U.S. Probing Charges on Ferraro’s Finances

The Justice Department is investigating whether former Democratic vice presidential candidate Geraldine A. Ferraro “knowingly and willfully” falsified financial disclosure statements that she submitted as a House member, according to department sources.

The investigation concerns allegations that she violated the chapter of the federal criminal code involving fraud and false statements, under which Rep. George V. Hansen (R-Ida.) was convicted two years ago.

The chapter makes it a crime to “knowingly and willfully falsify, conceal or cover up” information on a government form.

Each House member must file financial disclosure statements listing holdings, liabilities and transactions, including gifts, loans and profits for themselves and members of their immediate families.

The penalty for each violation of the law is up to five years in prison and a fine of up to $10,000.

Hansen, who was convicted on four counts, was sentenced to five to 15 months in prison and fined $40,000.

Inquiry ‘Continuing’

Ferraro’s lawyer, Stephen J. Pollak, said Wednesday that “we understand the Department of Justice inquiry to be continuing.”

Lawyers in the public integrity section of the Justice Department’s criminal division have been conducting the investigation to determine if there appears to be enough evidence to bring to a grand jury, a source familiar with the investigation said.

Their recommendation then would go to Assistant Atty. Gen. Stephen S. Trott, head of the criminal division, and Atty. Gen. Edwin Meese III, department sources said.

The department received complaints about Ferraro’s finances last August from the Washington Legal Foundation, a conservative nonprofit public-interest law firm, and John Banzhaf, a George Washington University law professor.

The complaints alleged that Ferraro falsely claimed on her financial disclosure forms that she was exempt from disclosing her spouse’s finances.

House members are exempt from such disclosures if the member “neither derives, nor expects to derive, any financial or economic benefit” from the spouse’s asset or business, if the member has “no knowledge” of the business or asset and if the asset was not purchased with any of the member’s “income, assets or activities.”

Mortgage Payments

But records released by Ferraro last year showed that her husband’s income was used for mortgage payments on their New York home and that Frajo Associates Inc., a firm owned by her husband, John A. Zaccaro, and his mother, was involved in the purchase of the couple’s vacation home in the Virgin Islands.

In addition, Ferraro was an officer in her husband’s major business, P. Zaccaro Co. Inc., and received relatively small amounts of income from the business.

The Washington Legal Foundation last year made the same allegations to the House Ethics Committee. Ferraro replied that she “reasonably claimed the spousal and dependent children’s exemption and reported her own financial affairs without errors or omissions that were either willful or deliberate.”

The committee found that she technically violated House rules by failing to disclose her interest in her husband’s real estate firm, but it did not call for disciplinary action.