I believe his argument is that if you have n people in on a conspiracy, than you have possibility of any of the n^2 communication channels becoming compromised, and n^2 more chatter going on. You can mitigate this by having only one person keep track of things, and ensure that no one else knows anyone else is in on it (yay! Star topologies!)

Also, each of the n individuals knows that there are (n - 1) others who could also leak. Attribution for the source of the leak becomes harder and everyone involved knows it. So the motivation to keep the secret is reduced along with the sense of accountability.

3 can keep secret only if two of them are dead