Special Counsel to Probe Deaver : Three-Judge Panel Can Set Scope of Inquiry

At the Justice Department’s request, a special federal court will appoint an independent counsel to investigate the lobbying activities of former White House Deputy Chief of Staff Michael K. Deaver, it was announced Tuesday.

The three-member panel gave no indication of when the appointment would be made. Deputy Atty. Gen. D. Lowell Jensen submitted a report proposing the scope of the investigation, but a spokesman said the contents will not be disclosed until an independent counsel is named.

The court, composed of senior judges of the U.S. Court of Appeals appointed by Chief Justice Warren E. Burger, can make the inquiry as broad or as narrow as it wants.

Congressional investigators and the Justice Department have been studying a range of conflict-of-interest charges involving Deaver and his lobbying for Canada, South Korea, Mexico, Puerto Rico and other clients. Most of the controversy has focused on a $105,000 contract to help the Canadian government forge an acid-rain agreement with the United States.

On April 24, five Democrats on the Senate Judiciary Committee asked Atty. Gen. Edwin Meese III to determine whether an independent counsel is needed in Deaver’s case. Four days later, Deaver--denying any impropriety--requested that an independent counsel be named.

Meese, a longtime associate of Deaver, removed himself from the case.

Jensen’s decision to ask for the independent counsel--thus automatically requiring the special court to appoint one--had been widely expected. The Administration’s Office of Government Ethics had recommended the move, and Congress’ General Accounting Office had said that there is evidence that Deaver violated conflict-of-interest rules with his acid-rain lobbying.

Deaver ‘Is Pleased’

After the announcement Tuesday, a spokeswoman for Deaver’s lobbying firm said that “Mr. Deaver is pleased that the process toward a fair hearing is on course.” Deaver believes that appointment of an independent counsel “is the only appropriate way to have the various allegations fully and impartially reviewed,” she said.

Records show that Deaver, while in the White House, lobbied for a special envoy to be appointed to negotiate an acid-rain agreement with Canada. Six weeks after Deaver left his government post last May, he negotiated a contract to represent Canada on acid-rain and trade issues.

Federal law bars former senior executive branch officials from lobbying their former agencies on issues in which they were substantially engaged. Violations can result in up to two years in jail and $250,000 in fines.

‘Mean-Spirited Attacks’

Deaver asserted before the House Energy and Commerce Committee two weeks ago that he was the victim of politically motivated “mean-spirited attacks” that implicitly question the integrity of his longtime close friend, President Reagan.

He testified that he had “absolutely never taken advantage” of his friendship with the President and Mrs. Reagan. He insisted that he had “consistently sought to maintain a high standard of integrity” in his business dealings since leaving the White House post.

Since the controversy erupted, Deaver’s firm has lost $250,000-a-year lobbying contracts with Singapore and Mexico and a $475,000-a-year contract with South Korea, according to documents he filed at the Justice Department under the Foreign Agents Registration Act.