Bush Aides Tied to Effort to Withhold Iraq Data : Technology: Officials invoked President’s name to keep Congress from learning of sales, documents show.

Internal Bush Administration documents made public Tuesday show that senior White House officials played more extensive roles than previously known in trying to restrict information provided to Congress about the sale of sensitive American technology to Iraq.

The new documents describe White House counsel C. Boyden Gray, National Security Adviser Brent Scowcroft and other senior officials invoking President Bush’s name on numerous occasions in searching for ways to avoid giving Congress embarrassing information about the sale of U.S. technology to Iraq before the Persian Gulf War.

The disclosure of the documents comes as Democrats on the House Judiciary Committee are posed to demand an independent counsel to investigate whether the Administration tried to cover up the extent of its prewar assistance to Iraqi President Saddam Hussein.

Congressional sources said that the committee will vote later this week to ask the attorney general to seek an independent counsel to look into contradictory statements that Administration officials gave to congressional committees about U.S.-Iraq policy, the Justice Department’s handling of a massive bank fraud involving the Iraqi government and alterations to a list of export licenses to Iraq.

The special-prosecutor request was bolstered on several fronts by the internal Administration records released Tuesday by Rep. Henry B. Gonzalez (D-Tex.), who also unleashed a stinging attack on Bush.

“The President or at least people acting in his name and apparently with his knowledge conspired to keep the truth about his Iraq policy from the very public that elected him and fought and died to support his efforts in the Gulf,” Gonzalez said.

One of the new documents disclosed that a White House official took the highly unusual step of contacting an assistant U.S. attorney in Atlanta in the midst of her investigation of the $5-billion bank fraud involving Iraq and Italy’s Banca Nazionale del Lavoro.

Rep. Charles E. Schumer (D-N.Y.), a senior member of the Judiciary Committee, said that the disclosure of the White House call convinced him of the need for an independent counsel to take the matter out of the hands of the Justice Department.

“The White House could not resist meddling in an investigation of BNL by an assistant U.S. attorney in Atlanta,” Schumer said. “How then can the White House honestly expect the American people to believe that it won’t meddle in an investigation here in Washington that could ultimately focus on people who work for the White House itself?” asked Schumer.

A White House spokesman said there would be no comment on the documents or Gonzalez’s accusations. “This is nothing new to us and we don’t see any need to respond,” said the spokesman, Paul Clark.

In the past, Administration officials have said that legitimate claims of executive privilege were weighed in withholding some information from Congress. Administration officials also have defended the response to congressional subpoenas and requests coordinated by the National Security Council as routine and proper.

The newly released records recount Administration concerns at the highest levels over releasing material possibly covered by executive privilege. At one point, officials discussed having then Commerce Secretary Robert A. Mosbacher refuse to provide the material even under threat of a contempt of Congress citation.

Among other documents describing the debate:

--Notes from an interagency meeting in 1990 on how to respond to a congressional request for a list of U.S. export licenses to Iraq. The note taker, a Commerce Department official, indicated that Scowcroft said Bush was “very, very mad” about the issue and there had been a “heated discussion.”

--Notes from a White House meeting on the congressional requests at which Gray said: “The President will want to meet with all Cabinet secretaries one-on-one to work it out adequately internally. Very sensitive.”

--A Commerce Department memo recounting a June 5, 1991, meeting of senior officials from several agencies who discussed documents on Iraqi exports sought by Rep. Sam Gejdenson (D-Conn.). The memo said that negotiations were under way to begin providing documents to Gejdenson, but added: “Any such accommodation would have to be cleared by the White House.”

Gonzalez and Gejdenson have both complained that the White House has withheld documents and information to which Congress is entitled as it examines the Administration’s Iraq policy.

The documents also shed new light on a critical period--the fall of 1989 when the Administration was fighting for another $1 billion in loan guarantees to Iraq under the Agriculture Department’s Commodity Credit Corp. program.

Agriculture wanted to reduce the loan guarantees to $400 million. After Secretary of State James A. Baker III called then-Agriculture Secretary Clayton K. Yeutter and asked him to support the full $1 billion on “foreign policy grounds,” the Agriculture Department reversed its position, according to previous reports in The Times.

But the Treasury Department and Federal Reserve Board remained opposed, partly because of evidence uncovered in the investigation of the Atlanta branch of BNL, which indicated that U.S. aid may have been diverted by Iraq to buy nuclear-weapons technology. At the time, federal investigators were examining records of more than $5 billion in fraudulent loans to Iraq by BNL.

A newly released CIA analysis dated Nov. 6, 1989, indicated that failure to provide the $1 billion in Department of Agriculture guarantees would harm U.S.-Iraqi relations. But the CIA also warned that BNL loans had financed Iraqi front companies that acquired technology for its missile, nuclear, biological and chemical weapons programs.

At some point that fall, an unnamed White House official telephoned Gail McKenzie, the assistant U.S. attorney handling the BNL investigation, according to notes from a Treasury Department lawyer who monitored the investigation.

In notes of her conversation with McKenzie on Nov. 7, 1989, Treasury lawyer Rachel Bailey wrote: “McKenzie: She had been called by White House--got impression concerned about embarrassment level.”

McKenzie did not return calls about the White House contact but a senior law enforcement official said that such a call would be very unusual.

After a push by the White House and the State Department, the full $1 billion in Agriculture Department guarantees for Iraq was approved by an interagency group on Nov. 8, 1989, the day after the call to McKenzie.

By mid-May in 1990--less than three months before the Iraqi invasion of Kuwait--the Agriculture Department wanted to terminate the guarantees after their own investigators confirmed allegations of massive fraud and improprieties.

Frantz is a Times staff writer and Waas is a special correspondent.

BAGHDAD INTRIGUE: Purges, defiance seen as Hussein’s survival strategy. A6