Reno Reportedly to Reject Prosecutor on Fund-Raising

In a decision that seems certain to anger congressional Republicans, Atty. Gen. Janet Reno has approved the draft of a letter rejecting their call for the appointment of an independent counsel to investigate Democratic fund-raising for last year’s presidential campaign.

Sources close to Reno said Sunday that the letter was scheduled to be sent today to the chairmen of the Senate and House Judiciary committees, who asked for a Whitewater-type outside counsel to look into alleged political fund-raising abuses.

“Unless the attorney general has a last-minute change of mind, she’s planning to turn them down,” a Justice Department official said. “She is relying on the advice of her career prosecutors and on provisions of the Ethics in Government Act,” which spells out when an independent counsel is appropriate.

Reno, who has rejected three previous requests to seek an outside investigator to look into the controversy, has repeatedly said that evidence of improper fund-raising is being thoroughly investigated by a team of career Justice Department lawyers from the criminal division’s public-integrity section, assisted by as many as 30 FBI agents.

“I’ve directed that they pursue every lead, that they follow those leads where the evidence and the law takes them,” she has said. If they find specific allegations of wrongdoing that involve high federal officials covered by the government-ethics act, these lawyers are under instructions to notify her immediately, she has said.

Assurances such as these were expected to be included in her letter to Congress, but they were unlikely to mollify her critics.

Senate Judiciary Committee Chairman Orrin G. Hatch (R-Utah) said Sunday on ABC-TV’s “This Week” that Reno, as a leading member of the Clinton administration, had a “conflict of interest, both apparent and real,” if her own department investigated the case.

If Reno once again rejects the notion of an outside counsel, Hatch said, “then I think there’s going to be a swirl of criticism that’s going to be, I think, very much justified.”

House Speaker Newt Gingrich (R-Ga.) said on “Fox News Sunday” that he hoped Reno would ask a panel of federal judges to appoint an independent counsel. If she does not, Gingrich said, Congress might launch an investigation to determine whether Reno herself had a role in the fund-raising affair.

“If she can look at this mound of evidence, . . . look at the day-after-day revelations, and not conclude it is time for an independent counsel, how can any serious citizen have any faith in her?” Gingrich said.

If she decides not to seek an independent counsel, Gingrich said, Reno needs to explain her decision. “She needs to answer in public, she needs to answer, I think, under oath,” he said.

The ranking Democrat on the House Government Reform Committee, Rep. Henry A. Waxman of Los Angeles, reacted on CNN’s “Late Edition,” saying Gingrich and the Republicans are seeking to cover up “a partisan witch hunt.”

Committees in both houses of Congress are already looking into campaign fund-raising in the last election cycle. The Senate panel under Sen. Fred Thompson (R-Tenn.) has broadened its agenda to include some Republican activities, while the House committee chaired by Rep. Dan Burton (R-Ind.) plans to focus almost exclusively on Democratic practices.

Hearings are not expected to begin for a month or two.

In a letter to Reno last month asking for an independent counsel, Hatch said campaign finance laws might have been violated when guests at White House coffees with Clinton and other officials contributed millions of dollars in campaign funds and when Democratic committees accepted funds possibly tainted by foreign interests.

The Democratic National Committee in recent months has returned about $3 million in contributions of suspicious origin.

Reno had previously rejected requests from Sen. John McCain (R-Ariz.), a leading advocate of campaign-finance reform, and from outside groups, including Common Cause, that she ask a special panel of three federal appeals-court judges to appoint an independent counsel.

Congressional Republicans sent their latest request to Reno after Vice President Al Gore acknowledged he had made phone calls from his office soliciting campaign funds; some deemed that to be a violation of federal restrictions banning such solicitations in government buildings.

However, some Justice Department sources as well as private legal authorities have said the millions of dollars in “soft money” raised by both political parties is not regulated by the Federal Election Campaign Act of 1971.

These are funds contributed by corporations and labor unions for “party building” activities and are not supposed to be used to benefit individual candidates for office. However, both parties used the money largely for television advertising to help their presidential candidates.

Acting Deputy Atty. Gen. Seth Waxman told reporters last week that Reno was continuing to monitor the inquiry by her career lawyers closely. Waxman said Reno had told them to advise her if they came across any evidence that would trigger the appointment of an independent counsel.

“That is still the status of the investigation,” he said.