Inquiry Asked in Deal for Chappell Club
The Common Cause organization called on the House Ethics Committee on Tuesday to investigate reports that representatives of two major defense contractors bought a failed Florida health club partly owned by Rep. Bill Chappell Jr. (D-Fla.) and absolved him of his share of $172,000 in debts connected with it.
“We urge the committee to initiate such an inquiry to determine if ethics have been violated and to report publicly its findings,” said Fred Wertheimer, president of the independent citizens lobby, in a letter to the panel.
Rep. Julian C. Dixon (D-Los Angeles), chairman of the House Committee on Standards of Official Conduct, refused to comment on the request. Chappell’s office did not respond to requests for comment.
Has Denied Impropriety
Chappell, who previously denied any impropriety in the health club transaction, is the powerful chairman of the defense appropriations subcommittee of the House Appropriations Committee, which oversees funding of a wide range of defense projects. His name has surfaced in wiretaps during the ongoing Pentagon defense fraud investigation, sources said, but he is said not to be a target of the probe.
The Washington Post reported earlier this month that in December, 1984, an investor group headed by Leonard Killgore, a consultant for Textron Inc.’s subsidiary Avco Corp., and George L. Dalferes, chief of lobbying for Martin Marietta Corp., bought the Racquet Club of Ocala Inc., which was then facing foreclosure.
The investors reportedly paid $175,000 for the club and absolved Chappell and his partner, William W. Austin, of $172,000 in outstanding personal obligations in it.
A little more than a year later, the investors sold the club for $200,000 to a real estate unit of Martin Marietta Corp., the Wall Street Journal reported.
Ethics Code Provision
Wertheimer’s letter to Dixon requested an investigation on whether the transaction violated an ethics code provision that states that a member should “never accept for himself or his family favors or benefits under circumstances which might be construed by reasonable persons as influencing the performance of his government duties.”
At the time of the initial sale, Chappell was the No. 2 Democrat on the defense appropriations subcommittee. Killgore formerly worked as an aide in his office.
In a response to the July 5 Wall Street Journal report, Chappell was quoted as noting that the investors made “at least a $20,000 profit 13 months later.
” . . . There was absolutely no benefit to me in any way.”
Investigative sources have said that Chappell’s name has emerged in the current defense fraud probe because he was mentioned by a defense consultant in a secretly wiretapped telephone conversation with a political researcher. In the conversation, a transcript of which was obtained by NBC news, defense consultant Charles F. Gardner told the unnamed political researcher to bill a weapons system subcontractor for political work he had done for Chappell.
No Evidence Chappell Knew
Sources have said they have no evidence that Chappell was aware of the instructions. It is not known whether the false invoice was ever submitted.
In a recent report by Common Cause calling for a ban on so-called honorariums that members of Congress and public officials receive for speeches, appearances and articles, the organization focused criticism on the defense contracting industry.
The watchdog organization cited a study it conducted showing that of the $737,744 paid by the defense industry for congressional honorariums in 1987, more than two-thirds went to members of defense committees who make crucial decisions on military contracts. Wertheimer charged that the practice of paying members of Congress up to $2,000 for a speech can be used to “buy influence.”
