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A MAN ON THE SPOT

July 30, 1990
July 30, 1990

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July 30, 1990

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A MAN ON THE SPOT

Leaked testimony limned a dubious picture of Yankee boss George Steinbrenner

The Helmeted figure on the video screen stood posed in full World War II regalia, a pistol on each hip, medals covering his chest, behind him a gigantic American flag. Guests at the gala birthday party in Ocala, Fla., on the weekend before July 4 thought that they were being shown the opening scene of Patton. But this was a homemade birthday video, and when the camera zoomed in on the soldier, he turned out not to be George S. Patton or even George C. Scott, who played Patton in the movie, but rather the 60-year-old birthday boy, George M. Steinbrenner, looking every bit as tough and imperious as Old Blood and Guts himself. The guests loved it. The two orchestras played on.

This is an article from the July 30, 1990 issue

There is more than a little of Patton in Steinbrenner, the owner of the New York Yankees, and last week he was struggling mightily to maintain a strong, Pattonesque front—and to protect his rear flank. As he holed up in a Manhattan hotel, calling in select groups of reporters for interviews and periodically getting reports on his wife, Joan, who was said to be recovering from major surgery in a Tampa hospital, Steinbrenner knew that his future in baseball was in question. Commissioner Fay Vincent was at his vacation home on Cape Cod with a mountain of transcripts and documents, trying to decide whether Steinbrenner, in paying $40,000 to self-described former gambler Howard Spira in January and in trying to discredit former Yankee outfielder Dave Winfield by various means over the last decade (Scorecard, July 23), had acted "not in the best interests" of baseball and thereby had violated Major League Rule 21(f). If Vincent decides that Steinbrenner did act against the best interests of the game, he can fine and/or suspend Steinbrenner or even force him to sell his majority ownership of the Yankees.

By week's end Steinbrenner was grasping for any signs of hope he could find. He pointed out that several of the players on his team had offered words of support for him in the New York newspapers. "Unsolicited," he marveled. And on Friday he boasted that "nine owners called today to say they were behind me."

But the outlook for Steinbrenner remains murky. Baseball launched its investigation of him in March after he admitted having paid Spira the $40,000. Spira claims to have worked in the early 1980s for the David M. Winfield Foundation, a charitable organization that funds educational and antidrug campaigns. Winfield says Spira was a mere "gofer." Spira has said he received the money for providing Steinbrenner with information damaging to Winfield, who has long feuded with Steinbrenner. Steinbrenner denies engaging in any such quid pro quo but has different explanations for the payment. Initially, he said he paid Spira merely to help him out; later he said he gave Spira the money to prevent his going public with embarrassing information about former Yankee employees. In June, after looking into these and other questions, baseball's chief investigator, John Dowd, reported his findings to Vincent. On July 5 and 6, Vincent held a closed hearing in New York City, at which Steinbrenner and his five lawyers spent 11 hours addressing allegations involving Steinbrenner.

The National, a sports newspaper, obtained the 372-page transcript of Steinbrenner's hearing and published excerpts last week. The transcript, which Vincent's office subsequently released, showed Steinbrenner squirming and wriggling under the bright, sometimes harsh, light of Vincent's questioning. Steinbrenner was evasive, defensive and inconsistent in his answers. In some instances Vincent seemed astonished that Steinbrenner could have been so naive and inattentive to his team's affairs. Vincent also strove to understand why Steinbrenner did not turn to the commissioner's office for advice before paying Spira.

"I think you know how I feel about you and maybe I should have. Come to you as a friend," said Steinbrenner.

"Not as a friend. As commissioner," replied Vincent.

At the hearing Steinbrenner addressed 12 principal "issues" that had been spelled out by Vincent. They included whether Steinbrenner paid Spira for information damaging to Winfield; associated or did business with Spira, knowing that he was a gambler; privately investigated allegations of impropriety involving Winfield and his foundation without telling the commissioner or Winfield; publicly aired allegations about Winfield that Steinbrenner knew to be false; and failed to tell the commissioner before going to the Manhattan district attorney in 1987 with information about alleged improprieties involving the Winfield Foundation.

Briefly put, Steinbrenner's stance was that he had probably used poor judgment but had never knowingly done anything contrary to the best interests of baseball. He denied having spread false allegations about Winfield, whom he traded to the California Angels in May, or having tried to discredit him. Steinbrenner also claimed that because he was contractually obliged to make contributions to the Winfield Foundation, he had every right to investigate it. All in all, Steinbrenner's testimony raised as many questions as it answered. Consider, for example, the four reasons Steinbrenner cited—two of them not mentioned by him previously—for having paid Spira:

1) Threats of physical harm. "I wanted to get him the hell out of my life and my family's life," Steinbrenner told Vincent. "You don't know what it's like when you've got a guy out there calling and threatening to kill people in your family." Steinbrenner said that because of Spira's threats he hired two armed bodyguards.

2) Harassment. Steinbrenner said he wanted to end the "nuisance to my friends and to my people that work for me" of having to field hundreds of phone calls from Spira.

3) Compassion. "He did tell me his mother had cancer," Steinbrenner said of Spira. "I felt, felt for his family, as I do for my own family, when they are in something like that."

4) Threats to disclose damaging information. Steinbrenner said Spira told him that, unless Spira were paid, Spira would reveal that former Yankee manager Lou Piniella, now skipper of the Cincinnati Reds, had a gambling habit and that former Yankee Stadium manager Pat Kelly and David Weidler, the team's former chief financial officer, had been fired by Steinbrenner for taking leftover promotional giveaway items and selling them for personal profit. Steinbrenner told Vincent that Kelly and Weidler had indeed been let go for that reason, and that even though he didn't know if Piniella really had a gambling problem, "I didn't want to see baseball or Lou Piniella dragged through something the way it would have been sensationalized."

When the allegation about his gambling appeared in the news, Piniella was understandably upset. He told reporters his gambling was limited to infrequent visits to the horse track. Vincent issued a release saying that Dowd had questioned Piniella and that "I am satisfied that Lou Piniella did not engage in any activity warranting further attention from my office."

The case of Kelly and Weidler puzzled Vincent. He couldn't figure out why Steinbrenner, who during the same period had vigorously pursued allegations involving Winfield and his foundation, didn't report the alleged misdeeds of Kelly and, especially, Weidler to investigative authorities or the commissioner's office. "In my experience, coming from the SEC [Securities and Exchange Commission, for which Vincent was a lawyer], from the public world, when a chief financial officer steals, that sets off major alarms," said Vincent. Steinbrenner said he didn't even know how much Kelly and Weidler had allegedly stolen; he believed it to have been "chicken feed." Last week Weidler denied having stolen from the Yankees, and Kelly offered no comment.

As for the alleged threats against Steinbrenner, Spira, 31, of the Bronx, is awaiting trial in New York City on charges that he tried to extort money from Steinbrenner and threatened to harm him and Winfield (the charges make no mention of Steinbrenner's family). Spira has pleaded not guilty. His defense team plans to contend in court that Steinbrenner, through his friendships with law enforcement officials in Tampa, engineered Spira's arrest and indictment to set Spira up as an extortionist-villain and deflect attention from the question of whether Steinbrenner was paying for information on Winfield. In a successful request to have Spira's trial, originally slated for Tampa, moved to New York, Spira's lawyers noted that Steinbrenner is "clearly one of Tampa's most...influential citizens" and that the FBI agents who arrested Spira and searched his Bronx apartment were from the bureau's Tampa office.

Spira hardly looks threatening—he's not much bigger than a batboy—but an August 1989 letter from him to Phil McNiff, a former head of the FBI's Tampa office who now works for Steinbrenner, shows why Steinbrenner might have feared him. In it, Spira calls him "George Von Steinhitler" and warns that "if anything happens to my [ailing] mother [as a result of Steinbrenner not giving Spira money] George and Dave [Winfield] better both hire a lot of extra security because then I will really be out of control."

Given that virulent language, it seems odd that Steinbrenner didn't report Spira to the FBI until early this year. "Why didn't you call [the] authorities?" asked Vincent at the hearing. Steinbrenner answered that he thought he could handle the matter himself, that Spira would just go away if Steinbrenner paid him off.

Vincent tried to pin down why Steinbrenner ever got involved with Spira. Steinbrenner said that Spira, a onetime free-lance radio reporter who used to work the Yankee clubhouse, called him in 1986 to say that he had information about Winfield. Steinbrenner met with Spira, who told him, among other things, that Winfield had lent him $15,000 in 1981 at a usurious rate to help him cover a gambling debt. (Winfield admits having lent Spira the money but says that he had no idea Spira was a gambler, and denies the usury charge.) Steinbrenner said that Spira also told him that the much-publicized death threat against Winfield during the 1981 World Series had been concocted by Winfield's agent, the late Al Frohman, whom Steinbrenner strongly disliked. Steinbrenner told Vincent that he asked McNiff to check out Spira's veracity, and that McNiff later told him that Spira and a corroborating witness named Kim Slamka had both passed lie-detector tests administered by the Yankees. Steinbrenner offered no other substantiation to his charge about the death threat's being phony.

Steinbrenner said that early in 1987 McNiff enlisted the help of a New York—area investigative firm, Yale Associates, to look into Spira's allegations against the Winfield Foundation. "There were investigators for years investigating Winfield and other employees of the Yankees," a source close to the team told SI. "McNiff always oversaw that stuff. 'The McNiff Commission,' it was called internally."

Improbable as it sounds, Steinbrenner told Vincent he didn't know exactly what Yale did or discovered. Deputy commissioner Steve Greenberg showed Steinbrenner a letter from McNiff to Yale dated Jan. 14, 1987, indicating that Steinbrenner's side already believed Spira's allegations. The letter listed four possible ways to use the information: "Federal prosecution of Frohman regarding the death threats, civil suit against the foundation, something else going to the IRS criminal division and finally a usury prosecution of Winfield and Frohman." Steinbrenner claimed never to have seen the letter, but one baseball source suggested to SI last week that the letter could hardly have been unknown to him. "It's like Patton's battle plan," said the source.

Vincent upbraided Steinbrenner for not having informed the commissioner's office about Spira back in December 1986, when Spira admitted to Steinbrenner that he had been a gambler. Steinbrenner says he did tell Peter Ueberroth, the commissioner at the time, about Spira within a few months but couldn't recall exactly when. Ueberroth last week declined to comment on the case.

"George and Howard, they're the same, except George has money," says a source who has had frequent dealings with both men. "That's the only difference. They're both megalomaniacs, compulsive, insincere pains in the ass. They're two of a kind. What they say today applies, not what they said yesterday. The truth doesn't matter to them if it doesn't benefit their position."

At one point during his session with Vincent, Steinbrenner grew exasperated at Vincent's repeated questions about his associating with Spira. "Maybe I'm overreacting," said Steinbrenner, "but this guy, this Spira, was in the foundation for years.... Why aren't they [Winfield and the foundation]—I mean, you've got me, literally I feel like I'm on trial. Okay, if I am, then why aren't they on trial?"

The answer is that baseball looked into the allegations against Winfield and his foundation—including those leveled by Steinbrenner that Winfield might have bet on baseball—and found nothing of substance, according to a source close to the commissioner. Steinbrenner, however, doesn't believe that baseball examined Winfield closely enough. He told Vincent that the "best interests" clause should be applied uniformly, and that means subjecting Winfield to the same scrutiny to which he has been subjected. Steinbrenner's lawyers would be likely to raise that point in a legal challenge if Vincent suspends their client or forces him to sell the Yankees. They have already failed to get Vincent to excuse himself from the case because of what they allege to be his bias against Steinbrenner.

"What has [Steinbrenner] done wrong?" says one friend of the Yankee owner. "He climbed all over Winfield for 10 years because Al Frohman got him to sign a long-term contract, and he went to baseball with a charge that Winfield was betting. How is this not in the best interests of baseball? The contract says that he can't get rid of him unless he [Winfield] consents, so for 10 years, he [George] makes life miserable for Winfield. So what? That's the way business works."

That hardball attitude contrasts with Steinbrenner's rather feeble complaint to Vincent that if the commissioner's office had only warned him about Spira, Steinbrenner never would have made the $40,000 payment and the whole mess would have been avoided. "Why didn't they reach out to me and say, hey, be careful. You are dealing with a bad guy," Steinbrenner said.

Replied Vincent, "Mr. Steinbrenner, I was commissioner at the time this payment was made. Had you come to me, that is precisely what I would have told you."

PHOTOTOM DIPACEWhy did Steinbrenner pay $40,000 to Spira, a self-described former gambler, in January?PHOTORICK MAIMAN/SYGMASpira is awaiting trial on charges of extortion and making threats.PHOTOPHIL HUBERVincent (above) cleared Piniella after Steinbrenner's testimony suggesting Piniella had a "sports betting habit" had become public.PHOTODAVID WALLBERG[See caption above.]PHOTOLANE STEWARTFrohman (left), Winfield and the Boss were all smiles when Winfield became a Yank in '80.