I think there was an element of surprise in Geary's demands and his outburst. When Geary said, "That will leave you with a problem: the LAH-sense will be in Klingman's name," Michael looked surprised and replied, "Turnbull's a good man..." I inferred that Turnbull was Geary's bagman, and that Michael had already made some bribery arrangement to Geary, through Turnbull, to nullify that "problem." Michael also shoots Tom a look of inquiry as if to say, "Didn't you square this with Turnbull? What is this?"

I definitely believe that Michael had the brothel killing scenario up his sleeve prior to the "oily hair/silk suit" rap. Geary had to have been a regular at Fredo's brothel--he told Tom re. the hooker, "We done it be-FOE-wer." Fredo or his manager had to have alerted Michael, who would have stashed that powerful blackmail lever away for future use.