Donovan Cleared in Secret Inquiry

Former Labor Secretary Raymond J. Donovan has been cleared in a secret probe into allegations that he may have lied when he denied knowing anything about an alleged $15,000 kickback scheme involving Donovan and his construction company, according to a report issued Friday.

One of the alleged kickbacks was a $5,000 contribution solicited by Donovan for the New Jersey gubernatorial campaign of Raymond Bateman, according to a report by independent counsel Leon A. Silverman released by a special appeals court panel that appointed him.

The report disclosed that Silverman, who directed a 1982 inquiry into Donovan’s activities, was reappointed in June, 1985, to probe Donovan’s testimony in Silverman’s earlier inquiry in which the then-labor secretary denied knowledge of kickback agreements involving $15,000 in payments to him by a former supplier of Schiavone Construction Co., a New Jersey construction firm of which he was vice president before joining the Administration.

Silverman concluded that although there is “some evidence to support an indictment,” a conviction is “unlikely” and charges are “not warranted.” A federal grand jury in New York reached the same conclusion, Silverman’s report said.

Donovan, who resigned as secretary of labor in 1985, was the first sitting Cabinet member indicted for criminal actions.

In May, however, Donovan and seven co-defendants were acquitted after a marathon, seven-month trial in New York on grand larceny and fraud charges stemming from a $186-million New York subway contract awarded to the Schiavone firm.