Informant (5 page)

Andreas was constructing his own brand of international corporate diplomacy—at times thumbing his nose at Washington to get his way. In the mid-1950s, Andreas advocated the sale of surplus government butter to the Soviets through a complex barter deal. The arrangement would have signaled some primitive form of détente, all while strengthening Andreas’s ties to Moscow. The American government saw it differently; the idea diverged too radically from administration policy. Commerce Secretary Sinclair Weeks refused to grant Andreas an export license.

Despite the administration’s clear dictate, Andreas finagled his way toward a Soviet deal anyway. Only the American government had enough surplus butter on hand to meet the Russian demand. But Andreas knew that vegetable oil could be used for the same purposes as butter—and with his company, he had virtually unlimited access to it. Of course, American officials would block a shipment of vegetable oil from the United States to the Soviet Union, but Andreas decided to get around that hurdle by shipping the oil from Argentina. At the time, he knew Argentina was sending 150,000 tons of vegetable oil to Rotterdam to meet contracts in western Europe. With American approval, he sent a second boatload of oil there from the United States. Then, in Rotterdam, he quietly had the two shipments switched. The American oil was delivered around Europe to meet Argentina’s obligations, and the tanker loaded with Argentine oil was sent to Russia. Through the switch, Andreas had not violated America’s laws, although he had certainly ignored its policies.

As the Kennedy administration took office in 1961, Andreas became the Zelig of Washington—present for great events, rubbing elbows with the powerful, yet unknown to the public. He was by Humphrey’s side the day they walked into a suite in Washington’s Mayflower Hotel to find Bobby Kennedy on his hands and knees, writing names on a huge chart of federal jobs that needed to be filled. Together, Andreas and Humphrey helped get George McGovern appointed as head of the Food for Peace Program; Andreas himself was named to the board advising McGovern. In the aftermath of the Kennedy assassination, Andreas’s influence grew in 1965, when Humphrey became Lyndon Johnson’s vice president. Andreas emerged as a fixture in the White House, heightening his own security concerns—often, he refused to discuss the issues of the day by phone, even with family, because of his fear of wiretaps.

It was at this time that Andreas crossed paths with of the old-line Archer Daniels Midland Company of Minneapolis. By the fall of 1965, ADM was teetering, having never recovered from the death of Shreve Archer. Its finances were in such disrepair that it could not pay its dividends to shareholders. To survive, the company needed a huge infusion of cash and the support of someone with the clout to catapult it into foreign markets. In short, ADM needed Dwayne Andreas. A member of the Archer family invited Andreas in, offering to sell him one hundred thousand shares of stock. Over the ensuing months, Andreas snapped up 10 percent of the company. By early 1966, he was named to ADM’s board of directors and executive committee. After surveying the company’s prospects, Andreas decided ADM needed to be closer to the soybean business that Shreve Archer had started so long ago. The company moved its headquarters to Decatur.

As Andreas solidified his new role, his chief political mentor took a tumble. The 1968 defeat of Humphrey by Nixon’s Republican machine might have seemed a setback to Andreas’s ambitions. But he was protected. The night Nixon was nominated, Andreas was dining with Tom Dewey. When the nomination was official, Dewey called Nixon to offer congratulations and mentioned that he was with Andreas.

Dewey listened for a moment, then put his hand over the mouthpiece and turned to his dinner guest.

“You willing to go in the cabinet?’’ Dewey asked.

Andreas shook his head; he could not imagine the reaction of friends like Humphrey if he turned up in a Nixon administration.

By 1972 Andreas was a big contributor to Humphrey once again but also to his friend’s Democratic challengers. At the same time, he secretly funneled oceans of cash toward the Nixon White House. Knowing that a Nixon operative planned to pick up the money, Andreas dropped $25,000 in bills into safe-deposit box 305 at the Sea View Hotel just before midnight on April 7, 1972—minutes before a new law made anonymous contributions illegal. Later that year, Andreas sauntered into the White House, carrying a folder stuffed with $100,000 in one-hundred-dollar bills. The cash, which Andreas gave to Nixon’s personal secretary, was kept in a White House safe for months until Watergate led Nixon to decide it should be returned.

With Andreas having locked in his role as a Washington power broker, federal agricultural policies began to align smoothly with ADM’s interests. Federal sugar programs became one of Washington’s most sacred cows. Through price supports and quotas, the programs kept the cost of sugar high—gifting billions to sugar producers while pushing consumer-product companies to save money by using highfructose corn syrup, a sweetener made by ADM. In time, that created a billion-dollar-a-year market for ADM, which sold its product at a higher price than would have been possible absent government intervention. In the decades that followed, many Americans would comment that the Coke or Pepsi they drank as children somehow tasted different, not knowing that the change had been largely the result of a switch of sweeteners dictated by government policies that favored ADM.

During the same time, Washington issued a federal subsidy for ethanol, basically corn-derived moonshine used as a relatively clean fuel for cars—albeit at a higher price and with lower octane than gasoline. To promote its use, the government taxed gasoline mixed with ethanol at a lower rate than pure gasoline. Through that decision, Washington directed hundreds of millions of dollars each year to the coffers of ADM.

A wide swath of political and corporate interests opposed the tax break, yet it remained untouchable for decades. Lobbyists marveled at Andreas’s skill in massaging government policy without leaving fingerprints. While struggling to reverse the federal law, they never saw Andreas but felt his influence. His clout seemed unprecedented.

No one could have guessed that Andreas was on the verge of increasing his political potency to almost unimaginable heights.

Mikhail Gorbachev smiled broadly as the American congressional delegation stepped into the Kremlin meeting room. It was April 10, 1985. Soviet-American relations were at a bitter point, an “ice age,’’ Gorbachev liked to say. President Reagan had yet to meet a Soviet leader during his four years in office. Gorbachev, who had assumed power months before, was set on changing that. He intended to use this day’s meeting, his first with a group of high-level American politicians, to indirectly prod Reagan for a summit.

Thomas P. “Tip’’ O’Neill, the American Speaker of the House and the head of the delegation, grinned as he thrust out a beefy hand and introduced himself.

“Oh, yes,’’ Gorbachev said through an interpreter. “Your friend Andreas tells me you’re a good fellow.’’

“Dwayne Andreas, the Soybean King?’’ O’Neill replied. “I played golf with him a couple of months ago, and he told me you were going to be the next Soviet leader. But I had never heard of you.’’

“Well,’’ Gorbachev said, smiling, “Russia is a big country, with many places to hide. But Andreas told me about you, too.’’

The moment perfectly captured the international role that Andreas had achieved by the mid-1980s. No longer was he a tagalong for Humphrey or Dewey or Nixon; with his political sponsors long dead or deposed, Andreas had come into his own, using his connections to establish relationships with new heads of state—at times, before the American government had. He was one of the first Americans to hold extensive conversations with Gorbachev, back when the Soviet leader was the Secretary for Agriculture. He would also be among the first Americans to meet with Boris Yeltsin, when the future Russian president visited Andreas in Florida. His list of influential friends seemed endless: O’Neill, Bob Dole, the Senate majority leader; Yitzhak Rabin, the once and future prime minister of Israel; Bob Strauss, the Democratic Party superlawyer; Brian Mulroney, the prime minister of Canada; David Brinkley, the television newsman. Some were Dwayne’s neighbors; Andreas helped Dole, Strauss, and Brinkley find apartments at the Sea View.

With his travels and connections, Andreas had expanded his role as diplomat without portfolio. That same year, 1985, he had helped broker a meeting between Reagan and Gorbachev, working back channels to pass messages between the two men. He assured Gorbachev of Reagan’s good intentions, despite the president’s brusque rhetoric about the Soviets; he eased Reagan’s concerns about the new Soviet leader by passing along word that Gorbachev was a churchgoer.

“Well,’’ Reagan responded after hearing the message, “I think I’ll meet with him.’’

With such unusual access to world leaders, Andreas and ADM had also become an important source of intelligence for Washington. He channeled information about world markets to the Agriculture Department; his tips about opportunities overseas often arrived at the Commerce Department. His briefings even reached the White House and the State Department.

But the most important—and most confidential—of Andreas’s government contacts were with the American intelligence and law-enforcement communities. The CIA and other government intelligence agencies developed particularly close ties with Andreas and his company. Often, at the end of meetings with foreign leaders, Andreas would pass detailed notes to the government for review. Briefings flowed both ways; ADM often relied on information from the intelligence world for meetings with foreign dignitaries.

Andreas’s relationship with federal law enforcement, particularly the FBI, was more complex. He and his company were financially supportive of law-enforcement causes. Still, for some agents, there were lingering questions about ADM’s commitment to the law. Enough agents were around from the Watergate days to remember Andreas’s role, one questionable enough to lead to charges. Then there were the cases against ADM itself: In 1978 the company pleaded no contest to charges that it fixed prices on contracts in the Food for Peace program; in 1981, the Feds had filed an ultimately unsuccessful civil case charging it with fixing the prices of fructose.

On top of that, whenever ADM executives chose to cooperate with the Bureau, they seemed to always demand the right to set the terms. One episode with ADM quickly entered FBI lore. In the mid-1980s, Andreas became convinced that his company was being cheated by dishonest traders at the Chicago commodities exchanges. Dwayne sought the FBI’s help and agreed to participate in a sting operation to catch dishonest traders. Agents traveled to Decatur and trained in how to trade. Then, they were sent out on the exchange floors, wired with recorders to tape the misdeeds of others. Andreas was delighted with the plan, which was known to only a handful of executives.

Such secrets could not be kept for long. Dwayne’s son, Mick, who ran ADM’s trading operation, heard everything and hit the ceiling. ADM’s relationship with the exchanges had long been strained. By siccing the Feds on them, Dwayne had run the risk of shutting ADM out of business there in the future. Mick demanded that the agents—who by then were working on the exchange floor—no longer pose as ADM employees.

The sting operation continued, but the agents could no longer rely on ADM for cover. The decision angered some at the FBI, which had already invested enormous sums of money in the investigation.

Years later, in 1991, some of that anger became suspicion. The FBI’s Chicago office had heard that ADM’s treasurer, Thomas Frankel, had been involved in financial irregularities. ADM had done its best to keep the information secret, but by September of that year admitted that
something
had happened. Company officials disclosed that they had uncovered more than $6 million in trading losses dating back years and that Frankel was resigning. Fraudulent trading records were discovered, and the total losses eventually exceeded more than $14 million. But when the Bureau investigated, ADM dragged its feet on providing information, crippling the case. It was an unusual response from a potential crime victim and left agents scratching their heads. Some couldn’t help but wonder whether ADM and Andreas had something to hide.

With suspicions running deep, one thing seemed clear: If Andreas ever again thought his company was the victim of a crime, he probably would not turn to the FBI for help. By the early 1990s, Dwayne Andreas had the power to go elsewhere.

Allen Andreas’s phone rang in his cavernous London town house sometime after seven
P.M.
It was October 1992. Darkness had already settled over London, but Allen, who oversaw ADM operations in Europe, had more work ahead of him that night. He picked up the phone.

“Do you still have your friends in Europe?’’

There had been no introductions, no pleasantries. But Allen immediately recognized the voice of his uncle, Dwayne Andreas. Something important had to be up. Dwayne had never become comfortable speaking openly over the telephone, particularly on overseas calls. Now, here he was, asking about Allen’s “friends’’—an oblique code for his London contacts at the Central Intelligence Agency.

“Yes, I do,’’ Allen replied.

“We have a problem,’’ Dwayne said. “Mick will call you about it. I want you to speak with him.’’

With that, the call ended. But Dwayne’s terse, transatlantic message was clear: Something serious was happening in Decatur. Whatever problem Mick was about to discuss, Dwayne wanted the CIA to take care of it.

Allen placed the telephone back in its cradle. Almost before he could pull his hand away, it rang again. Mick and Dwayne had obviously coordinated their telephone calls for maximum impact.

“Hey, Mick,’’ Allen said. “What’s happening?’’

“We’ve got a potentially serious situation going on here,’’ Mick said. “We need your help.’’

For the next few minutes, Mick repeated everything he had heard about the Fujiwara call. The story left Allen’s head spinning. Maybe Fujiwara was telling the truth. Maybe it was some sort of con. Maybe Ajinomoto had concocted a sting to get ADM in trouble with the Japanese government. Whatever the answer, Allen understood why his relatives were concerned.