Whitewater case splits banking panel allies

ON POLITICS

March 15, 1994|By JACK GERMOND & JULES WITCOVER

WASHINGTON -- When Chairman Henry Gonzalez of the House Banking Committee was tenaciously pursuing the savings-and-loan and BCCI bank scandals, among his most steadfast supporters was the ranking Republican on the committee, Rep. Jim Leach of Iowa. But that close working relationship has been severely jeopardized by Leach's insistence on pressing for hearings on the Whitewater case now plaguing Bill and Hillary Clinton.

Leach wants to call 40 specific Whitewater witnesses to a semiannual Banking Committee oversight review of the savings-and-loan cleanup by the Resolution Trust Corp. But Gonzalez is balking, insisting in a letter the other day to special counsel Robert Fiskethat "one witch hunt is enough."

Gonzalez told Fiske that he "would never permit our mandated RTC accountability hearings to encroach on the Justice Department's ongoing proceedings." He said he had "constantly reminded" all members of his committee that it is "a legislative body, not a prosecutorial or judicial one," and that "I regret that Mr. Leach, despite his considerable service on the committee, and elements of the jackal press, refuse to see this."

Gonzalez also has written top officials of the RTC and the forerunner Office of Thrift Supervision (OTS) telling them that a request from Leach for materials concerning the Madison Guaranty S&L involved in the Whitewater case is not justified because the committee "is not conducting an investigation" of the S&L, and "a hearing does not provide the basis for a member of Congress to obtain documents to which he or she is not otherwise entitled."

Leach responds by saying that Gonzalez' actions mark "the first time in my knowledge that a chairman wrote and asked that knowledge be denied his committee." It is being suggested among Republicans within the committee that the chairman is under pressure from the White House, from the House Democratic leadership and from other Democratic committee members, some of whom want to challenge him for the panel chairmanship.

Although Leach was quoted recently as saying there could be a "blockbuster" in testimony from some of the witnesses he is proposing, he continues to say that he is not talking about anything approaching the presidential impeachment that threatened Richard Nixon in the Watergate affair and finally persuaded him to resign.

He recently helped persuade Fiske to rewrite his charter for the investigation to provide for civil as well as criminal action, which Leach says gives Fiske discretion on any penalty, rather than being forced either to say that a crime was committed and pressing for a conviction or dropping the case as insufficiently conclusive. With the civil option, Leach says, the worst that is likely to result is a finding that the Clintons were guilty of "high improprieties and possible misdemeanors."

Specifically, Leach wants the committee hearing to listen to RTC officials from the Kansas City office who looked into Madison Guaranty loans to the Whitewater land-development deal involving then Arkansas Gov. Clinton and his wife. He says what they have to say could be comparable to testimony by OTS officials in San Francisco that broke open the case in which five U.S. senators were accused of interceding for financier Charles Keating when his Lincoln S&L in California was under investigation.

Just as the OTS office in San Francisco went to the mat with the agency's Washington office before the so-called Keating Five were put on a public griddle, Leach says, the RTC office in Kansas City had to fight its Washington office to have banking policies and practices of the Madison Guaranty S&L adequately examined.

Leach insists that the Democrats in Congress are in a "Catch-22 dilemma. If they do hold hearings, the president of their party is likely to be embarrassed. If they don't, they become accomplices in the effort to block full disclosure." But Gonzalez, from the tone of his letters to Fiske, the RTC and OTS, seems dug in against any committee hearing that can pose any threat to the integrity of Fiske's investigation -- or to the Clintons' political reputation.

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