-Caveat Lector-
http://www.washingtonpost.com/wp-dyn/articles/A48889-2001Jun10.html
Cisneros Counsel Still Digging
Grand Jury Weighing Whether Justice, IRS Blocked Inquiry
By Bill Miller
Washington Post Staff Writer
Monday, June 11, 2001; Page A17
Long after the original target of his investigation copped a plea to a
misdemeanor charge, independent counsel David M. Barrett remains in
business.
No longer investigating former housing secretary Henry G. Cisneros,
Barrett is now focusing on whether anyone in the Clinton administration
attempted to obstruct his Cisneros probe.
Barrett is the only independent counsel still in the midst of an active
grand jury investigation. Other independent counsels who examined
allegations against the Clinton administration -- including Robert W.
Ray, who inherited the Whitewater case, the Monica Lewinsky matter and
other subjects from the most famous special prosecutor of all, Kenneth
W. Starr -- have shut down their offices or set about finishing final
reports.
Barrett's mission appeared nearly complete in September 1999, when
Cisneros pleaded guilty in U.S. District Court to a misdemeanor charge
of lying to FBI background investigators about money he paid to a former
mistress. Cisneros paid a $10,000 fine and a $25 court assessment, and
won a promise that he would face no further criminal charges.
Cisneros has moved on, having started a business in San Antonio. But
Barrett has remained on the case, working for the past 16 months with a
grand jury at the federal courthouse in Washington. Sources said he has
summoned witnesses to determine whether the Internal Revenue Service and
Justice Department acted to obstruct his investigation of Cisneros, and
whether they took similar action to shield other political figures from
tax scrutiny.
Even though Congress let the independent counsel law lapse in 1999,
investigations in progress were permitted to continue. Barrett spent
more than $1.1 million in the six-month period that ended Sept. 30,
according to the most recent tallies compiled by the General Accounting
Office. He had spent $14.6 million overall since his appointment in May
1995, the GAO reported.
Two sources familiar with the matter said Barrett had gone to the IRS
and Justice Department during the Cisneros probe and asked to examine
three years of his tax records, the period of time that typically is
required to establish a pattern of criminal activity leading to a tax
fraud case.
Barrett, the sources said, wanted to determine if Cisneros reported all
outside income. But the two agencies gave Barrettonly one year of
records, having determined that anything more would have exceeded his
jurisdiction.
No criminal tax charges were filed against Cisneros by Barrett or the
IRS.
According to the sources, Barrett grew concerned that IRS and Justice
officials might have acted to protect Cisneros, perhaps in collusion
with others in the Clinton administration. That triggered the ongoing
investigation.
One former Justice official, who asked not to be identified, said that
such an allegation is "outrageous" and that Barrett couldn't establish a
legal right to the tax records. A former federal prosecutor said that
the IRS has strict standards for releasing an individual's tax records,
and that friction sometimes results during investigations.
Cisneros is in no way a target of Barrett's current investigation,
according to the two sources familiar with the case.
The independent counsel and his staff have questioned numerous IRS and
Justice officials who played roles in the dealings with Barrett, the
sources said. One witness from the IRS was described by sources as a
"whistleblower" who alleges wrongdoing. That witness has met about 20
times with Barrett's staff, one source said.
The grand jury proceedings usually have taken place twice a week, and
Barrett occasionally is on hand. A top lawyer in his office, Mark V.
Jackowski, is helping to coordinate the probe. He and Barrett have been
assisted by three other attorneys on the staff and a team of
investigators, as well as by some outside lawyers.
Barrett declined to comment, saying it would be inappropriate to discuss
a pending investigation. Justice Department officials also declined to
comment.
Last year, two officials from the Justice Department's criminal division
met with Barrett to air their concerns that his current investigation
fell outside the mandate given him by a special three-judge panel from
the U.S. Court of Appeals. Barrett held his ground, sources said, and
the officials took no follow-up action to challenge his authority.
Cisneros, 53, said he has been concentrating on building housing for
low- and moderate-income people and has paid little attention to
Barrett's recent actions. He runs American CityVista, a housing
development company based in San Antonio, and also is chairman of the
San Antonio Hispanic Chamber of Commerce. Cisneros said he knew of no
action by anyone at Justice or IRS on his behalf.
"I leave it to Mr. Barrett to do his job, and I'll do mine," Cisneros
said.
Cisneros was indicted in December 1997 on charges of conspiracy, making
false statements and obstructing justice. The allegations stemmed from
statements he made to FBI background investigators in late 1992 and
early 1993, when he was under consideration to be President Bill
Clinton's first secretary of housing and urban development. Cisneros was
accused of lying about the amount of money he provided to former
mistress Linda Jones, a political fundraiser with whom he had an affair
when he was mayor of San Antonio.
Barrett settled for the misdemeanor plea on the day that Cisneros was to
go on trial to face 18 felony charges.
The Wall Street Journal, which first reported on the grand jury
investigation last October, quoted sources as saying that Barrett
earlier wanted tax records to investigate whether Cisneros failed to
report income from speeches. According to the Wall Street Journal,
investigators suspected Cisneros passed along those earnings to Jones.
In his guilty plea, Cisneros admitted telling an FBI agent that he had
paid Jones roughly $2,500 a month after their relationship ended when,
in fact, the amount was much higher. All told, prosecutors said,
Cisneros provided Jones with more than $250,000 from 1990 until 1994. In
court, Cisneros said that he lied to protect Jones and his wife, and
because he was in a "confused sort of fog" when he met with the FBI.
Jones pleaded guilty to bank fraud and other charges in a spinoff of the
original probe. Clinton pardoned Cisneros and Jones in January.
© 2001 The Washington Post Company
http://www.wired.com/news/politics/0,1283,44398,00.html
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Kadosh, Kadosh, Kadosh, YHVH, TZEVAOT
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