2 Cisneros Aides Cleared, but at a Price

For the last two years, Sylvia Arce-Garcia and John Rosales have had their lives on hold.

The two aides to Henry Cisneros came here from Texas in 1993 when the ex-San Antonio mayor was named secretary of Housing and Urban Development.

But when an independent counsel launched what is now a $10-million probe into whether Cisneros lied about how much of his own money he gave to a former mistress, he was charged with 18 felonies and the two aides were charged with conspiring to conceal the payments, which were not illegal.

On Monday, without explanation, independent counsel David M. Barrett dropped prosecution of the aides and said charges against them will be formally dismissed after the Cisneros case ends.

Although the pair said all along that they had done nothing wrong, they had to spend most of their assets to clear themselves.

Their experience highlights a little-noticed byproduct of Washington’s many far-flung investigations: the fractured lives of peripheral players who get caught in the dragnet of zealous prosecutors.

In brief, separate statements, both Rosales and Arce-Garcia referred to the ordeal as a “nightmare.” Neither, however, was willing to speak critically of Barrett’s prosecutors since the charges have not been formally dismissed.

“All I can say is I’m pleased with the outcome,” said Rosales, who is an assistant to current HUD Secretary Andrew Cuomo. “I did not lie to the FBI.”

Arce-Garcia still works for Cisneros, who now is president of the Spanish-language TV network Univision in Los Angeles.

“I can’t explain how relieved and happy I am that this two-year nightmare has ended,” she said.

“These are two average people who got caught up in an investigation,” said Abbe D. Lowell, Arce-Garcia’s attorney. After realizing the two had no information that could be used against Cisneros, prosecutors “agreed to drop the charges and they asked nothing of the defendants,” Lowell said.

Defense lawyers complain that independent counsels are prone to over-prosecution.

“When you have these political prosecutions, people seem to lose their heads. They are so intent on their quarry, they sweep up everyone who gets in the way,” said Nancy Luque, a lawyer who represented Julie Hiatt Steele when she was prosecuted by Kenneth W. Starr on a matter related to his investigation of President Clinton.

While mayor of San Antonio, Cisneros carried on an extramarital affair with a political advisor named Linda Medlar Jones, a public embarrassment that prompted him to leave office. Although Cisneros went into private business and reunited with his wife, he continued to send money to Medlar Jones as she resumed her life in Lubbock, Texas.

After being nominated for a position in the Clinton Cabinet, Cisneros underwent a series of background interviews with the FBI. Agents said he admitted making payments to his ex-mistress but understated the amounts.

Medlar Jones, who has pleaded guilty to obstruction of justice charges, is expected to be the government’s key witness when the Cisneros trial begins Sept. 7.

Based on previous spending patterns, the cost of Barrett’s investigation likely has passed $10 million and could reach nearly $12 million by the time the case goes to trial.

None of this money, however, will compensate Rosales or Arce-Garcia for the cost of defending themselves. The Independent Counsel Act, which expired June 30, allows those who have been targeted for investigation to seek reimbursement of their legal costs only if “no indictment is brought.”

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Times staff writer Robert L. Jackson contributed to this story.