Murdered heiress, mystery, missing millions and more

Nearly 40 years have passed since millionaire recluse Marjorie Jackson was murdered during a robbery of her home in the 6400 block of Spring Mill Road.

After all that time, questions still linger about the fate of some of the $3 million or more the killers got away with back in 1977 — loot that was part of an unbelievable cache Jackson kept hidden around her home after withdrawing about $8.6 million from the bank in the months before her murder.

“We’ve always thought there was at least $1.6 million that was never accounted for,” said retired Indianapolis police captain Steve Koers, a nephew of Jackson and co-executor of her estate.

“There could be a lot more than that out there. You just don’t know. But the $1.6 million, we know, because of the serial numbers and the amounts she withdrew from the bank.”

Now, an 81-year-old investigative reporter in Arizona has a hunch where at least some of the missing money went. And he thinks the FBI may be hiding key information to protect the reputations of the agency and a deceased former agent he suspects may have kept some of the loot after arresting one of the suspects.

The scenario laid out by Don Devereux is a doozie, for sure. Some will argue it’s nothing more than a wild notion. Others will see it as the fitting explanation for a fantastical case that has seemingly defied plausibility at every turn.

Central to Devereux’s claim are public records, including real estate and financial documents, as well as an FBI file detailing the Phoenix field office’s role in the apprehension of the man later convicted of killing Jackson.

Among the FBI records he obtained last year through a Freedom of Information Act request is a notice that the file was “partially destroyed” in 1993 — something Devereux said he has never encountered in more than 50 previous FOIA requests to the FBI. The agency so far has not provided any explanation for why that part of the file was destroyed, or what the missing documents may have contained.

Devereux said he can’t help but wonder if those missing pages contained information about the possibility of missing money in the Jackson case and whether the bureau believed one of its agents might be involved.

If his theory seems far-fetched, remember this: So was the tangled series of events that culminated in the summer of 1977 when a pair of FBI agents from Phoenix reported digging up $1.7 million buried under five feet of sand in the desert north of Phoenix.

The crime

The killing of Jackson, because of her eccentric lifestyle and the vast amount of money involved, attracted international attention.

It was reported at the time as — and may still be — the largest cash heist from a residential burglary in U.S. history.

The case remains one of the most fabled crimes in Indiana history thanks to a cast of characters who seem like they jumped out of the script of a Coen brothers movie:

The eccentric grocery chain heiress who kept a table set in anticipation of the return of Jesus Christ, who covered doorknobs and heating vents with aluminum foil and stashed millions of dollars in trash bags, toolboxes, dresser drawers and garbage cans.

A pair of bumbling burglars, one characterized as a small-town hick and the other as a streetwise city hustler.

A sheriff nicknamed “Diamond Don,” who wore a jewel-studded vest and bragged about his past gambling exploits.

Even celebrity lawyer F. Lee Bailey.

Then there were the unbelievable — if they hadn’t been true — details and plot twists:

The crooks’ return to Jackson’s home to cart out even more cash, followed by a bungled attempt to set a fire to cover their tracks.

Their conspicuous spending sprees in the days after the deadly robbery.

The discovery of dozens of neatly wrapped gifts Jackson had left in her home with cards saying they were for “Jesus” and “God,” along with an additional $5 million the thieves had left behind.

A flight to Arizona, where one of the burglars buried at least $1.7 million in the desert — possibly in response to advice from Bailey.

The recovery of that money with the help of a woman who had at least twice married and divorced the suspect.

And, the speculation that millions of dollars from Jackson’s cache still remain unaccounted for all these years later.

Stash of cash

Marjorie Viola O’Connell Jackson’s money came from her husband Chester Jackson, a businessman and shrewd investor who amassed a fortune before his death in 1970.

Chester Jackson’s father, Lafayette Andrew Jackson, founded the Standard Grocery chain that grew to include more than 250 stores in Indianapolis and other cities around the state. Chester Jackson became the company’s president in 1931 after his father was shot and killed during a robbery of the chain’s flagship store in the 400 block of East Washington Street.

Jackson sold the chain in 1947 to the National Tea Co., according to the book “Notorious 92: Indiana’s Most Heinous Murders in All 92 Counties” by Andrew E. Stoner. The account says the sale “allowed (Jackson) to buy $14 million in coal stocks, $5 million in municipal bonds, $1 million in cash and Treasury bills, and other investments.”

“In all,” Stoner wrote, “the Jackson estate was worth more than $25 million.”

Chester Jackson was still married to his first wife when he met Marjorie O’Connell, former Indianapolis Star reporter and editor Dick Cady wrote in his book about the case, “Scavengers: A True Story of Money, Madness and Murder.”

Cady wrote that Marjorie, “who came from a hardscrabble background,” was working at a Murphy’s five-and-dime store in Downtown Indianapolis when they met.

The couple carried on a not-so-secret affair for years before Jackson finally obtained a divorce, according to the book. They were married — the second for both — in 1952. Two years later the couple, who had no children, purchased the home on Spring Mill.

When Chester Jackson died in 1970, Marjorie Jackson inherited an estimated $14 million, depositing most of the money in the Indiana National Bank.

What few knew at the time was that Chester Jackson, who didn’t like the IRS, had for years stashed cash at the couple’s home.

By some accounts, it may have been more than $2 million — but that was only a pittance compared to what was to come.

Marjorie Jackson, who was 60 when her husband died, continued to live at the couple’s home. But as the years went by, she became more reclusive and allowed the property to grow up in tall grass and weeds.

Neighbors, quoted in news stories after her murder, said the widow talked to the birds and animals, practiced bizarre religious rituals, spouted racial epithets and even claimed to grow money out of the ground. She had two new Cadillacs in her garage, including one that she never even bothered to license.

In 1976, after a bank employee embezzled $700,000, Jackson began withdrawing her savings. She would show up at the bank and demand $500,0000 to $1 million at a time, taking the stacks of $100 bills home in a suitcase or grocery bags.

Over the course of about four months, Jackson withdrew everything she had in the bank. The total was nearly $8 million.

She hid the money all around her home — in closets, toolboxes, garbage cans and vacuum cleaner bags. The money was interspersed with an odd collection of gifts, from wash cloths to cakes to expensive jewelry, scattered around the house. The neatly wrapped packages had tags that read: “To Jesus Christ from Marjorie Jackson” and “To God from Marjorie.”

Indianapolis attorney Robert “Tommy” Thompson, who worked for the prosecutor’s office at the time, said bank officials, police, a judge and the prosecutor all tried to convince Jackson that keeping so much money at home was a risk. It could, they told Jackson, put her life in danger.

She told them to mind their own business.

Several months before she was murdered, two teens burglarized Jackson’s home. They got away with about $800,000, but she refused to prosecute them — even after one of the thieves confessed to a grand jury.

Thompson visited Jackson after that theft and found himself staring down the barrel of a pistol. It was one of the coldest days of the year, Thompson recalled, and Jackson greeted him and several lawmen in the driveway of her home dressed only in a nightgown.

Jackson denied any money was taken in the recent break-in at her home. When Thompson said one of the crooks admitted to stealing nearly $800,000, Jackson insisted the man was lying.

“Get off my property,” she instructed Thompson and the others.

The next time Thompson saw Marjorie Jackson was about four months later. This time, she was lying dead in a pool of blood on her kitchen floor.

The curious case of the robbery and killing of Jackson began to unfold on May 2, 1977, when an unlikely duo — Howard “Billy Joe” Willard, 38, Mooresville, and Manuel Lee Robinson, 29, Indianapolis — broke into Jackson’s home. The pair left with about $1 million in cash.

They were, according to Indianapolis attorney John M. Schwartz, a fascinating odd couple.

“You had Robinson, a hip, inner-city black,” Schwartz, who was the deputy prosecutor assigned to Robinson’s case, said in a 1987 story marking the 10th anniversary of the robbery and murder. “And then you had Willard, who I think was just an ignorant hillbilly.”

Schwartz, in an interview for this story, said he has mellowed a bit over the years in his assessment of Willard, calling him “a somewhat unsophisticated guy with a rural background.”

Emboldened by the ease of the first burglary — and the lure of the horde of cash they had left behind — the pair returned to Jackson’s home two days later. This time, they were confronted by the widow, and Willard shot her in the stomach with a .22 rifle.

Jackson bled to death — surrounded by the scores of gifts, as well as the fine china and cutlery she laid out in her dining room for her anticipated feast with Jesus.

The burglars tried to set the home on fire, but the small blazed smoldered for hours before it was discovered and firefighters were called. Jackson’s body was discovered after the fire was extinguished.

And despite Willard and Robinson making a return trip to the home, hauling out bags of cash — mostly $100 bills — police found they had left millions behind.

Exactly how much money Jackson had hidden, and how much of that money Willard and Robinson got away with, could never be confirmed, said Schwartz, the deputy prosecutor.

By some estimates, he said, there may have been as much as $15 million stashed at Jackson’s home. More than $5 million was recovered after the fire, Schwartz said, and Willard and Robinson were believed to have taken at least $2 million to $3 million each.

“No one ever really knew how much money she had there,” Schwartz said. “The big open question has always been: Is there more money out there, and where might it be?”

Paid cash for cars

It didn’t take police long to identify and arrest Willard and Robinson in Jackson’s murder.

The men got caught, Schwartz said, because they “were spending money like water” in the days and weeks after the robbery.

Robinson’s public defender, Arnold Baratz, said his client and Willard committed a crime almost impossible to solve, then left a trail nearly impossible to miss.

“If they hadn’t set fire to the house,” he said, “(the killing) might not have been detected for months and months because she was such a recluse.”

The tips that helped break the case came from Indianapolis car dealers. Salesmen became suspicious and alerted police after the men purchased new cars, paying cash. While that wasn’t unheard of at the time, what happened next was: They came back to buy other cars, and again paid in cash.

After Robinson was arrested, $1.6 million was found in a suitcase hidden under a bed at his apartment at 20th and Central. He claimed a man had given him the money to keep but denied knowing the person’s name.

As investigators pressed Robinson about the absurdity of his claim, he eventually said he had the man’s telephone number. It turned out to be the number for the Mooresville home of Willard’s ex-wife and current girlfriend.

Willard and the woman had fled by the time police came to their home but were caught in Arizona. Again, it was their lavish spending that got the couple in trouble. They had paid about $50,000 in cash to buy two used RVs.

Willard was brought back to Indiana, convicted of murder and sentenced to life in prison. He died in June 1987 after collapsing while jogging at the Indiana Reformatory.

His partner, Robinson, was acquitted on the murder charge but was convicted of burglary and arson. He was released from prison in 1988 but was arrested again in 1990 and sent back to prison for 10 years.

Robinson, who was last thought to be living in Florida, told Cady he believed law enforcement officials had kept about $450,000 of the cash he got in the Jackson robberies, according to Cady’s 2011 book.

Baratz, Robinson’s public defender, said his client had insisted from the start that he still had some of the loot stashed.

“He always claimed,” Baratz said, “that the police never got all of his money.”

Buried treasure

It was Willard’s ex-wife who led two FBI agents to a spot not far off of I-17 north of Phoenix where they reported finding $1.7 million in cash.

The recovered money had been hidden in two boxes buried in the desert.

At Willard’s trial, according to Cady’s book, the woman testified that celebrity attorney Bailey advised Willard to divide up the money and bury it in several locations to protect the couple from thugs wanting to get their hands on the stash.

That testimony, Cady wrote, prompted Bailey to issue a statement.

“I told him (Willard) I would represent him only if he would surrender and return the money,” the statement said. “ ... I suggested for the safety of the child (who was traveling with them) he place the money somewhere for safe keeping while I negotiated his surrender and not keep the money in the camper.”

According to Devereux’s theory, one of the FBI agents may have found much more cash than they reported — and spirited it off to a Swiss bank account.

The FBI file indicates the recovered money came from only one location. Devereux said it is possible the agent skimmed some money from that find, or went back into the desert later and dug up money from other locations where Willard may have buried it.

Years later, after the investigator had retired, Devereux suspects the money was transferred back to the agent from the Swiss bank account, coming through a Caribbean tax haven, and then used to purchase valuable real estate in Phoenix.

Devereux has property and other financial records in the former agent’s name that show money transferred from Switzerland to the Netherlands Antilles was used to purchase property in the agent’s name. That property was then transferred back to an off-shore holding company he suspects was associated with a trust established by the now-deceased agent.

“The crucial question,” Devereux wrote in a letter to the FBI in April, “... should be whether the ultimate source of those funds was the money still ostensibly missing from the Jackson robbery/homicide.”

Taking no action

Devereux strung together his fantastical scenario after getting a tip from a source in law enforcement.

The source told the veteran investigative reporter, who twice has been nominated for a Pulitzer Prize, that it seemed odd some of the stolen loot appeared to be missing even though both suspects cooperated with authorities.

“Something about that struck him as weird,” Devereux said. “So, as a favor, I did a FOIA request with the FBI.”

The records Devereux received from the FBI contained a bombshell: the name of one of the FBI agents who recovered the money was not redacted. And it wasn’t just once. The name showed up six times in the records, something Devereux said, based on his years of dealing with FBI files, “seemed extraordinary.”

He took it as a sign that someone in the Phoenix FBI office also had suspicions about the agent, whose name typically would have been blacked out in the documents made public.

“Once is an oversight,” Devereux said. “Six times is a message. At least, that’s how I took it.”

After learning part of the case filed had been destroyed, Devereux asked the U.S. Department of Justice to investigate.

“The whole thing,” he said, “leaps out at you as irregular. And even though we’re talking about something that happened a long time ago, I don’t believe that is any excuse to ignore it now.”

In March, the FBI sent Devereux a letter informing him the agency’s Internal Investigations Section — the entity responsible for investigating allegations of serious misconduct against agents — is taking no action on his request.

“However, your information was provided to the FBI’s Criminal Investigative Division, Public Corruption and Civil Rights Section, as well as the FBI Phoenix field office, for appropriate action,” the letter said.

Devereux said he understands that “appropriate action” is an investigation, but he still is waiting for the agency to provide an explanation for why part of the file was destroyed, what it involved, and the source of the money the agent obtained from Switzerland.

An FBI spokesman in Phoenix told The Star he had no information on Devereux’s request.

Koers, 69, the nephew of Jackson, said he’s intrigued by Devereux’s theory.

“You just don’t know,” said Koers, who worked in the Indianapolis Police Department crime lab at the time of the robbery and murder.

Koers still fondly recalls Marjorie and Chester Jackson. They were the “rich aunt and uncle” he and his siblings would visit. Marjorie and his mother had the same mother but different fathers, and grew up together on North Oxford Street.

He said Marjorie Jackson may have been eccentric, but she was not insane at the time of her death. A judge, who was asked by bankers to block her huge withdrawals months before she was killed, agreed she was competent.

Koers was not actively involved in the murder investigation, which was headed up by the Sheriff’s Department, but said he was called to the scene to identify the body.

He also watched as police and firefighters gathered up the boxes and bags of money that Willard and Robinson left behind. That night, he accompanied sheriff “Diamond Don” Gilman back to the sheriff’s office with all the money.

The sheriff asked Koers to spend the night in his office to keep an eye on the money until it could be put somewhere more safe.

“I slept on the couch in the office,” Koers said, “but I’m not sure I slept all that much.”

Nearly 40 years later, the retired police officer is conflicted by the possibility another lawman would have skimmed some of the money stolen from his aunt.

“I’m not accusing the FBI agent of anything,” he said. “But it sounds like there could be something to it, so I think it is something that should be looked into.”

Star Researcher Cathy Knapp and Visuals Coordinator Dawn Mitchell contributed to this story.

Call Tim Evans at (317) 444-6204 and follow him on Twitter: @starwatchtim.