Indecent Exposure (31 page)
- The gist of the pro-
Begelman
story, as it was evolving in late October, was that his problems lay in his expense accounts and executive perquisites. According to this story, a routine audit by Columbia's accountants had turned up a few questionable transactions in
Begelman
's expense account—transactions through which he may, in effect, have made personal use of company funds by including in his business-travel and entertainment accounts certain expenses that, strictly defined, were personal. While this sort of thing theoretically was not condoned, it could not be denied that a lot of people did it. sometimes inadvertently. A careful audit would find questionable items in the expense accounts of most top executives in America, Begelman's partisans contended. In Hollywood, especially, business and personal lives are melded most of the time. The business of Hollywood is the life of Hollywood. A great deal of business— ostensible and occasionally more than ostensible—is conducted on tennis courts, in or around swimming pools, on sailboats, in home screening rooms, and of course, over breakfast, lunch, cocktails, dinner, and midnight suppers, not only in restaurants but in homes as well. Nearly all such expenses, which would seem personal to many outsiders, are charged in Hollywood to the studio, or to the production company, or to the record company, or to the budget
of the picture or television se
ries. "Who do you know who isn't a write-off" was the expression that covered the subject when it came up. - In the area of perquisites, many executives' contracts permit them to take their wives on business trips at the studio's expense. And the studios frequently pay, directly or indirectly, part or all of their executives' housing and automobile expenses. Many executives drive Mercedeses or Cadillacs or Jaguars or Rollses that are leased for them by the studio, and live in homes that are leased for them by the studio, or that the studio has enabled them to purchase at reduced prices.
- The Hollywood financial climate, in short, is permissive. It always has been permissive. Everybody takes advantage of it. Was David
Begelman
any worse than anyone else? Decidedly not. Why, then, was he being singled out? He was being singled out, the story went, because Alan
Hirschfield
wanted to get rid of
Begelman
and have more power himself. Thus, he seized upon
Begelman
's indiscretions (if they could even be called indiscretions) and was applying an ultrastrict post-Watergate standard in an effort to portray
Begelman
as a crook. - By the third week of October, this story was taking root among growing numbers of people in Hollywood. The same gossip networks that were carrying
Begelman
rumors were jeing used to spread pro-Begelman propaganda. And quite apart from inhibiting the-work of Peter Gruenberger. the propaganda was tarnishing the image of Alan Hirschfield. The story made sense, and people were getting angry. David Begelman, their friend, a popular leader of the community, seemed clearly to be the victim.
Hirschfield
, the outsider from Wall Street, was the heavy. It appeared that Hirschfield might turn out to be the latest of a breed of interloper that had plagued Hollywood throughout its history—the eastern banker who knows nothing about making pictures but is swept up in the glamour of it, and believes that his financial stake gives him the right to control the destinies, and even the day-to-day work, of the true creative geniuses of film, people like David
Begelman
. Hollywood had developed a number of ways of dealing with such intruders. If they had a weakness for attractive women, it was sometimes possible to preoccupy them with extraordinary sex in the Beverly Hills Hotel for the length of their stay on the coast. If they insisted on doing business, it was sometimes possible to dazzle them with introductions to a few film stars and visits to sound stages. Some intruders, however, came to town with grander notions of exercising genuine, long-term power. They had to be dealt with more carefully, more subtly, and on an individual basis. - In addition to anger,
Hirschfield
's apparent stance against
Begelman
generated a degree of pragmatic discomfort in the Hollywood community—discomfort crystallized in a widely read interpretive article by Art Murphy in
Daily Variety.
As Murphy saw it, Columbia's investigation of Begelman served to focus new and critical scrutiny on Hollywood executive perquisites in general. "The ultimate specifics of the
Begelman
-Columbia matter are really of minor importance," Murphy wrote. "It's the entire environment that is now under focus and fire. . . . The gravy train hasn't stopped, but it's going to slow down." In other words, if Hirschfield could get tough with Begelman, then every studio might be forced to get tough with everybody. The entire perk-laden financial structure within which thousands of people lived, and on which they depended, could be threatened, according to this reasoning. A discomfiting thought, to say the least. - The story and underlying rationale of
Begelman
's plight depended for its plausibility, of course, on suppression of the truth about Begelman's actual misdeeds. A lot of people who were prepared to condemn
Hirschfield
for investigating
Begelman
, and for whom expense-account chiseling was a daily practice, would have been horrified, and would have applauded the investigation, if they had known that its target was not perks and expense accounts but the quite different issues of check forgery and embezzlement. - As of late October, the secrecy was holding pretty well. It was naive, of course, to think that it could
be preserved forever. But naiveté
is as much a part of the Hollywood way of life as the permissive financial c
limate. David Begelman, for one,
was secure in the belief that the euphemism "unauthorized financial transactions" would endure and that the details would never be widely known. He was devastated, therefore, when a close friend said one day: "You're kidding yourself. Everybody knows you forged Cliff Robertson's name on a check." Although the friend was wrong—relatively few people outside of Columbia knew of the Robertson forgery at that time—the friend at least alerted Begelman to the likelihood that the word would spread. But how soon would it spread? Would it spread widely enough to undermine the cover story of the expense account and the perks?
The answers to those questions lay in part with the people in possession of the truth, and as of the third week of October, their motives and inclinations varied considerably. Barring revelation of major new embezzlements, Ray Stark wanted Begelman reinstated and was preparing to accelerate his efforts toward that end. Marty Ransohoff felt that
Begelman
should be fired but was unwilling to become an active lobbyist, aside from venting his views privately to Alan Hirschfiel
d and Herbert Allen. David Geffe
n, who sided with
Hirschfield
on principle, found himself being used as a conduit between
Hirschfield
and Stark. - The small number of people who knew about the embezzlements, however, was no longer limited to people with close relationships to the top echelon of Columbia. It had gradually expanded by that time to include a handful of top executives at other film studios. After recovering from the initial shock, some of these people quickly became concerned that Alan Hirschfield was being too lenient with
Begelman
. The top executives of MCA-Universal, for example, thought it odd that Columbia was taking so long to dismiss Begelman in view of the seriousness of his reported crime. They whispered to each other over lunch that if
a forgcr-embe
zzler had been caught in their company, he would have been fired immediately. What could be delaying Columbia? - Ironically, therefore,
Hirschfield
was gradually losing support— for opposite reasons—in two important constituencies:
le tout
Hollywood, who felt angered and threatened by his apparent persecution of Begelman for what they believed were minor indiscretions; and his fellow chief executives, who feared that he perhaps was being lenient and indecisive in a situation that required prompt, tough action. - Hirschfield
, however, was all but oblivious to such considerations. - Aside from David Geffen, whose warping had been specifically about Ray Stark and had not left a strong impression, no one had seen fit to warn Hirschfield about possible reactions in Hollywood to his handling of the Begelman affair. And he had not figured it out for himself. He had taken account of the SEC, the police, the banks, Wall Street, the business and financial community, the stockholders, and "the public." And yet, through more than a decade in and out of show business, he had never grasped that the Hollywood community is a constituency, too, and must be catered to if one proposes to flourish there.
- It was not too late, though.
Hirschfield
still had time. Hollywood was not yet ready to step forward and confront him. Except for cocktail-party whispers, its plotting was proceeding in private. Outwardly, the town was keeping its own counsel, watching and waiting - Despite Herbert Allen's suggestion that no replacement for Begelman be sought actively until the investigation was completed, Hirschfield began a preliminary survey of candidates for the jobs in question. On the morning of Wednesday, October 19, just before leaving for the Dallas preview of
Close Encounters,
he had breakfast at the Dorset Hotel with Fred Pierce, the president of ABC television. Though Pierce was not a candidate for Columbia himself—he saw his future at ABC—he suggested some other people as possibilities. One of them was his own colleague, Fred Silverman, ABC's programming head, whose contract would expire in a year and who was getting a little restless. Silverman had guided ABC into first place in television ratings among the three networks, duplicating his success at CBS a few years earlier. Hirschfield took Silverman to lunch on Friday at "21" and, in a general way, posed the notion that Silverman might be an appropriate replacement for Begelman as head of motion-picture and television operations at Columbia. As it turned out, Silverman was not yet prepared to decide whether to stay at ABC. He confirmed that he was restless, however, and even asked Hirschfield to recommend a lawyer skilled at negotiating executive employment contracts. Hirschfield referred him to Mickey Rudin. - Conversations like those with Pierce and Silverman were difficult for Hirschfield because they invariably began with questions about Begelman: "Is he coming back? What exactly did he do? We hear the problem is in the perk area." Hirschfield did not feel free to answer any of these questions candidly. He made clear that he would not be surveying possible replacements if there were not a strong possibility that
Begelman
would not return. Without detailing
Begelman
's crimes,
Hirschfield
did confide to a few people that they were more serious than "perk or expense account problems." - Hirschfield finally got to have a relaxed and open conversation with close friends on Saturday evening when h
e and Berte dined with the Clive
Davises and went to Trax on Seventy-second Street to he
ar Dwight Twill
y, a rock singer who recorded for Arista. Though there was no new information on the
Begelman
crisis to be exc
hanged, commiseration with Clive
always soothed Alan. - TWENTY-TWO
- Among Alan Hirschfield's most important achievements in 1976 and 1977 was the establishment of new business relationships between Columbia Pictures Industries and prestigious corporations outside the movie production industry. As well as opening new financial opportunities for Columbia, these relationships helped to build its reputation as a company that no longer was just a second-echelon film studio but was moving toward the front ranks of respected, multinational entertainment conglomerates like Warner Communications and MCA. One of Columbia's new relationships was with Time Incorporated, the world's preeminent magazine publisher, which had agreed to invest several million dollars in Columbia's motion pictures. Another relationship was with IBM, which was considering making Columbia its partner in the development of a laser video system. Still another was with the General Cinema Corporation, a large Boston-based concern which made half its money from soft-drink bottling and the other half from its original business—the nation's largest chain of movie theaters. In financial terms, the General
- Cinema relationship was the most important. The two companies had been negotiating a plan by which General Cinema would invest upwards of $26 million in .Columbia's motion-picture production program over a period of years.
- When the
Begelman
problem developed, one of
Hirschfield
's most acute fears was that it might jeopardize Columbia's carefully cultivated relationships with Time, IBM, and General Cinema. None of them, he felt, would want to be associated with a company whose top management included an embezzler and check forger. Hirschfield made special efforts, therefore, to reassure each of the three corporations that the
Begelman
problem was isolated, under control, and did not reflect a lax ethical climate at Columbia.
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