Bentsen put on the grill over Whitewater papers Ex-Cabinet member gave report to White House

November 08, 1995|By Susan Baer | Susan Baer,SUN NATIONAL STAFF

WASHINGTON -- Federal investigators who worked on a Whitewater ethics report said yesterday they were astonished when they learned that former Treasury Secretary Lloyd Bentsen gave the White House a draft of the report and related interview transcripts last year.

They said his actions violated their normal procedures.

But Mr. Bentsen, returning to Washington yesterday to defend his actions and his "30 years of public service" before the Senate Whitewater Committee, insisted he acted properly.

"I satisfied myself that it was within my authority and the proper thing to do," said Mr. Bentsen, who appeared to bristle at the proceedings.

Opening a new phase of the multipronged Whitewater controversy, the Senate panel focused yesterday on a 1994 investigation by the Office of Government Ethics -- with staff assistance from the Resolution Trust Corp. and the Treasury Department -- that examined the propriety of earlier contacts between the White House and Treasury Department over the Whitewater affair.

The report, conducted at Mr. Bentsen's request, concluded that there were no ethical violations in the contacts.

Before the report was completed in the summer of 1994 -- and just as officials were preparing to testify about the White House-Treasury contacts at congressional hearings -- Mr. Bentsen provided then-White House counsel Lloyd Cutler with a draft of the report and transcripts of sworn testimony from those interviewed.

Mr. Bentsen said he did so after Mr. Cutler told him he was having difficulty obtaining the materials for the inquiry that he was conducting for the White House.

Patricia Black, a lawyer with the RTC's Inspector General's office, told the committee she and her colleagues "were adamantly opposed to transcripts going outside the investigative circle."

She said the dissemination of the materials not only "violated our processes," but could have affected the testimony of subsequent witnesses.

Ms. Black said the documents contained confidential material -- involving the RTC's criminal investigation of the Whitewater land deal and the failed Arkansas savings and loan involving President Clinton and his wife, Hillary Rodham Clinton -- that should not have been seen even by Mr. Bentsen, much less the White House.

Sen. Alfonse M. D'Amato, a New York Republican and the committee chairman, said there was a "very real possibility" that White House officials who were about to testify before Congress "tailored their testimony" based on their knowledge of the sworn statements of others.

But Mr. Bentsen and Senate Democrats said there was no evidence that the report had any influence.

And the former Cabinet secretary said he provided the material to Mr. Cutler to help him with his own investigation of the White House-Treasury contacts, on which Congress had summoned him to testify.

Although Mr. Bentsen instructed Mr. Cutler not to show the transcripts to any possible witnesses for the congressional hearings, Republicans noted that, in at least one instance, a lawyer for a possible witness, Lisa Caputo, Mrs. Clinton's press secretary, requested and obtained a summary of one person's testimony.

Associate White House counsel Mark Fabiani explained yesterday that a Treasury official, David Dougherty, mistakenly released a summary of the transcripts to the White House that he thought was approved for distribution.

The next day, he rescinded that permission, said Mr. Fabiani.

Ms. Caputo was never called to testify.

"It was a no harm, no foul situation," said Mr. Fabiani.

Mr. D'Amato said the disclosure tarnished the whole OGE investigation.

But Maryland Sen. Paul S. Sarbanes, the senior Democrat on the committee, said there was no evidence to suggest the investigation was compromised.

"I don't see what point's been made here today," he said.

"Nothing has occurred to impact on the investigation itself."

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