`Cover-up' seen in Cisneros case

Independent counsel alleges that IRS, Justice Department blocked tax probe

January 20, 2006|By DAVID G. SAVAGE | DAVID G. SAVAGE,LOS ANGELES TIMES

WASHINGTON -- After more than 10 years and $21 million spent investigating former Housing Secretary Henry G. Cisneros, the last independent counsel from the Clinton era officially ended his probe yesterday, complaining that he needed more time to unravel what might have been a major "cover-up at high levels of our government."

"It would not be unreasonable to conclude as I have that there was a cover-up, and it appears to have been substantial and coordinated," said David M. Barrett, a former Republican lawyer who was appointed in 1995 to investigate Cisneros, a Democrat. "The question is why? And that question, regrettably, will go unanswered."

But his report offered no evidence of a cover-up, except that officials at the Justice Department and the Internal Revenue Service were not impressed with his contention that Cisneros might have cheated on his taxes. When the Bush administration came into office in 2001, its top officials refused to give Barrett permission to dig into old tax files.

But for at least four years after Cisneros pleaded guilty to a misdemeanor, Barrett continued to spend $2 million a year pursuing his theory of a cover-up.

Several officials who had dealt with Barrett reacted angrily to his final report.

It "is a fitting conclusion to one of the most embarrassingly incompetent and wasteful episodes in the history of American law enforcement," said Robert S. Litt, a Washington lawyer and former Justice Department official during the Clinton administration.

The case helped to bring an end to the system of independent counsels. Republicans and Democrats came to believe that these open-ended investigations were unwise, and the law authorizing them was allowed to lapse.

Cisneros was not alleged to have abused his power or to have misspent public money. The charges grew out of his pre-employment interview by the FBI.

Cisneros had stepped down as San Antonio's mayor in 1989 after admitting an affair with an aide, Linda Medlar Jones. When President Bill Clinton nominated him as HUD secretary, Cisneros told FBI agents he gave his former mistress about $10,000 a year to help her restart her life. In fact, the amounts were much larger.

Medlar Jones secretly taped her phone calls with Cisneros. After their relationship soured, she sold the tapes for $15,000 to a tabloid TV program. Her revelations launched the probe of Cisneros and led to her imprisonment.

When Barrett's staff found that Medlar Jones had doctored the tapes, they indicted her for lying and obstruction of justice.

After four years, the case against Cisneros was weak because Barrett's work had shown his lead witness to be a liar. Cisneros pleaded guilty to a misdemeanor, and the other charges were dropped.

With that, the Cisneros investigation appeared to be ended. But the independent counsel turned his attention to the possibility of a cover-up. An IRS inspector in Texas had sent Barrett a memo in 1997 alleging "possible improprieties" in the handling of Cisneros' taxes before 1993.

Barrett launched a new probe into whether there had been a cover-up at the Justice Department and the IRS.

But by 2003, the judges who had appointed Barrett ordered him to wrap up his investigation and write his final report. That took nearly three more years.

David G. Savage writes for the Los Angeles Times.

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