the fixers
Interview

Michael McAdams

Michael McAdams is a former employee of Creek Systems/Gage Corp., a Tulsa-based natural gas company that alleged discrimination by corrupt utility regulators. A court case that could have proved damaging to high-ranking Democrats was averted at the last minute when the Lums helped to purchase Gage Corp. and drop the lawsuit.

Gene and Nora Lum | Ron Brown | the big picture


Q: What was your reaction when Oklahoma Corporation Commissioner Bob Anthony went public and said he had been cooperating with a federal bribery investigation?

McAdams: It was major...The utility companies ran those guys. Here you have one man stand up [whom] they can't buy. They thought they'd bought him, but they couldn't buy him....[It] looked like there was going to be a big investigation, pull a lot of people down.....

Q: What did you think it was going to mean for Creek Systems/Gage Corp.?

McAdams: ...[We] were trying to make up our minds whether we were going to stay or not, what we're going to do. And me and another individual basically said, "Oh well, we'll stay and see the doors shut." ...Actually, for some of us it had gotten to be such an interesting situation, [kind of] very exciting....You've got the FBI involved, you're seeing and hearing conversations that the average public people don't get to hear and see. You begin to see things in politics in a whole different light.

Q: And then you heard that the company might be sold?

McAdams...[In] the fall of 1992, [my colleague] John and I went up to meet with a producer who was on our system,....and he begins to tell us about this sale....He said, "I know all about Jim Kitchens and I know all about your company. I know all about Jim and Ron [Miller]." He said, "There's a deal coming," and he mentions Don Sweatman, a name we barely heard around the office. Well, now we found out that this man is a main player in the sale of this company, this Don Sweatman...

And he begins to tell us about banks and where the money is coming from. "It will be a sale to settle the ONG dispute," and all this. And we're sitting there going, "How does this guy know this?" ....[We] go back to the office and tell Ron and Ron just acts like, "Oh, go on, you guys, you know, don't bother with this."

...And then we saw a letter some months later...from Jim to Nora [Lum], stating the letter of intent on the sale of the company and how many millions this thing was for.

Q: When did you first meet Nora and Gene Lum?

McAdams: ...Gene Lum, at one time in the office, [was] going down the hall, but I didn't [know] who he was,...[but] once they came in and...we were officially introduced, I realized this was the man I had seen before.

...[As] they were introducing each other as [W. Stuart Price], Nora and Gene, they made it very clear...that she worked for [late Commerce Secretary Ronald H.] Brown, [by] which I thought she meant the Department of Commerce. From the way it sounded, I thought that's who she was, that she was with a Department of Commerce individual, or had associations that way....

...Kathy Nojima, [Nora's sister], was there too, ...and we were just introduced to her by name. And then [W.] Stuart Price was introduced, [and] Nora was bragging that this would be the next lieutenant governor of the state of Oklahoma.

Q: Did they know anything about the oil and gas business?

McAdams: No...[When] I finally got in their offices, I realized they didn't know beans about it.

Q: And you thought what?

McAdams: ...That these people were all political. Especially when they introduced [me] to Nora, and Gene was bragging...more than once to me,..."Do you realize my wife works for Ron Brown?" And I thought Stuart was from back East somewhere, I really did....I didn't realize he was from Oklahoma.

...I thought they were cutting the deal. Jim had mentioned to...me and John before in a private meeting that there would be a sale of the company, but it wouldn't look like a sale, to settle this [Oklahoma Natural Gas] deal. So I figured this was it.

...I thought it was strange, very strange....They had to be pretty shrewd because to sell [that company] for the amounts they were talking about, they had to have a deal with ONG cut already....Every figure we had seen was in the millions and we knew that company without the contract wasn't worth $1 million.

...[It was clear] especially to the three of us [who] were working there in the office that this had to be [connected with stopping] that Supreme Court hearing from going on. In fact, it sold on the day that Judge Meyers said, "You will be in here"....

Q: Did you ever meet Ron Brown?

McAdams: No.

Q: Did you ever speak to him?

McAdams: No, not directly, no.

Q: When was the first time you heard his name?

McAdams: Right there when I was introduced to Nora and Gene. Then I heard it several times after that.....John Tisdale never mentioned his name. It's just that Gene told me that Tisdale was very tied in with the Clintons and with Ron Brown.

...You really knew something big was happening here. You realized that the implications of the ONG investigation and what was coming out in that must go to a lot of powerful people. And I had heard of some connections to an individual in the White House, not the President, but another individual, I had heard that before. And so, you realized there was some pretty deep water here.

Q: Did these folks appear to be saviors at all because they saved the company from going down the drain?

McAdams: That's a good question because you had mixed feelings about it. You weren't sure where they were headed.

...[We] knew they got a good contract with ONG, so that was a plus because ONG is a large gas buyer in the state and anybody [who's] got a good contract with them is going to last for years. But to think that Nora and Gene and Stuart [were] really dedicated to this proposition, no.

...[Gene] was in and out. Nora had plans, she was in and out. Stuart was not a person who was going to sit in an office every day and run the details of a company. He's going to be out wheeling and dealing and doing something else.

Q: What happened once the sale closed at the end of 1993?

McAdams: ...[Me] and John moved all the furniture up to the third floor of the State Bank Building, which is owned by the Wal-Mart family [and] where ...Stuart had some offices arranged...The transition was a little bit stressful, just because you're changing offices and you're changing employers.

Stuart Price -- His personality and mine started rubbing each other raw pretty fast...He'll nitpick you over 10 cents, and he'll spend $1 million on something. Like we were fighting over the copy machine. The thing wouldn't work and he wants us to make copies. Well, get us another copy machine, Stuart.

The big argument that we had, that I still laugh about, [was] over $125 for the tires on my company car...We were sitting there in his office and I said, "Stuart, you owe me $125." He said, "I can't afford it." I said, "You can afford it." And that's when we got in an argument over the contract. I said, "I know what you're making in this company. I know how you're doing it." He said, "No, you don't." I said, "Yeah, I do." He said, "Well, tell me." I said, "No, you'll get mad." He said, "No, tell me."

So I told him...about the deal they cut with ONG and stuff, and he got mad...They like to keep that part of the deal very quiet. I guess they thought we were really just naive and didn't understand that that pipeline is not why they bought this...but...that's the facade Stuart...wanted us to believe.

Q: Did you get phone calls from Washington?

McAdams: Yeah.

... [A phone call from] Melinda Yee is the one I took that was the only one relating to Ron Brown. And then a Michael Brown would call -- I took several phone calls from him. I took one that was [former presidential adviser George] Stephanopoulos, [who] wanted to talk to Stuart....Stephanopoulos would talk to Stuart a lot, or Stuart would call him.

Q: Did you get calls from the White House?

McAdams: One time-- Kathy Nojima took it, and it was from the White House because Stuart was supposed to go up there for some advisory committee he was on...Now who it was, I don't know. But I just know that Stuart had to fly up there to a meeting.

Q: Why do you think Nora, a woman who claimed to work for Ron Brown, would want to own an oil pipeline company?

McAdams: The only thing I could see was the ONG contract. If you could get it for 10, 15 years and make good money off of it, then it was worth it. You'd pay yourself back many times over.

Q: Tell us what happened when a local radio station broke the story about the Lums and Stuart being involved in Oklahoma politics.

McAdams: It basically talked about Nora and Gene Lum and Stuart Price trying to influence Oklahoma politics and [who they] were.

...[Nora] was in tears. Stuart was up, he was mad, and they left.....I think Kathy Nojima was standing there, and she just made a general announcement:..."Well, Stuart is going to be going to Washington, D.C."

Q: How did you finally part with the company?

McAdams: ...Stuart kept telling me I didn't know anything. That kind of ticked me off....So I wrote a document telling him about what I believed I knew about Nora and Stuart and Gene and the whole mess,...and I walked it over to ONG's office and left it with John Gabarino, their attorney.

...I told an individual, I said, "You watch when this hits, old Stuart is going to get it, and he's going to be mad." And then Kitchens calls me at home and says, " ... Stuart called and he is hot." He said, "You're not to come back to the office. You won't even come up here and get your stuff." And he says, "He wants a copy of that." And he asked me for it. I told him I wouldn't give it to him... I was basically fired.

Within about three to four days Stuart calls me....He's real nice,...[and] he said, "Mike, let's talk. Let's just all get together and smooth this thing out." I said, "No, I don't want to come back to work for you." He said, "No, no, no...Now, we need to work all this out. It's all fine." I said, "Stuart, I'm tired of being involved in this, and I'm tired of you, and I'm tired of everybody." So, that's it. I was out.

Q: Why should anyone care about this little oil and gas company?

McAdams: Let me tell you a question that [was] asked me about two years ago. They said, "McAdams, where do you think the money is coming from [for] this or any other deal like this that's going on in this country?" I said, "It's got to be from the Far East." He said, "Why?" I said, "Well, because of the Lums' situation."

Gene tells me he flies around to Hong Kong with the Department of Commerce, and you see these Oriental names calling up here to the office....[You] had a gut feeling that there has to be a lot of Far East influence coming in here....

...I wish I could sit up there and go "Eh, no big deal. What's the sale of a little gas company to people?" But it's much bigger than that.

...[There's a strange occurrence that happened.] When Clinton landed in Honolulu for a war memorial thing, ...the Honolulu Star Bulletin printed that first article I ever saw and it quoted me and John in there. And John calls my house, and...he says, "McAdams," he said, "Kathy Nojima called, apparently from Honolulu, and is saying that [I've] got to discredit anything [you] say." ...I said, "Well, are you going to do it?" He said, "No, I'm not going to do it."

....John was told...Bill Clinton was very upset with the Lums, had really chewed [them out] because these ex-Dynamic [Energy Resources] employees were talking....

...This thing is so corrupt and so big, everybody is wanting to keep secrets quiet. Everybody's got secrets.

Q: As a result of all this, do you know anything now about politics that you didn't know before?

McAdams: Money and power is not worth lying [for].

....I don't like people trying to say the one thing and do another. That's probably what upsets me about Gene and Nora a little bit....[To] think that people that come across that nice are going ahead and lying about stuff...and getting involved in activities that we don't need in this country.

I don't care which party is doing it, we don't need it....

[END]

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