The regulations also outlined controls intended to keep the agent from being compromised or, worse, corrupted. The safety checks were an acknowledgment of the danger and temptations inherent in having agents team up with criminals. Provisions emphasized the “special care” that had to be exercised “to carefully evaluate and closely supervise” the use of informants, in large measure to ensure that “the government itself does not become a violator of the law.” In an effort to keep the deal on track, an alternate FBI agent was to be assigned to work alongside the primary handler in managing the informant. To ensure that the FBI was keeping the upper hand, the handler’s squad supervisor was required to meet with the informant periodically to assess the bump and grind going on between the informant and his FBI handler. The informant’s reports were to be tested constantly for accuracy and quality. Meanwhile, agents were barred from socializing with their informants or having any business ties with them. The exchange of gifts between agents and informants was prohibited.
Taken as a whole, the regulations on paper seemed fairly airtight, but they also provided plenty of wiggle room. Even though the regulations stipulated that FBI informants could not commit any crimes, another section allowed for the “authorization” of an informant to break the law when “the FBI determines that such participation is necessary to obtain information needed for purposes of federal prosecution.” Though the guidelines discouraged use of this escape clause, the discretion to permit criminal activity rested with FBI agents in the field, agents like John Connolly, Paul Rico, and Dennis Condon. There was little oversight from FBI headquarters in Washington and no requirement that the bureau consult with anyone outside the FBI—namely, Justice Department lawyers—to review the wisdom of authorizing a particular crime. It was the FBI’s private business, an in-house matter. Deferring to the FBI, Levi and other Justice Department officials had agreed there was no other way if the FBI was going to fulfill its “sacred promise” of protecting an informant’s confidentiality. To seek outside review was to risk exposing an informant’s identity, and informants, according to the guidelines, were told right from the start “that the FBI will take all possible steps to maintain the full confidentiality of the informant’s relationship with the FBI.”
It was a pledge right down John Connolly’s alley, an institutional version of the loyalty oath taken on the streets of Southie: you never turn your back on a friend, and you always keep your word. But Southie was not the FBI. Even if field agents possessed the power to give informants room to move in the underworld, the guidelines nonetheless required that agents consult the Justice Department if they learned that their informants were committing unauthorized crimes that had nothing to do with their deal with the FBI—particularly crimes of violence. “Under no circumstance shall the FBI take any action to conceal a crime by one of its informants.” This commandment was regarded as one of the guidelines’ core principles. Getting word of a crime, the FBI had some choices. It could report the criminal activity to another police agency for possible investigation. Or it could consult with federal prosecutors and together consider whether the extracurricular criminal activity was worth tolerating given the informant’s high value. But something had to be done; some assessment of the informant’s status had to be made, a review that required outside ventilation of the FBI’s usually exclusive and secret domain.
But the rules were only as good as the agents abiding by them, and in Boston, Paul Rico had already shown how the rules could be exploited, or even ignored. It was as if the Boston agents focused on another section tailored to their personal styles: “The success of the Top Echelon Criminal Program depends on a dynamic and imaginative approach.” If need be, the Boston agents concluded, the rest of the guidelines could be treated as a nuisance.
BOSTON, of course, wasn’t alone. Street agents everywhere learned to bob and weave their way through the thicket of rules, at once trying to honor them and cut their informants as much slack as possible, all in the name of keeping the flow of intelligence uninterrupted. Given law enforcement’s own laws of gravity, gaps opened up between theory and real-world application. During the 1970s the FBI botched the handling of an informant inside the Ku Klux Klan. The klansman, Gary Thomas Rowe, was said to have committed a number of crimes, including a murder, while working as an FBI informant—crimes the FBI knew about but had covered up to preserve Rowe’s status. The peril was always out there.
Stevie Flemmi was a good example of some of the problems inherent in the system. In 1966 Flemmi had described to the FBI in detail the severe beating he gave an underworld flunkie in a dispute over a loan-shark debt. The victim required “a hundred stitches” to his head and face, according to the FBI report that Rico wrote up about the incident. But beyond the report, no action was taken. In 1967 Flemmi regularly told Rico about his illegal football lottery card operation—the ups and downs, when the money was good, when it was slow. In 1968 Flemmi described his loan-sharking business, and how he’d put money on the street that he’d borrowed from Larry Zannino. Flemmi got the money from Zannino at an interest rate of 1 percent a week; in turn, Flemmi loaned out the money at a rate of 5 percent a week, which translated into a usurious annual rate of 260 percent. He’d even hinted strongly that he killed the Bennett brothers, but it was as if Rico covered his ears: hear no evil. After all, Rico had, on his own, not only promised Flemmi that the FBI was not going to use information about his illegal gambling and loan-sharking against him but also pledged to protect Flemmi from other investigators, even if it meant breaking all the rules. It left Flemmi feeling pretty special.
Now it was John Connolly’s turn.
Connolly had finally managed to get the Green matter pushed aside, in order to keep Bulger and Flemmi going, when another brushfire broke out. This time two businessmen from a local vending machine company named National Melotone were complaining to the FBI about Bulger and Flemmi’s competitive business practices. In a predatory and expansive move, Bulger and Flemmi were intimidating bar and store owners in the greater Boston area, demanding that they replace Melotone’s vending machines with those from a company controlled by the two gangsters. Melotone went to the FBI for help.
Melotone was right to seek an investigation. During 1976 and 1977 Flemmi, Bulger, and two associates from the Winter Hill gang had scouted locations—bars and restaurants—where their vending machines could be installed. “In South Boston, Jim was looking for locations,” Flemmi said. “And I was looking for locations in Roxbury and Dorchester.”