IHR Prevails against Willis Carto in Missing Millions Case

Again, as repeatedly stated in previous issues of SR, we know that we should let sleeping dogs lie and not open up old wounds. If I had a chance, I wouldn't publish the following article. But we are in the business of posting the contents of all issues of Smith's Report for historical and archival reasons—all of its contents. So we won't hide this opinion piece either. –Webmaster, Oct. 2, 2015.

A judge in Vista, California has found that Willis Carto and one of his associates, Henry Fischer, as well as Carto's Washington, DC-based Liberty Lobby, owe the Institute for Historical Review (through its controlling corporation, the Legion for the Survival of Freedom), about $10 million.

California Superior Court Judge Runston Maino ruled on November 13 that Carto acted wrongfully in withholding and concealing from the IHR $6.43 million of a $7.5 million bequest to the institute by Jean Farrel, a grandniece of Thomas Edison, and ordered Carto and the Liberty Lobby to return the money – with 10% percent interest computed since 1991, which adds up to some $10 million. In addition, the judge ordered Carto and his wife Elisabeth, Fischer, former LSF officers and directors Lewis and Lavonne Furr, and Vibet, evidently a corporation set up in Switzerland for the conversion of the Farrel estate assets to Carto's use, to account for an unspecified quantity of gold and gems missing from the IHR's share of the Farrel estate.

In a separate letter issued a day before the ruling, Judge Maino stated that Carto had backdated corporate minutes, deceived lawful directors as to the Farrel estate, falsely told others that they were directors, and wrongfully acted as though the Farrel money left to the IHR in Switzerland in 1986 was his to do with as he wished.

The judge characterized Willis Carto's testimony during the trial as follows: “I found that much of his testimony made no sense; much of his testimony in court was different from his previous testimony; much of his testimony was contradicted by other witnesses or by documents. By the end of the trial I was of the opinion that Mr. Carto lacked candor, lacked memory, and lacked the ability to be forthright about what he honestly did remember.”

On the last day of the trial, Carto submitted a torn, handwritten, barely legible sheet of paper bearing a scrawled accounting of the disbursement of the Farrel money. According to this document, which Judge Maino characterized as illustrative of Carto's “entire attitude: one of arrogance, deceit, evasiveness and convenient memory,” Carto and his cronies and his “causes” have devoured all but a couple of hundred thousand of the Farrel millions.

Thus, a potential war chest that could have made the Institute of Historical Review – which Carto helped found and on behalf of which he claimed to act – a true force on the national and international scene was squandered away, on Carto's sworn testimony, on such enterprises as Euro Disney ($54,000 lost, Carto reports) and something called Cal Futures ($500,000 lost). The judge found that $100,000 of the Farrel bequest actually reached the IHR (presumably this does not include the slightly larger amount that Carto caused to be loaned, out of money that belonged to it, at interest, to IHR).

The staff at IHR is nonetheless hopeful that, despite Carto's testimony, a significant portion of the $7.5 million that Jean Farrel left to it on behalf of the revisionist cause ten years ago is still intact, and that it can be retrieved, with judicial prodding if necessary, from the remote caches in which Carto and Fischer have likely secreted what they haven't spent. Judge Maino's ruling, and his letter on the evidence, sustains the case of the IHR employees who overthrew Carto in 1993 after he had failed to respond to a number of their grievances, from the missing millions to his efforts to derail IHR's journal from its scholarly, revisionist track.

After three years of heated verbiage, some of it in the pages of past issues of this newsletter, both sides have finally had their day in court. Carto's protestations that the missing millions were rightfully his fell flat; his stories about where the money went proved as shabby as the page they were scribbled on. As for the colorful motley of Mossad agents, ADLers, Scientologists, spooks from the CIA, Burmese dissidents, and Afghan insurgents who, in Carto's telling, had figured in the plot to kick him out of the IHR—of them Carto and his lawyers, including the noted conspiratologist Mark Lane, spoke not a single word in the courtroom. No doubt there will be appeals, evasions, and excursions down the coming months and years. Perhaps IHR will never recover more than a small fraction of its money. But the IHR is cleansed, and Willis Carto is finished as a force among revisionists, and probably among “populists” and “patriots” too. And justly so.

These words are not written without a certain melancholy. It is hard not to admire Carto's spunk, energy, and achievements—not always entirely his, not infrequently to his private advantage. Without him there would have been no Institute for Historical Review. But alongside his virtues are his vices: his pettiness, his spleen, his vindictiveness, his smallness of spirit and narrowness of vision, let alone his cupidity and deceit in the matter of IHR's missing millions.

In the end, what precipitated Carto's fall was a breach of faith with revisionism. It wasn't simply the millions—although devoting the money Jean Farrel had earmarked for the revisionist work of the IHR to the not entirely congruent concerns of the Liberty Lobby, the fortunes of “le canard Donald” (or whatever the French call Donald Duck) etc. is no light matter. But Carto never really understood the moral and intellectual force behind Holocaust and other areas of scholarly revisionism, or its liberating potential. Rather, he seems to consider these fungible properties (somewhat like the Farrel assets) that could thrive as easily on the assorted intellectual oddments he has been featuring in his tabloid The Spotlight for years, and was planning to serve up in The Journal of Historical Review as well.

Revisionism is not merely a body of evidence and ideas. It is a community: of scholars, of publicists, of employees, of subscribers and supporters. It speaks for those who cannot speak; it aids its embattled scholars and activists; it unearths for generations yet unborn facts buried with their great-grandparents, facts that can set them free.

Revisionism is based on truth. Since it costs money, and since its supporters bear that cost, revisionism must also be based on trust. Trust and truth: it's that simple.

For a firsthand look at what Judge Maino had to say about the courtroom testimony of the major players in this drama, including Tom Marcellus, Mark Weber, Elisabeth Carto and [especially] Willis Carto. We have:

• the 13 November “letter” written by Judge Maino, which tells us how he looked at these people (9 pp.)
• the 14 November “Statement of Decision” (4 pp.)
• the 18 November IHR press release (3 pp.)
• one or more press clippings related to the story—in all, a minimum of 17 pages

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