In mid-1972, the Department of Justice announced a settlement of an anti-trust case that had been brought against International Telephone and Telegraph ("ITT"). The SEC had brought insider trading allegations against officers of ITT that were pending at the time of the settlement. Critics wondered why the government, which earlier that year had expressed faith in the strength of its case, settled with ITT on such favorable terms.
Congress began to investigate allegations that the settlement was reached after the Nixon administration pressured the Department of Justice in return for contributions to the 1972 Republican National Convention in Miami. The SEC insider trading investigation resulted from evidence that ITT officers had traded substantial blocks of stock after negotiations had begun between ITT and Justice.
The Senate Judiciary Committee, which was beginning its investigation of other allegations of campaign finance abuses in the 1972 campaign and eventually of the Watergate crisis, sought assurances from Chairman Casey that it would be permitted to view the SEC case file once the Justice proceedings had concluded.
Before Casey left the SEC, White House Counsel John Dean and former Attorney General and 1972 Nixon campaign manager John Mitchell met with him. While no record of the events of that meeting remain, Casey forwarded 34 cartons of ITT files the SEC had accumulated to the Department of Justice after the meeting, effectively putting those files beyond the reach of Congressional committees investigating the matter.
Casey's tenure ended, as it had begun, in controversy. But the SEC soon faced an even more significant public image disaster.
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