Ex-HUD Official Balks at Testifying in Inquiry : Former Executive Assistant to Secretary Invokes 5th Amendment in Probe of Consultant Favoritism

Deborah Gore Dean, a former top official at the Department of Housing and Urban Development, invoked her Fifth Amendment privilege Tuesday and refused to answer questions from a House subcommittee probing favoritism to Republican consultants in a federal housing program.

Dean said she could not testify about her five years as executive assistant to former HUD Secretary Samuel R. Pierce Jr. without risking self-incrimination unless she has access to agency records relating to the program.

Previous witnesses, including Pierce, have said Dean was the key decision maker in approving multibillion dollar low-income housing grants that led to lucrative consulting fees for former Ronald Reagan Administration officials, including former Interior Secretary James G. Watt.

Chairman Is Sympathetic

While some members of Congress criticized her decision to remain silent, Tom Lantos (D-San Mateo), chairman of the House Government Operations Committee’s subcommittee on employment and housing, said he was sympathetic to her request for HUD records before she testified.

Lantos said he would speak with HUD Secretary Jack Kemp, a former member of Congress from New York, about making the information available to Dean and her lawyers.

“It’s our earnest hope that before long you’ll be able to change your position,” Lantos told the witness.

Other members of Congress who sat in on the hearing, however, said they would urge the Justice Department to review the testimony on hand and evaluate whether there were grounds for a criminal investigation of the now-suspended HUD moderate rehabilitation subsidy program.

Rep. Christopher Shays (R-Conn.), for example, said he was astounded that Dean, who was at the center of HUD policy making, refused to testify. “I’ll use my office to encourage the Justice Department to pursue this with some vigor,” he said.

Rep. Charles E. Schumer (D-N.Y.) said the subcommittee’s investigation has “opened a can of worms” at HUD and “casts doubt on the inspector general’s assertion and the Justice Department’s assertion that there was no criminal conduct here.”

An inspector general’s audit charged that the program allowed politically connected consultants to abuse their influence to benefit developers seeking subsidies for rehabilitation of low-income housing. But it found no evidence of illegal kickbacks, embezzlement or fraud.

When she took the stand, Dean was flanked by lawyer Joseph DiGenova, former U.S. attorney in Washington, D.C., and Charles S. Leeper, her co-counsel. After giving her name, she refused to answer any other question, even the date she began work at HUD.

“In view of my present inability to obtain access to the HUD records which would enable me to prepare adequately for testimony that would be complete and truthful, I have accepted the advice of my counsel to decline, respectfully, to answer any questions posed by the subcommittee at this time on the basis of the rights guaranteed to me by the Fifth Amendment to the Constitution of the United States.”

Earlier, however, in an interview with the Wall Street Journal, the 34-year-old Dean said she was being made the scapegoat by former high-ranking HUD officials who were seeking to avoid blame.

But she also said the program now being challenged was designed to provide political rewards and she was quoted as saying: “We ran it in a political manner.”

Says He Took Orders

Pierce said in his testimony that he delegated the job of making the contract awards under the program to Dean and two others. However, one of those officials, Silvio J. DeBartolomeis, who was the acting federal housing commissioner for most of 1986, testified Tuesday that he signed the funding papers only when given a direct order by Dean. He said she was acting on behalf of Pierce and that he believed the program was flawed because career civil servants were frozen out of the decision-making process.

Watt, who testified Friday, said he and a partner, former HUD aide Joseph Strauss, received $300,000 in consulting fees for meeting with Pierce on behalf of a Maryland developer who later received a federal grant for a 312-unit project in Essex, Md.

Watt, however, denied that he was involved in “influence peddling,” contending that his efforts were “legal, moral, ethical and effective” although he had no housing expertise and did no more than contact the secretary for the fee.