HIGH LIFE STYLE PUT IRS ON REWALD

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-00494R001100710154-8
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 1
• Document Creation Date: December 22, 2016
• Document Release Date: July 26, 2010
• Sequence Number: 154
• Publication Date: September 28, 1985
• Content Type: OPEN SOURCE

Approved For Release 2010/07/26: CIA-RDP90-00494R001100710154-8
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SO daY, saptomber 28, Ms'
-High Life Style Put IRS .
on Rewald
Childress' Chauffeur, Fleet of Luxury Cars Were Noticed
By Charles Memminger
Star-Bulletin Writer
It was Just Ronald Rewald's
bad luck that an IRS criminal
investigator drove by Rewald's
water-front home to and from
work every day.
Joseph Camplone noticed the
large number of cars in Re-
ward's Kalanianaole Highway
driveway, including a limousine
with the license plate "RRR," a
couple of sports cars and a
Mercedes-Benz.
Camplone's interest in Rewald
began when the IRS agent's chil.
dren described how Rewald's
children were delivered to
school In a chauffeur-driven
limousine.
So it surprised Camplone to
find out that Rewald, who lived
in the $1 million house and had
thousands of dollars worth of
cars, had a taxable income of
only $8,500 in 1990.
And according to Rewald's
1979 tax return, he had a taxable
income of a negative $11,000.
Camplone told the Jury yester-
day in Rewald's federal fraud
trial that on the basis of the
1979 and 1980 tax returns, he
launched a "full-scale investiga-
tion" beginning in November
1982.
The investigation continued
until after the fall of Rewald's
company In July 1983, although
it was halted for about two
weeks in February 1983 at the
CIA's request.
REWALD CLAIMS the CIA set
up and ran his investment
corn any. Bishop, Baldwin, Re-
w?aldp Dillingham & Wong. The
CIA denies that but does admit
that Rewald provided covers for
some of its agents. r
At the time the IRS investiga-
tion began, Rewald had been
providing telephone and telex
backstopping" for CIA agents in
the Far East and was arranging
to provide cover for a West
Coast agent.
As Camplone pressed his inves-
tigation, Rewald went to CIA
field office chief Jack Kindschi
and asked the CIA to intervene.
Camplone said yesterday that
Rewald had told him he was.
connected to the CIA and warn.
ed him that the IRS investiga-
tion would jeopardize "national
security."
Rewald also told Camplone
that he had not filed tax returns
for 1981 and 1982 because he
was waiting for instructions
from the CIA.
Camplone continued his inves-
tigation until he was told in
February 1983 to suspend it. He
was unaware that the CIA had
sent officials to Hawaii to inves-
tigate Rewald's claim that the
IRS investigation threatened
sensitive CIA operations.
As far as the CIA knew, it
only was using Rewald for light
backstopping. CIA officials have
testified
TWO WEEKS after the IRS
investigation was stopped, Cam-
plone said, he was called into a
meeting with the IRS office
chief and two CIA men and told
that he could resume his investi-
gation of Rewald.
The IRS was just one govern.
ment agency that was moving in
on Rewald during the spring of
1983. The Securities and t ;x-
change Commission and the
Federal Deposit Insurance Corp.
also was investigating Rewald's
activities.
The combined weight of those
investigations, along with probes
by the news media, drove Re-
wald to attempt suicide on July
29, 1983. Investors forced the
company into bankruptcy a few
days later and it was learned
that $12 million in investments
was missing.
The government contends Re-
wald brought in some $22 mil-
lion as part of an elaborate
Ponzi scheme and spent much of
the money on himself.
IRS agent Richard Yamamoto
testified yesterday that Rewald
had a taxable income in 1979,
1980 and 1981 of $1.2 million. He
said Rewald owes the IRS more
than $700,000.
The government had hoped to
rest its case yesterday, but still
has one more witness to put on
the stand - bankruptcy admin-
istrator Thomas Hayes. The trial
will resume Tuesday.
Approved For Release 2010/07/26: CIA-RDP90-00494R001100710154-8