Loren McCannon stands, faces the frigid autumn wind blowing across the border at Otay Mesa, and sees the ghosts of crimes past. McCannon, now 75, suffering from diabetes, and survivor of a heart attack, can picture them as vividly as if it were 20 years ago, when he went in search of the secrets of San Diego's border.

A self-described Mafia hunter, McCannon says he risked death, saw others disappear, and watched as his stories of municipal corruption were hushed up, then buried by local editors and the U.S. Attorney. Many of the players are dead, but McCannon and his version of history live on, thanks to a yellowing manuscript he has kept locked in the closet for more than two decades. The manuscript is a road map to the deals done along the border and the people who did them during the beginning years of the Otay Mesa land boom. Except it's not all history. Not yet.

McCannon is back on the border beat at the invitation of a reporter. San Diego mayor Susan Golding, the Union-Tribune, and former U.S. Attorney Alan Bersin (now city schools superintendent and himself an owner of border-area property) are pushing a new project in San Ysidro. It's called the International Gateway of the Americas, and a developer by the name of Carmine Samuel Marasco III is trumpeting his plan to build a $192 million shopping mall, convention center, hotel, and a pedestrian toll-bridge to cross the border into Tijuana's Zona Norte, the city's red-light district.

Marasco and his backers on the city council and at the Union-Tribune say the city-subsidized project would serve the public good by bringing commerce to the border neighborhood where the project would be built, creating an attractive, "world-class" entry to Mexico. The arrangement between Marasco and the city has been in the works for at least a year. No other developers were asked to bid on the project, and the city council only held two public hearings before granting its approval. Amid the usual round of self-congratulatory speeches that accompany the unveiling of such deals between friends, a unanimous city council voted in May to award Marasco a subsidy of more than $20 million and exclusive development rights to 80 acres just west of the current San Ysidro border crossing.

Critics, including residents of a Mexican neighborhood that could be bulldozed, say it's another boondoggle forced on them by the city council that has given away millions of dollars to wealthy campaign contributors like Chargers owner Alex Spanos. Others ask how it was that Marasco, a one-time partner with Ron Hahn -- son of the late developer Ernest Hahn, darling of San Diego's downtown establishment -- was handed a fat subsidy, favorable city zoning, and development rights to prime border real estate he doesn't own.

Most of the property, now strewn with weeds and trash, belongs to partnerships and small corporations controlled by the family of 79-year-old N. Joseph Simons. Simons is a familiar name to Loren McCannon. In his small apartment, out of the biting wind of the border, his aging cat by his side, McCannon smiles and pulls a tattered newspaper clip out of the three-ring binder that holds his 400-page manuscript, entitled "The Monster Project." The year was 1978, and there were a lot of headlines about Joe Simons, thanks to Loren McCannon. "Officials, Border Speculation Linked," reads the headline in a Union clip dated April 6, 1978. "A land syndicate put together by a free-wheeling, fast-talking San Diego businessman named N. Joseph Simons has virtually sewed up the commercial real estate next to the Mexican border in San Ysidro," says the story under the byline of John Standefer. "Simons's group, whose investors include two city planning commissioners and the chairman of the Board of Zoning Appeals, has acquired millions of dollars of land, most of it during the last six years."

McCannon pulls out another old Xerox copy, this one from the Los Angeles Times, dated September 24, 1978: "Simons, who has a penchant for partnerships, persuaded a group of people to join him in land ventures in 1974 and 1975. Among the partners in his San Ysidro land were San Diego Planning Commissioners Oscar Padilla and Homer Delawie. Also joining Simons in two partnerships was city Zoning Appeals Board chairman Alfonzo Macy. It was these partnerships that attracted the interest of the FBI in San Diego. At least one agent has been investigating San Ysidro land deals for the past four months."

The Union story said that while all three men "generally have abstained from votes on specific property questions involving themselves or their partners, Padilla and Delawie have voted on at least two major land use proposals that affect all border area property, including land in which they have an interest."

The Union's Standefer went on to describe other alleged conflicts of interest, votes made by Padilla and Delawie that had a potentially beneficial affect on their property interests, though city officials were quick to play down the scandal. "City Attorney John Witt has been aware of the commissioners' land interests for several months, but said he has not seen any evidence of illegal conflict of interest. However, he said it is his personal opinion that no one on a commission or board should have holdings that could raise even a suggestion of a conflict."

The commissioners were quick to distance themselves from Simons, their partner on the borderline. Delawie, a well-connected architect who had backed then-mayor Pete Wilson, told the Union that he knew " 'very little' about Simons and virtually nothing about Simons's plans for the border properties. 'I'm just a five percenter.' " Padilla, a border insurance broker and a close friend and former campaign treasurer of Wilson's, later told San Diego Magazine, "I didn't even know Joe Simons, but got into the partnership only because others who were friends and had good reputations in the community were already involved."

John Gray, Simons's lawyer and another of his partners in the San Ysidro land, described Simons as "thoroughly reputable." "Joe made the market" in San Ysidro land, Gray explained to the Los Angeles Times. "He got enthused about it and he paid too much for it. He is a guy who was in the drugstore business. He got excited about this property.... Joe sank everything he had into San Ysidro real estate." Simons told a Union reporter, "he would not discuss his real estate dealings except to express enthusiasm for the border area. 'I don't know you from Adam, but if you've got any money and you want to make money, you ought to buy land down there.' " The mystery was heightened when Simons described himself as "just a cottonpicker from Texas. I talk like a damn Yankee only because I went to a damn Yankee school," and said he'd been investing in property along the U.S.-Mexican border for 35 years.

Other big names in the San Diego establishment had apparently heeded Simons's advice to buy in big. In addition to the city commissioners, partners in Simons's many border partnerships, according to the Union, included former city councilman Tom Hom. Hom was turned out of office by voters five years before in the infamous Yellow Cab scandal, in which councilmembers were accused of getting illegal campaign contributions from C. Arnholt Smith. (One councilman pleaded no contest, the others, including Hom, were acquitted or the charges against them dropped.) Among other Simons partners were wealthy customs broker David Porter and his socialite wife Kaye and Edward C. Hall, a well-connected San Diego real estate broker and Porter's father-in-law. All were friends of then-mayor Pete Wilson and gave heavily to local campaigns. Hall told the Union's Standefer that "Simons's family long ago began buying up border real estate from El Paso to the Pacific. 'Then Joe's older brothers didn't want to, so he went out and got all these other people to invest.' "

Rumors of inside deals and midnight meetings in Tijuana bars, where cash was passed to city officials, swirled through the city during 1978. The border was hot, and information soon emerged about others, unrelated to Simons, who had also cast their lot in property there, including Verne Thompson, a real estate broker and fundraiser for then-governor Jerry Brown, and Charles Pipitone and Charles Geraldi. The Union's Standefer reported that financier Alan Glick, who later turned state's evidence and testified against the Mafia in the infamous Las Vegas Stardust skimming case, also was a member of a partnership that owned land in San Ysidro.

Stories circulated about how the San Diego Union had almost killed the Simons story until Union reporter Violet Murphy, heavyset and hard as nails, leaked some of it to Larry Remer, then editor and publisher of Newsline, an antiestablishment weekly newspaper. Murphy, who would die of cancer in December 1987 at age 63, had quit the Union in disgust and moved to Redding in 1977. She was reportedly angry that Union editors were still sitting on the exposé more than a year after she'd handed it in. To the end of her days, she would insist that the newspaper had suppressed a mountain of incriminating evidence she had dug up against well-connected San Diegans and a world of border mafiosi. Her manuscript, documenting the secret dealings in border property, she said, had been stolen from her office safe by unknown thieves. Union editors denied they had attempted to hush up the story, but there was no denying that a day after Remer's version ran in Newsline, the Standefer story appeared on page one of the Union.

After an FBI investigation that lasted 18 months, U.S. Attorney Michael Walsh washed his hands of the entire matter, citing "insufficient evidence" to prosecute. Delawie and Padilla, still denying they had broken any laws, said they regretted causing any "appearance" of conflict. Walsh told a reporter from San Diego Magazine that the FBI had not been discreet enough in its conduct of the investigation, which he called "unfortunate."

Upon his retirement from the planning commission in April 1982, Delawie told the San Diego Tribune that he had "learned his lesson and ever since he's refrained from voting on any issue where there might even be an appearance of a conflict." The big plans to develop the Simons property were also put on the shelf, in part, it was said by sources in the mayor's office, because the FBI scrutiny of the public officials partnered with Simons had scared off other investors and made city hall, and especially Pete Wilson, afraid of being publicly associated with any of the Simons ventures.

San Diego Magazine reported in 1980 that "Padilla also admitted that he had made a mistake in not disclosing that he had purchased land from Phil Creaser, a San Ysidro businessman who later came before the [planning] Commission for a zoning change, from agricultural to industrial park, on other property that Padilla approved, thereby enhancing its value. But the investigators determined Padilla's favorable vote was not a quid pro quo – that Padilla had paid full market value in the first transaction, and the later zoning change awarded to Creaser's other property was in conformity with the San Ysidro Community Plan and the Planning Department's recommendations."

McCannon, however, remains unconvinced that Mike Walsh did everything he could in the pursuit of justice. "My theory is that Walsh dropped the case because of political pressure from Pete Wilson. The FBI really felt they had an excellent case, and they are a better judge than I am by far," he says today. "The agent in charge was transferred to Denver almost immediately. This was a classic cover-up by the Feds."

Former U.S. Attorney Walsh is no longer available for comment. Once viewed as a rising star in the world of San Diego politics, Walsh abruptly switched careers shortly after the Simons scandal, departing San Diego in 1980 for a job as vice president of Cummins Engine Co. in Columbus, Indiana. He would climb high in the powerful realms of corporate America, rising to board chairman of the giant Tenneco Corporation before being stricken with a brain tumor and dying in 1994 at age 51.

While the commissioners were off the hook, McCannon soon found himself under scrutiny. TV reporter and commentator Harold Keen went after McCannon in a story that appeared in the July 1980 edition of San Diego Magazine. According to Keen's version, an overzealous news media, spurred on by competition between the Union and the newly arrived San Diego edition of the Los Angeles Times, and acting on McCannon's tips and Violet Murphy's digging, had wrongly impugned the reputation of the three city commissioners who had invested in Simons's deals, especially Padilla.

"Padilla's original land acquisitions in San Ysidro, dating back to 1964, related to his need of commercial property for his Mexican insurance business," Keen wrote. "Had he stopped there instead of getting involved with 'wheeler-dealer' Joe Simons, he would have avoided problems with the press and, subsequently, the FBI and U.S. Attorney. One of the most conspicuous eyebrow-raisers was a chain of events that started with a plan to combine some of his personally owned land, which had been bypassed by the I-5 freeway, with adjoining property of a Simons partnership. The idea was to create a tract large enough to attract a developer (ultimately, plans for either a Tourist Center of varied enterprises, or a shopping center, were dropped and no development has occurred, an irony in the face of suspicions that Padilla stood to profit immensely from decisions he made on the Planning Commission with regard to commercial zoning)."

So, at least according to Keen, the Simons land scandal, involving the property that was ultimately to become the site of today's proposed International Gateway project, was a put-up job. "The trigger finger," Keen reported, "apparently belonged to a former San Diego city official named Loren McCannon, a retired Army Reserve lieutenant-colonel who was fired in May 1975 as director of city engineering and development after only ten weeks at that post." Keen then quoted John Lockwood, then an assistant city manager and McCannon's old boss and friend since their days together at city hall, as saying, "McCannon was a different man than when I first knew him. He acted troubled and his behavior was erratic. He seemed paranoid about the Mafia being determined to get rid of him because he was about to blow the whistle on organized crime. We finally had to let him go because his work product was unsatisfactory."

Today McCannon laughs at the way his old friend Lockwood talked about him back then. It wasn't that way at all, he says. His work was as good as ever. It was the city that had changed. "I never even thought about the Mafia, didn't cross my mind, until months after I had been out of that office."

McCannon seemed an unlikely whistleblower. Born in 1923 in Greenwood, Illinois, about 50 miles northwest of Chicago, he came to San Diego in 1941 after his brother, a flight engineer and mechanic for Consolidated Aircraft, was mortally injured in the crash of a B-24 bomber on San Diego Bay. Shortly afterwards, he was offered a job with Consolidated. Having just graduated from high school, he accepted. During the war, he served in the Pacific and seven months during the occupation of Japan. In 1946, he returned to San Diego, getting a degree in business administration. In the early 1950s, he became an administrative analyst in the budget office of the City of San Diego, where he stayed five years before becoming the director of budget and research for the city of Long Beach, then assistant city manager there.

After leaving Long Beach to work two years for a world's fair, which didn't get off the ground, McCannon worked in real estate development before returning to San Diego as director of engineering and development in 1975. He says that Lockwood's version of how he was fired ten weeks later is all wrong. "I had prepared a report recommending that we cancel the contract for the private contractor who was administering the city's leased-housing program." That contractor, McCannon says, had badly mismanaged the program. "I thought it was my responsibility as director for the department to try to do something.

"John supported my work in that report right up to the point I officially submitted it," McCannon remembers. "They hadn't done a damn thing before I got there." But after the report went to higher-ups, "I was called in and asked to resign or be fired, just like that." McCannon alleges that the contractor was being protected by friends on the city council and the city's housing advisory commission. As evidence, he cites the fact that after he was fired and tipped the news media to the alleged corruption he had found, three housing commissioners, including the chairman, resigned, and the contractor bowed out.

During his investigation into the contractor and his connections, McCannon says, he began to dig into real estate transactions in South Bay and along the border. "Among other things, I found these eight interlocking partnerships all headed up by N. Joseph Simons, with a mixture of partners within the partners, and some looked suspicious. The ones that really got my attention were the two city planning commissioners and the zoning appeals board."

Today, McCannon makes no secret of the fact that his South Bay research soon ended up in the hands of the San Diego Union's Vi Murphy. "I was running for county board of supervisors in 1976, and one of the ladies in an audience I was speaking to in Bonita worked for the Border Patrol, and she put me in touch with Vi and set up a meeting for us, and I turned over much of the stuff to Vi, and she took it from there." He disputes Keen's media-plot scenario. "I never thought that Keen ever wrote the article to get me, it was just to clean up Padilla's record. He didn't do it on his own volition," he says darkly.

"I was not in touch with the media when I found these records. I certainly wasn't doing this at the behest of the media. I tried to get somebody to do something, so I went to the FBI and later to the media. I thought a lot of activities were going on that appeared to be suspicious, both to me and to the FBI and the press when it finally got that far." The government's ultimate failure to prosecute, McCannon adds, was "just another cover-up."

McCannon's research didn't stop at the recorder's office. He often went out on field trips to alleged local mafia haunts, accounts of which he included in his 1978 manuscript. "Personal observations which I made at [a Mission Valley] restaurant, over just one weekend during December 1975, will give a clue to the type of meetings which I am sure occur with great frequency in San Diego. The [restaurant] is located in a Mission Valley hotel. The office manager for the hotel is a former San Diego City Councilman...

"Even as a councilman, his private occupation was as 'greeter' for the restaurant. The [restaurant] is the San Diego hangout for organized crime figures, a step down in importance from La Costa. At the time of my observations, I was interested in seeing who was 'out and about.' I can report that Joseph Sepe, a lieutenant of Joseph and Tony Zerilli, the present Detroit Mafia bosses, was there at least Thursday through Saturday. Friday evening 'J.V.' and his wife were visiting from Orange County and stayed at the hotel overnight.

" 'J.V.' has since been identified to me as a retired or semiretired contract man, assigned as a 'floater' to handle various jobs around the country. His specialty, I am informed, was the disposal of unwanted bodies, although his more mundane duties consisted of transporting funds and closing deals. Jim Torrescano was also there Friday night. Both he and J.V. were accorded considerable respect by the waitresses. This was significant."

It was during this period, McCannon says, that he inadvertently played a role in what he speculates was a Mafia murder. He had taken an interest in La Costa – the Teamsters-backed resort in Carlsbad, which at the time was widely believed to be mobbed up – and wanted to know more about the goings-on there. "In those days, I used to go down to dance at the Starlight Room at the Starlight Hotel fairly frequently, and I got to know the manager of the dance pavilion -- not the maitre d', I guess he just ran the place – and I got to know him reasonably well, and he used to work at La Costa at the restaurant and the facilities for meetings and all that. So he became interested and he volunteered to go back there -- he still knew people -- and try to get some of the records, you know. Well, foolishly I said 'Fine. Love to have anything I can get.' Apparently he did [go back to La Costa]. I never got anything. The next time I went into the Starlight, I said, 'Where's so-and-so?' and they told me, 'We don't know. He disappeared. He had his good job down there at Starlight, very regular, and everybody liked him, and suddenly he's gone. Never any record of him.' "

As a result of that incident and the investigation he was conducting into border-property deals, McCannon says he took care never to cross into Mexico, especially after he had an unnerving brush with Johnny Alessio, C. Arnholt Smith's sidekick and wealthy owner of the Caliente racetrack who had done federal prison time for tax evasion. "All these people I was tracing, so many of them were affiliated with Mexico, and I don't know if I had anything to fear from John Alessio, but he was very strong in Mexico and Tijuana and obviously had loads of connections there, and since he had occasion to call me, and take me to task, the next day his son Dominic called me and took me to task, because they found I had been doing a little investigating around their Mr. A's building, not so much about them as about somebody else, but anyway, I just felt it was I had no particular reason to go to Mexico."

McCannon became convinced that the web of crime he had discovered spread far into the business and political establishments on both sides of the border. And, as it turned out, some of Simons's partners were not as fortunate as Padilla and Delawie in keeping clear of the law. In September of 1978, another of Simons's border deals was back in the news. Tipped by McCannon, the Los Angeles Times disclosed that a Simons-led partnership known as Mesa 45 had acquired "a wedge-shaped parcel that ran along the border for nearly a mile on Otay Mesa." Simons, the newspaper reported, had contracted to buy the 47-acre parcel for $2000 an acre. "He then invited Hector Scolari, a San Ysidro customs broker, to join him in a partnership to help purchase the border property. Simons told Scolari the asking price was $4000 an acre."

According to the account in the Times, "Scolari, whose work had put him in touch with many Mexican businessmen, sought other partners to defray the cost. He brought in five other partners, including Javier Sanchez Mayans, who was later to become deputy mayor of Tijuana and is now a federal communications official in Mexico City.

"Also joining the group was Fernando Fernandez, a former gravel-pit operator and now the owner of radio stations in Hermosillo and Mexico City. Others included Bruno Petrini, a Mexican cattle rancher who lives in Tijuana; Alfredo Lencioni, owner of three tuna boats based in Mexico; and Fernando Garcia Granados. Simons, Granados, and Scolari each own 20 percent of the partnership and the other four own ten percent, according to Scolari."

As McCannon was prowling around the Otay Mesa deals, the Mesa 45 property suddenly figured prominently in the controversy over the location of the second border crossing on Otay Mesa, then unbuilt. The L.A. Times reported that "Simons, his friends said, was convinced that the United States and Mexico would put a major pedestrian and commercial crossing through his odd-shaped piece of border property. With such a crossing would come the customs brokers, the warehouses, the trade zones, the trucks, the people, and all the ingredients that make for profitable leases and valuable land."

At first, officials on both sides of the border agreed that the crossing would be located at Harvest Road, about a mile west of the Mesa 45 property. Then word had it that strings were pulled among highly placed Mexican politicians to have the location moved east to benefit the partners of Mesa 45. That was denied by Roberto de la Madrid, then governor of Baja, who announced in January 1978 that he had in fact favored the Harvest Road location.

"What instigated the switch back to Harvest Road was Vi Murphy querying Roberto de la Madrid. That's when the switch occurred," McCannon claims today. In the end, the border crossing was shifted yet again, closer to the Mesa 45 property, fueling further speculation that inside deals were in play. Such talk was repeatedly denied by the partners.

The name Scolari was to make headlines many more times in the years to come. In December 1984, United Press International reported that a federal indictment had charged Hector Scolari with "the illegal sale of five Chinese assault rifles and firearm silencers to undercover agents for export to Mexico." Scolari and the owner of a downtown gunshop were also reportedly charged with "selling firearms to aliens and falsifying federal firearms records."

In 1985, Hector Scolari and two of his sons were convicted in federal court for unlawful exportation of firearms and falsification of federal firearms records, according to accounts in the the Los Angeles Times and San Diego Union.

In January 1988 , the Times reported that a son of Hector Scolari's, Giovanni, had been indicted by a federal grand jury in San Diego for conspiring to sell assault weapons to Mexican federal police, whom, it was alleged, were protecting Bolivian cocaine shipments through the port of Ensenada. "Eleven Mexican law-enforcement agents and one former agent were involved in conspiracies to smuggle weapons from the United States to Mexico, in some cases providing semiautomatic assault rifles to Mexican drug dealers, according to indictments unsealed in federal court Friday," the Times reported.

"Sixteen weapons actually reached Mexico, while another 16 intended for illegal export remained in the hands of U.S. agents working on the case, investigators said. At the center of the conspiracies outlined in nine separate indictments was Interpol Products, a San Ysidro firearms store whose former owner was convicted in a similar scheme three years ago, federal investigators said.

"Also indicted Friday was Giovanni Scolari, son of the former owner of Interpol Products. His father, Hector Scolari, and two other sons served time in prison after their convictions in the earlier conspiracy at Interpol, officials said." In June 1993, U.S. Attorney James W. Brannigan Jr. announced that a federal grand jury in San Diego had again indicted Giovanni Fontes Scolari, this time for having made "alliances with the Colombian drug traffickers and negotiated with them to purchase large quantities of cocaine at the best possible prices," the Times reported.

"The Federal Bureau of Investigation, according to Mr. Esposito, utilized sophisticated investigative techniques including court authorized electronic surveillance and physical surveillances. Seized as part of the investigation was $239,435 in cash, which was part of the downpayment from one criminal group to purchase 50 kilograms of cocaine. In addition to the seizure of that money, several vehicles and a residence in Chula Vista, Calif., also have been seized." Court records show that Giovanni Scolari died of a heart attack at the federal prison in Lompoc in January 1997 after a hard game of tennis. According to Social Security records, his father, Hector, had died less than a year earlier, in March 1996.

But by then McCannon had long since retired from the border beat. Unheeded by federal prosecutors, his corruption-hunting days ended in 1980 after he landed a job as electricity-load manager with San Diego Gas and Electric. In that position, he developed an interest in an energy-conservation technology called thermal energy storage. After his retirement from SDG&E in 1985, he founded and became president of an industry trade group devoted to the technology. He retired from that job last week. Of his long-ago career as a mafia hunter, he smiles and says, "It was a worthwhile venture, but it didn't pay very much. My adversaries would have been much better off had they permitted me gainful employment during that period."

As for Joe Simons, his son Barry, who now acts as spokesman for the family and its network of border real estate holdings, declined to be interviewed.