiest clients as well as the political ones. Lenzner says he employs 92 people, a number many of his former investigators consider inflated. "I.G.I. is Avis," says one of those doubtful observers. "You probably get a level of ruthlessness you wouldn't get at Kroll [the largest U.S.-based investigative firm]. And right now you think you're hobnobbing with the guy who works for the president."

This is no small advantage. "There are thousands of these agencies, but very few run by people from above the salt," explains a former journalist who worked for Lenzner. "If you look around, none but I.G.I. is run by a guy who graduated from Harvard Law School. Let's say we're both on a corporate board ... you tell me you've got some crazy vice president in your company—you're worried about what he's up to. But you're not the type who knows private eyes, right? Well, I'll say, ' You remember Terry.'"

"Terry's a deeply paranoid, suspicious guy. It makes him a great investigator."

I.G.I. has recently experienced an exodus of disillusioned employees, but many who have passed through Lenzner's gates are of undeniable renown: Raymond Kelly, an undersecretary at the Treasury, was president of I.G.I. between 1994 and 1996. Former F.B.I. deputy director Larry Potts is now at the firm. Brooke Shearer, the First Lady's close friend and the wife of Deputy Secretary of State Strobe Talbott, worked at I.G.I. for four tempestuous years and remains Lenzner's particular confidante. Her twin brother, Cody Shearer, was also a frequent presence, according to former employees.

At a recent seminar at Harvard Law School, Lenzner was candid about his agency's philosophy of seeking out its targets' vulnerabilities. "One of the things we look for is people who have left an institution," he said. "A gold mine!" Small wonder that I.G.I., which in a 1997 promotional letter referred darkly to "socalled whistle-blowers," demands that its recruits sign confidentiality agreements.

Detective work, with its emphasis on exhaustive research, is not unlike journalism. But it does turn the rules of reputable reporting upside down. There is another vital distinction. "You don't have to tell a story," says a former Lenzner employee. "What has happened to facts in the last days of the 20th century is this: Facts are for sale. Not to readers and the world but quietly—to clients."

The field also attracts employees from law enforcement. "The truth is you can accomplish a helluva lot more as an investigator privately," explains former I.G.I. staffer Michael Moroney, a veteran of the Justice Department's organized-crime strike force. One thing he learned: "For a price, everything is available."

Phone records? "Absolutely!" He smiles broadly. Credit records? "Absolutely." Did I.G.I. do this? "Absolutely! Of course, it was always a little game as to whether Terry knew or didn't know. It was always a wink and a nod." Moments later he adds, "Credit records were never obtained unless Terry approved."

Lenzner vehemently denies knowing about the acquisition of credit or telephone records, "unless," he says, "they were part of the public record." Kathy Lavinder, who heads I.G.I.'s Washington office, calls phone records "a gray area," but says she herself spurns such methods. Three of Lenzner's exemployees, however, claim that some in the firm were asked to obtain both phone and credit data—which are usually protected by law. "Terry has this ethical reputation, which has become a real crock of shit," says one of I.G.I.'s 30-plus former employees.

Investigative firms even have their own vocabulary, mostly borrowed from the intelligence community. An "information broker" is someone willing to deploy creative means of gathering facts. "Dumpsterdipping," or sorting through the trash of a "target," is an art form mastered by, among others, Brooke Shearer, who is now a senior adviser at the Department of the Interior.

"There's nothing more hilarious than seeing Brooke go through people's garbage," reports one I.G.I. alumnus.

In November 1991, when an I.G.I. operative was found removing trash from a would-be corporate raider's home, rival investigators were outraged, fearing that Lenzner's people had blown it for everyone. "We've gone through it thousands of times—we've never gotten caught," boasts a competitor appalled by the clumsiness of the episode. "You have to have a story: 'My wife lost her ring. We were guests here at dinner last week, and now the family is away.'"

That sort of cock-and-bull invention is known as "pretexting." Its purpose, to disguise the detective's goal or identity by fabricating a story or personality, was described by Lenzner as "one of the most challenging vehicles to obtain information." "I did a couple of pretexts," recalls an ex-employee of I.G.I. Posing as a realestate assessor, she phoned targets, promising her services "for free!" (She was actually trying to discover whether the persons called actually owned the house they lived in.)

When a large cosmetics company signed on at I.G.I., an investigator pretexted as a makeup expert. "It was like making crank calls," she says, giggling. "But you kind of hang up saying, What the hell am I doingT She pauses. "You just do what you're told."

Ienzner strode into this complicated maze of pretexts and subtexts 14 years ago, when the rather disreputable field was battling to become button-down and mainstream. He was not, he assured staffers, going to get involved in ethically questionable cases or the gumshoeing of adulterers. He was the man whom none other than Representative Jim Leach of Iowa describes as having had "immense integrity."

Lenzner's professional timing was impeccable. In 1984—when company mergers and hostile takeovers were de rigueur, and everyone wanted to know who was stabbing whom in the back—Lenzner and his .partner Jim Mintz saw an opening. (Mintz formed a firm in New York in 1994, after a bitter split from Lenzner.)

Business boomed. An impressive investigation of Ivan Boesky on behalf of the junk-bond firm Drexel Burnham Lambert attracted clients. Fees of $300,000 to $400,000 for single cases were not uncommon.

One thing truly distressed Lenzner: top-notch lawyers looked down on diggers of dirt. It continues to rankle. "It starts in law school," he tells me. "The law schools don't focus on investigative work. They don't pay any attention. They don't teach it," he says, shaking his head.

Because they feel investigative work is basically low-class? "Exactly. It's elitism. It really is."

Terry Falk Lenzner's background is an uneasy blend of Our Crowd and Our Gang. His maternal grandfather, Myron S. Falk, a wealthy engineer Firmly embedded in the upper crust, served on the building committee of Temple Emanu-El in Manhattan and was a founder of old New York's exclusive, German-Jewish Harmonie Club. "Joe Lenzner [Terry's father] was the First Russian-Jewish member of the Harmonie Club," explains Margaret Lenzner, adding that he came from, "God forbid, Trenton."

Joe Lenzner, a New Jersey-born dentist with a passion for football, appears to have been as eager as his wife's family was to bury his past. During his childhood on Manhattan's East Side, Terry was unaware that his father even had siblings. On the other hand, once a year Terry and his family visited his mother's brother in his Fifth Avenue town house, which was crammed with gorgeous Chinese art. "They used to say, 'You're going to the Big House,'" Terry Lenzner recalls. "And there was always a fight, because he used to put my father down."

The father, in turn, demeaned his youngest son. The two had a dyspeptic relationship that remains impossible to sort out, and there was considerable rivalry among the three Lenzner boys.

"Jesus, you missed three tackles, four blocks," sneered Lenzner's father after Terry's final football game at Harvard.

"People tell me my favorite is Terry, but I always say no. Secretly, it's Allan," Joe Lenzner would casually inform relatives. But Margaret Lenzner never wholly believed this. "Terry was the one! Terry was the success! The others couldn't really do it," she insists.

"You won't believe how my son was raised," Terry's mother told an acquaintance before recounting the final football game of Terry's Harvard career, when the young man—his team's captain—was triumphantly carried on the shoulders of his buddies. The father remained unimpressed. '"Jesus, you missed three tackles, four blocks. That was a terrible game!'" sneered Joe—words his son never forgot.

After the 207-pound athlete graduated from law school in 1964, he joined up with John Doar, the Justice Department's civil-rights chief. Lenzner recalls, "Six months later I was walking around Philadelphia, Mississippi, not having the slightest idea of what I was doing, working on the murders of civil-rights workers Schwerner, Goodman, and Chaney."

Lenzner found himself sleeping on hotel-room floors, rounding up scared witnesses. "I was with [James] Meredith the same day he was shot, going from Memphis to Jackson," he says. One day, he figured, the odds would turn against him.

During the Nixon years, Lenzner became director of the Office of Legal Services, an agency thought by the commander in chief to be a hotbed of radicalism.

It was here that Lenzner met the idealistic Kimba Wood (now a federal judge in New York) as well as young Mickey Kantor, who later, as a senior official in the Clinton administration, would prove a highly useful contact.

In November 1970, Lenzner was Fired at the instigation of the president, who considered him one of the agency's biggest troublemakers.

Three years later, Chief Counsel Sam Dash summoned Lenzner to come on board as one of his top assistants on the staff of the Senate Watergate Committee. The subpoena that Lenzner served on the president of the United States hangs to this day in his I.G.I. office.

"Terry was an extremely good and very sophisticated investigator: he was a good cross-examiner and had a sense of how to use the records," recalls journalist Scott Armstrong, who was Lenzner's colleague on the Watergate staff and later at I.G.I.

What Lenzner was not, some veterans of the staff insist, was a team player. In his shadow, in fact, the team all but disappeared, Dash included. When Lenzner learned that Nixon had put his own brother Donald Nixon under surveillance, he didn't reveal the information to his boss for some time.

"Terry Lenzner operated in a very secretive manner on the Watergate Committee. He was very reluctant to share what he was doing with others, except the press," says another colleague still furious about the leaks that "really impeded our investigation." He is certain, from what reporters told him, that these leaks came from Lenzner directly. (Lenzner insists that he never provided information about the committee to the press.)

From Dash's committee, Lenzner moved on to a succession of law firms. By 1984, though, the life of an attorney seemed tame, especially when compared with the elusive business of investigation. "The facts are always what interested Terry," says his wife. "He wasn't about to go write briefs."

And by 1987, firmly ensconced at the helm of I.G.I., watching the money roll in, he no longer had to.

Around two years later, just as the boom era of corporate mergers went totally bust, Lenzner's firm began acquiring the political clients that would later make it famous, including some high-powered contacts of Arkansas's ambitious young governor, Bill Clinton. Some of I.G.I.'s competitors, who stay out of the political arena, were surprised. "Digging up dirt for politicians ... in an election—it sticks to you," says rival-firm owner Phil Manuel.

Politics and I.G.I. became intertwined. Friends say Lenzner harbored serious hopes of becoming F.B.I. director. Within two years, top staffers were marketing their services aggressively to the Democratic National Committee. Lenzner was properly situated, friendly still with Mickey Kantor—although one former staffer says he often derided Clinton's big buddy. (Lenzner says that he has "the greatest . respect for [Kantor's] professional accomplishments.")

The actual substance of Lenzner's labors in this period remains largely secret. Like most clients, politicians are referred to I.G.I. by lawyers. It is, therefore, often the law firm's name—and not the agency's—that appears on campaign reports reviewed by the press. As one investigator puts it, "'Laundering' happens routinely, through an attorney."

Lenzner insists that only a small number of his cases are political. But these are precisely what put him on the map. Contrary to the assertions of White House lawyers, who claim I.G.I. began its work for Clinton in 1994, the firm began its work on Clinton's behalf seven years ago. Even earlier it had investigated his potential political opponents in Arkansas. Around 1989, Democratic operative Ricki Seidman, who then worked for Lenzner, was managing a top-secret account called Arkla. Her door, someone around the office noticed, was always closed.

Generally the case would have been thought dull stuff. Arkla was an Arkansas public utility, much maligned for its sweetheart deals during a byzantine campaign for governor involving the ambitious candidate Bill Clinton. The utility's head was Thomas "Mack" McLarty, a close confidant of Clinton's, who ultimately became his White House chief of staff.

One of the firm's jobs when it undertook the Arkla case, say two former I.G.I. people, was to investigate Tommy Robinson, a Republican gubernatorialprimary candidate backed by the powerful Stephens banking family.

"They were worried the Stephens people would buy the governorship," recalls one of the former I.G.I. staffers, adding that the whole point was to ensure "Clinton could walk away with the governorship."

"Given that I am now here in the Justice Department, I can't talk about Arkla," says Seidman, who left I.G.I. in 1991. She adds, "I know absolutely nothing about [Lenzner's work for] Clinton." (Lenzner says he has no memory of the Arkla case.)

Other exiles from I.G.I. appear to know more. In 1991, says another ex-employee, when Clinton sought the presidency, work on his behalf began in earnest. The idea was to discover what dirt New York governor Mario Cuomo's supporters might have dug up on his rival presidential hopeful. There were evidently deep anxieties among Clinton backers, some concerning an Arkansas bank. A former Lenzner associate recalls learning of "a [Clinton] bank fund so tightly controlled that Clinton's best friends and closest supporters didn't know [what it was for]."

Friends of Bill had, according to this source, speculated in vain about the purpose of this mysterious account. Was the money being used to pay off Clinton's women? Campaign expenses? As it happened, I.G.I. already had considerable information on a Cuomo pal. According to a knowledgeable source, a few years earlier during its work for Arkla, I.G.I. had investigated Joel West McCleary, a Cuomo friend with strong connections to the Stephenses.

When contacted in Virginia, McCleary, who is married to Lavinia Currier of the Mellon family, laughs outright. Indeed, he says, he was close to Cuomo. Then, in '92, he switched allegiance, to Clinton. "I had no idea I was being investigated, but that was very smart of them," he says. "I mean, Primary Colors wasn't just a movie." A longish pause follows. "If they were nervous at all, it must be because of Arkla.... I was close to Jack Stephens."

"Terry was on balance good, noble. Now he's slimy. I see something ShakesDearean in all this."

Certainly political work would not make Lenzner's fortune. But that wasn't the goal. "I always have a theory Terry couldn't care less if he made a dime, as long as he got into the political arena," says an investigator who left I.G.I. a few years ago. "If he got a $25,000 case, he'd

spend $50,000 on it at the drop of a hat. He loves the client, the characters. He loves being a player."

Such freedom with money took its toll. Says Tom Ierubino, who was I.G.I.'s chief financial officer from 1990 to 1993, "It was a disaster! I had to negotiate a seven-figure line of credit. And when we got that, we were often at the edge of it, right up to the edge of the line of credit." Lenzner, he recalls, exploded heedlessly, "How could you let me get into this problem?" (Lenzner denies making the comment.)

Office tensions ran high. "We used to say that I.G.I. is the only place where animals eat their young. It is a cesspool of infighting," recalls a former investigator. Even I.G.I.'s Kathy Lavinder says her boss does little to lighten the aggressive atmosphere. "He has a short fuse from time to time.... He's lost a lot of good people that way."

In the late 1980s, when the firm worked on behalf of international banker Edmund Safra—whose good name had been smeared on several continents by American Express—I.G.I. learned to its horror that freelance journalist Cody Shearer, twin brother to Brooke Shearer and friend to Lenzner, had done some Safra-smearing in his syndicated newspaper column. In fact, Shearer had falsely accused the banker, in a story that had to be retracted, of laundering money. To the astonishment of some, I.G.I. decided to obtain Shearer's documents.

According to investigators, Scott Armstrong, a Lenzner consultant, was given the job of getting those papers from Shearer. "I told Terry, 'What's the problem? Why don't you ask Cody for the documents?"' says Armstrong. "But Terry said, 'I don't want Cody to know I.G.I. is interested in them.'" Armstrong told Cody Shearer he wanted to give his papers to an organization that would make them available to the public, and did so. "The only thing I disguised was that I.G.I. was interested in them," he says. (Armstrong says he left I.G.I. over a matter of professional ethics; Lenzner says that Armstrong was terminated.)

Shortly thereafter, Brooke Shearer, furious that her twin had been targeted, stormed into Lenzner's office and hurled a coffee cup straight at her boss's head. ("Brooke almost decapitated Terry with that coffee cup," reports one highly amused former staffer.)

"Scott Armstrong, without anyone's knowledge, pretexted Cody," Lenzner insists. But another former employee backs Armstrong's assertion that Lenzner was far from surprised.

Undaunted, Cody Shearer continued popping up at I.G.I.'s offices and using its databases, seemingly hard at work on company business. His favorite opening line was "I was talking to Bill last night...," by which he meant Clinton. No one knew what to make of this. "I thought he was lying, but maybe a creep like that does know the Clintons," says one listener.

In 1992, according to one old staffer, Cody Shearer wrote up a proposal suggesting that the firm investigate, on behalf of the Democratic National Committee, George Bush's alleged love affair with the State Department's Jennifer Fitzgerald. Shearer was also, others claim, "telling everyone about Bush in a gay bathhouse." He even attempted to launch an I.G.I. probe into allegations of marijuana use by Dan Quayle. Jeffrey Nason (who ran I.G.I.'s Washington office) threatened to quit over Shearer's plan to dig into Bush's love life. Former Washington Post journalist John Hanrahan, who also worked for I.G.I., was equally horrified.

"When that happened, Lenzner cut Nason out of the Cody loop," says one former staffer. "I know that Cody was working on the Bush love thing with I.G.I. He did it in writing. I know it didn't stop, because Cody kept coming around."

Lenzner and Shearer both adamantly deny that Cody did anything for I.G.I. In fact, Lenzner claims that the controversial journalist visited the firm's office "no more than two to three times—at most—in the past 15 years."

I.G.I.'s former C.F.O. Tom Ierubino recalls Cody Shearer's visiting the office "a good bit." Ierubino continues: "He was on the consulting rolls for nominal sums.... Now, that's not to say he wasn't doing something more ..."

Probably no one at the firm, aside from Lenzner, knows everything that is going on. "The big, high-revenue cases are brought in by Terry," explains one source, who describes I.G.I. as "very dysfunctional" and goes on to explain: "Many cases are marked HIGHLY CONFIDENTIAL and are not shown to I.G.I. staff in general. It was either secretive matters or stuff Terry didn't want to own up to." Adds Ierubino, "Terry would often take some very questionable cases."

"It's hard to make moral judgments," says lenzner. "There are gray areas of my life..."

In the 90s, these assignments became more plentiful at I.G.I. Some cases—an investigation of William Aramony, who had plundered United Way of America, a discovery that the Population Council had hired a disbarred lawyer to promote the abortifacient RU 486—were sources of pride. Others were not.

Around 1992, according to one exI.G.I. employee, the National Enquirer asked Lenzner's firm to investigate Rod Lurie, a Los Angeles journalist who had written two memorable exposes of the tabloid. (During this period, Lurie had also been investigated by a rival agency.) The writer began noticing "funny things" that made him so nervous he ordered a security system installed in his home. "There was a van parked outside of my house for long periods of time," he says. "It was like a media van with a little dish on it."

Equally unsettling, Lurie adds, "a diamond store in San Francisco ran a credit check on me, and some credit-card company wrote me I had been denied this credit." The puzzled Lurie, who claims he had never requested their jewels, called the store. "They said, 'Sorry, sir. We don't know what you're talking about.'" (Lenzner says that he has never heard of Lurie.)

For a reported payment of $250,000, I.G.I. accepted as its client the multimillionaire Michael Huffington, who was running in 1994 for the U.S. Senate in California against Dianne Feinstein. The firm also began an investigation of a rightwing television host for his angry wife, who suspected he was wooing young men. (He wasn't.) Some staffers deplored the nature of the work. Far worse, there were serious concerns in certain instances about the firm's conduct.

One of I.G.I.'s important sources of revenue during this decade has been Gtech, a 4,500-employee corporation that devises lottery systems and support services. "Rare is the company that has faced as many allegations of baldly sleazy conduct as Gtech," Fortune magazine reported in 1996. Richard Branson, founder of Virgin Atlantic Airways, claimed that Gtech's chairman, Guy Snowden, had tried to bribe him in an effort to keep the English billionaire out of the British lottery field.

Around the mid-90s, report former I.G.I. staffers, operatives (including the firm's technical expert) rented an office in Alexandria, Virginia. There, working on behalf of the lottery corporation, they shared space with an unknowing representative of its rival Control Data.

In short, they were able to spy on their client's opposition. "I know they got the trash of Control Data—I think they got its phone messages, which were left lying around," says a former I.G.I. employee. "It was a long-term thing. They were monitoring what was coming in from that exercise for a while." Valuable? "Very," says this person.

"Sounds like a very creative investigation," Lenzner remarks.

It got even more so, according to a former employee. More than two years ago, Branson launched a libel suit in Britain against the chairman of Gtech, which he won last February. During that time, according to one former staffer, I.G.I. went back to work. "In a battle with a guy like Branson, anything you can find is useful if you're going into a libel trial," he says, and adds that I.G.I. was looking for drugs, information, or other things germane to Branson's personal life or business ventures.

Lenzner's response to the allegation that I.G.I. worked for Gtech is evasive. "This is incorrect." But Branson is sure he was being tailed. He just doesn't know by whom.

"Rich was in a hotel in South Africa about six months ago," reports Will Whitehorn, Branson's head of corporate affairs. "He gets called by reception—there's a package for him. But it was marked 'Re: Branson' and actually intended for another hotel guest. It had Rich's itinerary, press cuttings, photos, what he was up to in South Africa. We kept them." (Lenzner denies that I.G.I. investigated Branson.)

On at least two other occasions, according to former staffers, I.G.I.'s surveillance seems to have gotten out of hand. Around the summer of 1994, Eduardo Valle Espinosa, a scared Mexican dissident, was holed up in Alexandria, Virginia. Formerly a top aide to Mexico's attorney general, he had run for his life after describing his country as a "narcodemocracy" and charging that his government's involvement in drug trafficking had prevented him from pursuing major criminals.

According to former employees, Lenzner got the Valle assignment from a friend in the Mexican government who had earlier sent business his way. "We rented an apartment next to the one [Valle] was renting," reports a former I.G.I. staffer. "And they snuck a young girl in there with no experience." He sighs. "Her ear was literally to the wall." ("I.G.I. has never conducted any investigation of any Mexican 'dissident,'" Lenzner responds. "I have no idea what your citation to an 'inexperienced young woman' refers to.")

Another 1994 assignment was also a source of deep concern. According to three former employees, the chairman of Samsung—the giant Korean electronics corporation-had a "vendetta" against a former executive living in New Jersey. The chairman told I.G.I. that there were many things he wished to know about his former friend, who returned to Korea quite often. These included "the whereabouts of this guy, who he was seeing, who he was talking to."

To obtain this information, ex-staffers say, the former executive was secretly taped with a pocket-size recorder from a room next door. Certain investigators worried about what the results of their espionage might produce.

"Look," says a source familiar with the case, "Korean business interests are often tied up with Korean intelligence services. And I.G.I. tells the Samsung chairman, 'Oh, this guy's going to be in Korea this day.' ... And let's say he hurts the former executive ..."

"What has happened in the last days of the 20th century is this: Facts are for sale. Quietly-to clients."

"I am amoral, but I wouldn't have worked this case," concludes another former I.G.I. operative CONTINUED I-ROM PAGE 208 the era. "There comes a point where, no matter how powerful the client, you've got to say no."

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Lenzner says that his company would "never work for any client who we believe might cause physical harm." He also says, "Nobody ever said anything to me. Nobody ever came to me and said, 'We shouldn't have taken this case.' There never has been a person who left our office over an issue involving a client." Yet sources say that John Hanrahan's departure was caused, at least in part, by the Samsung case. Others insist that Lenzner's former partner Jim Mintz quarreled with him over the morality of acquiring telephone-toll and credit records. (Lenzner says that he never disagreed with Mintz about telephone and credit records.)

By the mid-1990s, Lenzner was riding high. At the same time that these risky cases were moving forward, I.G.I. was also digging on behalf of Senator Edward Kennedy, who was involved in a re-election campaign against Massachusetts businessman Mitt Romney.

Problems arose when one of Lenzner's operatives pretexted a suspicious Romney associate and was discovered, exposing Lenzner's firm to ridicule. In 1994, Michael Isikoff of Newsweek began researching the escapade. Lenzner pressed him to alter the piece, but got, as he recalls, "nowhere with Isikoff."

Still, he didn't despair. Evan Thomas, then the magazine's Washington-bureau chief, was another Harvard man. The investigator put in a call to Thomas—as did, within record time, two other Harvard alumni, one from the bureau chief's own class of '73. Thomas listened to their pleas. "And he, frankly, changed the piece," Lenzner happily concludes.

Recalling Lenzner's request that Thomas "make sure we don't look like a scumbag agency," Thomas inserted into the story this consoling description of the firm: "an elite international investigative agency that represents blue-chip clients like Martin Marietta and Harvard Law School." But what struck rival investigators most was the absence of Lenzner's name. Thomas says he is "pretty sure" the omission was inadvertent.

It was perhaps inevitable that certain incidents at I.G.I. didn't receive much attention during this busy decade.

In January 1996, Susan Swanson, an I.G.I. investigator based in Chicago, E-mailed Lenzner that she was working pro bono for friends acquainted with "an individual who closely fits the description of the Unabomber." She had, she wrote, sent a writing sample from the suspect to Clint Van Zandt, a former F.B.I. profiler, as well as to a linguist and a psychiatrist. They were comparing it with the Unabomber's manifesto.

"They not only could not exclude this person," wrote Swanson, "they felt 'moderately confident' that [he was the Unabomber]."

As it happened, one of Swanson's concerned friends was David Kaczynski, brother of Ted Kaczynski, the man later revealed to be the Unabomber. Without identifying either man, Swanson explained that her contact feared that, if the deranged loner was approached by an F.B.I. agent, he might kill those who had identified him. Her friends wanted attorneyclient privilege from Lenzner, who they hoped would contact the F.B.I.

Swanson got no response to her first E-mail. She sent another, and received a brief reply: "I'll call." She tried phoning Lenzner about the Unabomber—three times, in vain. Lenzner, says an ex-staffer, found her E-mail "wacky."

After the Unabomber was caught, Lenzner appeared on CNN's April 9, 1996, TalkBack Live. He neglected to mention that he had missed the chance to identify the bomber.

"Why do you persist in focusing solely on people who have left my company, who are negative, who question my judgment? ... I didn't understand what she was talking about!" Lenzner exclaims. And then: "It was not on my radar screen. I was doing a lot of significant cases."

When this quote is read to Swanson, she sends me the unanswered E-mail.

Most press probably, developed the a moment keen interest when the in Lenzner was February 1, 1996, when The Wall Street Journal informed its readers that it had received a derogatory 500page file on tobacco whistle-blower Jeffrey S. Wigand from Brown & Williamson representatives. Many of these allegations (Wigand was supposedly a shoplifter and a liar on resumes) were unsupported, and some were untrue.

"How did you feel when The Wall Street Journal found major inaccuracies in your report?" I ask Lenzner.

"I was surprised," he replies.

Surprised about what?

"That anything was being printed_We were all surprised that these materials suddenly showed up in The Wall Street Journal. " Had he known the outcome of the allegations, Lenzner says, he "would have reviewed the documents and provided an assessment of what he thought was reliable." (Earlier, Lenzner had told me, "We assume that anything we do could end up in the press.")

"What does he think he's collecting information for—the edification of the women's garden club?" snaps public-relations man John Scanlon, who represented Brown & Williamson at the time and is a sometime consultant to Conde Nast.

I.G.I.'s Swanson E-mailed Lenzner about... "an individual who closely fits the description of the Unabomber."

Wigand was not the only public advocate whom Lenzner investigated. Less than two years ago, when Procter & Gamble was worried about the future of its potato chips, made with the food additive olestra—which some suspect may cause potentially drastic health problems—it hired I.G.I., say sources. The target was consumer champion Michael Jacobson of the Center for Science in the Public Interest, who had issued grim warnings against the fat substitute.

Nothing that might help Procter & Gamble was found on Jacobson, even though it was the second time he had been investigated by I.G.I. (Lenzner says he has "no information" about the Jacobson investigation.)

The second major blow to Lenzner's reputation came in the summer of '97, when the Senate Governmental Affairs Committee called him to testify about his less than arduous investigation of questionable contributions to Clinton's legal-defense fund. The investigator, who had been hired by the defense fund, testified that he took the assignment even though he was ordered not to contact Clinton supporter Charlie Trie. (Trie then fled the U.S. after it was revealed that he had been the conduit for some of the most suspect contributions to the fund and the Democratic Party.)

Nonetheless, testimony should have been a walk-through. "Mike Madigan [the chief Republican counsel] is a friend of mine," Lenzner reportedly boasted to friends who wondered how the attorney would treat him. (Lenzner says that his relationship with Madigan had no impact on the hearings.)

Senator Don Nickles of Oklahoma, also a member of the committee, was no friend of Lenzner's. He had learned from a Newsweek piece by Mike Isikoff that a few months earlier Lenzner had proposed a "discreet" but far-ranging investigation of both him and his wife. Native Americans in Oklahoma wanted help in recovering tribal lands; their leaders suspected that Nickles, who opposed the return of those lands, had taken a "gratuity" from the oil-and-gas industry. (Nickles denies that he was in the pocket of the oil-and-gas industry.)

The cost of the proposed investigation? A mere $15,000 to $17,000, Lenzner had told the Cheyenne-Arapaho tribes. Who arranged the meeting among the parties? None other than Cody Shearer.

"I don't really mind you messing with me," a livid Nickles told the investigator during Senate testimony, "but I do mind you messing with my family!"

What was Lenzner's relationship to Cody Shearer?, Senator Arlen Specter of Pennsylvania inquired.

"I play tennis against him. I see him around," said Lenzner.

One of Lenzner's old associates finds this episode puzzling, not the least because of Lenzner's alleged penchant for lambasting Democrats and Clinton for regularly soaking Native Americans for large contributions. "Can you believe this White House? They'd go after these Indians for four dollars, they are so immoral," this source recalls hearing from his ex-boss. "The White House is so fucked up."

(Lenzner says that he has never said words to that effect.)

Competitors are stunned by Lenzner's recklessness in choosing targets. This, they have decided, is almost suicidal. "There's no way you can face a United States senator and say, 'Yeah, Senator, I was investigating you for dirt,' and look good," says his competitor Phil Manuel. "I mean, that's crazy."

Prescient words, as it turns out. In Washington, a thwarted attack on the power structure can have the consequences of an avalanche. In late February of this year, Lenzner was summoned by Ken Starr's grand jury. The prosecutor wanted to discover whether I.G.I. was attempting to find scandal in the backgrounds of his staff.

An unrepentant Lenzner says that even if this were the case "there was nothing inappropriate about that." Indeed, when I ask the head of Lenzner's Washington office, Kathy Lavinder, about it, she says, "We were asked to get some public documents related to [Starr prosecutor] Michael Emmick. That's all."

But the idea of Clinton's lawyers paying Lenzner's fees—$375 an hour for the master himself, lower amounts for lesser staffers—to acquire photocopies of court records is not easily accepted. This past spring Representative Dan Burton's House Government Reform & Oversight Committee demanded that Lenzner hand over "any records relating to any investigation of past or current members of Congress" and "any investigation of Democratic fund-raising."

In the past few months, Lenzner's political work has continued, apparently unabated. One current staffer recently told a friend that he was "ashamed" of a certain case. The listener assumed this to be a reference to the "sleazy work" involved in investigating Starr's people. Lenzner claims that this is "incorrect." Nonetheless he appears worried about recent events. In April, he demanded not only copies of my tapes from our interview, but also of a tape I had made of an interview with a staffer.

Worst of all for Lenzner is the fact that despite the hard work, the enemies, the bad press, and the subpoenas, he has yet to meet Bill Clinton. Evidently that displeases him greatly. On one occasion when both Clinton and the investigator were at the same gathering, the president didn't even acknowledge his digger. "Terry was hurt," says a former employee, "and gets up and leaves early because the president doesn't talk to him." (Lenzner says that this account is "completely false.")

"Terry has been deeply offended that the president doesn't know who he is," says Lenzner's former associate Scott Armstrong. But doesn't Clinton owe Lenzner a good deal after all his arduous labor?

Armstrong responds gravely, "When it comes time to take care of the garbage, you don't invite the garbageman in for tea." □

"Terry couldn't care less if he made a dime as long as he got into the political arena. He loves being a player."

In the interest of complete disclosure: in the past I.G.I. has been employed by a Vanity Fair contributor and by distant relatives of the author.