Lyndon H. LaRouche Jr. told associates that Assistant Atty. Gen. William Weld, who has spearheaded the fraud investigation of LaRouche organizations, "should get a bullet between the eyes," an FBI agent testified Thursday during a hearing at which two of the political extremist's top aides were denied bail on obstruction of justice charges.
The alleged LaRouche statement was disclosed by Roy Frankhauser, a LaRouche security adviser and one of 10 associates indicted Monday on fraud and conspiracy charges. Frankhauser is now cooperating with the government, authorities said.
FBI agent Richard Egan said Frankhauser, former Grand Dragon of the Ku Klux Klan in Pennsylvania, quoted LaRouche in a conversation with him and other security aides as saying of Weld: "The son of a bitch does not deserve to live. He should get a bullet between the eyes."
Spokesman Denies Statement
A spokesman, Lawrence Freeman, denied that LaRouche had ever made such a statement.
A government source said that the purported statement alone, without corroboration, does not constitute grounds for action against LaRouche, who has not been indicted in the federal crackdown on his organization.
Egan said that extensive files on Weld and his wife, both of their families and some of their neighbors were found during the massive search of LaRouche's Leesburg, Va., headquarters by more than 350 federal and state agents Monday.
After the federal raid on his international headquarters and the indictment, LaRouche sent President Reagan a telegram stating that "I will not submit passively to an arrest but . . . will defend myself."
It was not clear whether the alleged statement about Weld was a factor in the decision by federal magistrate W. Harris Grimsley to order that Jeffrey and Michelle Steinberg, two top LaRouche aides, be held without bond. They are scheduled to appear Oct. 20 in federal court in Boston on charges of conspiring to obstruct justice.
$22 Million in Fines
Citing contempt findings against LaRouche organizations that subject them to $22 million in fines, Grimsley said: "To me, that is clear and convincing evidence the Steinbergs are obstructing justice."
Henry Hudson, U.S. attorney in Alexandria, where the hearing was conducted, said that the Steinbergs "are masterminds of the entire scheme to frustrate the (Boston federal) grand jury's investigation."
The 117-count indictment returned by the grand jury Monday charged that LaRouche's political network plotted nationwide to defraud more than 1,000 people of $1 million during his 1984 presidential campaign.
Under one scheme, special bank accounts were established, enabling the fraud to be carried out by simply phoning the data centers of the major credit card companies and claiming authorization for telephonic charges, the indictment alleges. In other cases, "loans" were solicited from victims without any intention of repayment.
Grimsley left it to attorneys to work out bond arrangements for a third defendant, Michael Billington, who is accused of fraud by wire in 1984 fund-raising activities in Boston.
Frankhauser, in interviews with the FBI, said that the Steinbergs told him they tried to intimidate the grand jury in Boston by organizing pickets at the federal courthouse and making repeated verbal attacks on Weld, who led the investigation when he was U.S. attorney there.
Egan testified that the Steinbergs first contacted Frankhauser when the grand jury convened two years ago and told him to "fix" the investigation. Frankhauser estimated that he and the Steinbergs had talked "several hundred" times about foiling the federal probe.
The hearing also provided evidence that the Steinbergs and the LaRouche organization were behind the 1982 distribution of about 200,000 copies of a bogus New York Times section that featured an attack on the late New York attorney Roy M. Cohn. The 12-page section also attacked New York Mayor Edward I. Koch and then-Republican gubernatorial candidate Lewis E. Lehrman.
Egan said that Charles Tate, a defector from LaRouche's security staff, told him that the Steinbergs devised the scheme, which used rented trucks to deliver the fake newspaper to newsstands in New York City.
Frankhauser told the FBI that the Steinbergs destroyed the printing plates just before a grand jury attempted to subpoena them.