Key Figure in Wright Oil Deal Testifies Before Panel

A Texas financier who put together an oil deal that brought a quick profit for House Speaker Jim Wright (D-Tex.) testified Wednesday before the House Ethics Committee but only answered “some” of its questions, the panel’s chairman said.

Morris D. Jaffe of San Antonio, who also is a prominent Democratic Party fund-raiser, refused to discuss his six-hour, closed-door appearance before the panel except to say that he tried to shed light on the controversial Sabine Lake oil and gas investment that produced a $340,000 gain for the Speaker last June.

Jaffe appeared in response to a committee subpoena after his refusal to testify a week ago in San Antonio before committee Chairman Julian C. Dixon (D-Los Angeles) and ranking Republican member John T. Myers of Indiana. Jaffe challenged the panel’s authority to look into his business deal with Wright but the committee reaffirmed the subpoenas.

‘They’re Here’

Asked if Jaffe now is cooperating with the panel as it winds up its inquiry into Wright’s financial affairs, Dixon replied: “They’re here and they’re testifying, if you call that cooperating.”

But Dixon suggested less than complete cooperation from the witness when he was asked if Jaffe was answering the panel’s questions. “Some,” the chairman responded tersely.

Four other Texans--including Jaffe’s son, Douglas--were scheduled to give testimony to the committee in the final phase of its 11-month investigation of charges that Wright broke House rules in his financial dealings.

Lawyers for the Jaffes have defended the Sabine Lake project as a “totally legitimate” business venture, despite suggestions by Richard J. Phelan, the committee’s special counsel, that the windfall for Wright might have amounted to a disguised gift.

Wright’s holdings were in a blind trust at the time and he had no knowledge of the transaction, according to his business partner, George A. Mallick Jr., a Ft. Worth developer who acquired an interest in the Sabine Lake tract for their investment company, Mallightco.

The well has never produced commercial quantities of oil and gas but a statement issued recently by the owners contends that it has reserves worth $44 million that still can be recovered.

The ethics panel has accused Wright of improperly accepting $145,000 in unrelated gifts from Mallick and of evading a House limit on speaking fees by making bulk sales of his book to organizations he addressed. He has denied any wrongdoing and the Ethics Committee will conduct a hearing soon to decide if the charges should be upheld or dismissed.

The Speaker’s predicament--and the possibility that he could lose his House leadership post if the chamber decides to discipline him--was on his colleagues’ minds Wednesday at the first public hearing of a bipartisan House task force on ethics.

Rep. Bill Frenzel (R-Minn.), a veteran lawmaker who once served on the ethics panel himself, expressed sympathy for Wright.

The process of investigation in the case of the Speaker and in that of former Sen. John Tower, who was rejected by the Senate for the post of defense secretary, produced leaks to the press that resulted in a prejudgment of guilt, Frenzel argued.

“That is unfair,” he said. “I would rather have the trial before we hang the guy and I do believe Mr. Tower and Mr. Wright were hung.”

Former Rep. Otis G. Pike (D-N.Y.) chastised the House for paying too much attention to ethics issues.

“You were not sent here to peek through the windows of each other’s private lives,” Pike said. “Your preoccupation with each other’s ethics is preventing you from doing your jobs. It is taking too much of your time and, worse, it is creating an atmosphere and an institution in which suspicion, bitterness, personal dislikes and private vendettas make cooperative efforts in writing laws increasingly difficult.”

Rep. Don Edwards (D-San Jose) told the task force that the present system in which the Ethics Committee decides whether to bring charges and then whether the charges are valid is a denial of due process. He said that the two tasks should be done by separate committees or subcommittees.

Edwards also advocated a five- or six-year statute of limitations for ethics charges.

Rep. Martin Frost (D-Tex.), a member of the task force who is one of Wright’s most outspoken defenders, said that Edwards’ recommendations, first presented in 1982, “appear much more attractive to me now.”

In another development, Common Cause, a citizens’ lobbying group, advocated appointment of an independent counsel by the Ethics Committee to investigate internal charges filed against Rep. Newt Gingrich (R-Ga.) over a $105,000 fund raised by Gingrich to promote a 1984 book. At issue is whether those who gave the money, including political supporters of Gingrich and others with clear interests in legislation, were investing in a business venture or making a gift to the Georgia lawmaker.