Reno opens inquiry into financing of Democrats' TV ads Benefits to Clinton-Gore might have violated federal spending limits


WASHINGTON -- Advancing a pivotal step toward the possible appointment of an independent prosecutor to investigate campaign finance abuses, Attorney General Janet Reno has ordered a 90-day inquiry into whether President Clinton circumvented federal election laws in 1996.

Reno's decision yesterday marked the third time in less than two weeks that the Justice Department has begun a 90-day independent-counsel inquiry into allegations of election improprieties -- this one into whether Clinton illegally benefited from Democratic advertisements during the presidential campaign.

But unlike the other two investigations, this one named Clinton himself as the subject of an inquiry, and it is potentially the most far-reaching because it goes to the heart of the Democrats' fund-raising strategy.

In a statement to the three-judge panel that supervises independent counsel matters, Reno said she had commenced a preliminary investigation "involving President of the United States William Jefferson Clinton concerning political advertisements during the 1996 election cycle."

The new inquiry centers on whether Clinton and White House aides coordinated Democratic issue ads in an improper effort to violate federal spending limits he agreed to when he accepted PTC taxpayer financing of his campaign.

Reno initiated the 90-day review based on the preliminary findings of an Federal Election Commission audit last month.

The audit concluded that the Democratic National Committee evaded federal spending limits by funneling $42 million to state parties for ads that were thinly veiled messages for the Clinton-Gore re-election campaign.

The audit determined that the ads, commonly called issue ads, should have been counted under spending limits imposed on the president's campaign.

The other two outstanding inquiries focus on Vice President Al Gore's statements about his telephone fund-raising calls and on possible perjury by Harold Ickes, a former deputy White House chief of staff, concerning his dealings with the Teamsters union.

By the end of the 90-day period for each investigation, Reno is required by law to decide whether to seek the appointment of an outside counsel.

Clinton's lawyer, David Kendall, said yesterday that the Democrats' ads were lawful.

"Each Clinton-Gore ad was reviewed by counsel at the president's request, to assure the ad's legality, and approved prior to broadcast," he said.

Reno has reviewed the legality of the issue ads on at least three occasions over the past two years, but each time she went no further than a 30-day initial review.

The allegations were first raised in late 1996 by Common Cause, the public interest group.

In each instance, Reno found no wrongdoing, saying she lacked specific and credible of evidence that a crime had been committed by any of the high-level officials, such as the president, who are covered by the law.

Law enforcement officials said yesterday that the audit report provided few new facts about the conduct of Clinton or any other official but was highly significant in persuading Reno to launch the inquiry.

The agency's audit marked the first time that the Federal Election Commission investigators had ever questioned the legality of the content of the ads in a manner that allowed the Justice Department to assert its criminal jurisdiction.

Pub Date: 9/09/98

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