Waldholtz's husband seeks to strike deal in exchange for testifying against her Representative's spouse bargains with prosecution in fraud case, sources say

November 23, 1995|By LOS ANGELES TIMES

WASHINGTON -- The estranged husband of Rep. Enid G. Waldholtz of Utah is negotiating with federal prosecutors the terms of a potential deal in which he would plead guilty to reduced criminal fraud charges in exchange for his testimony against his wife, law enforcement sources said yesterday.

Mr. Waldholtz, 32, was scheduled to appear before a federal grand jury yesterday; instead, prosecutors asked U.S. District Judge Emmet G. Sullivan for a three-week extension while they continued discussions on the conditions of his testimony.

Assistant U.S. Attorney William Lawler told the judge that negotiations with Mr. Waldholtz "have not yet reached the point as to whether Waldholtz will appear and testify before the grand jury." Another hearing was set for Dec. 15.

Meanwhile, Representative Waldholtz blasted prosecutors for not moving quickly enough to indict her husband and said she was providing the government with documents she claims prove that he has engaged in fraud for years.

Yesterday's developments indicate that the Waldholtz case is moving rapidly from an investigation of Mr. Waldholtz's questionable financial practices to a broad probe into the financing of the meteoric political ascent of one of Congress' most visible freshman Republicans.

Questions have long been raised on how she acquired and spent the nearly $2 million she used in her 1994 campaign for Congress.

Last week, a federal arrest warrant was issued for Mr. Waldholtz, seeking him for grand jury questioning on suspected bank fraud and a check-kiting scheme involving the couple's joint accounts.

But a well-placed federal law enforcement source said that the investigation also covers the financing of Representative Waldholtz's 1994 campaign and her knowledge of or involvement in her husband's alleged illegalities.

Representative Waldholtz spent $1.8 million on the campaign, one of the largest sums spent on any House race last year.

She said most of the money came from personal sources, including a large loan from her stockbroker father.

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