Annals of the Covert World: the Secret Life of Shampoo

Lobby of CIA HQ. Photo: CIA.

It’s been 30 years now since I wrote my first story about the CIA. In the decades that followed, the Agency has been a featured player in at least four books (Whiteout, Imperial Crusades, Grand Theft Pentagon and End Times) and hundreds of articles. My office has nearly been overtaken by the inexorable accretion of boxes filled with heavily redacted files extracted from the Agency’s vaults via FOIA. The files for our book Whiteout totaled more than 150,000 pages alone. The papers from the George W. Bush and Obama forever wars, mass surveillance, renditions and torture schemes amassed another 100,000 pages, at least. At a certain point you just stop counting. This week I was rearranging the Teton-like piles of boxes to reduce the risk of being crushed at my desk when the Big One hits the Willamette Valley and a file spilled open, scattering my notes on the following story, which I was working on the week before the planes took down the Twin Towers and immolated the Pentagon. It seems an epoch ago now and I’d nearly forgotten it. But I chuckled as I read the pages about how a veteran of the Agency’s infamous Phoenix Program had landed a job doing dirty tricks in a shampoo caper. The surveillance state is both more sinister and much sillier than most of us imagine. There are many such stories in these files, some of them outtakes from Whiteout, which deserve to be resurrected from the crypt to remind us of the kinds of obscenities and absurdities the CIA has been up to all these years. The running title for this occasional series, Annals of the Covert World, is a tribute to John McPhee’s books on geology, Annals of the Former World. We’ve both done years of excavating through deep strata of information about how the past continues to shape and often warp the present. –JSC

Veterans of the CIA’s Phoenix Program always seem to make soft landings with a golden parachute: a lifetime guarantee of gainful employment. CounterPunch reported on the ascent into the Congress of Robert Simmons, a Phoenix veteran and adept at torture. Then there’s the case of former senator Bob Kerrey, who commanded a Phoenix operation in the Mekong delta that featured throat-slitting and the assassination of elderly men and women and children. Now comes word that Phoenix veterans are also highly sought after by the upper echelons of the corporate world.

In early September, Procter and Gamble, the Cincinnati-based conglomerate, fessed up to hiring Phoenix operatives to infiltrate its chief rival Unilever, the Anglo-Dutch cosmetics giants. It was all about the secrets of shampoo, specifically the top-selling Salon Selectives and Finesse. It seems both of those Unilever brands had taken a big bite out of the market share once dominated by a shelf of P&G products, including Wash & Go, Head & Shoulders, Pantene and Vidal Sassoon. Also at stake was the planned sale of Clairol, which was on the auction block with both companies in an intense bidding struggle. One former P&G executive said that the companies were engaged in a decades-long dirty war, which had become “a death struggle to incrementally gain share”.

The operation was launched in June of 2000, when P&G contracted with the Phoenix Consulting Group of Huntsville, Alabama, a corporate espionage firm set up by Phoenix veteran John Nolan and fellow CIA officers. P&G also set up a secret wing inside its own security department. The operations were run out of a secret office known as The Ranch, and featured safe houses, off-shore bank accounts, dumpster diving and informants.

Nolan and his operatives were apparently able to secure more than 80 internal Unilever documents that detailed the company’s shampoo marketing strategy for the next two years. The documents were returned to the company after word of the operation leaked out to a reporter at Fortune magazine. P&G apologized for the operation, saying it had “violated our strict business guidelines regarding our business policies.” The company also fired two executives in the firm’s security sector.

But few take these actions as anything more than the defensive maneuvers of a company caught doing something shady and in full damage control mode. Indeed, P&G is well-known for its paranoia and obsessive concerns about corporate secrecy. Its security officers are known inside the company as “Proctoids”. In the past, P&G has shadowed employees on their business trips to see if they chatted to fellow travelers (and Unilever agents?) about company business, snooped in on company phone lines and tracked computer traffic. A few years ago P&G executives became enraged by a series of critical articles about the company by Wall Street Journal reporter Alecia Swasy and retaliated by hitting her with grand jury subpoenas and putting her under 24-hour surveillance.

P&G CEO, John Pepper, can hardly claim ignorance of the operation. Over the past year, Pepper has been bragging publicly about the success of his company’s ventures into “competitive intelligence,” most recently in a June speech in Montreal. The speech was given two months after Pepper sent his apologies to Unilever for filching the company’s marketing plans.

The leading guru of competitive intelligence is none other than Pepper’s pal John Nolan, the Phoenix vet who credits himself with perfecting, if not inventing the field. Indeed, there’s even a school for corporate snoops set up by Nolan and other CIA/Phoenix retirees called the Centre for Operational Business Intelligence, a kind of School of the Americas for corporate snooping and assorted dirty tricks.

Douglas Valentine, author of The Phoenix Program, describes Nolan as “disarmingly forthright”. There’s no question that Nolan doesn’t shy away from his bloody resumé. In fact, it’s his calling card. CounterPunch has acquired a briefing paper Nolan prepared for prospective clients, in which the former spook details his methods for “competitive intelligence gathering”, “elicitation techniques”, and “countermeasures”.

“As business turns” Nolan writes, “we’ve been asked to conduct intelligence collection assignments against an even dozen of those companies where the security managers had previously asked us about steps to defeat our efforts,” Nolan writes. “In every one of those cases, we’ve accepted the assignment, because that is what we do, but with the caveat to the client that we are uncertain about our level of success because we know that the company under consideration has a security leader who is apparently involved in information protection. But now we don’t bother with that caveat anymore. Why? Because when we try to penetrate the designated target company, we don’t find it any more difficult to conduct collection operations there than in any other companies…perhaps we’re just a heckuva lot better than we think we are.” It would take an analyst versed in the work of Lacan to decode the depth of schizophrenia involved in this spy-vs-spy scenario.

In his pitch to corporate executives Nolan delicately avoids mentioning the most important factor in corporate snitching: the fact that so many employees are mistreated at their jobs that they can’t wait to sabotage their bosses.

Jeffrey St. Clair is editor of CounterPunch. His most recent book is An Orgy of Thieves: Neoliberalism and Its Discontents (with Alexander Cockburn). He can be reached at: or on Twitter @JeffreyStClair3