Thanks very much for the replies (so quickly! I am very gratified).
I think there is merit to the suggestions about filing a harassment complaint--going down the police station with a tape of the phone call. But indeed, the letters (all to third parties) are not harassment, legally, and though they are actionable that is not a viable option--unless indeed they actually do harm, and that does not seem very likely. Besides, the man hasn't got a penny to his name.

I guess what I am searching for here is some kind of strategy, based upon what I've described, as to how to cope a person with the kind of sickness that he appears to have (whatever that might be). Alas, the psychologist I consulted on this was a girlfriend with whom I have since split up, so consulting her again is not a viable option!
As for the possible illness that he has, BPD is possible but I think Paranoid Personality Disorder seems to fit him more closely.
I should point out that I am not the only victim of this sicko. He has made grandiose accusations against some of my colleagues, accusing one of taking a $3 million bribe and another of illegal conduct--all absolute fantasies. One emailed me yesterday (these are all employees at a company where I no longer worked) and I get the impression that this sick person has begun escalating there as well. I was not told specifically,. but I get the impression from the emails that phone calls were made there as well. I was told that "corporate security" was notified.

Bottom line is that he is sick, and I could care less about whether the guy recovers. I just want him away, and I am trying to figure out some strategy to get rid of him.

This has been a good discussion so, please, keep the suggestions coming!
Dave