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FBI, Justice Dept. Clash Over Espy Probe : Investigation: ‘Heated meeting’ occurs regarding whether to close inquiry into alleged favors given to agriculture secretary by Tyson Foods of Arkansas.

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TIMES STAFF WRITERS

The FBI and the Justice Department are at odds over whether to curtail a politically sensitive investigation into allegations that Agriculture Secretary Mike Espy accepted personal favors from Arkansas-based poultry-processing giant Tyson Foods Inc., sources said Thursday.

While the FBI believes that it has not yet exhausted all avenues of inquiry in the investigation, sources reported, high-level Justice Department officials are pressing to close the case because they say investigators have found insufficient evidence that Espy’s actions violated the law.

Controversy over the investigation of Espy’s ties to Tyson is potentially embarrassing for President Clinton because the former Arkansas governor has been accused in the past of showing favoritism to longtime friend and supporter Donald Tyson, head of the company, which is one of the largest employers in Clinton’s home state.

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Atty. Gen. Janet Reno acknowledged at a news conference that the FBI has been looking into allegations that Espy violated the 1907 Meat Inspection Act by accepting Tyson’s hospitality during a visit to the company’s corporate headquarters in Springdale, Ark., and by sitting in the Tyson skybox during a Dallas Cowboys football game.

Violation of the 1907 act is a felony punishable by a mandatory one-year prison sentence.

The investigation is said to hinge on allegations that Espy accepted these favors at the same time he was delaying the imposition of new Agriculture Department standards governing inspections at chicken processing plants, including 66 such plants operated by Tyson.

While it not unusual for tensions to arise between investigators and prosecutors who must decide whether a case will hold up in court, sources familiar with the probe said Justice and FBI officials had a “heated meeting” on Tuesday in which investigators strongly objected to the department’s desire to curtail the probe. Justice Department spokesman Carl Stern acknowledged the department was “nearing a decision on whether to close” the case, but declined to elaborate.

An initial decision is in the hands of Jo Ann Harris, assistant attorney general in charge of the criminal division. But because of the sensitive nature of the case, Reno will have an opportunity to review Harris’ decision.

For his part, Espy refused to comment, saying only that his reaction would be “unprintable.” But the Agriculture Department issued a statement saying that the secretary is cooperating fully with the investigation.

At the same time, Tyson Foods issued a statement saying: “For anyone to think that Tyson Foods has gotten special or preferential treatment from the Department of Agriculture or any of its units is ludicrous and absurd.”

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Investigators are looking at a trip that Espy made to Mississippi and Arkansas in May, 1993, as well as his visit to the Dallas Cowboys game last January. During the Arkansas visit, sources said, Tyson provided the agriculture secretary with lodging, ground transportation and a return flight to Washington on a corporate jet.

Sources said Espy told investigators that he reimbursed Tyson Foods for the lodging, transportation and the football ticket. But investigators are still uncertain whether his actions violate the 1907 law, which prohibits officials under its jurisdiction from accepting “anything of value” from corporations subject to government meat inspections.

Attorneys in the Justice Department’s Public Integrity Section are said to have argued that the value of the benefits Espy received from Tyson were too small to warrant criminal prosecution--less than $100, by one estimate. Nor do they believe that the law, intended to curtail bribery of meat inspectors, applies to the activities of a Cabinet officer.

But FBI officials are known to fear that the sensitive matter could “blow up” if the case is closed before all leads are followed to their conclusion. Among other things, investigators have been unable to track down documents related to a May, 1993, decision regarding poultry inspections. In his interview with the FBI, Espy is understood to have said that he had heard rumors that the documents had been shredded.

Justice Department attorneys also are factoring in the likelihood that Congress soon will re-enact the law providing for an independent counsel investigation of Cabinet officers accused of wrongdoing. Espy is likely to be covered by that law.

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