U.S. Officials Found Not Tied to Iraq Scandal

Federal prosecutors have concluded that no U.S. government officials or politicians were connected to a $5-billion Iraqi loan scandal involving the Atlanta branch of an Italian bank, according to court records unsealed Wednesday.

The records revealed that Vice President Dan Quayle was among the political figures identified as having been investigated and exonerated after their names were brought up by the former manager of the bank branch.

Prosecutors said that they reached the conclusion after investigating information provided by Christopher P. Drogoul, former Atlanta manager of the Banca Nazionale del Lavoro. Drogoul has pleaded guilty to arranging the hidden loans and faces sentencing later this month.

The investigative findings were disclosed in the transcript of a meeting among prosecutors, Drogoul’s former lawyer and U.S. District Judge Marvin H. Shoob on July 7. The transcript was unsealed in Atlanta at the request of the government to rebut criticism that prosecutors have not pursued leads in the case.

Drogoul has been giving information to federal agents since he pleaded guilty June 2. Prosecutor Gail McKenzie said in the July session that the government had focused its probe first on political figures because the judge and congressmen had expressed concerns about a possible cover-up.

Drogoul told investigators he was told by an unidentified person that Quayle had helped an Indianapolis company obtain a contract to build a brass-smelting plant in Iraq while Quayle was a senator from Indiana, according to McKenzie.

The company, SerVaas Inc., is owned by Beurt R. SerVaas. It received a contract in 1988 to build the $40-million brass plant in a deal financed by BNL’s Atlanta branch.

But McKenzie said that SerVaas told investigators he did not receive any assistance from Quayle. A spokesman for Quayle said that the vice president’s office had never heard of the brass plant.

McKenzie said investigators also had been told that Sen. Wyche Fowler Jr. (D-Ga.) had dated Jean Ivey, a former officer of the BNL branch in Atlanta and one of two employees who alerted authorities to the loan scheme in 1989.

Ivey told investigators that she told Fowler she was “looking for another job because she was working with a bunch of dishonest people . . . and they were doing a lot of business with Iraq.”