Rostenkowski indicted on 17 felony charges

June 01, 1994|By Lyle Denniston | Lyle Denniston,Washington Bureau of The Sun Sun staff writers Susan Baer and Nelson Schwartz contributed to this article.

WASHINGTON -- A federal grand jury charged Rep. Dan Rostenkowski, an old-line Chicago politician who wields vast influence in the House, with 17 serious crimes yesterday -- crimes ranging from grand-scale fraud to petty money manipulation over a 20-year span.

The 49-page indictment charged the Illinois Democrat with making personal use of up to $700,000 in funds belonging to the House or to his campaign committees.

If convicted on all of the charges, he could be sentenced to up to 110 years in jail and $365,000 in fines.

Eric H. Holder, Jr., the U.S. attorney for the District of Columbia, told reporters at a news conference that the charges "represent a betrayal of the public trust for personal gain" by Mr. Rostenkowski, who stood accused of using "his elective office to perpetrate an extensive fraud on the American people."

The indictment came after the breakdown of intense plea bargaining. When a deal could not be reached, Mr. Holder was free to put the indictment to a vote in the grand jury.

The congressman, who knew all of the accusations that prosecutors were preparing to make, said over the weekend: "I did not commit any crimes." Yesterday, the lawmaker, who has represented the North Side of Chicago in Congress for the last 35 years, remained silent and out of sight.

Already, however, the charges took away at least temporarily his power-laden post as chairman of the Ways and Means Committee -- a position outranked in influence by few if any posts in the House other than that of the speaker.

Under the rules of the House Democratic Caucus, made up of all the Democrats in that chamber, the congressman had to step down as committee chairman because he was indicted for a felony that could lead to two years or more in prison.

If he is later found not guilty, he may resume his chairmanship. He may go on serving in the House and seeking re-election while the charges are pending.

The U.S. attorney said Mr. Rostenkowski was being accused of "abusing his congressional allowances -- which are paid for by American taxpayers" in these ways:

* Putting people on the congressional payroll "who did little or no official work," but who instead did personal and family chores in return for more than $500,000.

* Obtaining "at least $50,000 in cash from the House Post Office by disguising his transactions as stamp purchases."

* Charging Congress and the taxpayers "more than $40,000 for the purchase of valuable merchandise . . . handed out as gifts to his friends."

* "Causing Congress to pay over $70,000 in taxpayer money for personal vehicles used by himself and his family."

* "He obstructed justice by instructing a witness to withhold evidence from the grand jury." That charge was based on allegations that the congressman told a House staff member -- an engraver who was doing personal work for the congressman on gifts he was handing out -- not to say anything after getting a subpoena from the grand jury.

'Mobile district office'

Mr. Rostenkowski's "elaborate scheme to defraud," prosecutors said, involved the congressional payroll, the House post office, the House's stationery store, and the purchase of autos as a "mobile district office."

He was accused specifically of embezzlement, mail and wire fraud, covering up key facts, plotting to defraud, mail and wire fraud, and false reporting of campaign spending.

Mr. Rostenkowski is expected to plead innocent before a federal judge here within the next 10 days. Mr. Holder said he expected the trial to be in Washington but said he could not estimate when it could begin.

The prosecutor conceded that if Mr. Rostenkowski claims legal immunity under the Constitution to charges because they involved actions as a legislator, "that could have a delaying effect on how long it takes us to get to trial."

He added that Republican Rep. Joseph McDade of Pennsylvania was charged two years ago with taking bribes "and has yet to come to trial."

President Clinton, whose legislative agenda, including health care reform, was dependent on Mr. Rostenkowski's influence in Congress, said in a statement that "like all Americans, Chairman Rostenkowski has the right to contest the charges made against him and to have his day in court."

Clinton praises him

The president went on to praise Mr. Rostenkowski "and others" for helping to "create real momentum for health care reform."

Mr. Holder, asked if his office had come under any political or White House pressure in its investigation of Mr. Rostenkowski, said "No, not at all." The probe was "free from any kind of outside interference and free from any kind of political pressure."

Mr. Holder acknowledged publicly for the first time that he and his staff had been negotiating over a plea deal with Robert S. Bennett, who has been representing the congressman. The U.S. attorney said Mr. Bennett approached the prosecutors.

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