Defiant FBI Chief Is Fired by President : Law enforcement: Alleged ethical abuses by Sessions are cited as reason for dismissal. He refused to resign.

TIMES STAFF WRITERS

FBI Director William S. Sessions, who stubbornly refused to resign despite Justice Department ethics findings that he abused his office, was fired Monday by President Clinton--the first time a director of the storied agency has been dismissed.

Clinton and Atty. Gen. Janet Reno, steeling the Administration against claims that the decision was politically motivated, used unmistakably blunt language to describe Sessions' failings. Reno "has reported to me in no uncertain terms that he can no longer effectively lead the bureau and law enforcement community," Clinton said, adding that he fully agreed with her recommendation to replace Sessions immediately.

Clinton is expected to announce today that he plans to nominate U.S. District Court Judge Louis J. Freeh of New York, a former FBI agent and federal prosecutor, to succeed Sessions. Clinton met with Freeh for 90 minutes Friday night.

"With a change in management in the FBI, we can now give the crime fighters the leadership they deserve," Clinton said. Administration officials said Monday that they know of no other candidate under consideration for the post.

Clinton dismissed Sessions after the director rejected Administration entreaties to resign, contending that to voluntarily step down would violate the principle of an independent FBI. The FBI director is appointed to a 10-year term but serves at the pleasure of the President.

Sessions was appointed 5 1/2 years ago by former President Ronald Reagan.

"We cannot have a leadership vacuum at an agency as important to the United States as the FBI," Clinton said at a White House press conference. "It is time that this difficult chapter in the agency's history is brought to a close."

With Senate confirmation of the next FBI director not likely before fall, Clinton said that Deputy Director Floyd I. Clarke would serve as acting director. Sessions' wife, Alice, has repeatedly accused Clarke of leading an internal cabal to force her husband from office, and Sessions has publicly questioned Clarke's loyalty.

At his press conference, Clinton rejected the suggestion that Sessions fell victim to an internal vendetta and responded "absolutely not" when asked if the removal of Sessions would create the impression that the FBI is being subjected to political pressures.

Clinton cited the six-month-old highly critical report on Sessions' conduct by the Justice Department's Office of Professional Responsibility, which investigated the director in the final year of the George Bush Administration.

Clinton noted that the attorney general had studied the findings and thoroughly reviewed Sessions' leadership.

Reno said that, when she took office last March, then acting Atty. Gen. Stuart Gerson, a Republican holdover, advised her that Sessions "had exhibited flawed judgment which had an adverse effect within the FBI."

But Reno said she wanted to make her own independent assessment of Sessions' ability to lead the FBI, noting that she felt very strongly that the FBI director "should be above politics and not automatically subject to replacement with a change of administrations."

The Justice Department report found, among other things, that Sessions had engaged in a sham transaction to avoid paying taxes on his use of an FBI limousine to take him to and from work, that he had billed the government for a security fence around his home that provided no security and that he had arranged business trips to places where he could meet with relatives.

Sessions dismissed the findings as biased and said that they resulted from "animus" toward him by former Atty. Gen. William P. Barr, who--on his last day in office last January--presented the report to Sessions with orders to take remedial actions.

In addition to the sections of the report that have been released, the investigation looked into whether Sessions had accepted a "sweetheart" deal on his home loan from a Washington bank and into other matters that have not been made public, sources familiar with it said.

Reno said that she reviewed "all the circumstances," including the Office of Professional Responsibility report and responses to it submitted by Sessions. Her conclusions, couched in language even stronger than Clinton's, were detailed in a letter to the President that she read aloud at the press conference.

"I have concluded that the director has exhibited a serious deficiency in judgment involving matters contained in the report and that he does not command the respect and confidence needed to lead the bureau and the law enforcement community in addressing the many issues facing law enforcement today," she wrote.

Sessions, in a prepared statement, said that "because of scurrilous attacks on me and my wife of 42 years it has been decided by others that I can no longer be as forceful as I need to be in leading the FBI and carrying out my responsibilities to the bureau and the nation.

"It is because I believe in the principle of an independent FBI that I have refused to voluntarily resign," he said. "I will speak out in the strongest terms about protecting it from being manipulated and politicized both from the inside and out."

Sessions made no reference to negotiations that he and his lawyers conducted with Deputy Atty. Gen. Philip B. Heymann, in which Sessions indicated a willingness to resign if he were allowed to remain in office until Senate confirmation of a successor. The Administration rejected this condition, which would have blocked Clarke from taking temporary command of the agency.

One source familiar with the negotiations said that, when it became clear the Administration would not withdraw or significantly question the scathing ethics report, Sessions ruled out the option of "falling on his sword" by resigning because he thought it would be viewed as validation of the report's conclusions.

Sessions said that he had turned aside "strong counsel from a number of people" that resigning would have been the "painless and easy" answer to his troubles. But he said: "I felt I had an absolute obligation under my oath to be true to the bureau."

The most critical reaction on Capitol Hill came from Senate Minority Leader Bob Dole (R-Kan.), who supported the reasons given by Sessions for refusing to resign. Dole called his dismissal "a potentially worrisome precedent" that "should concern every American who values the political independence of our nation's top law enforcement agencies."

He said that Sessions "may have shown some poor judgment along the way." However, "the independence of the FBI suffers when its director can be removed simply by alleging 'deficiency in judgment,' " Dole said.

Rep. Don Edwards (D-San Jose), who heads a House Judiciary subcommittee that oversees the FBI and who supported Sessions' move toward opening agent ranks to more blacks, women and other minorities, said that the FBI "is a much better organization today because of him."

Edwards, a former FBI agent, called on the President "to appoint a successor who is independent and committed to civil liberties and who will continue the direction charted by Sessions."

Clinton took note of Sessions' efforts to open up the bureau to more women, blacks and Latinos, saying "that will be remembered as the best thing about his tenure."

Rep. Charles E. Schumer (D-N.Y.), chairman of the House Judiciary subcommittee on crime and criminal justice, agreed that Sessions should be credited for creating more opportunities for women and minorities in the agency.

"But because of the ethics controversy swirling around him, he has lost rank-and-file support and therefore his leadership effectiveness has been severely compromised," Schumer said.

Sessions was the first FBI director to be fired by a President. However, in 1973, acting Director L. Patrick Gray III, President Richard Nixon's choice to succeed J. Edgar Hoover, quit in disgrace after admitting that he burned Watergate-related evidence in his fireplace.

A Variety of Ethical Charges

A Justice Department report accuses FBI Director William Sessions of ethical abuses, including:

* Employing a "sham" to avoid paying taxes on transport to and from work in an armored limousine. Sessions put an unloaded gun that he is not trained to handle in a briefcase in the trunk to claim a law enforcement exemption.

* Chauffeuring family members on FBI planes and cars and taking trips at taxpayer expense for personal reasons that had only limited bureau involvement.

* Installing a $10,000 taxpayer-provided fence at his home that does not meet security needs. Sessions and his wife, Alice, rejected an FBI-approved fence that would have cost more than $90,000.

* Declining to release documents so Justice Department officials could investigate whether he received a sweetheart deal on his home mortgage. After the critical report was issued, Sessions signed the releases and the investigation continued. Subsequent findings and documents were sent to the White House.

Source: Times wire reports

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