Independent Counsel Weighed in Pena Case : Cabinet: The Justice Department considers appointing investigator of transportation secretary. Inquiry reportedly focuses on pension fund contract.

The Justice Department is reviewing whether to seek appointment of an independent counsel to investigate Transportation Secretary Federico Pena, according to government officials.

Those familiar with the review, opened in February, said that it encompasses efforts by a money management firm founded by Pena to win a contract with a Los Angeles transit pension fund.

The Justice Department is required by law to determine within 30 days of opening the review whether to go the next step, which is a more intensive 90-day inquiry to determine whether to seek appointment by an appeals court of an outside prosecutor.

According to the government officials, the review has been initiated by the Transportation Department’s inspector general. The review is the fourth of its kind involving a Clinton Cabinet secretary.

A similar examination was conducted of Housing Secretary Henry G. Cisneros, to assess whether he had responded truthfully to questions posed by the FBI before his Senate confirmation. After that review, Atty. Gen. Janet Reno elevated the matter to the second 90-day step and has until later this month to decide whether to seek a special prosecutor.

Another review was opened and elevated earlier this year to examine whether Commerce Secretary Ronald H. Brown has accurately disclosed the income and assets of his complex private business dealings.

An independent counsel already has been appointed to investigate the conduct of former Agriculture Secretary Mike Espy, who resigned in October amid allegations that he improperly accepted sports tickets and other gifts from businesses regulated by his department.

Spokesmen for Pena said Tuesday that the transportation secretary has not yet been contacted by the Justice Department but would cooperate if questioned. Pena’s representatives reiterated that the secretary believes he has done nothing wrong.

The Times reported on Feb. 10 that Pena Investment Advisors Inc., the Denver money management firm founded by the transportation secretary, won a contract to manage $5 million from the Los Angeles transit pension fund. That contract was approved 19 days after Pena took federal office in early 1993.

Officials in Los Angeles, including the former manager of the pension fund, said that the Pena firm was hired as part of an effort to curry the goodwill of the incoming transportation secretary. Melvin F. Marquardt, the pension manager, said that the Pena firm would not have been hired if Federico Pena had not been appointed to the Cabinet.

The federal government is paying half--by far the largest share--of construction costs for the multibillion-dollar Los Angeles subway. Pena, using his discretion as President Clinton’s chief transportation policy-maker, in January approved $187 million of extra funding for the project, most of which will help pay for extending the subway to East Los Angeles.

Pena has said that, while he was aware of the investment firm’s efforts to win the transit pension fund as a client, he averted any potential conflict of interest by selling his stake as president and chief executive officer shortly before taking office.

Pena reported on his federal income-disclosure forms in January, 1993, that he sold his interest “for a loss.” He has said that he is undecided whether he will return to the firm upon leaving office.

The secretary has declined requests for access to documents that describe the terms of his separation from the investment firm, which he incorporated in December, 1991. Richard Mintz, Pena’s chief spokesman, said Tuesday that the secretary “feels very comfortable that he took all appropriate steps.”

Another spokesman, Bill Schulz, provided a prepared statement on Pena’s behalf. The statement called The Times’ articles on Pena and the investment firm “outrageous.”

“The fact is that he fully divested himself of his financial interest in (Pena Investment Advisors) in December, 1992,” said Schulz. “His relationship with P.I.A. was fully reviewed during his (Senate) confirmation hearing. . . . All this material was reviewed by the Justice Department, our ethics advisers and the FBI. And all, including the Senate Commerce (Science and Transportation) Committee, gave him a clean bill of health.”

An executive of Pena Investment Advisors, based in Denver, has said that the firm has won its clients on the basis of merit.

In Los Angeles, one internal review conducted by the Metropolitan Transportation Authority ended last week with no conclusion as to whether wrongdoing occurred. A separate review by MTA Inspector General Arthur Sinai continues.