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PLEASE NOTE: The following transcript is a portion of the official hearing record of the Committee on Government Reform and Oversight. Additional material pertinent to this transcript may be found on the web site of the Committee at [http://www.house.gov/reform]. Complete hearing records are available for review at the Committee offices and also may be purchased at the U.S. Government Printing Office.
47–117 CC
1998
THE CURRENT IMPLEMENTATION OF THE INDEPENDENT COUNSEL ACT
VOLUME 2
HEARINGS
before the
COMMITTEE ON
GOVERNMENT REFORM
AND OVERSIGHT
HOUSE OF REPRESENTATIVES
ONE HUNDRED FIFTH CONGRESS
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FIRST SESSION
DECEMBER 9 AND 10, 1997
Serial No. 105–89
Printed for the use of the Committee on Government Reform and Oversight
50S
COMMITTEE ON GOVERNMENT REFORM AND OVERSIGHT
DAN BURTON, Indiana, Chairman
BENJAMIN A. GILMAN, New York
J. DENNIS HASTERT, Illinois
CONSTANCE A. MORELLA, Maryland
CHRISTOPHER SHAYS, Connecticut
STEVEN SCHIFF, New Mexico
CHRISTOPHER COX, California
ILEANA ROS-LEHTINEN, Florida
JOHN M. MCHUGH, New York
STEPHEN HORN, California
JOHN L. MICA, Florida
THOMAS M. DAVIS, Virginia
DAVID M. MCINTOSH, Indiana
MARK E. SOUDER, Indiana
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JOE SCARBOROUGH, Florida
JOHN B. SHADEGG, Arizona
STEVEN C. LATOURETTE, Ohio
MARSHALL ''MARK'' SANFORD, South Carolina
JOHN E. SUNUNU, New Hampshire
PETE SESSIONS, Texas
MICHAEL PAPPAS, New Jersey
VINCE SNOWBARGER, Kansas
BOB BARR, Georgia
DAN MILLER, Florida
HENRY A. WAXMAN, California
TOM LANTOS, California
ROBERT E. WISE, Jr., West Virginia
MAJOR R. OWENS, New York
EDOLPHUS TOWNS, New York
PAUL E. KANJORSKI, Pennsylvania
GARY A. CONDIT, California
CAROLYN B. MALONEY, New York
THOMAS M. BARRETT, Wisconsin
ELEANOR HOLMES NORTON, Washington, DC
CHAKA FATTAH, Pennsylvania
ELIJAH E. CUMMINGS, Maryland
DENNIS J. KUCINICH, Ohio
ROD R. BLAGOJEVICH, Illinois
DANNY K. DAVIS, Illinois
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JOHN F. TIERNEY, Massachusetts
JIM TURNER, Texas
THOMAS H. ALLEN, Maine
HAROLD E. FORD, Jr., Tennessee
———
BERNARD SANDERS, Vermont (Independent)
KEVIN BINGER, Staff Director
RICHARD D. BENNETT, Chief Counsel
WILLIAM MOSCHELLA, Deputy Counsel and Parliamentarian
JUDITH MCCOY, Chief Clerk
PHIL SCHILIRO, Minority Staff Director
C O N T E N T S
Hearings held on December 9 and 10, 1997
Volume 2—December 10, 1997
Statements of:
Smaltz, Donald C., Independent Counsel, Office of the Independent Counsel
Letters, statements, etc., submitted for the record by:
Bennett, Richard D., chief counsel, Committee on Government Reform and Oversight, exhibit 296
Buford, C. Douglas, Jr.:
Deposition of
Exhibits to deposition
Burton, Hon. Dan, a Representative in Congress from the State of Indiana, Smaltz exhibits 1 through 9
Cox, Hon. Christopher, a Representative in Congress from the State of California, documents discussed during the hearing
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Freeh, Louis J., Director, Federal Bureau of Investigation:
Information concerning possible violations of law
Number of FBI agents working on Campcon Investigation
Lindsey, Bruce R.:
Deposition of
Exhibits to deposition
Kantor, Mickey:
Deposition of
Exhibits to deposition
McLarty III, Thomas Franklin:
Deposition of
Exhibits to deposition
Mercer, David:
Deposition of—Volume 1
Deposition of—Volume 2
Exhibits to deposition—Volume 1
Exhibits to deposition—Volume 2
Mica, Hon. John L., a Representative in Congress from the State of Florida, letter dated December 10, 1997
Phillips, John R.:
Deposition of
Exhibits to deposition
Shadegg, Hon. John, a Representative in Congress from the State of Arizona, March 3, 1997, press conference of Vice President Gore
Smaltz, Donald C., independent counsel, Office of the Independent Counsel:
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Letter dated June 19, 1997
Prepared statement of
Speech from the Corporate Crime in America conference
Thornberry, Betty Jane:
Deposition of
Exhibits to deposition
Weymouth, Holli B.:
Deposition of
Exhibits to deposition
THE CURRENT IMPLEMENTATION OF THE INDEPENDENT COUNSEL ACT
VOLUME 1
December 9, 1997, hearing
VOLUME 2
December 10, 1997, hearing, and depositions from the December 9 and 10, 1997, hearings
47–117 CC
1998
THE CURRENT IMPLEMENTATION OF THE INDEPENDENT COUNSEL ACT
VOLUME 2
HEARINGS
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before the
COMMITTEE ON
GOVERNMENT REFORM
AND OVERSIGHT
HOUSE OF REPRESENTATIVES
ONE HUNDRED FIFTH CONGRESS
FIRST SESSION
DECEMBER 9 AND 10, 1997
Serial No. 105–89
Printed for the use of the Committee on Government Reform and Oversight
THE CURRENT IMPLEMENTATION OF THE INDEPENDENT COUNSEL ACT
VOLUME 2
THE CURRENT IMPLEMENTATION OF THE INDEPENDENT COUNSEL ACT
VOLUME 2
THE CURRENT IMPLEMENTATION OF THE INDEPENDENT COUNSEL ACT
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VOLUME 2
THE CURRENT IMPLEMENTATION OF THE INDEPENDENT COUNSEL ACT
VOLUME 2
THE CURRENT IMPLEMENTATION OF THE INDEPENDENT COUNSEL ACT
VOLUME 2
THE CURRENT IMPLEMENTATION OF THE INDEPENDENT COUNSEL ACT
VOLUME 2
WEDNESDAY, DECEMBER 10, 1997
House of Representatives,
Committee on Government Reform and Oversight,
Washington, DC.
The committee met, pursuant to notice, at 10:05 a.m., in room 2154, Rayburn House Office Building, Hon. Dan Burton (chairman of the committee) presiding.
Present: Representatives Burton, Gilman, Cox, Horn, Mica, Davis of Virginia, McIntosh, Shadegg, Sununu, Pappas, Barr, Lantos, Barrett, Norton, Cummings, Kucinich, Turner and Allen.
Staff present: Kevin Binger, staff director; Richard Bennett, chief counsel; Barbara Comstock, senior investigative counsel; Judith McCoy, chief clerk; Teresa Austin, assistant clerk/calendar clerk; William Moschella, deputy counsel and parliamentarian; Will Dwyer, director of communications; Ashley Williams, deputy director of communications; Dudley Hodgson, chief investigator; Dave Bossie, oversight coordinator; Robert Rohrbaugh, James C. Wilson, Uttam Dhillon, and Tim Griffin, senior investigative counsels; Charli Coon, Kristi Remington, Bill Hanka, and Jennifer Safavian, investigative counsels; Phil Larsen, investigative consultant; Jim Schumann, Jason Foster, and Miki White, investigators; Robin Butler, office manager; Carolyn Pritts, David Jones, and John Mastranadi, investigative staff assistants; Phil Barnett, minority chief counsel; Kenneth Ballen, minority chief investigative counsel; Agnieszka Fryszman, Andrew McLaughlin, Michael Raphael, and Michael Yang, minority counsels; Ellen Rayner, minority chief clerk; Becky Claster and Andrew Su, minority staff assistants; and Sheridan Pauker, minority research assistant.
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Mr. BURTON. The committee will resume its deliberations.
Good morning, Mr. Lantos.
Mr. LANTOS. Good morning.
Mr. BURTON. Mr. Barrett has a preliminary question. We'll grant him a brief moment.
Mr. BARRETT. Thank you, Mr. Chairman.
Mr. Chairman, I want to begin, yesterday in our hearing we had a motion to send some depositions over to the Justice Department. I support that. At the time we had the vote, the issue really was whether there was going to be disclosure of all depositions, which is, of course, something we support at this time.
But when I looked at the motion, that is something that I do support. I think that in order to move the investigation forward, those depositions should be going to the Justice Department. So I just wanted to make that statement for the record.
Mr. BURTON. The gentleman's statement will be included in the record.
Mr. SHADEGG. Mr. Chairman, point of personal privilege.
Mr. BURTON. The gentleman will state his point.
Mr. SHADEGG. Yesterday I made reference to the press conference which Vice President Gore held on Monday, March 3, 1997. I did not ask unanimous consent to have it inserted into the record. I'd like to do that at this time.
Mr. BURTON. Without objection.
[The information referred to follows:]
INSERT OFFSET FOLIOS 1 TO 11 HERE
[The official committee record contains additional material here.]
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Mr. BURTON. The Chair now recognizes the gentleman from New York, Mr. Gilman, chairman of the International Relations Committee.
Mr. GILMAN. Thank you, Mr. Chairman.
We welcome Director Louis Freeh back again with us, and we thank you for your patience and lengthy time we have imposed on you yesterday.
Director Freeh, the Attorney General testified yesterday that there must be sufficient credible evidence on a covered person which would have triggered the implementation of the Independent Counsel Act before the FBI could investigate such an individual.
Can you tell us, have there been any incidents that you are aware of that FBI agents wanted to interview someone, requesting documents or following leads on covered persons, as defined in the independent counsel statute or any other act or any others, and that they were thwarted by officials of the Department of Justice because of that condition that I just recited?
Mr. FREEH. There have been instances, Mr. Gilman, where the timing of certain interviews, particularly with respect to covered persons, were the subjects of discussion and sometimes even disagreement in terms of the timing as to whether those interviews should be conducted. For instance, there were discussions about whether people should be interviewed early in the inquiry or at a point where more information and evidence has been developed.
But the ultimate result, in answer to your question, is that I don't believe the agents who were conducting the inquiry were thwarted from interviewing any covered person because of the determination that the statute had to be triggered before they were allowed to be spoken to. But there were disagreements about the timing, and that's something that, you know, we've discussed and have discussed on an ongoing basis.
Mr. GILMAN. I just wanted to be clear with regard to our committee, since the Attorney General said she had to make a decision, if you were investigating a covered person, that there had been sufficient credible evidence to initiate the trigger mechanism for the Independent Counsel Act.
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Are you clear now of what I'm requesting? Did that necessitate a delay by your agency in making an investigation?
Mr. FREEH. Yes, in the sense that the covered person may have been interviewed, and perhaps there was a desire on behalf of the investigators to do an interview earlier than the legal designation which I just articulated.
But, at the end of the day, the persons in question were interviewed.
Mr. BURTON. Would the gentleman yield on that?
Mr. GILMAN. I'll be pleased to yield.
Mr. BURTON. Did that create a sense of frustration amongst some of your agents? I mean, we have read in a number of publications that there really was a sense of frustration on the part of some agents who were being obstructed from talking to some of these people.
Mr. FREEH. Yes. I think I alluded to yesterday, there were times when the investigators felt that interviews and the focus of interviews should move quicker than the attorneys who were managing the inquiry or the grand jury otherwise decided, and that was a source of some frustration at different points.
But, as I mentioned, no one was not interviewed, and nobody was insulated from being interviewed because of those disagreements. The disagreement was really the timing of the interview and what the overall focus was.
Mr. BURTON. If the gentleman would yield further. One of the things that I've noted in a number of investigations is that the timing of the interview by an agent is important. And if somebody at Justice postponed the interview for some time, which would allow the person to be interviewed to be more fully prepared, or to be able to cover their derriere might be considered impeding the process of justice.
Was that ever a complaint?
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Mr. FREEH. Not that justice was being impeded. There are different theories to conducting investigations. One theory is you go out and speak to everybody immediately because you lock people into statements as well as facts. Another theory is you wait until you have sufficient evidence to conduct a more informative interview, more confrontational interview, and put the person in the position where they have to tell you facts you can corroborate or not accurately answer those questions.
Depending on the investigation, one theory may be a stronger suit than the other. So I don't think there is any right or wrong way of doing it, depending on the case. What is important is that the ultimate objectives were accomplished, and nobody was made invulnerable or insulated from interviews.
Mr. BURTON. I thank the gentleman.
Mr. GILMAN. Thank you, Mr. Chairman.
Director Freeh, when you took on the responsibility itself as Director of the FBI it was against the backdrop of a White House official calling directly to the FBI with instructions to go investigate alleged wrongdoing by long-standing nonpolitical career-type employees in the White House Travel Office.
I understand that you informed the President that for you to take on the responsibilities as Director of the FBI, you insisted that the Federal Bureau of Investigation must maintain its independence and have no role in politics.
Is that why you said no to the call for information on the Bureau's Chinese money connection inquiry and a push for the appointment of an independent counsel?
Mr. FREEH. With respect to the first part of your question, yes, that was the condition under which I took this job. I told the President when he asked me what were the conditions under which I would accept the job, and I certainly made it clear, and he agreed that I would be politically independent, appropriately so, as the Director.
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With respect to decisions which you cite, again, I made those decisions with the intent of not only preserving the political independence of the FBI, but the integrity of the investigation. It is bad practice, in my view, to do anything which potentially alerts prospective subjects as to the course of the investigation or evidence. I think it is bad practice and should not be done.
Mr. GILMAN. And we want to commend you for maintaining the independence of the FBI.
One last question, Mr. Chairman, with your permission since my time was utilized by the exchange.
How many FBI agents are now working on this matter, illegal foreign campaign contributions, and other illegal activity involving the DNC during the last Presidential election? What portion of your budget is being allocated to that?
Mr. FREEH. There are 54 special agents assigned on a full-time basis to the overall investigation. There is 39 professional support, which include paralegals as well as investigative analysts. I can get some budgetary figures for you.
Mr. GILMAN. Just roughly what percentage?
Mr. FREEH. There's several millions of dollars, of course, invested here. We have an overall budget of about $3 billion. I would be just guessing at that right now. But it is a major investigation. I mean, if you compared it with anything else we've done historically, it is a major investigation.
Mr. GILMAN. With your permission, Mr. Chairman, I would like to ask the Director to submit that at a later date.
Mr. BURTON. Without objection.
[The information referred to follows:]
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The FBI does not routinely account for its expenses at the investigative case level; therefore, the actual cost to date of the CAMPCON investigation is not available. However, those costs readily identifiable to the CAMPCON investigation have been compiled and total $3,910,311.
Mr. GILMAN. Thank you. And thank you, Director Freeh.
Thank you, Mr. Chairman.
Mr. BURTON. Gentleman's time has expired.
Mr. Lantos.
Mr. LANTOS. Thank you very much, Mr. Chairman.
I want to followup on the questioning of my good friend from New York. He raised the issue of the political independence of the FBI, which I would consider critical.
Has there been at any time any attempt on the part of the White House to interfere with the independence of your agency, Director Freeh?
Mr. FREEH. As far as my tenure as Director, no, I would say there has been no attempt that I would recognize as such to interfere with what I think is, appropriately so, the political independence of the FBI.
Mr. LANTOS. Since we all feel passionately that the political independence of the FBI must be preserved at all costs, let me pursue it with respect to the Vice President's Office. Has there been any attempt at the present time to interfere with the political independence of your agency by the Vice President's Office?
Mr. FREEH. No, sir.
Mr. LANTOS. Has there been any attempt by any other agency of Government to interfere with your independence?
Mr. FREEH. No, I don't believe so.
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Mr. LANTOS. So, basically, your answer to Mr. Gilman's probing is that we are dealing with a nonissue, that political interference with the independence of the FBI has not been part of your experience as Director of the FBI?
Mr. FREEH. Well, it's not been part of my experience. As you know, of course, Independent Counsel Ken Starr is looking at the issue of the FBI files, which, of course, has been the subject of great interest and inquiry by this committee. I don't know the results of those investigations, but from my point of view and where I sit, I have not seen what I would call an attempt, as far as I can prove it, of political interference.
Mr. LANTOS. Let me raise an issue concerning the Chinese involvement in our 1996 elections. I realize that you are under constraints in terms of the extent to which you can deal with that, but as one who has studied the macro figures of the 1996 elections, as I'm sure you have as well, what is the quantitative importance of alleged Chinese political interference with the 1996 elections in terms of the totality of spending during the course of that election?
Mr. FREEH. Mr. Lantos, it would be very difficult for me to—first of all, to approximate that. But even to address it, as you know, it has been the subject of classified briefings to this committee and others, and I would be respectfully reluctant to get into that. And it would also be difficult to approximate an answer to your question.
Mr. LANTOS. You agree with me that of all the items that we have been exploring, this clearly is potentially the most serious one?
Mr. FREEH. I think all of the items that we're exploring are serious. As to which one ultimately proves by fact to be the most serious, it is hard to estimate at this point.
Any time a law enforcement agency is investigating the commission of a crime, or the potential commission of a crime, it is very serious. And the external matters which you refer to are of critical seriousness to the national security as well as the criminal laws. But how they all prove out to be based on what we know now is difficult to predict.
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Mr. LANTOS. Is there any area you would like to just give us your views beyond the questions that you have been asked by members of this committee? I want to give you an opportunity to express any other thoughts that you may have.
Mr. FREEH. Yes. No, I appreciate that very much. As I said before, I will continue to do my very best to ensure the independence of the FBI, and I think that's critical for the country. It is critical, for everybody's rights are potentially affected by an agency with such awesome powers. And I pledge to continue to do that. And if at any time we make a misstep or a misjudgment, and we create the perception that it is otherwise, that's as bad as the reality of it being otherwise.
But you have in the FBI, I think, a crown jewel in the United States. You have men and women who—and I see them every day on a daily basis—do great good for the country, and despite a couple of missteps here and there, there's nobody in the FBI with a political agenda. We have a job to do, and we want to do it correctly and fairly.
Mr. LANTOS. I think my colleagues share my view that we have the highest regard for your agency and for your leadership of that agency.
Final question relates to your relationship in the future to the Attorney General in view of this unfortunate attempt to try to drive a wedge between the Attorney General and yourself.
Yesterday both of you were extremely complimentary of each other's performance and of each other as individuals. Is it unrealistic on our part to hope that this minor blip will fade into the background and your working relationship with the Attorney General will continue to be cordial, cooperative, exemplary and pleasant?
Mr. FREEH. I have every confidence it will remain a very strong relationship. But as I alluded to yesterday, and again, I'm not speaking so much for myself as perhaps maybe for a future FBI Director, I have to tell you that the next time I sit down and write a memo to the Attorney General on a matter of this importance and substance, I'm going to have in the back of my mind a thought that it was not as strong as it was when I wrote this memo, which is that even though what I put in there is frank and honest and very sensitive, I think it creates the awareness that it is an issue that is potentially something I have to consider.
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I think that's a bad thing for people in my position and in future Directors, which is why I'm hopeful, Mr. Chairman, as I spoke to you yesterday, that Mr. Bennett and lawyers for the Justice Department can discuss this issue. I spoke to the Attorney General this morning, and she told me to relay to you that her lawyers would be pleased to engage with Mr. Bennett.
And I think for the good of the process and because I wrote the memo and I know what's in there, it is a much more preferable course to see if we can work that out and avoid what is really not only a constitutional issue, but an issue that will impact adversely on what you expect to get from us, which we want to give you in many cases, and what we have to protect in some critical parts of an ongoing case.
Mr. LANTOS. If I may just followup on this thought. Your answer to this question underscores the validity of the Attorney General's statement yesterday that attempts by congressional committees to obtain confidential memoranda written by the FBI Director to the Attorney General chill the atmosphere and discourage the degree of candor that the Attorney General ought to be able to expect of you. I fully agree with your statement, and I hope there will not be future attempts to obtain such memoranda.
Thank you, Mr. Chairman.
Mr. BURTON. Mr. Shadegg.
Mr. SHADEGG. Thank you, Mr. Chairman.
Just to followup on the points that my colleague Mr. Lantos made. He questioned you about political independence and about this issue of a wedge. I want to begin by saying, No. 1, as a former law enforcement official and assistant attorney general in Arizona, I respect what you're doing, I encourage you to be an independent voice, I admire your record, and I would encourage you to hang in there notwithstanding what I consider to be some improper influences.
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Mr. Lantos referred to there being no attempt to interfere with you in a political sense. I won't ask you to comment on it. But, quite frankly, I think the remarks last week by the White House, which were guarded, and which Mr. McCurry advised the press to read as they would, besmirched your record, came at a point in time right after you had exercised your independence, which I think the Nation should want you to do. And if that wasn't an attempt to interfere with your political independence, I don't know what was.
And if there is a problem here, I see a problem in terms of a wedge not driven between you and the Attorney General. She apparently respects your independence. I see a wedge trying to be driven between you and the public based on the fact that you had the courage to speak your mind and to give her the right kind of advice.
So I applaud that conduct, and I quite frankly think the President was grossly improper in following your—nobody likes the leak of that memo, but once it came out, the President says, well, he has something critical to say about me or something I don't like, so I'm going to be critical about him.
Quite frankly, I think it was petty and inappropriate and it was, in fact, at least a veiled attempt to interfere with your independence, and I resent it, and I think a lot of people in America resent it.
Having said that, I want to turn to an issue I discussed yesterday. In the 29-page report released by the Attorney General in her decision not to continue with the investigation, she says point blank, I have determined that there are no reasonable grounds to believe that further investigation is warranted into the allegations that the Vice President broke the law and illegally raised the campaign funds.
I was very encouraged that, in response to Mr. Cox's questions yesterday, you indicated that even that topic, the topic of the illegality of phone calls by the Vice President, remained open. Did I hear you correctly on that point?
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Mr. FREEH. Yes, sir, it is fully open.
Mr. SHADEGG. I was also stunned yesterday to review this entire document and to find that—well, let me ask you. Have you read it?
Mr. FREEH. Yes, sir.
Mr. SHADEGG. She devotes almost a third of this document to making the case that the President did not know that some of these funds would be used as campaign money; that is, hard money which could not legally be raised from a Government office.
Mr. FREEH. Do you mean the President or Vice President?
Mr. SHADEGG. Vice President. There was a whole section of this, quite a bit of it, trying to make the indication that he did not know that he was raising campaign funds. You would agree with me that's a good portion of this report?
Mr. FREEH. Yes, sir.
Mr. SHADEGG. So that would go to the issue of whether or not he knew his conduct was illegal. And I'm troubled by that, because normally in the law knowing that your conduct is not illegal is not an element. That is to say, if I'm stopped by a police officer for speeding, I can't say to him, I didn't know I was speeding, and he will say, oh, well, OK, you're off. Correct?
Mr. FREEH. Yes.
Mr. SHADEGG. And it wouldn't be a defense—let's say I went back to my office, and I spent the next 10 days in my office doing nothing but making campaign fund-raising calls from my Government office. It would not be a defense to a prosecution for that conduct if I said, well, my chief of staff told me I could do that from my office, and I believe her, would it?
Mr. FREEH. Except as it went to intent.
Mr. SHADEGG. Except as it went to intent. But it would not necessarily be a defense to the crime?
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Mr. FREEH. No.
Mr. SHADEGG. OK. You're charged with—your agency is charged with investigating this. Do you know the date on which the Vice President was questioned about those fund-raising calls?
Mr. FREEH. Yes, I do. November 11.
Mr. SHADEGG. Of 19——
Mr. FREEH. 1997.
Mr. SHADEGG. As I mentioned yesterday, in his press conference, which went on for, I guess, 30 or 45 minutes, almost a year earlier, on March 3, 1997, nowhere does the Vice President ever indicate that he thought he was raising soft money. In fact, you were here yesterday when I brought out four different quotes by the Vice President in which he said he thought he was raising money for, quote/unquote, our re-election.
Wouldn't you think what he said candidly and voluntarily shortly after this issue became public would be more solid evidence of what he believed and what his state of mind was than an interview conducted almost a year later where he'd heard that the Attorney General was already looking at the issue of soft money and say, well, if he was raising soft money, then we're off the hook?
Mr. FREEH. Yes. I just don't think it is appropriate for me to comment on his intent or knowledge at any point.
Mr. SHADEGG. Well, as an investigator, wouldn't you have thought that what he said a year earlier describing his own conduct deserved at least some mention in her report on that issue?
Mr. FREEH. It is not my report, and, you know, what processes went into what she included or deleted I'm not aware of.
Mr. SHADEGG. Well, I find it stunning that she spends a third of this report including a number of questions, including describing the phone calls she made or her investigators made to these contributors in which they all said they understood it was soft money. And these are people out across America questioned a year later. They said, well, we all understood it was soft money. And yet days after the issue became public, the Vice President gives a 45-minute-long press conference. He never mentions that he thought it was soft money, and he, in fact, describes it as raising money for our re-election campaign, which would be hard money. I, quite frankly, see that as a huge flaw in her report.
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I'm encouraged that the investigation is still open. I quite frankly think the evidence is clear that he did violate the law. I think there may be an argument that he couldn't be successfully prosecuted for it, but I believe he violated the law.
Mr. BURTON. The gentleman's time has expired.
Ms. Norton.
Ms. NORTON. Thank you, Mr. Chairman.
Welcome, Mr. Freeh. I was intrigued by perhaps the most significant statement in your testimony, and I'm quoting:
In recommending that an independent counsel be appointed I did not, and do not, imply that I believe any particular person has committed a crime, is the target of investigation or even has done anything improper. I recommended appointment of an independent counsel to investigate whether crimes may have been committed.
Are you aware that the independent counsel statute says that there must be specific and credible evidence that a covered person has committed a crime?
Mr. FREEH. It says ''may have committed a crime.''
Ms. NORTON. Do you believe a covered person may have committed a crime, because that is not what this statement says. Your statement from yesterday says—it implies that you don't see any covered person, you don't see any evidence, or you don't want to imply that any covered person has committed a crime or even has done anything improper. And yet you believe that an independent counsel should have been appointed?
I'm trying to find the basis upon which you believe and independent counsel should be appointed.
Mr. FREEH. I think we're talking about two different things. The trigger in a statute that a crime has been committed—actually that used to be in the statute, and in the revisions the Congress changed that, the governing language that a crime may have been committed.
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My statement yesterday spoke to two issues. The first issue was the one that I said made me reluctant to publish my recommendation because many people could misunderstand a recommendation like that, or one under the independent counsel statute to believe exactly what you asked me about, that someone had committed a crime. So I wanted to make that clear.
The fact that the statute would be triggered does not mean that a crime has been committed or that any findings of guilt or innocence have been made. It simply means that further investigation is required.
Ms. NORTON. Well, if you can trigger a criminal statute of this kind because further information is required, then I really wonder about whether we ought to reign in the statute. The specific and credible evidence, it seems to me, is an important safeguard.
It became known before your memo that you disagreed with the Attorney General. How did that first become known?
Mr. FREEH. I don't know. I wish I did.
Ms. NORTON. Were you asked that question, and did you have occasion to answer that question before your memo was written? Why did the press know before your memo was written that you disagreed with the Attorney General?
Mr. FREEH. These discussions within the Department of Justice, both between the Attorney General and I and the people on the Task Force, have been ongoing for months, and one of the key subjects of those discussions which involves a larger and larger circle of people have been going on for many, many months. So, unfortunately, some of that spilled out before the memo was written. But the memo does not for the first time raise these issues.
Ms. NORTON. Is it your practice to make it known to the Attorney General when you disagree with her prosecutorial decision?
Mr. FREEH. If it is an FBI case, and particularly a case about which we consult and she asks me my opinion, absolutely.
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Ms. NORTON. No, I asked is it your practice. Is it your practice as a general manner to make it known when you disagree with the decision that the prosecutor makes, or is this an unusual occurrence?
Mr. FREEH. It is an unusual occurrence in the sense that I don't, and neither does the Attorney General, regularly get involved in charging decisions except for a very small number of cases.
So it is not my practice to get involved in charging decisions either in the Department of Justice or in the U.S. Attorney's Office. However, from time to time I have intervened in cases where I thought charges should be brought or not brought for one particular reason or the other, but it is not something that I frequently do.
Ms. NORTON. You have been an Assistant U.S. Attorney yourself?
Mr. FREEH. Yes, ma'am.
Ms. NORTON. Did you have an occasion to use the FBI when you were an Assistant Attorney?
Mr. FREEH. Yes.
Ms. NORTON. Did you find that sometimes the investigators at the FBI want to prosecute when the lawyer or prosecutor thought otherwise?
Mr. FREEH. Yes.
Ms. NORTON. Isn't it natural that investigators who put a lot of time and effort and grunt work into investigations have a tendency to want to go forward with what they have uncovered and prosecute? Isn't that pretty much naturally built in structurally in being an investigator?
Mr. FREEH. No, I don't think so. I think it depends on the case. I've had cases as a prosecutor where I wanted to go forward, and the FBI told me not to go forward. I think it depends on the facts and circumstances.
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Ms. NORTON. In your judgment did this leak concerning the memo come from within the FBI, or do you think it came from the larger Justice Department or outside the FBI?
Mr. FREEH. I don't know. We're conducting an inquiry, as we did in all these matters. I hope in this case we can come up with what happened, and if we do, there would be serious consequences.
Ms. NORTON. What precautions have you taken to assure that the confidentiality of your advice to the Attorney General would be respected and that we could depend upon this not happening again? I mean, do you have a home computer?
Mr. FREEH. I'm sorry?
Ms. NORTON. Do you have a home computer? I'm asking, what precautions you will have taken—if I could just finish this question Mr. Chairman. You said that yesterday in your testimony that these—that the leaks have occurred—that multiple leaks have occurred, and they are occurring all the time, and they have occurred in an instance which you obviously regret. I'm asking you, what have you done to assure that this kind of leak will not occur in the future?
Mr. FREEH. I've told people that I will fire them if they leak, or I will have them prosecuted.
Ms. NORTON. You told them that before.
Mr. FREEH. Well, I tell them that frequently. I've told and suggested that when we have certain leaks, we ought to have a grand jury proceeding as opposed to administrative inquiry. I handled this particular memo as carefully as I could. I mailed only six copies. We accounted for each one of them. People who were deeply involved in the case not only didn't know about the memo, but didn't know the timing of its presentation. We rely on people's good faith and honesty and integrity.
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Unfortunately, at I said yesterday, if I ever write my memoirs the most frustrating thing about Washington in this particular job are leaks, which I deplore and which people should be arrested for.
Mr. BURTON. The gentlelady's time has expired. Mr. Pappas.
Mr. PAPPAS. Thank you Mr. Chairman.
Director Freeh, it is good to see you again here today. I wanted to make a brief comment about what was said before about wedges and that some on the other side are suggesting that we are trying to drive a wedge between you and other people. I don't think that's the case. I know that in the letter that you jointly signed with Ms. Reno, and I'm quoting, this was at least from the New York Times, quote, public and judicial confidence in the criminal justice process would be undermined by congressional intrusions into an ongoing criminal investigation, end quote.
If that is, in fact, an accurate quote, what this is all about is public confidence in the Federal Government and in the ability of people in high levels to be making the decisions, and the judgment that is being used to drive those decisions and the reasons for making those decisions.
And we have in this instance two of the top law enforcement officials in the Federal Government have differing opinions, so there is no wedge that is being created here. We're not creating a wedge, we're just trying to understand how two people whom we both respect have come to two different positions. And I think there are a lot of people around the country that are scratching their heads, trying to understand that as well.
Now, I would like to yield to Mr. Cox.
Mr. COX. Thank you. I appreciate your yielding.
Director Freeh, yesterday we talked a bit about the independent counsel statute, about the law, with the Attorney General and with you. Under the independent counsel statute, the decision whether to initiate a preliminary investigation is made on the basis of the AG's assessment of whether there is specific and credible evidence; and if there is, then she is supposed to, within 30 days, initiate a preliminary investigation to see whether further investigation is reasonable. And if that further investigation is reasonable, under the independent counsel statute, it must be done by an independent counsel; is that right?
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Mr. FREEH. Yes, if further inquiry is required after whatever last extension of that period.
Mr. COX. Right.
Now, it is discretionary for the Attorney General—if there is not a presumed conflict of interest, as there is with certain named people in the statute like the President or Vice President—it is discretionary and it depends on her judgment of whether, according to the statute, there is a conflict of interest, potentially a conflict of interest, that is political, personal, or financial; is that right?
Mr. FREEH. Yes. Actually in the new statute they do not name individuals anymore except for a few. There are people before a certain pay grade in the executive branch. But you're correct.
Mr. COX. Now, yesterday I read from a Los Angeles Times article in which it was discussed how $10,000 checks were passed out in southern California; how people were writing checks to the DNC who didn't know what the DNC was; how they were reimbursed, and all this money came from, in one of the specific examples, the Bank of China in Macao.
Under the statute, do you think that that is specific and credible evidence that a crime may have been committed?
Mr. FREEH. It could be.
Mr. COX. Well, I'm asking you whether, because you are now in possession of that information as well, whether you think that's specific and credible evidence? Is it not specific enough, or is it not credible, or is it both?
Mr. FREEH. I think to answer that question I would be giving you some conclusions with respect——
Mr. COX. Which is exactly what I'm asking for.
Mr. FREEH. Well, I don't think, with all due respect, it is appropriate for me to do that. That is a subject potentially under inquiry, and to tell you before the Attorney General makes those determinations——
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Mr. COX. I'm just asking you to give me your reading of the Los Angeles Times article.
Mr. FREEH. I would hesitate to give you the reading of any article, but I certainly don't think it is appropriate for me to analyze an article for you.
Mr. COX. All right. Let me ask you another question.
Let us assume that that Los Angeles Times article, which was worked on by a lot of reporters, which followed up on hearings by this committee, and which included information taken under oath, is at least credible evidence and that it is specific as far as it goes.
The only reason, then, if hypothetically we say it is specific and credible, for us not to appoint an independent counsel is that in our judgment, if we were the Attorney General, there is no potential political conflict of interest with these people like Charlie Trie or John Huang or Antonio Pan; is that correct?
Mr. FREEH. Yes. If you were the Attorney General making the decision under the statute, you could either decide there was a potential conflict or not decide.
Mr. COX. And finally, I had a discussion yesterday with the Attorney General because I heard her to say that she needs to find an actual conflict of interest. The statute says ''potential.'' She read from a memo. I've had a chance now to read that memo myself. The memo is correct. I believe that it was the impression that she learned in her testimony that was incorrect. But the memo and statute are consistent. They both say that the conflict of interest must be potential, not actual. Is that your understanding of the statute?
Mr. FREEH. I don't think, you know, my view of the statute on this particular issue since it——
Mr. COX. It is very important. Because if we have to find an actual conflict of interest, that is a much higher standard. But if the statute says, as it does, that there ''may'' be a potential conflict of interest, well then it's potential conflicts of interest that we are worried about, and that standard is obviously much lower.
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Mr. FREEH. There are other lawyers that will cite the legislative history and talk about the actuality as opposed to the reality of the conflict.
Mr. COX. The legislative history that was cited by the Attorney General yesterday pointed out that Congress intended that there be the potential for an actual conflict of interest, not the potential for an appearance. But is it your understanding that it is the potential for an actual conflict of interest?
Mr. FREEH. I just don't think my understanding is relevant since I don't make those decisions. I think a statute—if you want to ask me as a former judge.
Mr. COX. I do.
Mr. FREEH. You know, different schools of judges and lawyers, I was always taught and believed that statutes ought to be strictly construed.
Mr. COX. I appreciate it.
Mr. BURTON. The gentleman's time has expired.
Mr. Cummings.
Mr. CUMMINGS. Thank you very much, Mr. Chairman.
Welcome, Director Freeh. And I, too, agree that you are doing an outstanding job as a lawyer. And as a lawyer, I really appreciate what you're doing.
In listening to your testimony yesterday and today, one of the things that impressed me was the fact that you have a tremendous or appear to have a tremendous amount of respect for the Attorney General; is that correct?
Mr. FREEH. Yes, sir.
Mr. CUMMINGS. You were here, and some of us were surprised that you were here during her entire testimony, and we saw that as a very good thing, very positive. And I'm not here to drive a wedge between you two. I think, from what I've seen, it is a very close relationship. But let me ask you this so that we can be very clear with regard to your opinion. I think we sort of skirted around this, but we haven't hit it right in the bull's-eye.
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You listened to the testimony of the Attorney General. Do you have any reason to believe that she is out just trying to protect the President and the Vice President or Ms. O'Leary?
Mr. FREEH. Well, as I said yesterday, my understanding and belief again, based on working with Janet Reno for 4 1/2 years on many issues, is that she took all the facts and the law and made the best and most honest decision with all the integrity in the world, and that's how she got to her result and by no other means.
Mr. CUMMINGS. Thank you.
So the answer would be you don't think that she is just out trying to protect them as has been stated in various publications and by many people?
Mr. FREEH. I think she made the decision on the law and the facts in her view.
Mr. CUMMINGS. Thank you.
Let me ask you this: You said something a little bit earlier that concerned me a bit, and I just want you to clarify it, and I think we on this side of the aisle are a bit concerned. You were talking about possibly that you had gotten—had a conversation with Ms. Reno, I think you said this morning, with regard to trying to come up with some kind of compromise with regard to certain information in the memo that you had written; is that right?
Mr. FREEH. Yes.
Mr. CUMMINGS. And I noted that you said that you would get together, or your employees would get together, with Mr. Bennett. There was no mention of the Democratic side. We represent the American people, too.
Mr. FREEH. Sure.
Mr. CUMMINGS. As a matter of fact, we want to make sure that we're included. But I just found it interesting, and a number of us did, that you mention Mr. Bennett, but we who represent almost half of the American people was not mentioned there. I don't know whether that was a misstatement or you—I mean, do you just see it from the Republicans' side or what?
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Mr. FREEH. I certainly don't see anything from either the Republican or Democratic side. Mr. Bennett is the counsel that I've been dealing with as a witness here, and I assume that any discussions between the Departmental lawyers and himself on this issue is inclusive to the committee, but I certainly didn't mean by mentioning him that—well, I didn't mean anything by that.
Mr. CUMMINGS. As someone said a long time ago, we people on this side are not potted plants, and we are kind of concerned about that.
Let me ask you this: Mr. Gilman asked you a very excellent question, and you agreed to supply him with certain information. He asked you about how much resources were being directed from your staff with regard to the DNC investigation. He used DNC, and I'm wondering, are there Republicans under investigation here? I'm just curious.
Mr. FREEH. The investigation is not, as I said yesterday, structured along party lines or person lines or officeholder lines. It is a broad-based inquiry into all aspects of the 1996 campaign and issues surrounding that and on both sides of it.
Mr. CUMMINGS. Well, the things that concerned me, as I said, when he asked his question, he specifically asked about DNC. I wouldn't be asking this question if he had not said it that way. And you said that you would supply him with information, I think it was figures, how much it would cost—how much it is costing with regard to investigating the DNC. Now, that is one party. And I was just wondering, is there a breakdown for anything other than that?
Mr. FREEH. What I will supply him with or I'll supply the entire committee with is the amount of expenditures with respect to what we call the Campcon investigation, which is our acronym for campaign contributions. It doesn't devolve to one party or one person or the other. And I would provide those overall figures. There is no breakdown between, you know, parts of that investigation or subjects or entities. But I'll give you all the figures that we've been spending.
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Mr. CUMMINGS. We would also ask on this side that you include minority counsel, because we don't always get information from our counsel, and we would like to have information, and we think we're entitled to it. We'd appreciate that.
Let me ask you one other thing. You were talking about your memo a little bit earlier, and Ms. Reno, I think, used these words. I don't think they were your words. She said that the memo that was written could possibly provide a road map or did provide a road map with regard to the investigation. Would you agree with that?
Mr. FREEH. I would agree with the proposition that in the memo are discussed different theories of the investigation, different scopes of the investigation, and clearly somebody reading that could be alerted to what the proposed courses would be with respect to this investigation.
Mr. CUMMINGS. And you also said a little bit earlier that you know if you—I think you said that if you had to do this again, that is writing the memo, you might do it a little bit differently.
And I'm just wondering, are most of your memos something of this magnitude that could affect the President of the United States, one of the most powerful countries in the world? Does it concern and possibly put certain defendants or potential defendants in the position where they might be in a position to—Mr. Chairman, I just want 2 minutes that you gave Mr. Cox. That's all I want. I'm almost finished.
Mr. BURTON. We will let you finish your question.
Mr. CUMMINGS. Thank you. I timed it.
I'm just curious as to whether you're doing a road map memo and you're giving it to six people, and then to find that in publications all over the country. How would you do it any differently? Because I'm just curious. Because I know that concerns you. I've listened to what you've said, and I certainly agree with you. But that is a very serious situation considering the fact that we are spending millions upon millions of dollars with regard to these investigations when people can't even send their kids to college, and then the idea that a road map would be out there for all the public to see to basically squash the very things that we're trying to do with all this money, tax dollars we're spending, I'm just curious. How would you do it differently?
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Mr. FREEH. I'm also very concerned about those issues. I don't know that I would do it any differently. But the road map, as you've described it and as I describe it, is not out there, which is why I said yesterday I don't believe anybody has this memo in the press, or you would be reading things that I know that they would report which have not been reported. So I don't feel and I don't believe that that memo is out there and that that road map is out.
How would I do this in the future to eliminate it? I could have, you know, conversations in the hallway with the Attorney General of the United States. I don't think that's a good response to an inability on either the FBI or Department of Justice to control sensitive information. I think if I had to do it again, I would do the same things.
Mr. CUMMINGS. Thank you very much.
Thank you, Mr. Chairman.
Mr. BURTON. The gentleman's time has expired.
Mr. Horn.
Mr. HORN. Thank you, Mr. Chairman.
Director, going back to the Franklin Roosevelt administration, each administration has had a policy on the clearance of testimony, the review of testimony by high-ranking officials before they come up to the Hill. Was your statement cleared by OMB and/or the White House?
Mr. FREEH. As far as I know, it was not. I gave a copy to the Attorney General. She gave me a copy of hers, but there were no editing or suggestions. I don't know if OMB got it or not. Maybe I could find out.
Mr. HORN. Is that the usual procedure?
Mr. FREEH. I'm told they did not get a copy.
Mr. HORN. What is the usual procedure to review?
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Mr. FREEH. The usual procedure would be if I'm talking about counterterrorism or encryption, which I won't talk about today, yes, we send it up to OMB, they review it. Sometimes they have suggestions. Sometimes they have objections. We discuss that. That was not done in this case.
Mr. HORN. You were listening with great care yesterday to the answers and the questions given the Attorney General, and I know you as a high official probably face the same thing many high officials do.
When you're head of an agency, there are possibilities where there will be conflicts of interest in terms of who represents whom. She cited the so-called prison guard problem in the Department of Justice where they might have a case on one side of it, and there is also a case on the other side of it. What she didn't say was that the President does not appoint prison guards, the President appoints the Attorney General.
Did you find real problems in the administration of the conflict of interest situation within Justice when they have to represent the whole Government going into court, and yet they might have a stake in this one way or the other? What's your reading on that as a former judge?
Mr. FREEH. It is really a fact-specific situation. When I was on the bench, every time we got a new case, both myself and my law clerks would look at it carefully to see if there was any potential from conflict. In fact, I went on the bench directly from the U.S. Attorney's Office in New York, so not only the assistant itself, but even some of the matters were matters that I had to preside over as Deputy U.S. Attorney.
I think it is fact-specific. I think it requires great care, conscientiousness, but it is really specific as to the case involved.
Mr. HORN. You look at the ability of the FBI to get to witnesses and take their testimony. Who gives you the authority to issue a subpoena? Is it the U.S. Attorney in the particular region? Is it the Attorney General? Is it the chair of the task force?
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Let's say you're going after people outside of the jurisdiction of the United States. Mr. Cox asked a series of questions on various people that have escaped our jurisdiction, they are overseas. What do you do in a situation like that as well as the ones within the United States?
Mr. FREEH. With respect to within the United States, the investigators would go to the prosecutors on the task force and request a subpoena, or the prosecutors would tell the agents they want to subpoena such and such person or records and provide the process. If it was out of the district, we would go through the U.S. Attorney's Office.
For example, in Los Angeles there are full-time investigators and task force attorneys assigned to this investigation. If it was overseas, we would go through the legates, the FBI representative itself in those countries. We might ask for judicial assistance in a foreign country. We could ask for a foreign witness warrant to have someone detained in response to the subpoena, but it is a process that goes through the U.S. Attorney's Office because they are the people charged with the administration of the grand jury's inquiry.
Mr. HORN. Could a judge issue a subpoena if you weren't satisfied with the U.S. Attorney's decision?
Mr. FREEH. Probably not. A judge could issue a writ or an order, depending on whether it was a native of his or her jurisdiction, but could not issue—could not—this is a good question. A judge who does supervise the grand jury could issue a grand jury subpoena on somebody who knows that.
Mr. HORN. Under the wiretap situation, you go to the judge ordinarily to get that subpoena and that authority?
Mr. FREEH. Yes, sir. That's an order, but the statute provides for that.
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Mr. HORN. Given the jurisdiction of this committee and the issues before it of the 1996 Presidential election, are there any witnesses that the FBI has wanted to depose and issue—have a subpoena issued that any member of the U.S. Attorney's staff, the chair of the task force has turned down and said, no, you can't interview that person? Have you had any particular requests stopped somewhere in the process?
Mr. FREEH. No, not to my knowledge.
Mr. HORN. OK.
Mr. FREEH. Except, as I said before, as to the timing of interviews, that has been the subject of some disagreements at different points.
Mr. HORN. Yesterday I happened to mention to the Attorney General the Hudson Dog Track case, where a lobbyist that fought these poor Indians in Wisconsin and get $6,000 a year, versus the Indians in Minnesota that make $400,000 a year per person, and he raises $420,000 for the Democratic campaign, sits next to the President the night before Secretary Babbitt makes the decision, and most Secretaries, including Babbitt, have approved Indian gaming. He was ordered by the White House to disapprove this particular application. And this has wrecked that tribe's chance for opportunity and health care, schools, you name it, clinics. Is that under investigation?
Mr. FREEH. Yes, sir. FBI agents and task force attorneys in terms of the preliminary investigation are conducting that. I've discussed the matter with the Attorney General. I'm sure I'll discuss it again with her before she makes any final decisions.
Mr. HORN. Thank you.
Mr. BURTON. Mr. Kucinich.
Mr. KUCINICH. Thank you very much, Mr. Chairman. Good morning, Director. I join with other members of this committee in saluting you for your independence and I have joined many members of this committee for about 7 hours in 2 days of discussions and questions and I think we have covered a lot of territory and many questions have been asked several times. I think I know the answer to this question, at least I hope I know the answer because of your reputation. Could you tell us for the record, did you or anyone in coordination with you leak the contents or sense of the memo to the Attorney General?
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Mr. FREEH. No, sir. Nobody associated with me as far as I know and believe, unless I am shown otherwise.
Mr. KUCINICH. That is the answer I was hoping for. I am glad we got it on the record. Thank you.
Now, you mentioned in response to Mr. Cummings' question that you would deal with Mr. Bennett because he represents the committee, and as I am sure you know, he represents the majority of the committee. I would say represents them well. I would ask you to include minority counsel in any further discussions you or your counsel may have with this committee. Is this something that you could do?
Mr. FREEH. We will talk to anybody on the committee, either Members or counsels on either side with respect to the—certainly the matter with respect to the memo.
Mr. KUCINICH. Thank you very much.
Mr. BURTON. Mr. Kucinich yields back the balance of his time.
I would like to take my 5 minutes, if I might, right this minute. Do you know, Mr. Freeh, Donald Smaltz, the independent counsel that has been investigating the Department of Agriculture affair?
Mr. FREEH. Yes, sir.
Mr. BURTON. Can you give us your opinion of his capability, qualifications, what kind of a guy he is? He is going to be before us later today.
Mr. FREEH. I have worked with Mr. Smaltz since about 1994, when the matter under inquiry was referred to him. He, in my view, is an outstanding attorney. He is a former Federal prosecutor, as you know, a law professor. He is one of the finest lawyers I have worked with and, as you know, he has had FBI agents separated from the FBI assigned to his inquiry for many months. All of our dealings have been professional and I have great respect for him.
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Mr. BURTON. He has done an outstanding job in your opinion?
Mr. FREEH. Well, without commenting on the work that he has done, since I am removed from the substance of the work, my view of him as an attorney and a prosecutor is extremely high.
Mr. BURTON. Thank you. There was an article written by Bob Novak. I want to read to you from this article. It says,
A veteran FBI agent resigned and retired from the government in September after refusing a demand by Attorney General Janet Reno to give the Justice Department the names of highly sensitive, secret China contacts. This sent a wave of outrage coursing through the Bureau and will surely prompt new congressional concerns about Reno.
Ray Wickman, former head of the FBI's Intelligence Unit monitoring Chinese operations, was reached at his home in suburban Washington and told me, ''I took my retirement,'' but he refused to say more. However, well-placed and outraged Bureau sources said Wickman's resignation was his only recourse because of the Justice Department's threatened compromise of FBI intelligence. ''It was an insult,'' a veteran FBI agent told me. . . . months of confusion over FBI and Justice Department investigation of alleged Chinese attempts to influence American politics
was the subject that Justice was looking at.
I am going to leave some of this out.
High level officials at the FBI and the Justice Department, when asked what happened, put out the story on a not-for-attribution basis: When Wickman decided to resign, he was asked to turn in his sources on the Chinese account, but declined to do so because he was concerned about their ''low quality.''
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That sounds like bureaucratic nonsense, and close colleagues of Wickman in the Bureau said it certainly is. They report that Wickman quit after, not before, he refused to turn over his sources. Far from being of low quality, the Chinese sources and the intelligence derived from them are regarded by FBI professionals as the best in the Bureau. What's more, they consider these files as the most sensitive kept by the FBI.
The Justice Department, clearly on Reno's orders, was demanding raw files sent shock waves through the Bureau. ''The purpose of the FBI is to safeguard sources,'' a senior FBI agent appalled by the Wickman affair told me.
It says nobody in the FBI will talk on the record and I understand that Senator Specter is likely to have some closed-door hearings with you and others on this.
You were asked earlier about this and you said you had no knowledge of it. Since the time that you were asked about this, I am sure you have looked into it because Mr. Wickman is one of your leading investigators. Can you tell us the circumstances surrounding this?
Mr. FREEH. With respect to—first of all, I know Mr. Wickman from several years of working with him and, in fact, I presented his 25-year key to him not too long ago. He has never told me, and I think he has the kind of relationship with me that he could, he has never told me or complained to me or said anything to me which indicated he was leaving for any other reason except that he wanted to retire.
I extended him beyond the mandatory retirement age of 57 so he could stay. He was certainly welcome from my point of view to stay. I know he has spoken to Senator Specter. I understand he is going to speak to this committee. I have heard, as you have heard, this notion that he left because he was unhappy because he was forced to turn over files. I certainly don't know of any basis in fact for that. The idea——
Mr. BURTON. Have any agents in your Department in any way inferred that that is factual to you?
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Mr. FREEH. No, in fact they have come back to me upon my inquiry and said, no, he has said that he is retired because he wanted to retire and did not retire because he felt forced. The other thing—excuse me. The idea that he was told to turn in his sources is a nonsensical notion.
FBI agents don't have sources that are not official sources with files. You don't, when you leave the FBI, take those sources with you. In fact, you are not supposed to have a source that is not set up and documented according to our guidelines. So that would not be a realistic situation.
Mr. BURTON. So nobody in the FBI has inferred in any way that he was distraught or concerned about possible leaks of intelligence sources that he had that might be in jeopardy if they were turned over to the Justice Department?
Mr. FREEH. No, I have heard other people have reported to me that when he left he was not, he was not altogether happy about certain things. But nobody has told me, and I have asked this question several times, that he left because he was being told to hand in any sources.
Mr. BURTON. I understand that nobody may have told you that. What I am trying to find out is, have any agents or anybody at the Bureau indicated that he was dissatisfied with the Justice Department regarding its inquiry into his sources?
Mr. FREEH. No, sir.
Mr. BURTON. You have no knowledge of that?
Mr. FREEH. I have heard, as you have heard, and apparently as a reporter has heard, that he made complaints to people that he was unhappy with his assignment, but when I asked people to get the facts and report back to me, they told me that that was not the case, that he retired because he was beyond his mandatory age and wanted to retire.
Mr. BURTON. Well, all I can tell you is that I know Mr. Novak and I see my time has expired. He has talked, according to him and his article, with FBI agents who have verified the things that I just mentioned to you. If that is true, I wish you would look into it because you are the head of the FBI and this committee and I would like to know if there is any credence to what has been said.
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Mr. FREEH. I will look into it.
Mr. BURTON. Would you report back to me? If it is sensitive information that should not be made public, you may rest assured that it will not be made public, but I would like to know about that. We are cleared for top secret. If there is any indication whatsoever that there was some concern about sources regarding the Chinese giving contributions to people in this country, and we know from reports in the Washington Post that the Chinese Government has been giving contributions to political people in this country, and if there was some kind of a threat to any of those sources, it is imperative that the Congress know about that and we can keep that secret, but we need to look into it.
Mr. FREEH. I will report back to you, Mr. Chairman.
Mr. BURTON. Thank you.
Mr. Turner.
Mr. TURNER. Mr. Chairman, I would like to yield to Mr. Lantos for a minute.
Mr. LANTOS. Thank you very much. I just want to conclude on this exchange between Mr. Burton and yourself. During your entire testimony, you were never as animated as you were in response to this. And basically, Director Freeh, you are denying the validity of this Bob Novak story; is that correct, sir?
Mr. FREEH. As far as I am concerned, I don't have any basis in fact. I think what we need to do is talk to the people with firsthand knowledge and direct knowledge and I will report back to you.
Mr. LANTOS. Could I ask you what is the mandatory retirement age?
Mr. FREEH. Fifty-seven.
Mr. LANTOS. When did this gentleman retire?
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Mr. FREEH. I know it was extended for a year.
Mr. LANTOS. So he was over 57.
Mr. FREEH. Yes, he was over 57.
Mr. LANTOS. So what we are dealing with is an off-the-wall Bob Novak story. I thank the gentleman for yielding.
Mr. BURTON. Would you care to comment on that, off the wall?
Mr. FREEH. You raised a serious issue. It is a serious issue that when it was raised in the article, I asked that people make inquiry. And I have gotten back, as far as I have seen, I haven't seen a written report, but as far as I have been told, he did not leave because he was being forced to turn over files. The notion that he had sources that he took with him, that is just not, that is not the way we do business. I will conduct further inquiry.
I have been reluctant to call Mr. Wickman myself. I have not done that. Let me see if I can get some more facts for you, and I will report back to you. It is a serious enough allegation that I will look into it more fully.
Mr. LANTOS. I thank the gentleman for yielding.
Mr. TURNER. Director Freeh, I know you have a unique perspective on the campaign finance system. As you know, there are many of us who are working very hard to reform that system. We believe that the campaign contribution limits ought to be meaningful, that there should not be a system that is a dual system where we tell folks they give $1,000 to a candidate, but if they want to give $100,000 in so-called soft money to a party or nonprofit group that is OK.
You have seen it all. You have investigated, I am sure, hundreds of cases. Is there, in your opinion, is there any doubt in your mind that soft money is being used to influence the election and re-election of candidates for Federal office?
Mr. FREEH. As I said yesterday, it is an area that I do not think is appropriate for me to give an opinion on because I am the investigator who is trying to determine whether people either intentionally or unwittingly crossed lines or boundaries or violated statutes. I don't think my experience in the criminal investigation is really relevant to the statutory scheme. I don't think it is appropriate for the Director to be giving an opinion on that.
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Mr. TURNER. Well, without stating opinion as to whether you think it is good or bad, I mean in terms of your investigation, have you seen what we call soft money influencing the outcome of elections in this country?
Mr. FREEH. I just would rather not comment on that.
Mr. TURNER. A little bit earlier you were asked some questions about the FBI's being, some of the agents saying they were maybe hindered and the timing of their investigation because of the Independent Counsel Act had not been triggered and therefore they could not move forward as quickly as maybe they wanted to. Do you recall that testimony earlier?
Mr. FREEH. Yes.
Mr. TURNER. Without discussing the specifics of any evidence, was there any indication that any evidence was covered up, altered or compromised by any delay?
Mr. FREEH. It is almost an impossible question to answer. I mean I don't know. Please do not infer from that, that there was. I do not think you could calculate an answer that would be accurate.
Mr. TURNER. Well, there is no, you have no personal knowledge that there was any evidence covered up, altered or compromised by virtue of the delay. You have no personal knowledge of it?
Mr. FREEH. From a criminal point of view?
Mr. TURNER. Yes.
Mr. FREEH. No. No personal knowledge.
Mr. BURTON. Would the gentleman yield? Could you expand upon that? I will give the gentleman more time. You said not from a criminal point of view. Was there a cover-up in any other area?
Mr. FREEH. Well, my inquiry is a criminal inquiry.
Mr. BURTON. Well, I will give the gentleman more time. I think you are begging the issue, Mr. Freeh. Was there a cover-up in any other area?
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Mr. FREEH. That is not the question that was asked.
Mr. BURTON. Well, I am asking the question.
Mr. FREEH. Cover up in terms of a criminal act or——
Mr. BURTON. In any area that you think was relevant.
Mr. FREEH. No.
Mr. TURNER. Mr. Freeh, you had stated in your testimony the other day that on the issues of fact, the Attorney General and I do not disagree. Was that your testimony yesterday?
Mr. FREEH. Yes.
Mr. TURNER. I am reading from a press report. That is the reason I am inquiring again. The Attorney General, in her finding regarding the Vice President's phone calls from the White House, from Federal property, concluded that there are, was no basis for concluding that his phone calls were solicitations for hard money. That was a factual determination. Is it fair to say that you do not disagree with the Attorney General regarding her fact findings?
Mr. FREEH. Well, your question—I am sorry. With respect to the facts that were developed in regard to that aspect of the investigation, there is no dispute about what the facts are.
Mr. TURNER. All right. That is what I was trying to clarify. That you had no disagreement regarding the factual findings but, rather, your disagreement was regarding the interpretation of the independent counsel law.
Mr. FREEH. The disagreement was in the ultimate recommendation. Yes.
Mr. TURNER. Does the independent counsel statute require the Attorney General to consult with the FBI?
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Mr. FREEH. No.
Mr. TURNER. But in this instance because of high regard for you she sought out your opinion?
Mr. FREEH. She sought it out.
Mr. TURNER. And how much time elapsed between the time you gave her your opinion and the time that she actually issued her opinion?
Mr. FREEH. As I indicated before, these discussion have been ongoing for many, many months. With respect to the memo in question, I provided that to her about a week before her final decision.
Mr. TURNER. And you felt like that was sufficient time for her to give your opinion adequate consideration.
Mr. FREEH. Yes, because we had been discussing these issues for a long period of time.
Mr. TURNER. So, again, your disagreement was like two lawyers may disagree on the interpretation of the law.
Mr. FREEH. That is a good characteristic of it.
Mr. TURNER. Rather than any disagreement about the facts that the two of you looked at?
Mr. FREEH. We did not dispute the facts.
Mr. TURNER. And, in fact, as the FBI Director, it is your role to find and investigate and provide the facts; is that correct.
Mr. FREEH. Yes, sir.
Mr. TURNER. And it is her role to interpret them and determine what the law is that should be applied to the facts that you provide.
Mr. TURNER. Yes.
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Mr. FREEH. Yes.
Mr. TURNER. Is that a fair characterization of what the appropriate role of the FBI Director is and the Attorney General.
Mr. TURNER. Yes.
Mr. FREEH. Yes.
Mr. TURNER. And I believe you stated earlier that you respected her judgment even though as lawyers you may have had a little different take regarding what the law said?
Mr. FREEH. That is correct.
Mr. TURNER. Has anybody ever been prosecuted under this 1883 Pendelton Act for making a campaign solicitation from Federal property?
Mr. FREEH. There has been some prosecution because there is some case law on it, but I don't know exactly the cases or the statutes. There are four precedents, I am told, under the statute, but not with this factual scenario.
Mr. TURNER. Were those telephone calls solicitations of campaign contributions or do they relate back to the historical basis for putting that into the law in 1883, which said you shouldn't have officials going around buttonholing their employees on the job to get money out of them for their campaign and their re-elections.
Mr. FREEH. I don't know off hand. I know the Supreme Court case is quite old, the one that talks about the statute.
Mr. BURTON. The gentleman's time has expired. I granted him some additional time because of my interruption.
Mr. Mica.
Mr. MICA. Director Freeh, you are also charged with upholding the law; is that correct?
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Mr. FREEH. Yes, sir.
Mr. MICA. And it is my understanding this committee issued you a subpoena; is that correct?
Mr. FREEH. Yes, sir.
Mr. MICA. It is also my understanding that the deadline for complying with that subpoena for the request of documents was yesterday at noon; is that correct?
Mr. FREEH. That is correct.
Mr. MICA. So at this time, you are technically in contempt of our request. Similar action was taken by the Attorney General. I told her yesterday and I will tell you today that if there is not compliance, I will seek contempt of Congress both against the Attorney General and against you for not complying. I am hoping that we don't have to do that.
I am glad to hear the message that was delivered first thing by you this morning from the Attorney General that we do not have to proceed in that fashion because we are willing to work with you. We have, we are not interested in everything you have on the investigation. But you have to understand, Director, where we are coming from.
I consider myself a strong advocate of the FBI and law enforcement, but I have sat here now through Travelgate, where we saw the attempted misuse of the FBI. I sat here through Filegate, where we saw the abuse by the White House of the FBI. I saw the Thompson hearings and a cache of information suddenly appears, and some of it from what I have read in press accounts in conflict to closed door briefings that were given to us. We should discuss that later, Mr. Chairman, because it raised some serious questions about national security and interference with our political system from foreign entities.
But understand where I am coming from. We are not a legislative committee, we are not an appropriations committee of Congress. We were set up in 1808 by the Founding Fathers to conduct investigations and oversight. And we are learning things from news accounts. I mean, our best sources are the Los Angeles Times, the Washington Post, the New York Times.
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I am stunned to read that the Attorney General said that we could provide or you would be providing a road map. She would be providing us with a road map to the investigation and the Wall Street Journal says the FBI Director's still secret memo advocating an outside prosecutor claims that Democrats' diversion of party building funds into campaign accounts may have constituted a conspiracy reaching into the White House. Among other possible crimes he cited misuse of Government resources and obstructing justice.
Now, again, this is just a press account. But you have to understand where we are coming from; that this raises great questions about what is going on.
Mr. FREEH. I understand that.
Mr. MICA. And leaks. So that is one reason why if there are press accounts, we should see at least part of what is going on. The other thing, too, is we do not want to duplicate investigations. You have criminal responsibilities. We have congressional responsibility. So it is important that we know something of what is going on and making certain that this scandal is properly investigated.
Have any of your agents conducted any investigations in Indonesia, China, or Thailand?
Mr. FREEH. Yes, we have had leads as well as direct investigation done in many of those areas.
Mr. MICA. In all three countries?
Mr. FREEH. I am not sure exactly in all three countries, but certainly in that region and one or more of the countries. We have been actively pursuing that through our legats overseas.
Mr. MICA. I am pleased to hear that. Incidentally, you said you have issued more than 1,000 subpoenas so you have surpassed us by over 300. You are not paying attention to whether these are Republican accusations or Democrat accusations, are you?
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Mr. FREEH. No.
Mr. MICA. One part of your job is to uphold the law. I reported to the Attorney General or started to report an investigation we have conducted on possible violations of the Federal Code. If we could provide the FBI Director with one, two, three, four, five, possibly six Federal violations and one State violation.
As I indicated yesterday, Kansas instituted a law, a lot about this is about complying with laws already on the books. But Kansas instituted a law to limit the amount of Federal money coming into their States, soft money. I have a list of conduit payments in Kansas, which is absolutely outrageous, 17 States contributed money in conduit fashion to Kansas elections in conflict with their law, and I think in violation of at least five Federal statutes. Can I have your assurance that this matter will be investigated?
Mr. FREEH. Yes, sir.
[The information referred to follows:]
INSERT OFFSET FOLIOS 12 TO 14 HERE
[The official committee record contains additional material here.]
Mr. MICA. Let me ask you one other question. I am concerned that—I outlined yesterday for the Attorney General what I see as a conspiracy in this whole campaign financing scheme from the Federal level and possibly from the White House. There are provisions of the RICO statute for investigation and some of this activity may now border on racketeering or conspiracy. Do you think that the RICO statute may be invoked in your investigation?
Mr. FREEH. I do not think I could comment on that at this time.
Mr. BURTON. The gentleman's time has expired. Was the question answered? We will allow Director Freeh to answer the question.
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Mr. FREEH. I don't know. I can't comment on that at this time, what statutes might ultimately be implicated here, if any.
Mr. BARRETT. Parliamentary inquiry, Mr. Chairman.
Mr. BURTON. The gentleman will state his inquiry.
Mr. BARRETT. Mr. Mica indicated that he was intending to seek a contempt of Congress against Mr. Freeh for Mr. Freeh's failing, according to Mr. Mica, to comply with the subpoena. Mr. Freeh has indicated obviously that he feels this would hamper the current investigation. Under the rules, how many business days' notice is required? I feel very strongly that we should not hamper this investigation and for that reason I would vote against that motion of contempt.
Mr. BURTON. First of all, let me say that is a moot point because that is something that the Chair is not considering at this time.
Mr. BARRETT. This is a parliamentary inquiry for my knowledge. How many prior days——
Mr. BURTON. The gentleman will wait just a moment. I will check. It would be three business days.
Mr. BARRETT. I will be here if he does that.
Mr. BURTON. Obviously, we would probably all be here, but that is something that is under consideration, but we are not making any moves in that direction. We are hoping, as Director Freeh has stated earlier, that we can work this out between his counsel and the Attorney General's counsel and Mr. Bennett so that we get the information, albeit in a redacted manner.
Mr. KUCINICH. Would the gentleman yield?
Mr. BURTON. He made a parliamentary inquiry. If you have a parliamentary inquiry, you may state it.
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Mr. KUCINICH. It is in connection with your statement. You said that it is under consideration.
Mr. BURTON. We have not closed any options regarding the subpoenas that were sent to the Attorney General and to the FBI Director.
Mr. KUCINICH. But as the chairman, can you inform the Members why it is under consideration?
Mr. BURTON. The Chair is not going to get into the negotiations that are taking place at the present time or will be taking place. Members of the committee will be informed if we are contemplating taking any action.
Mr. Allen.
Mr. ALLEN. Thank you, Mr. Chairman.
Mr. Freeh, you said a moment ago that you investigate equally—it makes no difference to you whether allegations are about Democratic abuses or Republican abuses. You consider it your responsibility to investigate both; is that right?
Mr. FREEH. Yes, sir.
Mr. ALLEN. That is very important because that is not what we are doing in this committee. On this committee all of the depositions and all of the interrogatories have been directed to Democratic targets. There have been 373 subpoenas issued, 364 of them have been directed to Democratic targets and not to Republican targets. There have been 178 requests for documents and 177 of those requests were related to Democratic fund-raising abuses and only 1 to Republican fund-raising abuses.
The fact is, it is unfortunate, but this committee's investigation has been far more about politics than about reform.
I am new to Washington. This is my first year. One thing strikes me from what I have seen and heard here in this past year. That is how quickly people are willing to attribute motives to you or to anyone else in this city and how quickly they will change allegiances.
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You have come under attack from leading Republicans for the Jewel case, the problems with forensic labs, for Ruby Ridge and then last week when your memo was being discussed, the same people were singing your praises. I noticed in the paper just the other day when your memo was released, people were attributing motives to you that had to do with your ability to engage in bureaucratic infighting and there was a suggestion yesterday that now you are trying to appease Janet Reno and this administration.
What strikes me is that they are all wrong and that basically you are here trying to do your job, trying to take the information that you get and make the best possible decisions. And the suggestion, the speed with which people attribute motives in this city is astonishing.
I am concerned about two things here. First, I want all of us to get to the bottom of any fund-raising abuses in 1996 and 1994, any cases where the law was violated. And second, I want to see real campaign finance reform in this term of Congress. You can't help with the second, but you are critically important to the first.
So the only thing I would ask is that whenever you feel that you are being subjected to political pressure from Democrats or from Republicans that you will speak up, that you will let me know, that you will let people on this committee know, that you will let the public know so that we can stop it before it continues. I would just, my only question, sir, is will you do that?
Mr. FREEH. Yes, sir.
Mr. ALLEN. Thank you very much. I yield back the balance of my time.
Mr. BURTON. The gentleman yields back the balance of his time.
Mr. McIntosh.
Mr. MCINTOSH. First let me commend the chairman on the excellent way in which you have conducted these hearings and for being fair and impartial to all sides. I want to thank you for doing that.
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Second, I really have one question for you, Director Freeh, and then I want to yield the rest of my time to Mr. Barr. I guess a question and a statement.
The question for you is—and I don't think you meant this, but I want to be sure. You don't believe that because a law is an old law on the books for over 100 years that that is a reason that people shouldn't obey it and fully enforce it in the law enforcement agencies?
Mr. FREEH. No, I—no, I did not speak about that law at all. But, no, not at all. The Constitution is even older.
Mr. MCINTOSH. Exactly. I think we share that value. I find it shameful that the President and Vice President and some of their supporters are implying that because it is an old law, it has been on the books a long time, it shouldn't apply to them today, and to its full extent.
That leads me to my general point. I want to say thank you for being willing to stand up against political pressure, and I know what it is like to serve in an administration where you need to be loyal and do what you think is right.
I am offended by the Attorney General's decision not to appoint an independent counsel. And the worst thing about it is that it sends a message to the young people in America that the President and the Vice President might be getting away with something and nobody is going to appoint an independent investigator to find out if that is true. I think that is wrong. It is a terrible message for this Attorney General to send.
I appreciate the candor with which you advised her to make that appointment. I appreciate your reluctance to bring that out to the public because you have to be able to give advice to your superiors, but I want to say thank you for standing up for that principle.
With that, Mr. Chairman, I would like to yield the balance of my time to Mr. Barr.
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Mr. BARR. I thank the gentleman.
Mr. Freeh, unfortunately, as in many things, just saying things in law enforcement does not make it so. The Attorney General just saying that she is going to follow evidence wherever it leads doesn't make it so. It may or may not turn out to be the case, but just saying something over and over and over again doesn't mean it. Saying that there is no political interference doesn't make it so. Saying that you are going to be independent does not make it so. Actions do, in fact, speak louder than words.
I am somewhat concerned because I think there has been political interference with the FBI during this administration. I do not think that in several instances there has been independence exercised. I think independence, for example, is when there is a crime, evidence of a crime, even the possibility of it at the highest levels of Government, which information may be destroyed. Independence means the FBI secures a crime scene, as was done in the Irangate matter, not that people are allowed to take information out. There is apparently no effort made to secure a crime scene, to me, that is not independence.
To me, independence would be when somebody from the White House seeks to obtain access to have sensitive files on American citizens. Independence means asking some very tough questions about why those files are sought, under what circumstances they will be maintained, that there be followup to make sure that those strictures are complied with. And independence does not mean that dozens and then hundreds of files, sensitive files on law-abiding American citizens by all accounts, are turned over to political operatives.
Independence I do not think means that when a former distinguished agent such as Gary Aldrich or let us say John Doe submits a manuscript to the FBI and people at the FBI send it over to the White House for political reasons so that they can run their spin on it and prepare to take care of any embarrassing information that may be in it. That is not independence. That indicates a far too close political relationship between the bureau and administration. That is what I see. Despite your protestations that you are independent and there is no interference, the record bespeaks that there are problems.
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With regard to the current situation that we have, also I was rather astounded to hear yesterday your interpretation of 28—well, the authority under which the Director of the FBI is appointed states very clearly in law passed in 1976 that the tenure of the Director of the FBI is 10 years. And if one goes back and looks at why that was done, it was done precisely so the President could not just fire a Director of the FBI for political reasons, that there has to be a reason.
Independence, to me, would be if the Director of the FBI is asked, can the President just fire you because he wants to? Independence would mean not saying, no, but, hell no, the President cannot do that; I will not tolerate that happening. If there is good cause for a President to terminate a Director of the FBI, then certainly. But I just do not understand why you seem to be going out of your way to show lack of independence in some of these things.
With regard to the memo that we are talking about, I understand as a former prosecutor that there are reasons why every communication between a Director of the FBI and an Attorney General are not to be made public. But to rely and to play into, to some extent, the attempts to trivialize this issue on the other side that this is just a disagreement among two lawyers is not accurate. You are not just another lawyer. You are not paid just to be another lawyer. You are the Director of the FBI. I will followup on that, because I do have a couple of specific questions during my time.
I thank the gentleman from Indiana for yielding.
Mr. FREEH. May I respond, Mr. Chairman?
Mr. BURTON. Yes, sir. You may respond.
Mr. FREEH. I will be happy to answer your questions. With respect to your concerns about the FBI's independence, no one has a greater concern about that than I do. I think it is important to distinguish, however, between events that happened and the perception or interpretation of independence and the actual factual issues surrounding motive and intent.
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I think there are two slices to independence. There is what may be perceived to be actions which are not independent, turning over FBI files, for instance, but turning them over in a process that was 28 years old and started under the Johnson administration and which was fixed immediately by this Director as soon as it came to his attention.
So I think we have to be very careful about distinguishing between the perception of independence or nonindependence and what actually is at stake and the facts regarding motive and independence.
I am not going out of my way to trivialize or play down or emphasize my independence one way or the other. I call the shots as I see them. My job is not to please anyone in this town at the expense of doing what I think is required by my duty. If things that I do or things that the FBI does from time to time interfere with that perception, that is my fault, I have to try to correct that. But I am appropriately and politically independent, and I stake all of my integrity on that.
Mr. BURTON. Mr. Sununu.
Mr. SUNUNU. Thank you, Mr. Chairman.
Good morning, Director Freeh. Thank you very much for being here and addressing the questions people have offered in such a direct way.
Yesterday, the Attorney General indicated in her testimony that she has not initiated a 30-day preliminary investigation as to whether or not an independent counsel is appropriate in the matter of Webster Hubbell and payments involved, other allegations of illegality that I know you are investigating. Is that your understanding, that no 30-day inquiry has been initiated?
Mr. FREEH. That is correct.
Mr. SUNUNU. You worked with Hubbell in 1993 and 1994 at Justice; is that correct?
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Mr. FREEH. He was at Justice while I was FBI Director.
Mr. SUNUNU. What was your working relationship?
Mr. FREEH. Well, as the Associate Attorney General, he had very little to do with the FBI in terms of my issues and what I dealt with from time to time on different issues. We would be involved with him, but we worked primarily with of course the Attorney General, the deputy, and the head of the Criminal Division.
Mr. SUNUNU. But given that level of interaction, do you think you personally would have a conflict of interest in investigating matters related to Webster Hubbell?
Mr. FREEH. No, sir.
Mr. SUNUNU. Do you think the Attorney General, in her working relationship—previous working relationship, would have a conflict of interest with the investigation of Webster Hubbell?
Mr. FREEH. I think only she can make that determination.
Mr. SUNUNU. Are you aware of Webster Hubbell's relationship with James Riady, John Huang, and others related in the campaign finance allegations—correct?
Mr. FREEH. I am aware of reports and facts involving those matters, yes.
Mr. SUNUNU. Have you had discussions with people in the Department of Justice about potential conflicts of interest——
Mr. FREEH. No.
Mr. SUNUNU [continuing]. With respect to Hubbell? With respect to Hubbell and people in the Department of Justice investigating the former No. 2 employee at the Department of Justice?
Mr. FREEH. No, I have not.
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Mr. SUNUNU. I would only make the comment that it would seem to me, given his past history working with people very closely in the Department, that this would represent at least within the Department of Justice and the Attorney General's office a pretty clear case where the perception and the reality of a conflict in the investigation might exist. It would seem very appropriate, at a minimum, to initiate a 30-day inquiry as to whether or not a special prosecutor, an independent counsel, would be appropriate.
I want to ask just a couple of questions about the use of immunity. You are a former judge. You are obviously very familiar with the use of immunity, more so than I am, I am sure. It is common, is it not, to use immunity with lower-level witnesses in an attempt to gather valuable information in prosecuting higher-level members of an organization?
Mr. FREEH. That is a common procedure, yes.
Mr. SUNUNU. Are you aware that the Department of Justice initially opposed immunity for a group of nuns that wanted to provide testimony regarding conduit payment, straw donor payments; is that correct?
Mr. FREEH. I am aware of that.
Mr. SUNUNU. Did any agents that you are aware of express concern about Justice's reluctance to allow immunity to be used in that case?
Mr. FREEH. No, not that I am aware of.
Mr. SUNUNU. Do you think that their reluctance, the Department of Justice's reluctance, to use immunity in that case—did that strike you as uncommon or unusual given their, the nuns', background, their willingness to work with the committees in their investigation?
Mr. FREEH. I don't think I can make a determination on that. The issues of competing witnesses or subjects and how that relates to decisions to immunize or not immunize are, first of all, not decisions that we make in the FBI, and I was not privy to the conversations or the process in the Department on that issue.
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Mr. SUNUNU. But it didn't strike you as unusual that there was such reluctance with these particular witnesses?
Mr. FREEH. I don't really have a reaction one way or the other without knowing the facts and being privy to the issues involved.
Mr. SUNUNU. Mr. Chairman, I yield the balance of my time to Mr. Mica.
Mr. MICA. Real quick, Mr. Freeh, you stated to us that while, candidly, there are startup problems and growing pains in this task force you have put together, it is my understanding that a new U.S. Attorney was recently brought in, who is that?
Mr. FREEH. Charles LaBella, who was the first assistant out in San Diego.
Mr. MICA. How long have you known him?
Mr. FREEH. I have known him many years. We were prosecutors together in the U.S. Attorney's Office in New York for several years.
Mr. MICA. Is there any reason Mr. LaBella couldn't run an investigation as an independent or special counsel rather than at the Justice Department?
Mr. FREEH. Whether he could be an independent counsel?
Mr. MICA. Right.
Mr. FREEH. I think the statute actually prohibits Department of Justice employees from being appointed.
Mr. MICA. If he was appointed, if we had an independent counsel, wouldn't he make a good one?
Mr. FREEH. I think he would be outstanding.
Mr. MICA. Thank you.
One of the problems I have is, I have learned that there is already some conflict with Mr. LaBella. He has already clashed with Lee Radek, the head of Public Integrity. I understand Mr. Radek is a very turf-conscious individual and wanting to maintain control of the—of this investigation. What is going on?
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Mr. FREEH. I do not think it is appropriate for me to comment on relationships between any of the prosecutors involved. What I can comment on and what I will be happy to talk about is what the FBI is doing and whether our——
Mr. MICA. Could you then describe maybe the chain of command for us?
Mr. FREEH. As I understand it, Mr. LaBella reports to Mr. Radek. Mr. Radek is the head of the Public Integrity Section. And then from there, it goes up to Mark Richard, who is Acting Assistant Attorney General in this matter, and then up to the Attorney General.
Mr. MICA. Finally, your relationship with Mr. LaBella, you said it goes back a long way.
Mr. FREEH. Yes, we know each other very well.
Mr. MICA. In what capacity?
Mr. FREEH. We were both prosecutors, Assistant U.S. Attorneys, in the southern District of New York, going back from 1980 to 1991. We had different cases, but we knew each other very well.
Mr. MICA. Thank you for your cooperation.
Mr. BURTON. Mr. Lantos.
Mr. LANTOS. Thank you, Mr. Chairman.
Since Mr. Mica referred to the Director a matter pertaining to Kansas, I would like to refer to you a matter pertaining to Montana.
Triad Management Services, a secretive organization funded by ultrawealthy ultraconservatives, funneled millions of dollars into issue ads, into congressional raises, through two nonprofit organizations. We are requesting you, Mr. Director, to look into this case as you are looking into the Kansas case mentioned by my colleague.
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Mr. FREEH. Let me look at the facts, and I will review it.
Mr. LANTOS. We appreciate that.
I want to deal with the contempt issue that has now been raised on several occasions. I would like Mr. Burton to pay attention. One of the problems we have had with this committee procedure throughout this entire investigation is that the committee has not operated on a bipartisan basis. The subpoenas issued to the Attorney General and the Director of the FBI we were never consulted on, we never participated in, and unanimously our side rejects the appropriateness of the subpoenas.
Now, since the subpoenas, according to Mr. Mica, have now run their course and both the Attorney General and the Director are technically in contempt of Congress and you, Mr. Chairman, indicated you are not excluding anything, let me state for the record—and I speak for our side unanimously—that we think the notion of a contempt citation that might be issued against the Attorney General or the Director of the FBI because they are determined to uphold their oath of office is preposterous beyond words. I am convinced that should such an outrageous course of action be attempted, there will be a unanimous vote on the part of the Democrats opposing it.
I want to thank you, Mr. Director, for your excellent testimony. As always, you have conducted yourself with dignity and professionalism, and we are all hoping that you will continue in your capacity as Director of the FBI as long as you choose.
I yield back the balance—I yield to my friend, Congressman Kucinich.
Mr. KUCINICH. Thank you very much, Congressman Lantos.
Picking up on what Congressman Lantos just said, moments ago we heard the chairman of the committee relate that he was, in fact, considering contempt of Congress charges alluded to negotiations. When I asked the question, the Chair could not respond as to why.
I would hope—and I have hoped this from the beginning of these proceedings—that members of this committee, particularly the Chair, would be very slow in making statements that could be considered to be quite provocative, statements that have serious consequences.
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I have a background in the media. I have a master's in communications. I have worked on the other side here. People are writing and behind the cameras; I have done that work. I know that when the chairman of a committee says the words, ''We are considering contempt of Congress charges,'' that has impact. You write it down. You report it to the American people. But, unfortunately, what doesn't happen is, there is not a process here which substantiates chapter and verse as to why that statement should even be made.
So when we go through this whole exercise of hearings, we in the Congress, the administration, people in the media and the general public, I think that we must be very careful in using the accusations, the nuances of accusation, the rhetoric of condemnation. We are an investigative body. As an investigative body, we have to be prudent in our use of terms, just as the Director is prudent and just as the Attorney General has been very prudent in not releasing information which would smear someone.
The process of government is a very powerful process. As the wheels move, it can affect people's lives. It can affect their reputations. It can have an impact on their service. So as one member of this committee, I just feel it is my obligation, with the experience that I have, in saying that we should be very careful about the terms that we use, about the actions that we say we would take, so as not to inflame the situation or to smear someone who is serving this country.
Thank you.
Mr. BURTON. Three quick points before I yield to our last speaker.
First of all, the minority and majority counsel are working on and awaiting more information from the Senate committee which is ceding us information on Triad. There will be, as I said before, an investigation into the Triad matter, No. 1. No. 2, the minority did get 24 hours notice on the subpoenas in question in accordance with our protocol. And third, we are trying to work things out with the Department of Justice counsel and the FBI Director's counsel regarding a memorandum.
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Mr. Barr.
Mr. BARR. Thank you, Mr. Chairman.
With regard to the memo, Mr. Freeh, it is not your position that it is not being provided because of an assertion of executive privilege; is that correct?
Mr. FREEH. As far as I know, that has not been asserted yet, correct.
Mr. BARR. As a matter of fact, the Attorney General explicitly said yesterday that the refusal to comply with it was not based on a claim of executive privilege; is that correct?
Mr. FREEH. I believe she did.
Mr. BARR. Right.
Let me ask a couple of questions here. And to followup on where I began before, you are not paid by the citizens of this country to be just another lawyer; you are paid to head up a very large, very sophisticated, and very fine investigative agency, I would say the best in the world. And, therefore, when questions are asked of you, they are not asked of you at least in this context here as Mr. Louis Freeh, member of the bar. We are not interested in what two lawyers in private practice or in some prosecutorial office may disagree on from time to time. These matters are a slight deal more important than that, and the background and responsibility that you bring to answering those questions is more than just another lawyer.
So I really do not appreciate efforts by certain people on the other side to trivialize this into just, this is just another disagreement. It is not just another disagreement. We are asking questions, and the American people are asking questions, legitimately so, that go to the heart of whether or not we are going to have accountability on the part of our top leaders, whether or not there is credible, specific evidence that people in the highest levels of our Government may have violated laws. Those are very serious questions.
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I would hope that when you provide advice to the Attorney General, to the President, or your people, you are providing advice not just as another member of the bar. It is also based on vast experience that you have, very distinguished experience as a Federal judge, as a Federal prosecutor, and that background, close to 2 dozen years, as you indicated yesterday, is really a great deal of background more than many other people currently in Government have.
And I do have a fairly substantive question about that, but what to do with that, but let me ask just a couple of quick questions. Did the FBI do any investigation with regard to Larry Lawrence and his background?
Mr. FREEH. Larry who?
Mr. BARR. Larry Lawrence, the fellow about the controversy at Arlington Cemetery.
Mr. FREEH. We do not do the background investigations for Ambassadors; we only do name checks and national security checks.
Mr. BARR. Would a name check have disclosed that this gentleman apparently falsified records regarding his educational and supposed military fact background?
Mr. FREEH. It depends what records we had related to the name. I don't know what they were at this point. But we would not be the people going out doing the background and checking the military records. We would simply check that name against our——
Mr. BARR. Who does that? The State Department, in that case?
Mr. FREEH. Yes, the State Department, I am told.
Mr. BARR. If you had, I presume that the FBI would not be satisfied with just what they might find. If questions are raised, they would check further, wouldn't they?
Mr. FREEH. The background investigations we do for Senate confirmees are exhaustive. It is the same background that I received, and they go beyond interviews and——
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Mr. BARR. So if the FBI conducted a background check on Mr. Lawrence, would we be correct in presuming that these discrepancies, shall we say, would have been uncovered?
Mr. FREEH. We would do the fullest and most complete background——
Mr. BARR. Really, you are shortchanging the FBI. I think that they would have been.
Mr. FREEH. I would like to think——
Mr. BARR. Can't you say with some degree of certainty that, yes, the FBI is good enough that we would have uncovered that?
Mr. FREEH. I like to think that we would.
Mr. BARR. If you would have, would those facts have been made known to those that were putting this man forward for this high position?
Mr. FREEH. Yes, that would be reported to the White House.
Mr. BARR. Is the FBI—have they been asked to do any background checks on welfare people who, under the Welfare to Workfare program under this administration, are being given jobs at the White House?
Mr. FREEH. I don't know.
Mr. BARR. Taking people directly off of the welfare rolls and placing them in the White House itself physically as employees.
Mr. FREEH. OK. I don't know, Mr. Barr, but I will find out and get back you to, sir.
Mr. BARR. I would appreciate that, because it is our information, and that raises very serious security concerns, at least in the mind of this Member of Congress.
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With regard now, Mr. Freeh, to your background which goes far beyond——
Mr. LANTOS. Would the gentleman yield for a moment?
Mr. BARR. No.
Mr. LANTOS. Thank you very much.
Mr. BARR [continuing]. Which goes far beyond your background and your current position, you bring to your role as Director of the FBI the vast experience that we have indicated. Obviously, and aside from the so-called memo, just putting the memorandum aside, that is—that is the issue that brings us here—looking at all of the evidence in your background in Federal law enforcement and Federal judicial matters and prosecutorial matters, there are facts there that, as you understand them, indicate that covered persons may have violated Federal laws?
Mr. FREEH. Under the facts and the law as I understand them to be, the matter, in my opinion, should be referred to an independent counsel.
Mr. BARR. Based on the language of the independent counsel?
Mr. FREEH. Certainly, based on the statute.
Mr. BARR. Which is that, at least in pertinent part, that if there is specific credible evidence that a covered person may have violated Federal law, it should be referred to an independent counsel?
Mr. FREEH. I recommended it should be referred.
Mr. BARR. Based on that analysis, that there is specific and credible evidence that Federal laws may have been violated?
Mr. FREEH. As I said yesterday, I made my recommendation on more than one basis under the statute.
Mr. BARR. There are only two bases—is that correct?—conflict of interest and specific and credible evidence of a Federal crime.
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Mr. FREEH. You are correct.
Mr. BARR. OK. And, therefore, those two are the bases on which you submitted your recommendation?
Mr. FREEH. I——
Mr. BARR. Are there any others?
Mr. FREEH. There are no others.
Mr. BURTON. Mr. Freeh, you have been very patient. Under the rules, we have finished the whole round. If Mr. Kucinich wants to make some brief comments, I will allow that. The problem is, we have two people that want to make brief comments and we have severe time constraints for the Director.
Mr. KUCINICH. What I wanted to do was to yield a minute to my friend, Congressman——
Mr. BURTON. I will make an exception, and I will allow you 1 minute and my colleague from California 1 minute.
Mr. KUCINICH. Thank you, Mr. Chairman. I yield my 1 minute to Congressman Lantos.
Mr. LANTOS. I want to thank my friend for yielding.
I cannot express outrage strong enough at Mr. Barr's observation that individuals on welfare somehow represent a unique security risk in this country. One of our colleagues, Congresswoman Woolsey, was on welfare for a protracted period of time. She is a highly respected, valuable Member of the Congress of the United States. I have no idea whether any individual who had been on welfare is currently working in the White House, but welfare recipients are American citizens to be presumed no more loyal and no less loyal than Mr. Barr, and his question to the Director looking into this issue I think is preposterous beyond words.
I thank my friend for yielding.
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Mr. HORN. Mr. Chairman, I thank you. What I want to do is defend you from some of these assaults.
Mr. BURTON. Well, then I'm glad I yielded the extra time.
Mr. HORN. Thank you. You can give me a few more seconds.
The other side is talking in great shock and concern that we might think about a contempt of Congress situation. Well, this goes back to 1792 and George Washington and the St. Clair expedition. The President decided then, give Congress all the papers on the St. Clair expedition, and he did. That was the first Congress President and the first President. And what gets me is of course we have a right to file a contempt of Congress if they don't comply with the subpoena.
Now, the chairman has indicated they tried to work something out, they'd redact certain things. The chairman might want to look at it or some designated members of the committee. But we have a clear right to compel the papers from the executive branch, and particularly the Department of Justice.
McGrain v. Daugherty is very clear. Every student in political science studies that case, 1927. The question was could Congress get the documents out the Department of Justice, a rather corrupt department at that time I might say. And I do not say the current one is corrupt, but we have a right to see the papers.
We've been stiffed by the White House, as I said yesterday, for 5 solid years of not providing the Congress with the evidence we need in a lot of these cases. And all I want to say, Mr. Chairman, is there is a long precedent, and we should not get upset when somebody says where if you do not give us the documents, a contempt citation will be voted. And I assure you it will be voted by the majority.
I yield the rest of my time, Mr. Chairman, to Mr. Mica, who has a point of personal privilege.
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Mr. BURTON. The gentleman will state his point of personal privilege.
Mr. MICA. Just a quick closing comment that, in fact, the Director's hired by the President in this administration and the Attorney General, and if ever there is a case for us pursuing a contempt of Congress, this would be the case. We represent the people, and that's our obligation.
So, Mr. Director, if you don't get fired and we don't get smeared, we'll both being doing good. Thank you.
Mr. FREEH. Mr. Burton, may I put one thing on the record with your permission?
Mr. BURTON. You may do so.
Mr. FREEH. I got this note from my general counsel, who asked to ask a question with respect to Mr. Wickman. I'm told by my counsel that Mr. Wickman was concerned with the question of DOJ attorneys accessing what we call asset files. An asset file is not the substantive information, but lists the name and address of the informant, which is the most sensitive files that we have.
I'm told that once the DOJ attorneys understood that the asset files were not substantive, that was the end of that issue. But let me get some more information and report back to you.
Mr. BURTON. Well, I'd like to quickly have you add to the information that I'd like to have. Did his successor give any information like that that he did not want to give to DOJ after Mr. Wickman left?
Mr. FREEH. I would check that. I would be shocked if that was the case, but let me find out. I've been shocked before. Let me report back to you.
Mr. BURTON. You have been very candid. You have taken a lot of flack from some people in the committee. I just want you to know that my admiration for you has been enhanced by your performance here before the committee. I gave you a couple of pointed questions that I probably should not have, and for those things I apologize. But I look forward to working with you in the future, and I hope we can work this thing out on the memo.
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Mr. FREEH. Thank you, Mr. Chairman and Mr. Lantos. It is a pleasure to appear before you. And we will work with you as closely as we can.
Mr. BURTON. The committee stands in recess until 12:30 p.m.
[Whereupon at 12:02 p.m., the committee recessed to reconvene at 12:30 p.m., the same day.]
Mr. BURTON. The committee will reconvene.
Mr. Smaltz, while you're standing, can we get you sworn, please.
[Witness sworn.]
Mr. BURTON. Thank you. Please be seated.
On September 9, 1994, Don Smaltz was appointed Independent Counsel by the Special Division of the U.S. Court of Appeals for the District of Columbia Circuit to investigate allegations that former Secretary of Agriculture Mike Espy accepted things of value from persons with business pending before the U.S. Department of Agriculture, in violation of Federal criminal statutes.
Prior to his selection as Independent Counsel, Mr. Smaltz had a distinguished career with over 30 years' experience in all areas of criminal and civil trials as a Federal prosecutor, as a law professor, and as a defense lawyer. He began Federal Government service in the Judge Advocate General's Corps for the U.S. Army, serving in the rank of captain, as Chief Military Justice Section 17 Airborne Corps, and as a trial attorney of major felonies. As an Assistant U.S. Attorney for the then southern District of California, he quickly developed a national reputation as an innovator of prosecution theories. As an example, he was the first prosecutor to successfully indict and convict a public company of making false financial statements in a registration statement under 15 U.S.C. 77.
Mr. Smaltz's private law practice has centered around white collar criminal defense and complex civil litigation matters. Notable courtroom victories include obtaining the dismissal of two separate indictments brought by the Watergate special prosecutors against President Nixon's personal tax attorney for prosecutorial misconduct and a successful 10-week jury trial on behalf of International Brotherhood of Teamsters Pension Fund, resulting in a $10 million verdict for the Fund.
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He has contributed to the development and understanding of criminal law, including teaching criminal procedure at Southwestern University's School of Law in L.A., offering numerous articles on criminal law including a criminal practice case book, and serving as a panelist at numerous seminars concerning the substance and application of criminal and civil laws. His skills as a trial lawyer have been recognized through his induction as a fellow of the American College of Trial Lawyers.
In addition, Mr. Smaltz has been an active participant in the Ninth Circuit Judicial Conference, whereby judges and lawyers discuss common issues and problems in the Federal courts. Immediately before being appointed independent counsel, he was the chairman of the Civil Justice Reform Act of 1990 Advisory Group, central District of California, which advised the district on methods of reducing delays and costs in the civil cases in Federal court.
He was born in Lebanon, PA, to Monroe C. Smaltz, a steelworker at Bethlehem Steel Co., and Adeline T.—Ceccini?
Mr. SMALTZ. Ceccini.
Mr. BURTON [continuing.] Ceccini, who immigrated to the United States from Italy.
He graduated from Pennsylvania State University and received his law degree from Dickinson School of Law, having financed both his undergraduate and graduate education as a jazz musician——
What did you play?
Mr. SMALTZ. My primary instrument, sir, was the trombone, but I also played the vibes and base.
Mr. BURTON. And you look like Jimmy Stewart, too—a passion he has maintained throughout the years.
Mr. Smaltz is married to the Honorable Lois Anderson-Smaltz, a Los Angeles County Superior Court judge; a father of four daughters; and a grandfather of six children. He and his wife have also adopted two sons from the Republic of Russia. That's commendable.
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Do you have an opening statement, Mr. Smaltz?
Mr. SMALTZ. Yes, sir, I do.
Mr. BURTON. We will entertain that at this time.
STATEMENT OF DONALD C. SMALTZ, INDEPENDENT COUNSEL, OFFICE OF THE INDEPENDENT COUNSEL
Mr. SMALTZ. Thank you, Mr. Chairman, members of the committee.
Pursuant to subpoena, I appear here to discuss with the committee the circumstances behind our recent successful prosecution of Ronald H. Blackley and Five M Farming Enterprises, and also my concerns about the delays that resulted from the Department of Justice's decision not to prosecute Blackley and its opposition to our prosecution.
I believe this case illustrates some of the impediments to effective law enforcement that can result from efforts by DOJ to rein in the most fundamental attribute that Congress has conferred on the independent counsels, namely, their independence.
Last week a Federal jury in the District of Columbia convicted former Secretary of Agriculture Espy's Chief of Staff, Ronald H. Blackley, of three counts of lying to hide $22,000, he received in 1993, from Mississippi agri-businesses. These businesses sought and received in excess of $400,000, in USDA subsidies in the year that Mr. Blackley served as Espy's Chief of Staff, and Blackley attempted to influence and reverse a USDA decision not to provide one of those businesses with the amount of subsidies it requested.
In an earlier and related prosecution, United States v. Five M Farming Enterprises, also brought in the District of Columbia, we indicted Bruce Keith Mitchell, Sr., and Five M Farming Enterprises in May 1996. They later pleaded guilty to one count of conspiracy to illegally obtain $770,000 in USDA subsidies payments; two counts of false statements to USDA, and one count of entering false entries on USDA forms to illegally benefit from the subsidy program.
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Both of these results came in the face of strong opposition from DOJ, opposition that I believe did not have a principled basis grounded in effective law enforcement and that served to make our efforts more difficult and time-consuming.
As of late December 1994, DOJ was aware of at least some of these facts concerning Blackley and Five M but did not prosecute or otherwise pursue them. My office became aware of these facts as a natural outgrowth of our investigation of Espy, which caused us to investigate the activities of those close to him in matters related to the Department of Agriculture.
While we believed our jurisdictional mandate gave us jurisdiction over Blackley and Five M's violations, in order to avoid prolonged battles after indictment, we informally requested the Department of Justice to give us these matters as related matters under the independent counsel statute. That statute provides in section 594(e) that an independent counsel may ask either the Attorney General or the Special Division to refer to him matters related to the independent counsel's jurisdiction.
We elected to pursue the alternative outlined in the statute, and we applied directly in January 1996 to the Special Division for a referral of a related matter. DOJ vigorously opposed our application, and litigation ensued. DOJ argued that the requested referral was not truly related to our jurisdictional mandate and would not concede, despite the clear wording of the statute, that the Special Division had the power to make such a referral without DOJ's blessing.
However, I am firmly of the view that the only real motivation behind DOJ's opposition was attempting to keep the Special Division, and hence the independent counsel, from exercising too much independence from DOJ. In other words, DOJ wants to control the scope and direction of the independent counsel investigations. I draw this conclusion because the connection between the requested referral and my original jurisdiction, which was quite broad, should be obvious to an objective observer.
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The Special Division, in a published opinion on April 1, 1996, stated that, in exercising its power to refer a related matter, the court ''makes explicit the independent counsel's jurisdiction over a matter that was implicitly included in the original grant of prosecutorial jurisdiction.'' It concluded that I have ''shown that the new matter is demonstratively related to the factual circumstances that gave rise to the Attorney General's initial investigation and request for appointment of an independent counsel.''
Now, after we indicted Five M Enterprises, they moved to dismiss the prosecution, contending that we didn't have jurisdiction. The trial judge there, Judge Jackson, went so far as to review for himself the record we had put before the Special Division on the referral application, and he concluded that the referral was indeed proper.
Another reason why I do not believe that DOJ's opposition to the referrals had anything to do with how closely the matters were related was the contrasting position it took in United States v. Tucker. The only real distinction between the two cases is that DOJ made the Tucker referral, but was bypassed in the decisionmaking process for our referral. Thus, the real reason for DOJ's strident opposition to this referral appears to have been a turf war. It simply would not concede that the Special Division could make a referral of which it did not approve.
DOJ's opposition thus was just an attempt to convince the Special Division not to exercise the power that this Congress had affirmatively given it in 1987. As I have already indicated, the Special Division was unpersuaded, and it granted the referral. This was, I submit, in keeping with the whole philosophy of the Independent Counsel Act, which is, after all, to minimize DOJ's control over the independent counsel investigation.
As Chief Judge Edwards of the D.C. Circuit Court of Appeals perceptively noted, quote, ''The entire purpose of the independent counsel statute was to provide independence from the executive branch.''
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Defendant Blackley's motion to dismiss on jurisdictional grounds his indictment gave the district court occasion to reflect on the need for independence for independent counsel. In denying the motion to dismiss, Judge Lamberth, the trial judge, stated, quote, ''For the independent counsel to play a meaningful role, he or she is necessarily expected to act in a manner different from, and sometimes at odds with, the Department of Justice.''
Although it lost the referral fight more than a year and a half ago, DOJ has continued to publicly assail our efforts. Recent articles in the New York Times and another in the New Yorker Magazine has cited high DOJ officials as criticizing my office for pursuing these matters in the larger context of disparaging statements that describe the current independent counsels as, quote, ''overzealous amateurs who have tried repeatedly to expand jurisdiction.''
These articles then attempted to fix the blame on present independent counsel for Ms. Reno's apparent reluctance to appoint an independent counsel in current matters. Such statements, coming as they do from DOJ personnel and apparently sanctioned at the highest level, are shocking. They threaten to undermine not only the efforts of the independent counsels and the already difficult job in prosecuting public corruption, but also the fair administration of justice.
The courts have held that the Blackley prosecution was foursquare within my original jurisdictional mandate. The statute clearly authorized the procedures we followed. And DOJ's unwarranted efforts to curtail the scope and direction of my investigation significantly delayed our investigation and prosecution.
Thank you very much, Mr. Chairman. I have some prepared remarks I'd like submitted. And that concludes my opening statement.
Mr. BURTON. Without objection.
[The prepared statement of Mr. Smaltz follows:]
INSERT OFFSET FOLIOS 15 TO 37 HERE
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[The official committee record contains additional material here.]
Mr. BURTON. I'm going to have Mr. Bennett ask some questions, and then I'll follow him. Mr. Bennett.
Mr. BENNETT. Thank you, Mr. Smaltz. Nice to see you here today. I think, for the record, I notice that you've brought four obviously very hard-working members of your staff with you. I wondered if you want an opportunity to introduce those people to us here today?
Mr. SMALTZ. Certainly. Immediately to my left is Charles Bakaly, who's been with my office since I've been sworn in. Next to him is my right and left hand, Jan Drake. She is my personal secretary and who worked very hard to get this opening statement and the submitted statement typed. Next is Rocsoe Howard, one of our lead trial attorneys. Mr. Howard is a professor of law at the University of Kansas, and he has taken a sabbatical from there to come and work in my office on behalf of some prosecutions. And next to him is Nathan Muyskens, who is a young lawyer who worked in the Senate for a while and decided to come over and see how a prosecutor's office functions and is doing a very, very fine job.
Mr. BENNETT. Welcome to all of you here.
Mr. Smaltz, I don't believe you and I ever met until today; is that correct?
Mr. SMALTZ. That is correct.
Mr. BENNETT. In fact, I think we've only spoken on the telephone maybe three times for I believe less than 10 minutes. Would that be an accurate statement?
Mr. SMALTZ. That's accurate.
Mr. BENNETT. Have you been particularly politically active, sir, prior to arriving here today?
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Mr. SMALTZ. No.
Mr. BENNETT. What political activity have you engaged in going back from college forward?
Mr. SMALTZ. Well, when I was in college, I was president of the young Democrats.
Mr. BENNETT. You mean the young Republicans?
Mr. SMALTZ. No, I mean the young Democrats. I was a very, very die-hard Democrat for many years. And I had almost an apolitical political life outside of making an occasional contribution to one candidate or another. I have never sought any elected public office.
Mr. BENNETT. Have you ever held any appointive office in any Republican administration?
Mr. SMALTZ. No.
Mr. BENNETT. I believe Chairman Burton indicated that your wife is a judge in Los Angeles; is that correct?
Mr. SMALTZ. She is.
Mr. BENNETT. And with respect to your professional background, Mr. Smaltz, I should note, in addition to the strong résumé recited by chairman, that the Director of the FBI, as Mr. Lantos aptly notes, the very distinguished Director of the FBI Louis Freeh, paid you high compliments here early this morning. I'm not sure you heard those compliments, but he was quite complimentary of your outstanding reputation, and we are pleased to have you here.
Mr. SMALTZ. Glad to hear that. Thank you.
Mr. BENNETT. Let me just go into the matter of your original appointment by the Special Division of the U.S. Court of Appeals with respect to the investigation of former Secretary of Agriculture Espy.
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Did you actively seek that appointment?
Mr. SMALTZ. No. I put my name in—my name had been put in consideration for—as a possible candidate for an independent counsel if the need would ever arise. I didn't even know it was put in originally until I was subsequently told. I sent in my résumé and sat back and waited, and the next thing I know, I got a call from the Special Division, who told me they were looking for someone to act as independent counsel in connection with the application the Attorney General had filed.
Mr. BENNETT. And I believe that you have brought a series, I think, of nine exhibits with you here today; is that correct?
Mr. SMALTZ. Yes, sir.
Mr. BENNETT. Mr. Chairman, I would perhaps move that those exhibits, which I think are numbered Smaltz 1 through 9, be made part of the record.
Mr. LANTOS. Does staff have authority to make motions at the committee, Mr. Chairman?
Mr. BENNETT. I will withdraw that, Mr. Lantos, and would note that the Chair ask that they be marked as exhibits.
Mr. LANTOS. I think it is appropriate to differentiate between the functions. I chose not to object to staff beginning the questioning, which I have felt all along is an inappropriate procedure, but there is a line beyond which you really transgress upon your position as staff attorney, Mr. Bennett.
Mr. BENNETT. And, Mr. Lantos, I meant no offense, and I apologize to you, sir.
Mr. BURTON. The Chair would note that, under the protocol which was passed by the committee early on, the chief counsel to the committee has the right to question for up to 30 minutes with the consent of the chairman. And you are correct, Mr. Lantos, however, that he can't make any kind of a motion like that.
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So I will make the motion that those be included in the record. And without objection, so ordered.
[The information referred to follows:]
INSERT OFFSET FOLIOS 38 TO 165 HERE
[The official committee record contains additional material here.]
Mr. LANTOS. Parliamentary inquiry, Mr. Chairman.
Mr. BURTON. The gentleman will state his parliamentary inquiry.
Mr. LANTOS. Have you instructed all members of your staff that when they are given the privilege of the microphone, they are not to make motions?
Mr. BURTON. I have not to this point, but I will so do right now.
Mr. LANTOS. It is long overdue, Mr. Chairman.
Mr. BURTON. Well, thank you, Mr. Lantos, for bringing that to our attention.
You can't do that.
Mr. BENNETT. I promise you, Mr. Lantos, I will not let that happen again. I will promise you.
Welcome to the hearing, Mr. Smaltz.
Mr. SMALTZ. Thank you.
Mr. BENNETT. To the extent that you need to refer to any of those exhibits during your testimony here today, please feel free to do so.
In that regard I would ask, if we can, to have Smaltz exhibit 3, which I think is Exhibit 296, placed on the Elmo if we can.
[Exhibit 296 follows:]
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INSERT OFFSET FOLIOS 757 TO 761 HERE
[The official committee record contains additional material here.]
Mr. BURTON. If the gentleman will suspend. We'd like to have copies of this. It cannot be read very easily. And I'd like for Mr. Lantos, the acting ranking minority member on this committee at this time—let's suspend while we get this information.
Mr. SMALTZ. If it please the Chair, we have extra copies here if you need any.
Mr. BENNETT. To my knowledge, we have copies to distribute. But if we could perhaps—they are being distributed, I believe.
Mr. BURTON. Proceed.
Mr. BENNETT. Referring to exhibit 296, this is a status review of the various prosecutions which your Office of Independent Counsel has conducted, as well as any pending cases; is that correct, Mr. Smaltz?
Mr. SMALTZ. Yes, that's correct, sir.
Mr. BENNETT. What are the total number of indictments and/or convictions which have been brought by your office over the past few years?
Mr. SMALTZ. We have indicted and convicted seven individuals, four corporations, one law firm, and brought a civil proceeding with a penalty and a fine against one major broker dealer.
Mr. BENNETT. And with respect to fines which have been assessed in connection with your successful prosecutions payable to the U.S. Government, what has been the total amount of the fines which you have won in those convictions?
Mr. SMALTZ. In excess of $4.5 million.
Mr. BENNETT. Now, with respect to the matter of the recent successful prosecution of Ron Blackley, which you addressed earlier in your statement, and you certainly can make reference now to other portions of your statement you have not yet had an opportunity to refer to, what was the reason for your reference in the opening statement? I believe you had previously alluded to the fact that you're not sure if there was a principal basis on the part of the Justice Department in opposing your implementation of the independent counsel statute. Could you expound on that for us, please?
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Mr. SMALTZ. Sure. In 1987, Congress amended the independent counsel statute, and one of the things—one of the things that it did is it provided that—it made clear that whenever there's an issue of a referral of a related matter, as opposed to expansion of jurisdiction, that the Special Division or the Attorney General, on request of independent counsel, can grant that application. And that was passed in 1987 over the objection of the Department of Justice, which had proposed that it control, it be the gatekeeper, for any either expansion of jurisdiction or referral of a related matter.
Mr. BENNETT. In fact, that was the Reagan Justice Department that took that position at that time; is that correct?
Mr. SMALTZ. I believe so.
Mr. BENNETT. And in a nutshell, then, that statute and implementation is such that it not only needs a referral from the Department of Justice, there can be referral or approval directly from the three-judge panel, correct?
Mr. SMALTZ. That's correct. And that's found, sir, in section 594(e), that is the referral of a related matter, and should be contrasted with the expansion of jurisdiction which is found in a different section.
Mr. BENNETT. Now, with respect to the matter of Blackley and the Justice Department's opposition to your seeking an indictment in that case, with whom were you dealing with at the Department of Justice when you were experiencing these problems initially in trying to get departmental approval for the prosecution?
Mr. SMALTZ. Well, the person we dealt with, we deal primarily with Public Integrity, and then the chain of command goes up from there.
Mr. BENNETT. And who was the head of the Public Integrity Section at that time?
Mr. SMALTZ. It is the same person that's head now. It's Lee Radek.
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Mr. BENNETT. Had you had any prior professional dealings with Mr. Radek prior to these problems?
Mr. SMALTZ. Yes, uh-huh. We had a series of ongoing discussions, I think as all independent counsel do, with Public Integrity.
Mr. BENNETT. Were there any other individuals you dealt with at the Department of Justice apart from Mr. Radek?
Mr. SMALTZ. On this matter?
Mr. BENNETT. Yes.
Mr. SMALTZ. I dealt briefly with Jack Keeney, who is the Acting Assistant Attorney General in charge of the Criminal Division.
Mr. BENNETT. And just for the record to clarify, that is Mr. Keeney, Sr., not Mr. Keeney, Jr., who's on record as representing John Huang, correct?
Mr. SMALTZ. I dealt with Mr. Jack Keeney, Sr. He's been with the Justice Department for a long time.
Mr. BENNETT. Just to make sure there is no confusion on that.
Approximately how much time and at what cost was this delay which took place as a result of the arguing with the Department of Justice over the process?
Mr. SMALTZ. We figured that we were delayed about 8 months in connection with these two prosecutions. But we never attempted to quantify the cost of that delay because it just is very, very difficult.
Mr. BENNETT. And this dispute ultimately wound its way into the courts in terms of a ruling by the courts on the applicability of the statute; is that correct?
Mr. SMALTZ. It did. We filed our application with the Special Division in January 1996, and the matter was decided in April 1996, and we brought the first indictment in May 1996. That was the indictment against Five M Farming.
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Mr. BENNETT. So is it safe to say, then, that the Department of Justice fought with you on this matter from January 1996 until April 1996 through the court process?
Mr. SMALTZ. Yes. Our dialog with them began I want to say in October 1995. So we had discussions October, November, December 1995. In January, we decided we weren't getting anywhere, so we filed the application with the Special Division.
Mr. BURTON. Let me just ask you. When you were having these discussions and running into these impediments with the Justice Department, did you have a sense of why this was taking place? Was it strictly because of a jurisdictional thing where they wanted to keep control, or was it because there were some possible political pressure?
Mr. SMALTZ. I never got the sense in connection with Blackley that it was so much an issue of political pressure, sir. My sense was that it was a question of controlling the independent counsel, because, as I understood it, no independent counsel, I was told, had ever gone directly to the Special Division over the objection or over the—and bypassed the Attorney General.
I don't think that's correct. I later found out that at least on one other matter the independent counsel went directly to the Special Division and got a referral of a related matter.
Mr. BURTON. So it is your sense that they wanted to just keep control of everything?
Thank you.
Mr. BENNETT. Picking up if I can.
Mr. SMALTZ. Excuse me. If I might, I misspoke. If I said we filed the application in January 1995, that was incorrect. We actually filed the application in January 1996.
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Mr. BENNETT. Picking up on the chairman's question with respect to going around the Department of Justice and seeking approval of the three-judge panel. In fact, there was a case in which the Department of Justice had agreed on an interpretation by independent counsel as to a prosecution, and that involved, I believe, Mr. Tuck—Jim Guy Tucker; is that correct?
Mr. SMALTZ. It did.
Mr. BENNETT. Former Governor of Arkansas?
Mr. SMALTZ. Yes.
Mr. BENNETT. And as to that matter and decided opinion, had the Department of Justice approved that prosecution?
Mr. SMALTZ. The Department of Justice, yes, it had. It had also referred as a related matter to the independent counsel Mr. Starr. And then Mr. Starr had sought also the approval of the Special Division to exercise that jurisdiction.
Mr. BENNETT. Were you ever able to get to the distinction between Kenneth Starr's investigation and the approval by the Department of Justice as to the prosecution of Mr. Tucker and the distinction that would be drawn between that and the prosecution of Mr. Blackley, who was the chief of staff for Secretary of Agriculture Espy? Do you see any distinction in those cases?
Mr. SMALTZ. No. We never did see the distinction. And it was a matter that was argued in the papers filed with the Special Division. And you can see what it was we wrote and what the Department of Justice wrote in exhibits 4(a) and 4(b), 4(a) being the opposition of the Department of Justice to our application for referral, 4(b) being our reply to that.
Mr. BENNETT. And the Tucker case in those legal materials in terms of the distinction that the Department of Justice was seeking to draw, that was ultimately rejected by the courts, correct?
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Mr. SMALTZ. Yes, it is. There is some discussion. One of the things that we did, when the district judge in Arkansas dismissed the prosecution that was brought by Mr. Starr against Jim Guy Tucker and others, he did so on the basis that Jim Guy Tucker was not named in the referral order—in the jurisdictional order, pardon me. And when the case went up, the Department of Justice filed an amicus brief, and they listed eight factors which they said were relevant whether or not the Attorney General would exercise her jurisdiction to declare that the matter was related.
When we filed our application with the Special Division, we noted these eight factors. When DOJ filed its opposition, they attempted to repudiate those eight factors.
Mr. BENNETT. The Department of Justice did?
Mr. SMALTZ. Yes. And the matter that we were arguing, while it was somewhat arcane and a lot of legal words involved, the entire matter is laid out in exhibit 4(b).
Mr. BENNETT. And, essentially, the Department of Justice found itself taking the exact opposite position in the matter of Blackley that it had taken with respect to Mr. Tucker?
Mr. SMALTZ. We thought it did. In our judgment, in light of the clear language of the statute, which clearly grants the Special Division the power to refer a related matter, in light of that and the arguments in opposition to our application that were made by DOJ, we thought it was outrageous that they filed that kind of paper.
Mr. BENNETT. Mr. Chairman.
Mr. BURTON. Did you talk to Lee Radek about this?
Mr. SMALTZ. We did, yes. We had informal discussions, I would say, from sometime late October up through——
Mr. BURTON. Did you ask him about the inconsistencies between the Tucker case and this one?
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Mr. SMALTZ. I'm not sure we discussed all of that. I cannot recall.
Mr. BURTON. I mean, but if he was opposing your being able to prosecute this individual for the very reasons that the court decided that Tucker could be prosecuted under the independent counsel statute, did he have any explanation for his opposition or did anybody try to explain that to you other than just oppose it?
Mr. SMALTZ. Well, generally what came out of my discussions with the Department of Justice was their explanations and their contentions that the matters didn't seem to be factually related sufficiently, No. 1; and No. 2, that the independent counsel statute, to the extent it granted the Special Division the power to refer a related matter without the approval of the Department of Justice, would be an unconstitutional infringement on the executive office.
Mr. BURTON. Did you get the impression from Mr. Radek that he just generally opposed what you were trying to do in its entirety or just this one aspect?
Mr. SMALTZ. I'm not sure, sir. The discussions occurred; they went on in good faith, I thought. The Tucker decision didn't actually come down until March 1996, while the matter was pending before the Special Division, although we had received a copy the Department's amicus brief in Tucker. So we knew what factors the Justice Department was citing to the Eighth Circuit as defining when a matter is related or not. So I can't answer the question any better than that, sir.
Mr. BENNETT. Attorney General Reno, yesterday, I think, essentially said that she had just heard about your concerns within the last few days since the Blackley conviction. I believe that was the nature of her testimony yesterday.
Have you had any discussions with the Attorney General about these concerns and the opposition during the Blackley approval?
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Mr. SMALTZ. No, I have not.
Mr. BENNETT. Do you have any knowledge as to who at the Department of Justice would have been speaking with her about the concerns you voiced, and particularly those you expressed that were quoted widely in the papers within the last week to 10 days?
Mr. SMALTZ. Is your question, sir, do I have any idea who it was that was making the statements that appeared in the New York Times?
Mr. BENNETT. I'm going to lead to that, I guess, because, clearly, in response to your comments and your frustrations dealing with the Justice Department as an independent counsel, there have been some fairly harsh words which have been attributed to unnamed officials at the Department of Justice. I think some were quoted in the New York Times.
Have you talked with anyone there about those kind of comments coming from the Department of Justice?
Mr. SMALTZ. I've not spoken with them, no.
Mr. BENNETT. I think you addressed those matters in your opening statement in terms of some of those actually coming during the pendency of yet another matter being prosecuted by your office; is that correct?
Mr. SMALTZ. That's correct. Some of these remarks—first of all, the Blackley case was still open, and I can't recall if it had gone to the jury and was in the hands of the jury when the New York Times articles were published.
Mr. BENNETT. I believe they are included in your exhibits; are they not?
Mr. SMALTZ. They are. And then the New Yorker Magazine article came out. It is dated December 1, but it came out a week before that. And we had a case out in San Francisco that was before the jury. That was United States v. Douglas, who was a Sun Diamond lobbyist who had given Espy about $6,000 worth of gratuities. And the jury was out, I think, when that statement—when that publication came out. So it was cause for concern.
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What is the jury supposed to think when the Attorney General and her senior representatives are out calling the independent counsel a bunch of off-the-wall zealots who don't know what they are doing and who are seeking to overexpand their jurisdiction, and then turning around and making the link that that's the reason a decision can't be made now with regard to independent counsel matters? I mean, I think that can have a very significant effect on a jury, even a judge.
Mr. BENNETT. Needless to say, you felt that you were undermined in your efforts as a result of this cross blitz of these comments to the press by unnamed officials at the Department of Justice?
Mr. SMALTZ. I certainly thought we were undermined. I thought it was terribly unfair. And most importantly, it was untrue.
Mr. BENNETT. Do you have any knowledge as to whether or not the Attorney General is looking into the matters of these leaks at the Department of Justice attacking you?
Mr. SMALTZ. I don't know.
Mr. BENNETT. That would probably lie within the province of the Office of Professional Responsibility, wouldn't it?
Mr. SMALTZ. I would expect so, yes.
Mr. BENNETT. With respect to the nature of the original referral that triggered the Espy independent counsel statute as it applies to former Secretary of Agriculture Espy, do you have any knowledge as to the original nature of the referral from the Inspector General of the Department of Agriculture as to how it relates to your charge as independent counsel?
Mr. SMALTZ. Do you mean Blackley, or do you mean Espy?
Mr. BENNETT. Espy initially. And then in terms of the expansion, Blackley, to include Blackley.
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Mr. SMALTZ. Well, what happened was the jurisdiction that I was given in the Espy matter was very, very broad, and that jurisdiction was proposed initially by the Department of Justice to the Special Division.
You see, under the statute, the independent counsel statute, after the Attorney General files an application with the Special Division asking that an independent counsel be appointed to investigate the matter further, it is up to the Special Division to define the scope of the jurisdiction that's granted to that particular independent counsel.
Now with regard to my case, the Attorney General proposed a grant of jurisdiction that was attached to the application submitted to the Special Division. That's part of the exhibits. It is a part of exhibit 1. The Special Division accepted that jurisdiction and adopted it and only added one paragraph. So the scope of my original jurisdiction was actually recommended by the Justice Department and accepted by the Special Division.
Mr. BENNETT. Then, essentially, Mr. Smaltz, in your view, is there any distinction between the nature of the charge for which Mr. Blackley was ultimately convicted and the initial referral?
Mr. SMALTZ. The Blackley matter?
Mr. BENNETT. Yes.
Mr. SMALTZ. You mean to the Attorney General?
Mr. BENNETT. Yes.
Mr. SMALTZ. OK.
Mr. BENNETT. The reason I ask that is apparently there was some comment late yesterday by someone at the Department of Justice trying to respond to your anticipated testimony, trying to say that the conviction is somehow distinguishable from the original referral. I'm giving you an opportunity to respond to that.
Mr. SMALTZ. I don't think it's distinguishable from the original referral, and let me tell you why. I should tell that you we have two courts now that—well, at least one court, the Special Division. Here's what they said. They said as follows. They said,
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IC Smaltz's original prosecutorial jurisdiction covers the receipt of gifts by Secretary Espy from individuals or companies having business before the Department of Agriculture. Obviously the concern motivating such an investigation is that a Cabinet Secretary may have been improperly influenced to favor or intervene in the gift-giver's causes pending before his or her Department.
This is the Special Division.
The original jurisdiction also included the authority,
To investigate other allegations or evidence of criminal violations by any organization or individual developed during the independent counsel's investigation, related to and connected with or arising out of that jurisdiction.
And they say,
IC Smaltz has described the factual and procedural basis concerning his original jurisdiction and the referral he seeks and supported his arguments with the affidavit of the agents who uncovered the new matters during their investigation. We conclude that Smaltz has shown that the new matter is demonstrably related to the factual circumstances that gave rise to the Attorney General's initial investigation and request for the appointment of an independent counsel.
Mr. BENNETT. So, essentially, the court in its opinion has already responded perhaps to the response that the Department of Justice is placing on this matter as of yesterday?
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Mr. SMALTZ. It has. The answer is a rhetoric response, and the rejoinder to the things that have been said are contained in the Special Division's opinion and In re Espy.
Mr. BENNETT. Mr. Chairman?
Mr. BURTON. I think that a lot of the legalese that's being discussed here is being lost upon people who do not have the legal background that you gentlemen have.
I would like to ask a very direct question. Do you believe the leaks from the Department of Justice are impeding the prosecution of justice?
You have cases that are now pending; is that correct?
Mr. SMALTZ. I do. We have three cases awaiting trial.
Mr. BURTON. Now, these leaks that are coming out about you and the way you are handling these cases that you said you think might have an impact on the judges and on the juries——
Mr. SMALTZ. I said I think it certainly could have an impact on the juries and maybe even the judge.
Mr. BURTON. So the Justice Department, in your opinion, and I don't want to put words in your mouth, but the Justice Department, in your opinion, is deliberately—some people over there are deliberately trying to impede your ability to prosecute justice in a fair and efficient way?
Mr. SMALTZ. That's the effect.
Mr. BURTON. That is the effect. I do not want to put words in your mouth, but I think it is very important, especially when we're talking about an independent counsel being necessary in other areas.
Mr. SMALTZ. Well, may I respond to that?
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Mr. BURTON. Yes, I wish you would.
Mr. SMALTZ. Here is my concern. Independent counsels are an endangered species, perhaps. I mean, they are publicly attacked for a whole variety of reasons.
When the chief law enforcement officer and her officials——
Mr. BURTON. The Attorney General.
Mr. SMALTZ [continuing]. Takes or makes statements that suggest that the independent counsels and their staffs are not acting in good faith and that they are a bunch of zealots and only interested in expanding their jurisdiction, and that then turns and is used as a basis for her decision not to appoint an independent counsel in current matters, that effectively undermines all the independent counsels who are out there prosecuting cases.
Not only that, it also has an effect on the Department of Justice generally, because at the Independent Counsel Offices, we utilize the same investigators. They are detailed from the FBI, from the Inspector General's Office. They are Department of Justice people. We use Department of Justice attorneys.
Mr. BURTON. I understand.
Let me also say one thing, and I think this needs to be clear. It also undermines the intent of the independent counsel statute as passed by Congress, and that's something that I think should be made very clear to my colleagues, because if this is going to lead to no more independent counsels being appointed or their minimizing that, especially in cases like the one that we've been talking about the last couple of days, then it sounds to me like this is undermining the intent of the statute.
Mr. Bennett.
Mr. BENNETT. Just picking up on the chairman's point. Mr. Smaltz, there was a similar problem you had with the Department of Justice, was there not, that was reported, I think, in the Legal Times of Washington about 2 years ago and has been addressed by the Wall Street Journal, and that is your efforts with respect to Tyson Foods; is that correct?
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Mr. SMALTZ. There have been ongoing dialogs between Justice and me concerning Tyson Foods. Certainly that was true back in 1995.
Mr. BENNETT. And indeed, to show the bipartisan flavor of this perhaps for Mr. Lantos, indeed the opposition there apparently came from not only the Clinton administration, but also a Republican Member of Congress in terms of your efforts as independent counsel in that regard; isn't that correct?
The Wall Street Journal reported that you were called on the carpet by someone at Justice. Have you seen the references to your being called on the carpet by the Department of Justice?
Mr. SMALTZ. I'm familiar generally that those statements were made.
Mr. BENNETT. And were you called on the carpet by the Department of Justice in terms of your efforts to perform your duties as independent counsel?
Mr. SMALTZ. Well, I don't like to think that I'm the kind of personality that can be called on anybody's carpet and made to account, but I did engage in a dialog. The answer is yes, and was I unhappy. The answer is yes.
Mr. BENNETT. And what was the result of the dialog that caused your unhappiness?
Mr. SMALTZ. Well, we changed direction somewhat.
Mr. BENNETT. And did not proceed as you had perhaps desired; is that correct?
Mr. SMALTZ. Well, we weren't going in the direction I thought it was appropriate to go. But let me say this: Two minds can differ over such things. And, so, we just changed direction.
Mr. BENNETT. Did you have occasion to see the testimony of the Attorney General yesterday?
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Mr. SMALTZ. I did not. I heard portions of it, but very few.
Mr. BENNETT. And how would you define, sir, your present relationship with the Department of Justice, specifically with the Attorney General, as you continue to proceed with your duties?
Mr. SMALTZ. I've only met the Attorney General twice. The first time is shortly after I was sworn in, I made a courtesy call just to say hello to her; and the second time was when we were at a meeting in 1995. I haven't seen her since then. And, so, I don't even have a relationship with the Attorney General.
There are times that I deal with the Department of Public Integrity from time to time, and sometimes things go smoothly. Sometimes they don't always agree with us. So it is an ongoing matter of discussion.
Mr. BENNETT. And have you discussed—just a followup as I wind up here, Mr. Chairman—have you discussed with Mr. Lee Radek the recent public discourse in the newspapers over the last 2 weeks, not only your comments, but the comments by unnamed Department of Justice officials criticizing you?
Mr. SMALTZ. I have not.
Mr. BURTON. If I asked this earlier, I apologize. Have you discussed that with anybody in particular at the Department of Justice?
Mr. SMALTZ. No, sir, I have not.
Mr. BENNETT. Mr. Chairman, I yield back the balance of my time.
Mr. BURTON. The gentleman yields back the time.
I have a couple of questions. I just didn't want to interrupt you any further.
The Tyson Foods case, is there any way you could elaborate further on your discussions or negotiations on that? Because Tyson Foods has been tied very close to a number of significant people in Arkansas, including the President. So if you could elaborate a little bit on that, I'd appreciate it.
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Mr. SMALTZ. Mr. Chairman, with all due respect, the Tyson matter is still part of our ongoing investigation, and I would respectfully decline to talk about that at this time.
Mr. BURTON. I understand.
Does anyone want the rest of this time?
Mr. Horn.
Mr. HORN. Thank you, Mr. Chairman.
No. 1, let me ask you, who can remove you as special independent counsel?
Mr. SMALTZ. The Attorney General can fire me, and the Special Division can terminate my investigation.
Mr. HORN. Just to get the definition of Special Division, it's the group, when the formal filings of the courts, it is an application to the court for—an Independent Counsel Division is the same as the Special Division, part of article 3, separation of powers, judiciary, when they are making these decisions. You've got three judges at the appellate court level?
Mr. SMALTZ. Yes, sir, three judges who are all circuit court judges, and they are referred to as the Special Division, and they pass on the applications of the Attorney General.
Mr. HORN. Now given the situation of your feelings toward the turf problems within the Department of Justice, why haven't you requested a meeting with the Attorney General to say, what's going on here? Or do you think the Attorney General is responsible for the turf? I think a lot of that is a corporate culture that exists in every organization, and the Department of Justice isn't an exception from it.
Mr. SMALTZ. My sense, sir, is that the Attorney General has her coterie of legal advisors that she looks to for advice and direction, particularly in connection with the independent counsel matters. And they know where I stand, and I know where they stand, and I don't think there would be any chance to successfully talk them in or out of a particular position.
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Mr. HORN. Well, have you ever told the Attorney General face to face what the problem is?
Mr. SMALTZ. I did on one occasion.
Mr. BURTON. My time has expired.
Mr. Lantos.
Mr. LANTOS. Thank you very much, Mr. Chairman.
Mr. Burton started out this hearing, Mr. Smaltz, by saying you remind him of Jimmy Stewart. And I must say, after the initial dialog between Counsel Bennett and yourself, you remind me of the late and unlamented Secretary General of the United Nations, Kurt Waldheim, who also had a lapse in memory. He conveniently forgot several years when he was a Nazi, and this came out after he left office.
Mr. SMALTZ. I'm sorry, are you suggesting that I'm a Nazi?
Mr. LANTOS. No. Allow me to finish.
Mr. SMALTZ. Let me tell you, I take umbrage at being compared with anyone affiliated with the Nazi party, sir.
Mr. LANTOS. No. No. If you'll allow me to finish, you'll understand where I'm going.
When you were asked about your political affiliation, you had a delightful interplay with Mr. Bennett concerning your presidency of the college young Democrats, as I recall.
What college was that?
Mr. SMALTZ. That was Penn State University.
Mr. LANTOS. And what year are we talking about?
Mr. SMALTZ. 1957, 1958.
Mr. LANTOS. 1957 and 1958. I want to commend you for your good judgment in 1957 and 1958 for leading the young Democrats in Penn State.
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But now we are in 1997, so we are 40 years beyond that, and I'm wondering if you would care to make some comments about your political affiliation, about your political contributions, in the intervening 40 years. That was my reference to Mr. Waldheim. It was not a political reference. It was a reference to your evading the statement of what your political affiliations are in the last 40 years.
When did you first register as a Republican?
Mr. SMALTZ. I would say 1967—when Lyndon Johnson was President and we had the problems with Vietnam. I think it was 1967.
Mr. LANTOS. So for about 30 years you have been a registered Republican?
Mr. SMALTZ. I have.
Mr. LANTOS. I'm sure you are very proud of it. And you ought to be. It is a great political party. But when you are asked about your political affiliation, how old are you now?
Mr. SMALTZ. How old am I? I'm 60.
Mr. LANTOS. You're 60. You really should not respond to what your political affiliation was as a 21-year-old college kid; you should just state publicly what your political affiliation is. So let me move on.
Mr. SMALTZ. Well, let me respond.
Mr. LANTOS. I am the one who is asking the questions.
Mr. SMALTZ. I would like to respond.
Mr. COX. Mr. Chairman, could the witness be allowed to answer the question?
Mr. LANTOS. There was no question.
Mr. BURTON. The gentleman from California has the time, and, unfortunately, he can use it however he chooses.
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Mr. LANTOS. I will appreciate the witness answering my questions when I ask questions. I do not wish to be interrupted by the witness.
So between 1967 and 1997, you have been a registered Republican; is that correct?
Mr. SMALTZ. I have.
Mr. LANTOS. How about your wife?
Mr. SMALTZ. What about her?
Mr. LANTOS. Is she a registered Republican?
Mr. SMALTZ. She is.
Mr. LANTOS. Very good.
Was she appointed as justice by the Republican Governor of California, my friend Pete Wilson?
Mr. SMALTZ. No.
Mr. LANTOS. By whom was she appointed?
Mr. SMALTZ. Governor George Deukmejian.
Mr. LANTOS. By the former Governor of California, Governor Deukmejian?
Mr. SMALTZ. Yes.
Mr. LANTOS. It would be helpful, for the sake of accuracy, if the witness responds in a chronologically meaningful manner to questions.
Now let me ask about political contributions. You made an observation, an offhand observation, Mr. Smaltz, at the beginning that you have occasionally made some contributions to various political candidates; is that correct?
Mr. SMALTZ. I have.
Mr. LANTOS. Very good. I commend you for it. I wish more Americans would participate in the political process.
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Can you list for me Democratic candidates to whom you've made contributions?
Mr. SMALTZ. Well——
Mr. LANTOS. If you haven't, that's all right. I'm just asking.
Mr. SMALTZ. I have, as a matter of fact.
Mr. LANTOS. Good.
Mr. SMALTZ. I made political contributions to President Kennedy.
Mr. LANTOS. That was during your Democratic period?
Mr. SMALTZ. It was.
Mr. LANTOS. OK. And then?
Mr. SMALTZ. I'm not sure when the next political contributions I made were. I made some political contributions to Senator Wilson, Pete Wilson, when he was running for the Senate.
Mr. LANTOS. He's a Republican.
Mr. SMALTZ. He is. And I made some political contributions or a political contribution to a fellow who ran for the Senate, a Republican who lost; I want to say his name was Hers——
Mr. LANTOS. Hershenson.
Mr. SMALTZ. Thank you. Correct. And I made a variety of contributions to various judicial candidates. But they were not political.
Mr. LANTOS. Right. So Pete Wilson and Mr. Hershenson were the only political candidates?
Mr. SMALTZ. Well, other than——
Mr. LANTOS. Other than judicial candidates.
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Mr. SMALTZ. And other than President Kennedy. I may have mailed other ones, sir; I don't recall.
Mr. LANTOS. But I think we now have a more accurate and chronologically more relevant description of your political affiliation, because obviously your most recent political affiliation was not that of being president of young Democrats at Penn State.
Mr. SMALTZ. Let me just tell you.
Mr. LANTOS. I have not asked a question, Mr. Smaltz. So allow me to continue, and when I ask questions, you answer them.
Mr. BURTON. Will the gentleman suspend for just a moment?
Mr. LANTOS. I'll be happy to.
Mr. BURTON. I just want to say to my colleague from California, it is your time and we are not going to interrupt you, but there have been a number of times when I and people on our side have asked hard questions and we did not allow the courtesy that you thought we should, and I heard a number of Members hollering at us saying, ''Let them answer, let them answer.'' And we did.
Now, you have the time, and I'm not going to interrupt, but rather than badgering the witness, I think that if you can allow him the courtesy of an answer, I think you should.
Mr. LANTOS. Mr. Burton, I will not only allow him the courtesy to answer, I will expect him to answer questions.
What I did not appreciate was this interplay of joviality between Counsel Bennett and the witness discussing his political affiliation. Now, people who watched that interplay came away with two statements. I wish to repeat those two statements. No. 1, he was president of college young Democrats; and, No. 2, occasionally he made political contributions. That was the only information Mr. Smaltz, an attorney, gave in response to Mr. Bennett's question.
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To my questions, he now revealed that for the last 30 years he was not president of young Democrats at Penn State, and his political contributions, with the exception of President Kennedy—which, I take it, was, you know, during the Presidential campaign, the Nixon-Kennedy campaign I presume—your contributions went to two Republican senatorial hopefuls.
That's perfectly legitimate. But you did not state that in response to Mr. Bennett's question.
Let me move on. I'm puzzled at this whole hearing, because clearly what we are dealing with is a turf fight between Mr. Smaltz, an independent counsel, and the Department of Justice. And I thought it would have been proper to have a representative of the Department of Justice present at this hearing, because I personally would like to hear from the Department of Justice concerning their view of the turf fight. I understand we have the Attorney General here, but this was a very small segment of her testimony.
Let me begin by asking you, Mr. Smaltz, comments concerning some media views of your performance. Allow me to finish the quotes that I will read, and then I will give you all the time you need to answer them.
Time magazine, on June 16 of this year, said the following:
What do you call someone who works in secret with a multi-million-dollar budget, pressures wives to testify against their husbands, compels State agencies to turn over the names of thousands of workers who might have a grudge against their employer, all in order to learn whether a Cabinet Member got some free football tickets? The answer: Independent Counsel Donald Smaltz, who has become a walking, talking argument for changing the way this Nation investigates its high public officials.
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In the same article, Time magazine says:
Smaltz has the distinction of making even the most neutral lawyers argue that Attorney General Janet Reno should think twice before triggering any more such appointments. After spending more than $9 million, Smaltz has compiled a record that shows the perils of prosecutorial passion.
End Time magazine.
Let me move to the Legal Times. Stewart Taylor of the Legal Times, who is a legal analyst deeply respected by both conservatives and liberals alike, has said—I'm quoting; this is from the Legal Times of May 22, 1997—''Smaltz has seized the opportunity to muckrake wildly through Arkansas while improperly blabbing—improperly blabbing—to the press about his interest in unsubstantiated allegations.''
Now let me move on to the Press Enterprise of Riverside, CA, July 27, 1997. The Press Enterprise in Riverside is not exactly a bastion of liberalism. This is their quote: ''Your probe is another indication of how unruly the independent counsel process has become since the 1978 Ethics in Government Act.''
Chicago Tribune, August 29, 1997:
The indictment of Espy 3 years after he left office raises questions about the failure of the independent counsel law to allow rational judgments about the relative value of investigation and prosecution. Smaltz has spent more time investigating Espy than Espy spent as Agriculture Secretary.
The Sacramento Bee, April 27, 1997: ''Your investigations'' they say—I quote——
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Now run longer than all of the Watergate investigations or the combined civil and criminal trials of O.J. Simpson. This investigation into former Agriculture Secretary Mike Espy, now in its 31st month, has touched innocent and guilty alike. Independent Counsel Donald Smaltz's work has also cost the taxpayers more than 8 1/2 million.
More than 8 1/2 million.
The Arkansas Democrat Gazette says, Smaltz has taken up residence in Fayetteville, barged into the U.S. Attorney's office space there, leased a fleet of cars and brought in six lawyers and eight FBI agents. He says he has outgrown the Espy investigation. Among other things, he is looking into hundreds of workers' compensation claims filed against Tyson. He's spattered grand jury subpoenas all over the State and national landscape.
I would be grateful if you would comment on these.
Mr. SMALTZ. Certainly. I am not sure I can recall all of the quotes——
Mr. LANTOS. I would be happy to refresh your memory.
Mr. SMALTZ [continuing]. That you have referred to, but let me tell you how it works, Congressman. I was appointed to investigate the Secretary of Agriculture who was accused of accepting gifts from businesses and entities he regulated. The Secretary of Agriculture is a very important position. He is a steward of the Nation's food supply. The purity of the food that is sold to the public is the responsibility of the Secretary of Agriculture. The loans that are given out to farmers and the subsidies is the responsibility of Agriculture. Whenever you have allegations that the Secretary is taking things of value from sources he regulates, that creates a significant problem.
Shortly after the Secretary took office in 1993, there was an outbreak of the E. Coli bacteria in the western United States. Shortly after I was appointed, there were allegations that there were chickens in Puerto Rico that somehow were sitting in the dock and that the Secretary intervened because Tyson Foods had a substantial interest in those chickens, and if they had been in any way tainted, they would have gone to the—they would have been sold to the residents and who knows what else could have occurred.
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Mr. LANTOS. I do not mean to stop you. I just want to ask you to answer the question I asked. I asked about your comment concerning the quotations from the spectrum of media. I understand the case. I understand the Espy case. We stipulate the Espy case. It was a case that should have been investigated, was investigated. We all are pleased that it was investigated. We do not want to get into that case. I am asking you to comment on the media comments of your work.
Mr. SMALTZ. I am prepared to do that.
Mr. BURTON. If the gentleman would suspend for just one moment. Mr. Smaltz, if your answers are interrupted, I will guarantee you at the conclusion of Mr. Lantos' questioning, I will give you adequate time to respond.
Mr. SMALTZ. All right. May I continue, sir? All right.
When you have the sworn duty to conduct an investigation to determine the nature and extent of the things of value that are given, that is a solemn responsibility. And you investigate two things. You investigate the givers as well as the receiver. In this case there were a number of agribusinesses that gave Mr. Espy things of value, and it was not an easy thing to root out the information. The entities under investigation were quite resistant to producing the information, and it required a lot of time and effort. And it required an effort in Arkansas. It required an effort in Louisiana. It required an effort in Washington, DC, and it required an effort in San Francisco, CA because that is where the source of the corrupt acts occurred.
So to the extent that these media don't understand or do not appreciate what it is that we are investigating or understand the prosecutions that we are bringing, I submit that that is, that is their problem, not mine. We have proved that the Secretary of Agriculture, while he was a sitting Secretary, has gotten substantial gratuities from a variety of different businesses that were regulated by his Department.
Mr. LANTOS. Mr. Smaltz, what you are saying, I take it, and I am more than happy to let it go at that, that Time magazine, the Legal Times, the Press Enterprise of Riverside, the Chicago Tribune, the Sacramento Bee, the Arkansas paper, they were all just brainwashed and incomprehending of your work; that all of this criticism was unwarranted. I understand that.
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Now, let me move on to the jurisdictional issue case.
Mr. SMALTZ. That is not quite what I have said. I am sorry you misunderstood me.
Mr. LANTOS. Well, please expand on it then.
Mr. SMALTZ. With regard to the Time magazine article, if you would like to see a copy of the letter that I sent to Time, since they omitted to state a substantial number of factual matters that they overlooked, I will be happy to provide a copy for you.
Mr. LANTOS. We will be happy to receive it. I appreciate that.
[The information referred to follows:]
INSERT OFFSET FOLIOS 166 TO 174 HERE
[The official committee record contains additional material here.]
Mr. SMALTZ. But—well, I don't want to say anything beyond that, thank you.
Mr. LANTOS. OK. Now, you say that the Department of Justice impeded your prosecution of Mr. Blackley. That, of course, is not the case. Yesterday one of our colleagues asked Attorney General Reno to explain why the Department of Justice preferred to litigate with you over the Blackley case, and she explained that the Department of Justice was concerned about the process by which the independent counsel takes on new matters and that the Department was concerned that the matter was not sufficiently related to your jurisdiction.
So what we are really dealing with here is a fairly common dispute between various legal entities, typically described as a turf fight. As a matter of fact, the written opinion of the court shows that the Department of Justice took the position before the court that Attorney General Reno described yesterday. Let me read to you what the court said the Department of Justice position was. I am now quoting from the court: ''The proper course in Department of Justice's view is for Independent Counsel Smaltz to allow DOJ to investigate the new matters and determine whether to prosecute any Federal offenses it may discover.''
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So the Department of Justice took a position that they could do that job. It is obvious to everybody they would have done it at a far lower cost than you did and you preferred to do it yourself.
Now, let me move on to the notion of what other independent counsels say about the law, the independent counsel law.
Mr. SMALTZ. I am sorry; is there a question pending? Did you want me to respond to what you said from the Special Division?
Mr. LANTOS. No, there is no question pending.
Let me point out that some distinguished attorneys who have served as independent counsels do not share your views at all. Let me take Joseph diGenova, who, as you, is a staunch Republican and served as independent counsel in the inquiry into allegations that the Bush administration misused passport files during the 1992 Presidential campaign. Parenthetically, he is also Chairman Burton's personal attorney.
Mr. diGenova told the New York Times, and I quote, ''I do not believe for one moment that Reno or anybody in the Department is motivated to protect the President. They are in this to show that the career people can do it and she backs them.'' New York Times, July 6, 1997.
Mr. diGenova is also a very harsh critic of the independent counsel statute as it is currently written. This is what he said in the Christian Science Monitor on March 5, 1996. I quote. ''This is a bad law and it needs to be changed.'' In the New York Times July 6, 1997: ''Too much unreviewable power is in the hands of a prosecutor. That is a dangerous thing. It is a dangerous thing.''
In USA Today, November 14, 1997: Mr. diGenova, because of the way the independent counsel statute works, thinks a U.S. Attorney would never investigate—get investigated under the statute because the independent counsel has one and one case only. And then Mr. diGenova goes on to say, this is a structural problem with the statute.
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On National Public Radio on November 30, he says that in his view the statute should be used only with regard to the President and his family, the Vice President and his family and the Attorney General and his or her family. It seems to me that if one looks at the cost of independent counsel investigations, the figures become absolutely mind-boggling.
Your investigation is one of those investigations that fuel a great deal of public concern. Mr. Kenneth Starr's investigation so far has cost about $30 million. Mr. Barrett's investigation has cost almost $4 million, attempting to find out whether Mr. Cisneros made a false statement.
It seems to me we need to find some way to take a more realistic view of the value of independent counsel operations. As one looks across the board, these operations are clearly the least cost-effective and most inefficient operations of the U.S. Government.
I will give you an example. I would like you to comment on it when I am finished. The most recent figures I have, March 1996 to March 1997, independent counsel investigations cost $21 million. Now, in a similar period, fiscal 1996, the six active independent counsels, including you, brought a total of 13 indictments. During the same period, the U.S. Attorney's Office for Massachusetts, covering the entire State, filed over 1,050 cases and spent only $17 million. So in bringing 1,050 cases, the U.S. Attorney brings 1,050 cases.
One might argue your cases may be more complex, but clearly the present formula that you can stay in office, apparently indefinitely, spend without any budget, is a unique phenomenon in American Government. The former Republican Senator of New Hampshire, Warren Rudman, said that independent counsels are like kings in a country that does not like kings.
Speaking of the length of these investigations, you were quoted, Mr. Smaltz, in the Los Angeles Times on November 23, 1994, as follows. You say that your probe will take 6 months. That was on 11/23/94. Then you say your investigation will take a year. In December 1997, your investigation still continues. Mr. Espy resigned his position 3 years ago. You were named independent counsel, I believe, in September 1994, if that is correct, and we are still at it. Do you have any thought about the cost and unlimited time span of these investigations?
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Mr. SMALTZ. Yes.
Mr. LANTOS. We would like to hear them.
Mr. SMALTZ. Well, in the first instance, I am not sure you are comparing apples with apples when you attempt to contrast the cost of an independent counsel investigation with the cost of a U.S. Attorney's office. There is no way that when you are talking about the function of a U.S. Attorney's office or Department of Justice, that in the figures that you look to you are taking into account the space the U.S. Attorney's office is occupying. You are taking into account the staff the U.S. Attorney's office is utilizing. You are taking into account a whole lot of fixed costs that suddenly, when you have an independent counsel, you are able to quantify. I am not sure that it is fair to try and tag independent counsel with all those costs. For instance, let me tell you that 51 percent, I think, or thereabouts of my costs last year went for payroll, payroll-related items.
Now, most of the agents that I have are detailed to me from some other agency. So they would be getting paid, working on cases in their agency, if they weren't working under my direction. The only thing that happens is they are working under my direction.
Mr. LANTOS. But they would be doing the work for which they were initially hired.
Mr. SMALTZ. And that work is prosecuting criminal acts. When you deal with the criminal prosecutions at the senior executive level, which is what independent counsel investigations are all about, you are dealing with prosecutions that are extremely difficult. You are dealing with situations where witnesses have no memory. You have seen that in some of the hearings that have occurred, if not here, before Senator Thompson's committee.
You are seeing where everybody is running for cover and you are seeing where there is a political campaign that is out to demonize the prosecutor. That almost never happens in investigations in any other criminal cases. The prosecution, when it is investigating, is not publicly attacked. When the independent counsel comes to town, he is publicly attacked and accused of being partisan, almost from the time he is appointed.
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And so when you talk about costs, I am not sure that you are comparing apples with apples and I don't know that I agree with Mr. diGenova. And even if you are correct on costs, and I do not think you are, when you are dealing with corruption at the highest level of government, I think it is worth the price.
Mr. LANTOS. Well, Mr. Blackley was not at the highest level of government.
Mr. SMALTZ. May I respond to that?
Mr. LANTOS. No, that was not a question.
Mr. SMALTZ. That is an inaccurate statement.
Mr. LANTOS. That was not a question.
Now I come to what I think is perhaps the most serious issue I would like to raise with you. Implicitly you are criticizing the ethics of our Attorney General, Janet Reno, when you claim that she somehow obstructed your investigation. Of course, your ethics have been criticized richly and repeatedly.
In the mid-1980's, when you were a private lawyer in the case of Mills Land and Water Co. versus Golden West Refining Co., a California court disqualified you from a case due to your conduct. You were disqualified for violating California Rule of Professional Conduct 7–103, which prohibited any member of the State bar from communicating with a person whom he knows to be represented by a lawyer, without the permission of that person's lawyer.
The trial court found that you improperly met with a witness named Mr. Wynn, without getting permission from his lawyer, and the court disqualified you from the case. You appealed and you made a number of arguments to the appellate court. However, the appellate court upheld your disqualification stating, and I quote: ''We conclude that Smaltz's contact with Wynn was improper. Smaltz, at a minimum, violated the letter of rule 7–103, at least insofar as he failed to seek leave of the court to interview Wynn without the participation of Wynn's counsel.''
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Moreover, the court said that it was not unfair to your client to disqualify you from the case because, the court said, quote, ''Smaltz directly created the predicament of which he and his clients now complain. Consequently, we see no unfairness in prohibiting his further participation in this litigation.''
Was this accurate?
Mr. SMALTZ. No.
Mr. LANTOS. Then please respond?
Mr. BURTON. He did respond. The gentleman's time has expired. Did you have any further comments you would like to make about the statements made by Mr. Lantos?
Mr. SMALTZ. Sure; just this. The situation that you just referred to was a case where Mr. Wynn was a lawyer who was president and chairman of the board of a company. There was an internal disagreement and he, Mr. Wynn, was a member of the out group, not the in group. When I talked to Mr. Wynn, it was in his capacity as a member of the out group, and he did not believe he was represented by the company's lawyer. It was as simple as that. That is what led to the proceedings.
Mr. BURTON. I will take my 5 minutes now. Let me just say, Mr. Smaltz, anyone who conducts an investigation into this administration or into people who are in the administration I have found are attacked again and again and again and again, and I know one of them personally. It is the chairman of this committee—me. And so I know what you are going through right now. Let me just comment on a few things that Mr. Lantos has mentioned.
He indicated that you were everything but incompetent and that you have been overstepping your bounds. I want to read to you a few things.
DOJ sided with the White House and opposed Independent Counsel Ken Starr in the 8th Circuit Court of Appeals case regarding attorney-client privilege. He is an independent counsel. They lost. But they opposed the independent counsel in that case.
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DOJ sided with the White House and opposed Independent Counsel Don Smaltz—you—in the D.C. Circuit Court of Appeals case regarding executive privilege, and they lost in a unanimous decision.
DOJ opposed Independent Counsel Don Smaltz's application for referral of a related matter pursuant to the Independent Counsel Act so that he could prosecute former Secretary of Agriculture Mike Espy's former chief of staff Ron Blackley, indicted on three counts of lying to hide $22,000 he received in 1993, from a Mississippi agribusiness in violation of 18 U.S.C. 1001. Again, they lost.
DOJ sided with President Clinton and argued before the Supreme Court that he was immune from a civil suit arising out of events that occurred before he took office regarding the Paula Jones case. Again, they lost. Nine to zero in the Supreme Court.
Now, for them to continue to impugn your integrity and say that you are expanding your authority in an unwarranted manner simply does not wash. I think it goes along with the strategy of the opposition to try to discredit everyone who is involved in this investigation, myself included. I am not going to be intimidated, and thank God you are not being intimidated.
I congratulate you on changing from Democrat to Republican, as I did when I was a little younger.
Now, let me just say one more thing. I hope I didn't hurt myself with my colleagues. Let me just say a couple of other things. Louis Freeh, the head of the FBI, appointed by the President of the United States and supported by Janet Reno before this committee, said you were a man of impeccable character. So I apologize to you for the scurrilous attacks on you and your credibility and your character and your integrity before this committee today because I think it was totally unwarranted.
With that, I will be happy to yield to my colleague Mr. Cox.
Mr. COX. Thank you Mr. Chairman. I would like to welcome you, Mr. Smaltz, on behalf of myself and most of my California colleagues. I would like also to apologize for the way you have been treated here this morning. The truth is that the country has a great deal that it owes to you for having convicted 12 individuals and companies successfully. And I would just like to ask you, because there is a newfound sense of fiscal responsibility among some of my colleagues who have been some of the biggest spenders in the history of this Congress when it comes to discovering wrongdoing and finding it out and prosecuting it, I would like to ask you whether or not when you convicted Sun Diamond Growers of giving the Secretary of Agriculture thousands of dollars in gifts, whether or not they were fined, and to whom they paid the fine, and how much was the fine?
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Mr. SMALTZ. The fine was $1.5 million. It was paid to the Treasury of the United States.
Mr. COX. So probably we are not taking into account some of the revenues that you are collecting on behalf of the U.S. Government when you win these convictions. When you convicted Smith Barney of unlawfully supplementing the salary of a Federal Government official, the Clinton administration's Secretary of Agriculture, how much did Smith Barney pay in fines?
Mr. SMALTZ. They paid a total of fines, let us see, fines, penalties, $1,050,000.
Mr. COX. So just in those two convictions out of a dozen, we have got a couple million dollars that have gone directly into the Treasury of the United States that my colleague neglected to mention. And in fact, I won't go through the rest of them but there are others, because you have been routinely sending people to prison and collecting fines.
I might state the obvious as well. I believe that the gentleman who was putting those questions to you has occasionally gotten some bad press. He read a bad press clip on you. Have you ever gotten any good press?
Mr. SMALTZ. I believe I have.
Mr. COX. I know you have. I am reading some of it right here. One of the things that it says, after recounting the fact that you have won all these convictions, is that you have also won a grand jury indictment of the Secretary of Agriculture himself on 39 counts, including accepting illegal gratuities, witness tampering and mail fraud, and that since several individuals and companies have already been convicted by you, by the courts, with you as prosecutor, of giving illegal gifts to Secretary of Agriculture Mike Espy, ''Smaltz is widely expected to win his case against the former Clinton Cabinet secretary.''
Do you think that might provide a reason for the Clinton administration to be unhappy with what you are doing?
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Mr. SMALTZ. It may well, may well.
Mr. COX. I did not mean that to be a hard question but you are coming under some very, very unfair character attacks here, and I think it is delightful that somebody who was for a long part of his career a Democrat can see things from both sides, and I am happy that you are a Republican. But I find it rather outrageous that only a Democrat member of the Clinton administration is thought sufficiently independent to investigate the Clinton administration.
Mr. BURTON. My time has expired. Let me just state to all the Members that the rule of the committee is that there will be 5 minutes given on this round to each individual and we will adhere strictly to that rule.
Mr. Lantos, you are recognized for 5 minutes.
Mr. LANTOS. Thank you, Mr. Chairman.
The recoveries that my friend from California referred to do not begin to cover the enormous costs that you have run up, Mr. Smaltz. The record clearly shows that.
I want to return to the ethical problems, because I did not ask you to agree with me or not to agree with me. I was quoting from the papers of the court, the appellate court in California. So I will read the statement again and I would like to ask you whether you think the court was wrong.
This is what the court stated. ''We conclude that Smaltz's contact with Wynn was improper. Smaltz at a minimum violated the letter of rule 7–103 at least insofar as he failed to seek leave of the court to interview Wynn without the participation of his counsel.'' That is what the court said. Do you agree with that statement?
Mr. SMALTZ. No, because——
Mr. LANTOS. This is the appellate court.
Mr. SMALTZ. I understand that. But I am telling you that Wynn's—the counsel they are referring to is the company counsel. And Wynn considered himself to be as part of the out group and as not represented by that counsel. I remember the situation very well. Mr. Wynn was a lawyer with some considerable experience.
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Mr. LANTOS. Well, let me deal with another ethical problem which is more recent. I am dealing with these because I feel very deeply that your attack on the Attorney General questions the ethics of a person of impeccable integrity. She at no time attempted to obstruct justice.
Mr. SMALTZ. I don't think I ever said that she attempted to obstruct justice.
Mr. LANTOS. Mr. Smaltz, more recently your prosecution team has had another ethical problem when the U.S. District Court here in the District of Columbia held that you violated the constitutional rights of a defendant and overturned the defendant's conviction. Your prosecutors convicted a man for making two false statements to investigators in the course of your investigation. When your prosecutors tried and convicted this man, a key issue was whether the false statements were material, whether they really mattered. The only witness that testified for your team that statements were material was a certain FBI agent.
What your prosecutors did not tell the defendant during the trial was that the FBI agent who testified for your team earlier in his career forged several signatures of informants on witness statements and lied about doing so. The agent had received a letter of reprimand for this conduct, which amounts to forgery and perjury. After the jury verdict, the judge overturned the conviction because your prosecutors had violated the defendant's constitutional rights in not providing him with this information. Is this correct?
Mr. SMALTZ. No.
Mr. LANTOS. Excuse me?
Mr. SMALTZ. No.
Mr. LANTOS. Well, then explain why it is not correct. Did the judge overturn the conviction?
Mr. SMALTZ. The judge granted a new trial but it was——
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Mr. LANTOS. He overturned the conviction.
Mr. SMALTZ. The judge granted a new trial. But it wasn't because the prosecutors hid anything. It was because the prosecutors were unaware of certain things. And on a motion made by the defense, very, very close to the end of the trial, our office caused a request to the FBI to undertake a review of individual's files. And that review came back and we advised the judge, and at that point in time the defense said well, they did not want to go into the matter now. They will wait until a verdict is returned and take it up then.
It was at that point in time that the matter came to light, and after the verdict they decided that they wanted to move for a new trial based upon the fact that the individual FBI agent who testified only on materiality had had previous allegations made against him of misconduct. That was, according to the judge, a factor which the defense, had it known about, may have been able to develop and may have changed the jury's verdict.
We have subsequently reindicted the defendant in that case—Mr. Williams—and he is awaiting trial in February for those counts of false statements as well as giving gratuities to Secretary Espy in violation of the Meat Inspection Act of 1907.
Mr. LANTOS. The court basically found that your team violated Mr. Williams' constitutional rights by not providing him with exculpatory evidence that you had. This was a clear violation of his constitutional rights.
Mr. SMALTZ. I do not believe the court put the blame on the prosecutors that prosecuted that case.
Mr. BURTON. The gentleman's time has expired.
Mr. Horn.
Mr. HORN. Thank you, Mr. Chairman. Welcome to the world of American politics, Mr. Smaltz. We find when we are campaigning every 2 years sometimes your opponents are lacking in ideas and they are also lacking in good analogies. And so what do they do? They resort to a negative campaign to try to destroy you. That is why a lot of people do not even go to the polls. They are so fed up with that kind of behavior.
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Let us talk about behavior. You got a pretty good reference yesterday and today when the Director of the FBI said that all dealings with you have been professional and when he said he had great respect for you and he said that the view of Mr. Smaltz as an attorney and prosecutor is extremely high. So I think you come before this committee with some pretty good references and negative campaigning won't destroy that.
Now, let me get into a few issues here. Tyson Foods has been named a couple of times by some of my colleagues. We had an extensive hearing of this full committee a few years ago on the frozen chicken rule of the U.S. Department of Agriculture. So I hope when you get into this in agriculture that you take a look at the forces that led to the Federal frozen chicken rule remaining the same against what the law in California is, which is more stringent, has a higher standard to protect the public health, and the U.S. Department of Agriculture wouldn't change it.
When I listened in that hearing that this committee held, the fingerprints of Tyson Foods were all over that particular position of the Department of Agriculture. Whether you can trace it to exact money buying in campaigns and all the rest, I don't know. But you might want to look at that.
Now, let me get into a few other things.
We got into a discussion with the Attorney General, I think all of us, on what is a conflict of interest. And she said that Justice has tried to take care of that situation by having different teams and so forth and so on and gave me the prison guard analogy, that, yes, there might be a case against a prison guard and there might be a different interest, so forth.
The point is, she is not a prison guard. She is an appointee of the President of the United States. He doesn't appoint prison guards. You don't have to worry about the prison guard that much. You do have to worry when the Attorney General is the appointee of the President and, as you said, there is a real problem here with Justice and a lot of the independent counsels. Do you have any feeling on how it is in Justice? Do they try to prevent these conflicts of interest from going on as to who represents whom?
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Mr. SMALTZ. Congressman, I can only speculate as to that. I would prefer not to do so. I am not that familiar with the internal workings of the Justice Department except to the extent as it relates to me and specific issues and items of discussion that I have had with them.
Mr. HORN. Let me ask you then, moving on, the Department of Justice's opposition to the Blackley prosecution was not the first time that the Department of Justice had actively opposed or impeded your investigation, was it?
Mr. SMALTZ. It was not.
Mr. HORN. What kind of opposition did you get from the Department of Justice before?
Mr. SMALTZ. Well, when we had thought that we had sufficient evidence and facts to justify looking at particular other matters that we thought we should investigate, Justice opposed that. And we asked them either for a referral of the matter as a related matter or alternatively as an expansion of our jurisdiction and they declined to do either. And so we just deviated from that course and directed our attentions elsewhere.
Mr. HORN. When I listened to some of my colleagues both yesterday and today compare the U.S. Attorney's Office in Massachusetts to an independent counsel, the thought that crossed my mind, the U.S. Attorney's Office in Massachusetts doesn't have to pry documents out of the White House. Isn't it true that the Department of Justice supported the White House position not to turn over 86 documents that were material to your investigation?
Mr. SMALTZ. I do not—I am not certain that the Department of Justice took a position in that. I think that perhaps the White House Counsel's Office took a position, but I do not believe, I believe DOJ stayed out of that fight.
Mr. HORN. And the result of that opposition, be it by the counsel to the President or the Department of Justice, was, what, when it went to the court?
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Mr. SMALTZ. Let me tell you this, and the matter was argued before the circuit and the circuit ruled, I think, in June and the circuit ruled that we were entitled to certain information and we would have to make an additional showing as to other information. As I sit here today, we still don't have that information the circuit said we should have back in June. And this is now December.
Mr. HORN. And then some wonder why you take so long to convict when you have this type of obstacle that is put up before you every step of the way.
Mr. SMALTZ. There are a lot of obstacles that are placed in the way of these types of prosecutions. I mentioned some of them in a speech I gave not too long ago that was reported among other places in the Wall Street Journal. So there is a number of obstacles that independent counsel particularly face.
Mr. HORN. I think this case is known as the In re Sealed case for reference.
Mr. SMALTZ. The D.C. Circuit case, yes.
Mr. BURTON. Mr. Mica.
Mr. MICA. Thank you, Mr. Chairman. I want to congratulate you on the work you have done on this whole matter, the Espy matter. I served on this committee as a freshman on a subcommittee that dealt with the question of meat and poultry standards. I remember after getting elected, I just pulled some copies of our hearings, the administration said the meat and poultry standards are coming. The new rules are coming and we held a hearing.
In fact, the hearings were November 4th and 19th, 1993. We had the E. coli problems. They were coming and coming. This is another hearing we held. They never got there. I always wondered why they never got there. I raised questions about Tyson's interference. It is all documented. It is public record. It is great reading. But I found out what happened to the meat and poultry regulations. It is all documented there. You did great followup.
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I think the public, and your job is the health and public safety, the job that you are responsible for ensuring took place and you did a commendable job. So it is there. It is great reading. You can read how the Department of Justice intervened in a case after Tyson weighed in in California. Unprecedented fashion. It is all detailed here.
What I want to get into is a couple of things. First of all, you discussed the turf war with the Public Integrity Section, I think, of the Department of Justice briefly. I heard Louis Freeh tell us the chain of command. We have heard that there is already problems there in the Department of Justice with his task force. It is my understanding that Mr. La Bella is now in charge. You have said you have had problems with DOJ. Specifically, who have you had problems with? Have you had any problems with Mr. Radek, the head of Public Integrity Section?
Mr. SMALTZ. Well, we have because it was the Public Integrity Section that opposed our exercising our jurisdiction over Mr. Blackley and farming enterprises.
Mr. MICA. So that opposition would have been by Mr. Radek.
Mr. SMALTZ. Yes, by him and his division.
Mr. MICA. And as I understood the chain of command today, I guess that Mr. La Bella, who has now been put in charge, is underneath Mr. Radek.
Mr. SMALTZ. I don't know. I don't know how the present task force is set up.
Mr. MICA. That is what the FBI Director testified to so that raises some concern. Now, there has also been a report that you may have talked to David Barrett, I guess, was the HUD special counsel and Ken Starr, the Whitewater special counsel. They may have expressed similar concerns about DOJ interference. Could you describe any conversations you have had or concerns they may have expressed?
Mr. SMALTZ. Well, I really would prefer not to do that, Congressman.
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Mr. MICA. We should call them in separately.
Mr. SMALTZ. I wish you would. As you know, there have been statements in the press concerning various efforts to extend jurisdiction or have things referred to as a related matter by other independent counsel, but they are in the best position to tell you.
Mr. MICA. But they have expressed concern to you that they have had similar problems?
Mr. SMALTZ. I am not prepared to say that they have. I think one of the two has.
Mr. MICA. One of the two has. Let me also express some concern about the organized attacks that you have noted, that there are media attacks and DOJ attacks that have been orchestrated by the White House. I find that disturbing. Could you describe more in detail how these attacks may undermine your investigations and prosecution?
Mr. SMALTZ. Well, any time that an independent counsel, any prosecutor is attacked and portrayed as some zealot who is not altogether there or who is overly aggressive, there is what I call the ripple effect. First of all, to the extent they can be painted as some aberration, witnesses are less likely to come forward and be forthcoming. Targets are less likely to come in to admit their criminal culpability because they believe that the press and the efforts of those who are attempting to pillar the independent counsel may sufficiently discredit them so that the independent counsel will never get to complete his prosecutorial efforts.
Mr. MICA. Wouldn't it just force you to learn that they formed a committee, back to business committee, which solicited money from some of the folks we are investigating, Johnny Chung, to attack Mr. Starr and other investigations and some of these folks are now, like Ann Lewis and Lynn Cutler, operating out of the White House.
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Mr. SMALTZ. I am not aware of that. I have to tell you the truth. I have enough problems in my own investigation and prosecutions. I have not been keeping myself totally current with all the endeavors and efforts of the ongoing investigation.
Mr. MICA. Mr. Chairman, a unanimous consent request. Yesterday Mr. Lantos, to this committee, made a statement which said that I would like the record to show that President Reagan made fund-raising calls from both the White House and from Camp David. These calls included direct solicitation of Richard DeVos, president of Amway, asking him to raise $3.350 million. Mr. DeVos has sent a letter in response. I would like that to be made a part of the record and it does correct it, that that is inaccurate, and he has the accurate information. I would be glad to read it, if I was given the time.
Mr. BURTON. We will submit that for the record without objection. I will be glad to give Mr. Lantos a copy of it so he can review it. Without objection.
[The information referred to follows:]
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[The official committee record contains additional material here.]
Mr. BURTON. Mr. Barr.
Mr. BARR. Mr. Smaltz, following up both on the conversation with Mr. Mica and, I think that you touched on this also in an interchange with the chairman earlier, with regard to statements made by Government officials about an independent counsel and what effect that can have. I think you used the word earlier that it could have the effect of impeding a proceeding, a prosecution; is that correct?
Mr. SMALTZ. I did. Yes. That is correct.
Mr. BARR. I suspect that you used the word, your words very carefully, that that is the effect that it would have because if we look at it a different way, it puts us square into 18 U.S.C. 1505, the obstruction of proceedings before departments, agencies and committees, obstruction of justice statute, which makes it a Federal crime for any person, not just a Government official, that would include, for example, somebody like a James Carville, who is on record repeatedly making very, very vicious and very pointed attacks on independent counsels and particularly Mr. Starr, that if they corruptly, and it defines the word corruptly, not in the sense that in different statutory settings we might think of a payment in return for something, but simply acting with an improper purpose. If somebody corruptly impedes an investigation or prosecution or other proceedings, very broadly defined, which would clearly include an independent counsel, that they are, they have violated the corruption, the obstruction of justice statute.
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So we are talking about matters here that are very, very serious, that go, I believe, and I suspect you would agree, to the integrity of not just an independent counsel, but our judicial system and the ability of prosecutors, whether they are appointed prosecutors, elected prosecutors or independent counsels to carry out their lawful mandates; is that correct?
Mr. SMALTZ. Well, yes, Mr. Barr. I agree with much of what you say. But let me make it clear that I at no time have accused any person of violating either 1503 or 1505 and obstructing justice.
Mr. BARR. I understand. I am glad. I tried to make that clear. You chose your earlier words, very, very carefully. I am characterizing the process somewhat differently and saying that it could very well get us into 1505, but I understand that you have not said that.
Mr. SMALTZ. I have not and I would never suggest that of Public Integrity. My concern with the opposition that Public Integrity filed was I didn't think it had a principled basis. First of all, the statute was clear, No. 1, and No. 2, it was clearly a related matter because of the broad scope of my jurisdiction, as I previously mentioned and read. And there is just no basis. There may have been other bases, but nonetheless they came forward as is their right. I think they have a right to litigate their position, but I didn't think it was a principled position.
Mr. BARR. I understand. Speaking of Public Integrity at the Department of Justice, Mr. Chairman, I think it might be worthwhile to take Mr. Lantos up on one thing that I think he did say that was appropriate today and that is that we ought to hear from the Department of Justice on this, perhaps Mr. Lee Radek, the head of Public Integrity; Mr. John Hogan, the Attorney General's chief of staff; Mr. Bob Litt, the Deputy Assistant to the Attorney General on this matter because I think it is very, very important.
Mr. Smaltz, again, with regard to another matter that has already been touched on today, according to what I believe was an October 8, 1997, report in the Wall Street Journal, you were quote, ''called on the carpet,'' as we have discussed, earlier at Justice in July 1995 in order to stop investigating Tysons Foods. Would you please explain in a little bit of detail that meeting and the circumstances surrounding it?
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Mr. SMALTZ. Well, first of all, let me point out that Tyson Foods is still under investigation. I can only say this about the meeting. At the meeting that I was at, the following people were present from the Department of Justice: the Attorney General; the Deputy Attorney General, who was then Jamie Gorelick; JoAnn Harris, who was Chief of the Criminal Division; Jack Keeney; Lee Radek, and I believe JoAnn Farrington. And present with me was my deputy at the time, Ted Greenberg. And that sort of set the parameters for the meeting. I do not think it would be appropriate at this time for me to go into what was said given the sensitivity of the matter.
Mr. BARR. Could you indicate to us whether or not the characterization made in this particular article by Mr. Morrison in October 1997 was essentially accurate in the gist of the meeting being to stop investigating Tysons Food? Obviously if that was, it did not work, but was that the gist of the proceedings generally as he has laid them out in his article?
Mr. SMALTZ. Let me just say that it concerned our investigation of Tyson Foods.
Mr. BARR. Thank you, Mr. Chairman.
Mr. SMALTZ. May I ask a question, Mr. Chairman?
Mr. BURTON. Of myself?
Mr. SMALTZ. No, of Mr. Barr.
Mr. BURTON. Of course.
Mr. SMALTZ. What was the source of that article? Was it two Justice officials or do you recall? The record will speak for itself.
Mr. BARR. I have some references to it here. I do not recall the exact sources, but I remember it was. It seemed to be, as always, by the Wall Street Journal, a well-written piece by Mr. Morrison.
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Mr. BURTON. The gentleman's time has expired. Mr. McIntosh.
Mr. MCINTOSH. Thank you, Mr. Chairman. I would yield my time to Representative Cox.
Mr. COX. I thank my colleague for yielding. Before I proceed with a line of questions, Mr. Smaltz, you and I discussed the fines that you had recovered in consequence of winning 12 separate convictions. That is, as we established, multimillions of dollars. I have totaled it up myself and the only reason I did so, after you and I discussed it, is that my colleague from California asserted that the fines that you have collected ''do not begin,'' if I am quoting him correctly, and I think I am, ''do not begin to cover the expenses that you have generated as an independent counsel.''
First of all, I have never thought that law enforcement was anything but a cost. I mean the cops on the beat, except to the extent we give them quotas for tickets and so on, generally don't return enough revenues to cover their investigation of murder cases. The U.S. Attorneys cost money. We have to pass a DOJ appropriation bill around here because the Department of Justice costs billions of dollars over time. So I do not think it is your job to be a profit center. But the truth is that not only do the fines that you have recovered begin to cover the total costs, but they do far more than that.
To use my colleague's number, I believe he said that you have run a tab up so far of $8.4 million. I don't know if that is correct. I know that you have said other costs that the Department of Justice is engendering are being included in your total. My calculation of the amount of fines that you have collected, which need to be offset against the cost of the independent counsel, in your case is $4.5 million not counting the fine that you may get against Ron Blackley.
And I note that since it is $250,000 a count and that he has been punished on three counts, that that is another three-quarters of a million dollars potentially. He may not be good for that so we won't count that. But a $2 million fine was awarded against Crop Growers Association; is that correct?
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Mr. SMALTZ. That is correct.
Mr. COX. A $1.5 million fine was awarded against Sun Diamond Growers.
Mr. SMALTZ. That is correct.
Mr. COX. A $1 million plus fine was awarded against Smith Barney.
Mr. SMALTZ. That is correct.
Mr. COX. And I have got $60,000 in other fines for a total of $4.560 million in fines that are to be paid directly to the U.S. Treasury. I hope that that puts to rest this notion that we should be opposed to an independent counsel because we can't afford it. I think that is a foolish assertion and people should be embarrassed to make it. I would permit you to comment on it, if you wish.
Mr. SMALTZ. Thank you. Those fines have, in fact, been paid. We have collected that amount. It is not just outstanding. I would make a comment. We are not in the quota business, and you are right, you can't put a price tag on law enforcement. But let me just emphasize, since one of these cases resulted in a $2 million fine, the Crop Growers case, that was a case where a public corporation, Crop Growers Insurance Co., contributed $46,000 in illegal campaign contributions to Henry Espy, the brother of Secretary Michael Espy, when the Secretary of Agriculture was sponsoring a major bill that could affect how crop insurance was written.
And those kinds of cases, they are not easy to dig out. Crop Growers was located up in Montana. The campaign was down in, for Henry Espy, was down in Mississippi. There was money laundering involved that occurred in Louisiana. That takes time, effort and money to ferret out. I think it is an unfortunate hit when people try to say, well, the investigation cost this much and what do you have to show for it, because we are trying to make the Government better, weed out the corruptive sources. That takes time, effort, and a lot of money. But law enforcement is expensive.
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Mr. COX. Mr. Smaltz, just a few days ago you won three convictions against the chief of staff to the Secretary of Agriculture in the Clinton administration. The convictions obviously couldn't have been obtained if there were not a prosecution. Justice did not want to prosecute the chief of staff to the Secretary of Agriculture and it also went further and went to court to stop you from doing so. Is it fair to say that if Janet Reno had had her way that Mr. Blackley would have gotten off scot-free?
Mr. SMALTZ. Well, Justice had looked at the Blackley matter. It had much of, but not all the same evidence we had, and it had declined in March 1995 to prosecute Mr. Blackley. So if we had not prosecuted him, I don't know who would have.
Mr. COX. And of course if he were not prosecuted, he would have gotten away scot-free with the crimes for which he was convicted a few weeks ago.
Mr. SMALTZ. That is correct.
Mr. COX. I thank the chairman. I am sorry. I yield to the gentleman from Georgia, Mr. Barr.
Mr. BARR. Just a quick question, Mr. Smaltz. With regard to the length of time it takes to successfully conclude one of your prosecutions, is that entirely a function of what you and your staff do? Or would it also be somewhat dependent on delays occasioned by opposing counsel, the courts and so forth?
Mr. SMALTZ. It is a multiparty problem. It is not only what we do. We can try and investigate as rapidly and thoroughly as we can. But when the entities that we are seeking information from or subpoenaing documents, whatever, won't cooperate or won't turn it over, then we have to go to court. We have to do, when we have to go to court, we have to wait for the court process to take its time. That involves some considerable delays.
I think we factored in at one time that it takes about 15 weeks when a motion is contested at the grand jury level because of the number of motions that have been filed, about 15 weeks often for material to come forth after the subpoena has demanded, about 15 weeks later before we get it. That is very disruptive on the investigation. That is just the investigation.
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Then you get to the prosecution. Once the indictment is returned, Government does not control how quickly the case proceeds. In all our cases we have told the court we are ready to go. On the date of the indictment we are ready to go. The court has its problems with its calendars. It is going to look to defense counsel. The courts are usually deferential to the defense counsel and despite the fact that we have tried to get cases to trial as rapidly as possible, the best we have done is about 65 days. And that was here in the district.
We have had one case in California that lingered more than a year before we got it to trial after it was indicted, although we kept asking for a trial and asking for a trial. So the Government doesn't have the ability to control that pace. That is where a lot of the delay, that is where they come from.
Whenever you have a delay, your costs are going to go up. Because you have the staff in place, you are prepared to go, you are waiting to go. What are you supposed to do? Fire the lawyers and say, I do not need you now? Come back in 3 months or 4 months when we get a trial date. You can't do that. You can't tell the investigators to go home.
Mr. BURTON. The gentleman's time has expired. Mr. Cox has his time now, 5 minutes.
Mr. COX. I thank the chairman. I yield to the chairman.
Mr. BURTON. I just wanted to point out, there have been some questions about the cost of the investigation and I think my colleague, Mr. Cox, has very clearly stated why this has not been an overly expensive investigation. I wanted to compare that to the Iran Contra investigation which lasted from 1986 to 1993, the total cost was $48 million. The investigation of HUD Secretary Sam Pierce was $27 million. The Whitewater investigation, I think, has been about $27 million. So there have been some substantially more expensive investigations than this one. As Mr. Cox said, you have garnered some substantial results. Mr. Cox, thank you for yielding.
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Mr. COX. I thank the chairman. Mr. Smaltz, if I may, I would like to ask you about the independent counsel statute. You are a lawyer. You have been appointed by a three-judge panel as an independent counsel. Certainly, you understand the law. It is not long and you work under it. We had a chance to talk to the Attorney General about the statute as well and the standard that she uses to determine whether an independent counsel is in order.
Under section 591(c), an independent counsel for a covered person, like the Vice President, whom she was investigating under the independent counsel statute up until recent days, is mandatory if, quote, there are reasonable grounds to believe further investigation is warranted, close quote.
We have learned from our hearings in recent days that, despite the fact that the Attorney General, at the expiration of the time of the preliminary investigation, did not make application to the 3-judge panel to consider appointing independent counsel, the FBI is continuing its investigation into the matter of telephone calls, and fund-raising phone calls, made from the White House by Vice President Al Gore.
The way I read the statute, if the investigation is continuing, of course there must be reasonable ground to do so. And if there are reasonable grounds to do so, an independent counsel is mandatory. Therefore, on the face of the statute, it would appear that the Attorney General is violating independent counsel law.
Could you give us your understanding of the way the independent counsel law works and whether or not you agree that if there are reasonable grounds to continue investigation after the preliminary investigation expires, one must, if you are the Attorney General, apply to the 3-judge panel to appoint an independent counsel?
Mr. SMALTZ. Congressman Cox, you're a fellow Californian and I have the greatest respect for you. You worked in the White House at one time, I believe. You're a lawyer. I think I would be overstepping the purpose for which I'm here if I began to opine on the Attorney General's present decisions whether or not to appoint an independent counsel. I really don't think that it would be appropriate for me to do that. I mean, I've got enough problems of my own. And besides, I'm trying to get this investigation done. I want to get back to California.
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Could I be excused from that question, please?
Mr. COX. I permit you to demur. Although, frankly, all I am asking for is a fair reading of the law. It is the face of the statute that I am concerned with. But I understand that you do not want to stick your neck in that wringer.
Mr. SMALTZ. I can tell you what I said publicly in a speech I gave about the independent counsel, how I viewed how the independent counsel statute works, if you gave me a moment. But it had nothing to do with whether or not the Attorney General was acting properly. If you would like to hear it, I will see if I can find it.
Mr. COX. Well, you are certainly welcome following the hearing to submit it for the record. And we will be sure to see that it is included. And I ask unanimous consent for that purpose at this moment.
Mr. BURTON. Without objection, so ordered.
Mr. COX. I thank you.
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[The official committee record contains additional material here.]
Mr. COX. And at this point I would yield to my colleague from California, Mr. Horn.
Mr. HORN. Thank you, Mr. Cox.
As we closed out the last interrogatories, I mentioned In re Sealed case—and I wasn't quite clear whether you received any of the 86 documents involved in this case from the White House; have you?
Mr. SMALTZ. No, not yet.
Mr. HORN. And when was that court decision made?
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Mr. SMALTZ. I want to say June 1997.
Mr. HORN. So we are almost a half a year now. We are at the half-year mark. What can you do to compel the White House to agree and submit to a ruling of the Article III judiciary?
Mr. SMALTZ. I think we've done everything we can. And we have motions pending before the appropriate tribunal and we're just waiting for rulings.
Mr. HORN. Now, is that the Supreme Court?
Mr. SMALTZ. No, sir, it is not. It is back down at the trial court level.
Mr. HORN. The decision required you to retry that?
Mr. SMALTZ. No, we don't have to retry it. The circuit said we were entitled to certain information, we have yet to receive that information, and that we're entitled to make a showing as to the other documents, which we have not done yet because we're waiting the documents or the information the circuit said we're entitled to.
Mr. HORN. The U.S. District Court of Appeals is probably the second most highest court in the land. And your treatment reminds me of what Andrew Jackson said about John Marshall when Marshall and the Supreme Court sided with the Cherokees. He said, ''Marshall made his decision. Let him try to enforce it.'' You are totally dependent upon the executive branch to enforce a court order.
Now, here we have the highest level, the executive branch, the White House. They lost the case 3–0 at the appellate level. They have not turned over the documents. They are in defiance of the law and in defiance of the Constitution; are they not?
Mr. SMALTZ. We think we're entitled to the information that the circuit said we are so that then we can attempt to make the requisite showing to obtain the rest.
Mr. HORN. And it is essential to your case; is it not?
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Mr. SMALTZ. Well, until we see it, we think it is but we haven't seen it, so we don't know.
Mr. HORN. You would think they would quit protecting their political appointees when they were found with their hand more than in the cookie jar.
Mr. BURTON. The gentleman's time has expired. Mr. Sununu has arrived I see. He has 5 minutes.
Mr. SUNUNU. Mr. Chairman, I would be happy to yield my time to Mr. Horn.
Mr. HORN. Well, I think we have covered it. I guess I don't know what else you can do except have the frustration we all have when we are stiffed.
As I said earlier today, this committee has been stiffed for 5 solid years on documents. Whether it be Democratic or Republican, the White House simply hasn't produced. And yet the law is very clear, when so many members of the committee and the minority, they can demand records out of the executive branch. Well, they just thumbed their nose at that in the 103d Congress. We are now in the 105th and we are still dragging along here.
And if you have any insights as an independent counsel, we would sure welcome them on what process we need to do to get the law obeyed by lawyers in the White House. Do we get the American Bar to say, gee, fellas, you are not professionals anymore; let's yank your law, whatever? Except those are handled at the State level generally. Or could the Federal court say, deliver that stuff or you can't practice before us?
What unique little options can you think of to get the law obeyed?
Mr. SMALTZ. Ordinarily, when the court issues an order to produce documents and the party doesn't do so, the option is to move to hold the party in contempt.
Mr. HORN. Do you plan to do that?
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Mr. SMALTZ. I'm not sure. I'm not sure. We're trying to wrap up our investigation. We have three prosecutions. We have some more avenues to pursue. And I'm not sure what we're going to do with that at this point in time. But that is an option.
Mr. HORN. My last question would be, do any of you ex-independent counsels and you current independent counsels ever get together and share war stories, and can we learn something from that as to the culture within the Department of Justice regardless of administration?
Mr. SMALTZ. The answer to your question is before I—right after I was sworn in, I spoke to four—three independent counsels, or former independent counsels, and was trying to get their sense of what the problems were, No. 1.
No. 2, I think it is important that independent counsels, to the extent they can, exchange information to see what common issues or problems they are facing. No. 3, at some point in time, and I'll probably do this in our final report, I think we're going to recommend that there be something—there be a body of knowledge, institutional knowledge, on independent counsel and independent counsel problems so that when somebody is sworn into the independent counsel jobs he or she knows the nature of the problems they might well be facing. So I think it is probably a good idea if the independent counsels among themselves discuss those common problems that they have and possible solutions to them.
Mr. HORN. It would make an excellent law school panel that C–Span could cover and you could get a book out of it.
Mr. SMALTZ. I don't have time to write a book.
Mr. HORN. I know. But you might some day if you can convict the rest of them. Thank you.
Mr. BURTON. Does the gentleman yield back the balance of his time?
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Mr. SUNUNU. I yield back the balance of my time.
Mr. BURTON. The gentleman yields back the balance of his time. We have concluded.
I think, Mr. Lantos, I believe you have a unanimous consent request?
Mr. LANTOS. Yes, Mr. Chairman.
A few moments ago Mr. DeVoss of Amway sent a letter via Mr. Mica, which is part of the record. I would like to request that a White House memorandum from Michael Dever to the President, dated March 2, 1981, be made part of the record, which spells out the $3.350 million Mr. DeVoss was asked to raise.
Mr. BARR. Reserving the right to object, may I see the document?
Mr. BURTON. He reserves the right to object. May he see the document, please?
Mr. LANTOS. Yes, he may see the document.
Mr. BURTON. Here is an addition to that document if you would like to look at it, Mr. Barr.
Mr. LANTOS. They are from the Reagan archives.
Mr. BARR. Does the gentleman have information indicating where the phone call was to be made?
Mr. BURTON. You mean where it was made from?
Mr. BARR. Well, this is recommending that a phone call be made.
Mr. LANTOS. Yes. If I may answer my colleague, Mr. Chairman.
Mr. BURTON. Without objection.
Mr. LANTOS. The letter that Mr. Mica submitted on Amway letterhead, dated December 10 and signed by Richard M. DeVos, reads as follows:
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''Dear Mr. Chairman,'' this is to Mr. Burton,
It is my understanding that yesterday Congressman Tom Lantos, Democrat California, made the following statement: ''I would like the record to show that President Reagan made fund-raising calls from both the White House and from Camp David. These calls included the direct solicitation of Richard DeVos, President of Amway, asking him to raise $3,350,000.''
I would like to correct the record. Like most Americans, I certainly remember a telephone call from the President of the United States. The telephone call, that I believe Mr. Lantos is referring to, was not to solicit any money from me personally. President Reagan called to ask me to serve as Chairman of the Republican Party's Finance Committee which I was very honored to do. During this telephone call, I do not remember his mentioning any amount of money the Committee needed to raise.
Et cetera.
The memo from Mr. Dever to President Reagan tells the President that he should ask DeVos to get another 335 Eagles. Eagles contribute $10,000. If my arithmetic is correct, that is $3.350 million.
Mr. COX. Would my colleague yield, Mr. Barr?
Mr. BARR. Yes.
Mr. COX. Because I have that memo in front of me and it does not say anything about 335 Eagles.
Mr. LANTOS. Yes, it does.
Mr. COX. Is it the other document?
Mr. LANTOS. Well, there are two documents and I think my colleague has them both.
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Mr. BURTON. Would the gentleman yield?
Mr. COX. I thank the gentleman.
Back to your original question, Mr. Barr.
Mr. LANTOS. If I may read the memo to help my friend.
Mr. COX. The question I think is pending on Mr. Barr's time, is whether or not you have any information about from where the call was made?
Mr. LANTOS. Well, my understanding is that these calls were made from the White House. I do not recall——
Mr. BARR. As I recall, the answer is ''no.''
Mr. LANTOS. No, the answer is not ''no.'' This is on White House stationery.
Mr. COX. That was recommending the calls should be made, not where it should be made from.
Mr. BARR. I object to the introduction.
Mr. BURTON. Mr. Barr objects. The objection is heard. The document will not be included.
That may cause me a little problem with this next request. I have a unanimous consent to add two documents to the record.
Mr. LANTOS. I object.
Mr. BURTON. I have a sneaking suspicions that I am not going to get that done. Since we do not have a quorum here, we will have to deal with this at a later date.
I want to thank you, Mr. Smaltz, very much for your patience and for being able to compose yourself as you have under some pretty dire circumstances. I think you are a credit to your profession, and I think you have given us a great deal of information that is going to be useful in our investigation. And I want to thank you for being with us.
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Mr. COX. Mr. Chairman.
Mr. BURTON. Mr. Cox.
Mr. COX. Mr. Chairman, before you bang the gavel, might I make another unanimous consent request that all the documents that you and the ranking member have just referred to be admitted for the record?
Mr. LANTOS. I am sorry, I didn't hear.
Mr. BURTON. He is asking that all the documents, including yours, be submitted for the record.
Mr. BARR. Reserving the right to object, if the gentleman could just enlighten me as to the purpose of that? Does the gentleman from California want the documents that we just referred to introduced?
Mr. COX. Yes. We have all read them and discussed them on the record. I see no reason not to include them.
Mr. BARR. If our side does not object, I certainly will not impose an objection.
Mr. BURTON. Is there objection?
Mr. LANTOS. No objection.
Mr. BURTON. Without objection, so ordered.
[The information referred to by Hon. Tom Lantos and Hon. Dan Burton follows:]
INSERT OFFSET FOLIOS 193 TO 214 HERE
[The official committee record contains additional material here.]
Mr. BURTON. We are adjourned.
[Whereupon, at 3:05 p.m., the committee was adjourned.]
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[The depositions of Holli B. Weymouth, David Mercer, Betty Jane Thornberry, Thomas Franklin McLarty III, Bruce R. Lindsey, C. Douglas Buford, Jr., Mickey Kantor, and John R. Phillips follow:]
Executive Session
| Committee on Government Reform and Oversight, |
| U.S. House of Representatives, |
| Washington, DC. |
DEPOSITION OF: HOLLI B. WEYMOUTH
The deposition in the above matter was held in Room 2203, Rayburn House Office Building, commencing at 10:05 a.m.
Appearances:
Staff Present for the Government Reform and Oversight Committee: Uttam Dhillon, Senior Investigative Counsel; Barbara Comstock, Chief Investigative Counsel; Kristi Remington, Investigative Counsel; Miki White, Investigative Attorney; Dale Anderson, Investigative Counsel; Kenneth Ballen, Minority Chief Investigative Counsel; Andrew J. McLaughlin, Minority Counsel; and Michael J. Raphael, Minority Counsel.
For MS. WEYMOUTH:
ROBERT D. LUSKIN, ESQ.
Comey, Boyd & Luskin
1025 Thomas Jefferson Street, N.W.
Suite 420 East
Washington, D.C. 20007-5243
CAROLE J. YANOFSKY, ESQ.
Comey, Boyd & Luskin
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1025 Thomas Jefferson Street, N.W.
Suite 420 East
Washington, D.C. 20007-5243
Mr. DHILLON. Let's go on the record.
Good morning, Ms. Weymouth. I would like to begin by thanking you on behalf of the members of the Committee on Government Reform and Oversight for appearing here today. This proceeding is known as a deposition. The person transcribing this proceeding is a House reporter and notary public. I will now request that the reporter place you under oath.
THEREUPON, HOLLI B. WEYMOUTH, a witness, was called for examination by Counsel, and after having been first duly sworn, was examined and testified as follows:
Mr. DHILLON. I would like to note for the record those who are present at the beginning of the deposition. I am Uttam Dhillon, the designated Majority counsel for the committee. I am accompanied today by Kristi Remington, who is with the Majority staff. Mr. Kenneth Ballen is the designated Minority counsel for the committee. Mr. Ballen is accompanied by Mr. Andrew McLaughlin and Mr. Michel Raphael and Mr. Phil Barnett, who are also with the Minority staff. The deponent is represented by Mr. Robert Luskin, and there are no Members present.
Although this proceeding is being held in a somewhat informal atmosphere, because you have been placed under oath, your testimony here today has the same force and effect as if you were testifying before the committee or in a courtroom. If I ask you about conversations you have had in the past, and you were unable to recall the exact words used in the conversation, you may state to me that you are unable to recall those exact words and then you may give me the gist or substance of any such conversation to the best of your recollection.
If you recall only part of a conversation or only part of an event, please give me your best recollection of those events or parts of the conversations that you recall. If I ask you whether you have any information upon a particular subject and you have overheard other persons conversing with each other regarding it or have seen correspondence or documentation regarding it, please tell me that you do have such information and indicate the source, either a conversation or documentation or otherwise, from which you derived such knowledge.
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Before we begin the questioning, I want to give you some background about the investigation and your appearance here.
Pursuant to its authority under House rules X and XI of the House of Representatives, the committee is engaged in a wide ranging review of possible political fund-raising improprieties and possible violations of law. Pages 2 through 4 of House Report 105-139, a copy of which you have received, summarizes the investigation as of June 19th, 1997, and encompasses any new matters which arise directly or indirectly in the course of the investigation.
Also, pages 4 through 11 of the report explain the background of the investigation. All questions related either directly or indirectly to these issues or questions which have a tendency to make the existence of any pertinent fact more or less probable than it would be without the evidence are proper.
The committee has been granted specific authorization to conduct this deposition pursuant to House Resolution 167 which passed the full House on June 20th, 1997. Committee rule 20, of which you have received a copy, outlines the ground rules for the deposition.
Majority and Minority committee counsels will ask you questions regarding the subject matter of the investigation. Minority counsel will ask questions after Majority counsel has finished. After the Minority counsel has completed questioning you, a new round of questioning may begin.
Members of Congress who wish to ask questions will be afforded an immediate opportunity to ask their questions. When they are finished, committee counsels will resume questioning.
Pursuant to the committee's rules, you are allowed to have an attorney present to advise you of your rights. Any objection raised during the course of the deposition shall be stated for the record. If the witness is instructed not to answer a question or otherwise refuses to answer a question, Majority and Minority counsel will confer to determine whether the objection is proper. If Majority and Minority counsels agree that a question is proper, the witness will be asked to answer the question. If an objection is not withdrawn, the chairman or member designated by the chairman may decide whether the objection is proper. The deposition will be held open subject to rescheduling for the purpose of resolving any disputed issues.
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This deposition is considered as taken in executive session of the committee, which means it may not be made public without the consent of the committee, pursuant to clause 2(k)(7) of House rule XI. You are asked to abide by the Rules of the House and not discuss with anyone, other than your attorney, this deposition and the issues and questions raised during this proceeding.
Finally, no later than 5 days after your testimony is transcribed and you have been notified that the transcript is available, you may submit suggested changes to the chairman.
The transcript will be available for your review at the committee office. Committee staff may make any typographical and technical changes requested by you. Substantive changes, modifications, clarifications, or amendments to the deposition transcript submitted by you must be accompanied by a letter requesting the changes and a statement of your reasons for each proposed change.
A letter requesting any substantive changes, modifications, clarifications, or amendments must be signed by you. Any substantive changes, modifications, clarifications, or amendments shall be included as an appendix to the transcript conditioned upon your signing the transcript.
Do you understand everything we have gone over so far?
The WITNESS. Yes.
Mr. DHILLON. Do you have any questions about anything we have gone over so far?
The WITNESS. No.
Mr. DHILLON. Mr. Ballen, I am prepared to begin asking some preliminary questions. Did you have a comment you wanted to make?
Mr. BALLEN. No. Just to put on the record that to the extent that any questions exceed the authorized scope of this committee relating to credible allegations of improper or illegal campaign fund-raising activities, the Minority would object.
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Mr. DHILLON. That is noted for the record. Thank you.
Mr. LUSKIN. For the record, may I note that Ms. Weymouth is appearing voluntarily in response to the committee's request for a deposition and did not require a subpoena to enforce her attendance today.
Mr. DHILLON. That is noted for the record, and I think I had a question on that. Thank you very much.
EXAMINATION BY MR. DHILLON:
Question. Now, I will be asking you questions concerning the subject matter of this investigation. Do you understand that?
Answer. Uh-huh.
Question. If you don't understand a question, please say so and I will repeat it or rephrase it so that you understand the question. I sometimes start talking fast, especially if we are getting late in the day. Please tell me if you don't understand a question or if you want me to slow down. Do you understand that?
Answer. Yes.
Question. The reporter will be taking down everything we say and will make a written record of the deposition. You must give verbal, audible answers because the reporter cannot record what a nod of the head or other gestures mean. Do you understand you cannot say ''uh-huh'' or ''huh-uh'' and must give audible answers?
Answer. Yes.
Question. If you can't hear me, please say so and I will repeat the question or have the court reporter repeat the question to you. Do you understand that?
Answer. Yes.
Question. If you don't know the answer to a question, simply say you do not know. I do not want you to speculate or guess. Do you understand?
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Answer. Yes.
Question. Please wait until I finish each question before answering, and I will wait until you finish your answer before I ask the next question. Do you understand that this will help the reporter make a clear record because she cannot take what we are both saying down at the same time?
Answer. Yes.
Question. Your testimony is being taken under oath, as if we were in court and that if you—if you answer a question, it will be assumed that you understood the question and the answer was intended to be responsive to it. Do you understand that?
Answer. Yes.
Question. Are you here voluntarily or as a result of a subpoena?
Answer. Voluntarily.
Question. Do you have any questions about the deposition before we begin the substantive portion of the proceeding?
Answer. No.
Question. Could you please state your name and spell it for the record?
Answer. Holli, H-O-L-L-I, middle initial B., as in boy, Weymouth, W-E-Y-M-O-U-T-H.
Question. And what is your present address?
Answer. [Redacted].
Question. And if you could briefly describe your work history, including volunteer work, from college forward.
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Answer. Let's see. I graduated from William and Mary, May of 1991. At that time, later in that summer, I left to go to Japan for a year on the Jet program as an English teacher, after which I went on a Rotary scholarship to Guadalajara, Mexico, where I worked for another year, taught at the University of Guadalajara; volunteered some there in community service projects—I really don't recall everything I did—at which time I came back to the United States approximately in October of 1993, where I worked then part-time in Maryland for Social and Health Services, which is—did marketing for the Department of Health and Human Services on drug and alcohol abuse prevention, while I was interviewing and looking for the job in Washington in international trade.
Let's see. When did I start? In February of 1994, I started working for a company called International Strategic Advisors, which is a consulting firm here in Washington that represents U.S. companies on matters of international trade, market entry issues, things of that sort.
I worked there through—I believe I gave notice in September of 1995, but I continued working part-time through January of 1996, training people that were replacing me.
I am trying to think if there were any volunteer efforts during that time.
Oh, I taught GEMET, GRE courses for Princeton Review, just as something fun. And in February of 1996 is when I began working for CommerceCorp. And the only volunteer activities outside of that are community cleanup projects for a group called Hope Worldwide and things through my church.
Question. And where are you presently employed?
Answer. CommerceCorp International.
Question. And I think you already—let me ask you the question. When did you start there?
Answer. In February of 1996.
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Question. Now, how did you come to work at CommerceCorp International? If it is all right with you, I will just call it CommerceCorp.
Answer. Sure. A friend of mine, who I had gone to undergraduate with, Kate Wilson, was a desk officer at the U.S. ASEAN Council, and she knew that I was not happy at the consulting firm where I was employed, and so she, in talking to Mark, who was looking for someone who could help him with a new company who could handle both the business aspects of starting a small business and also someone who knew Washington a little bit, had dealt with international trade and issues of that sort, and she recommended me for the position.
Question. Now, you referred to someone named Mark. Who was Mark?
Answer. Mark Middleton.
Question. Who is Mark Middleton?
Answer. My employer.
Question. And did you know Mr. Middleton before you started working at CommerceCorp?
Answer. Only in that when I was employed at International Strategic Advisors, which we can call ISA, I had done some work on a textile-trade-related issue for The Limited, and we had sent briefing memorandas and bullet points related to our issue on the Cardin rule, and we had sent—the Cardin amendment was an issue of legislation that dealt with rules of origin for textile trade, and we had sent briefing memoranda to a sundry of people, one of which was Mark Middleton, then at the White House. But that was my only—the only time I had ever seen his name, really.
Question. Had you met him prior to your employment at CommerceCorp?
Answer. No, I had not.
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Mr. LUSKIN. Obviously, in connection with your——
The WITNESS. Interview, yes.
Mr. LUSKIN.—interview, yes.
EXAMINATION BY MR. DHILLON:
Question. I was going to get into that. Prior to your employment, did you interview with someone at CommerceCorp?
Answer. Yes, I interviewed with Mr. Middleton on two separate occasions.
Question. Was the first interview with Mr. Middleton the first time you ever met him?
Answer. Yes, it was.
Question. And would that be in or about February of 1996?
Answer. I believe it would have been January of 1996. It was during a tremendous snowstorm.
Question. What is your title at CommerceCorp?
Answer. My official title is director.
Question. That's it's, just director?
Answer. Uh-huh, just director.
Question. And what are your duties as the director of CommerceCorp?
Answer. Many hats. Mostly project research; market research; identifying different sectors of—I would say sectors within the U.S. economy that are growing, looking for opportunities where U.S. businesses may be interested in exporting technology to different countries; research on market segments within foreign countries that may be emerging, emerging growth areas; also includes just general running of the company.
I was initially involved in helping Mark set up or complete all of the paperwork and maintaining tax filings on time, other documents that you file in the District or articles of incorporation, things of that sort related to the existence of the company, and generally whatever needed to be done in helping make sure things run smoothly.
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Question. Where was CommerceCorp incorporated?
Answer. Delaware.
Question. Are you one of the directors? Are you listed as a director of CommerceCorp?
Answer. No.
Question. Do you know who the directors are?
Answer. I believe Mark is the only person who is listed as an officer on the corporate documents.
Question. Do you recall your exact start date?
Answer. No. I can give you an approximation.
Question. February of 1996?
Answer. February 15th, on or about.
Question. Okay. Now, have your duties at CommerceCorp changed since starting in February of 1996?
Answer. I would say my duties have—they have constantly been evolving, only because it is a small company and it was a new company, and, therefore, there are a lot of things initially in getting a company off the ground and started that we had to deal with.
Mark had never managed a company before, so there were some—just when you start anywhere, there is some initial weeding out and solidifying exactly what your role is going to be.
Question. On an average day today, what do you do at CommerceCorp?
Answer. Now, I would say 85 percent of my time is exclusively on project research, market research; writing memoranda regarding those things; maybe only 15 percent of it comprised of administrative things. Everything is now in place, so it would be just filing away tax filings and things of that sort that come through, checking on any problems.
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Question. I think you sort of answered this when you told me what your responsibilities are, but I am going to ask about CommerceCorp specifically. What type of a business is CommerceCorp?
Answer. It is a corporation. You mean, define the business?
Question. What does it do? What does CommerceCorp itself do?
Answer. I would say international business consulting.
Question. Now, does it consult for companies in other countries?
Answer. We have U.S. clients, and we have some foreign clients.
Question. And what sort of activities does CommerceCorp perform for clients in foreign countries?
Answer. I would guess—gosh, it is a wide range of things, because the company has different focuses, but mostly market research here in the United States.
We have one client that's interested in joining with a U.S. company and penetrating the market here, working on some type of joint venture. We do market research for them here in the United States, helping to identify U.S. companies that would benefit from that relationship and how they might work together, things of that sort. Also, helping them, U.S. companies who have, let's say, franchises that they may be interested in setting up internationally and our client overseas is also interested in those opportunities. So helping put the two together.
Question. So CommerceCorp obviously has what you would describe as clients?
Answer. Yes.
Question. Do you have any interaction with the clients of CommerceCorp?
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Answer. Yes.
Question. And what generally is the kind of interaction you have with the clients?
Answer. Not so much face-to-face contact. That, again, depends on what we are working on. A lot of times it is communications via fax and telephone, sending through brief—you know, briefing bullets on research that I have done, on markets that I have studied, what I have found out; answer requests that they have for information; getting them the information they need; kind of generally monitoring what they are interested in doing, looking around here in the United States and seeing who is in that business and who may be interested in having more of an opportunity overseas and communicating that back to the client.
Question. What is the chain of command there at CommerceCorp? Who is in charge?
Answer. Mark Middleton is the president of the company.
Question. Who is the number two person below Mr. Middleton?
Answer. Myself.
Question. Okay. Who is below you?
Answer. We have different administrative staff that we work with.
Question. How many? After you and Mr. Middleton, how many administrative staff are there?
Answer. Well, in what sense? I mean, I am the only other employee of the company. The administrative staff that we use is actually—we are in a shared office space, and so we share that administrative staff, but there is no direct command in the sense that they are on payroll and we direct their day-to-day operations. They actually are employed by someone else, but they do type memos and answer the phones, things of that sort. And then I would work—Mark would work directly with them. And then I would also work with them.
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Question. So you and Mr. Middleton are the only actual employees of CommerceCorp?
Answer. Yes.
Question. Now, does Mr. Middleton travel abroad in connection with CommerceCorp business?
Answer. Yes.
Question. And is there anywhere he travels frequently?
Answer. He travels to Asia frequently.
Question. Any other countries or parts of the world he travels to frequently?
Answer. Not frequently. I mean, he does travel to other locations.
Question. Let's define our terms. I used the term ''frequently,'' and you seemed to understand what I was talking about. But what is your sense of what ''frequently'' is?
Answer. I mean, in international business, ''frequently'' can have—it is not the same as it would be for you or I, I guess.
Question. That's right. That's why I need you to define it for me.
Answer. ''Frequently,'' as I am using it here, would mean once every 6 to 8 weeks.
Question. Okay. Now, have you ever traveled with Mr. Middleton in connection with CommerceCorp business?
Answer. Domestically; not internationally.
Question. Approximately how many times?
Answer. Two or three times, I believe.
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Question. Who does CommerceCorp share its office space with? We will go back a couple of questions.
Answer. The company's name is Concord Associates.
Question. Just generally, what do they do?
Answer. They also work for U.S. companies in identifying international opportunities. Beyond that, I am not sure.
Question. Is there any sort of relationship between CommerceCorp and that company?
Answer. No.
Question. Besides sharing administrative staff?
Answer. No.
Question. Who pays or who employs the administrative staff?
Answer. Concord Associates does.
Question. How are they compensated for the work they do for you?
Answer. I believe it is part of the rental agreement, but I am not real privy to that information.
Question. Who is the custodian of records at CommerceCorp for legal purposes?
Answer. I am not sure what you mean.
Question. Okay. You don't know what I mean when I say ''custodian of records''?
Answer. Huh-uh.
Question. Has CommerceCorp ever been served with a subpoena? I don't want to know what the nature of the subpoena is but whether it has been served with a subpoena for documents or anything like that.
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Answer. What we turned into the committees.
Question. Other than that, prior to that, had it ever been served with a subpoena of any sort?
Answer. No.
Question. Does Mr. Middleton have any associates or partners in CommerceCorp?
Answer. No.
Question. Is there anyone else you represent at CommerceCorp other than Mr. Middleton?
Answer. No.
Question. Have you ever heard of a person named Linda Littlehale?
Answer. Yes.
Question. Who is she?
Answer. She is employed by Concord Associates.
Question. And what is her position at Concord Associates?
Answer. She is the assistant to the president of that company.
Question. Has she ever worked for CommerceCorp?
Answer. No.
Question. Has she ever done any work in an administrative staff position for CommerceCorp?
Answer. Yes. She does answer the phones.
Question. Is she normally the person that would answer a phone if a call came in to CommerceCorp?
Answer. She is now, yes.
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Question. Okay. How long has she been that person?
Answer. She has been there since I came on board, but only, I would say, within the last 5 or 6 months has she been the person who answers the phone initially.
Question. So her job description is basically receptionist; is that it?
Answer. More assistant to the president of their company. She used to work on the Hill, and they do a lot of work with the Hill, and so she is very helpful to her boss in knowing how to get information from the Hill, so on and so forth.
Question. Do you know—have you ever heard of someone named Sandy McClure?
Answer. Yes.
Question. Who is she?
Answer. She was formerly employed by Concord Associates.
Question. And was she ever employed by CommerceCorp?
Answer. No.
Question. Did she do work for CommerceCorp?
Answer. Yes, she did.
Question. What kind of work did she do?
Answer. She was initially the receptionist for Concord Associates, so when I started working at CommerceCorp, she was the person who answered the phones on a daily basis, and then Linda was a backup on the phones.
Question. Now it is Linda who is doing that?
Answer. Now it is Linda who answers the phone.
Question. Linda Littlehale?
Answer. Right. Sandy was also the secretary, doing typing and things of that sort.
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Question. Not for CommerceCorp, though?
Answer. For the other firm, but she also did typing for CommerceCorp, for Mark Middleton.
Mr. DHILLON. See how fast this is going?
Mr. LUSKIN. Are you done?
EXAMINATION BY MR. DHILLON:
Question. Have you ever heard of a company called International Realty Investors?
Answer. I believe that's where Mark was employed after the White House, before CommerceCorp, but I didn't really deal with them.
Question. Do you know what type of business International Realty Investors is?
Answer. No.
Question. Did Mr. Middleton ever discuss it with you?
Answer. No.
Question. Do you know what Mr. Middleton did for International Realty Investors?
Answer. No.
Question. Have you ever heard of a company called Astrum International?
Answer. Yes.
Question. And what do you know about Astrum International?
Answer. Nothing actually, only that I know the name. It is not a project or anything that I worked on directly.
Question. How do you know the name?
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Answer. It is just familiar. I feel like I may have heard it or seen it on—seen it written on something perhaps, but right now I am not recalling.
Question. Do you know if Mr. Middleton was ever employed by Astrum International?
Answer. No, I don't.
Question. Now, what is Mr. Middleton's practice with respect to typing memos or letters? Does he do it himself or does he have someone else do it?
Answer. No, Mark doesn't type them himself. He writes memos on legal pads, and then he gives them to someone to type.
Question. Is that his practice? Does he—is that typically his practice?
Answer. Yes.
Question. You nodded your head, which is why I re-asked the question.
Answer. Okay.
Question. Does he ever use a Dictaphone?
Answer. No. And he doesn't know how to turn his computer on.
Question. Okay. I am sorry, maybe you answered this and I just didn't catch it. Who typically types his memos or letters?
Answer. Sandy.
Mr. LUSKIN. I am sorry, at what time period are you talking about?
EXAMINATION BY MR. DHILLON:
Question. From the time you have been there to the present, who has typically typed his, Mr. Middleton's, memos and letters and any other written material he needs typed?
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Answer. The receptionist/secretary would have typed his memos, and I have typed some things for him. It just kind of depends, whoever he happens to see, but mostly it was Sandy McClure. I believe Linda has also typed some things for him at times, and we have had temporary help that has also typed letters.
Question. Like temps come in for the day or something like that?
Answer. Uh-huh.
Question. What about things like faxing documents? Does Mr. Middleton fax his own documents, or does he have someone else do that for him?
Answer. Some of each. He faxes some things, and some things we fax.
Question. You said a second ago he doesn't know how to turn his computer on?
Answer. Yes.
Question. But he does know how to use the fax machine?
Answer. Yes, he does.
Question. When Mr. Middleton is out of town, how does he typically retrieve his messages?
Answer. He would call in to the office, and we would tell him over the phone. Then some things we would write up and fax to him, wherever he was.
Question. Is that the regular practice, fax him things if he needs——
Answer. Yes.
Question. If he needs—what is—why do you fax him something? Do you type up a memo to fax it to him?
Answer. He didn't call in regularly.
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Mr. LUSKIN. I am sorry, there were about three questions there.
Mr. DHILLON. You are right.
EXAMINATION BY MR. DHILLON:
Question. Why would you fax him something?
Answer. Usually just to make sure he had all of the information correct, because if we told him over the phone, he might not necessarily remember. To make sure he had phone numbers, et cetera and so forth.
Question. You were starting to say that he doesn't—he didn't regularly call in.
Answer. Right. Sometimes, you know, we would talk to him in the morning, we would have messages that came in in the afternoon, and we might not talk to him before we left for the day. At that time, the secretary/receptionist would fax the messages through to his hotel.
Question. Does Mr. Middleton use voice mail?
Answer. No. We don't have voice mail.
Question. Now, from the time you started at CommerceCorp, did you ever or have you ever contacted any employees at the White House in your capacity as an employee of CommerceCorp?
Answer. Yes.
Question. Was there anyone in particular you would speak to at the White House?
Answer. I have talked with Ann McCoy, Debbie Schiff. Those are the only two that I can remember.
Question. And who is Ann McCoy?
Answer. I am not sure of her title actually.
Question. Who is Debbie Schiff?
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Answer. Debbie Schiff, I believe, is the receptionist in the West Wing.
Question. What did you typically call Ann McCoy for?
Answer. Ann McCoy, at times, would meet people for tours.
Question. So did you call her to help arrange tours?
Answer. Usually it was just to pass along something from Mark, pass along a message or, you know.
Question. Were there any other reasons you called Ann McCoy other than to—let me back up. I am not clear on the tours.
Answer. Sure.
Question. Did you call her—did you ever call her to arrange a tour?
Answer. Mark would talk to her, and then at times—I can only honestly think of either one occasion or two occasions where I talked to her to make sure I had the right number to fax information through or something of that sort; not a great deal of contact.
Question. Any other reasons to talk to her besides what you have already described?
Answer. No.
Question. All right. How about Debbie Schiff? Why did you contact Debbie Schiff?
Answer. For the same reason, to send her information on clearance information for tours.
Question. Clearance information for tours?
Answer. Right.
Question. Any other reasons?
Answer. No. One time we asked her to send us the—the catalog of the book store, or I guess there is a gift store or something like that at the White House, and we wanted a list of books and other things that they had.
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Question. Any other individuals besides Ann McCoy and Debbie Schiff that you contacted at the White House while you were employed at CommerceCorp?
Answer. Not names that I can recall off the top of my head.
Question. Were there other people that you spoke to that you just can't recall right now?
Answer. Yes, there may have been; I just can't remember.
Question. You have said that you called in clearance information. Could you please tell me what that is?
Answer. Names and dates of birth for individuals who would be attending tours.
Question. Okay. And these tours are not the kind of tours that you line up outside the White House for? These are different kinds of tours?
Answer. I believe that there were some—and I am sorry—the tours, I know that there are several different kinds. They have early morning tours, they have the kind where you can line up at the White House at the gates, and there are some where you can get the tickets ahead of time so you don't wait in line but you go on the same tour, and I know that there are some special tours that staff can give.
I am honestly not clear if the information I sent through—I know sometimes we did give—they gave special tours, but I don't know if I sent through clearance information for all types or just for a specific type. I wasn't that directly related to the tours.
Question. You do have a recollection, though, that special tours were at least in some—in terms of some of the conversations you had, that special tours were the issue?
Answer. Yes.
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Question. Do you recall how many of those were special tours?
Answer. I can think of maybe three where, as a courtesy, there was someone—I believe there were three where there was someone who met the guest and walked through with them. There may have been more. I am not sure on the number.
Question. Someone at the White House walked through with them?
Answer. Yes. Yes.
Question. Now who were these—talking about just those——
Answer. Sure.
Question. Who were these for?
Mr. LUSKIN. Excuse me. Those being the three that she has just described as special tours?
Mr. DHILLON. Correct.
The WITNESS. Do you want names?
EXAMINATION BY MR. DHILLON:
Question. Yes.
Answer. The first one I was thinking of was for the Widjaja family, and the second one I can think of was for the—I am not sure what his name is now; I am blanking. It was a young guy that—I believe, who does property development. He is not a client or anyone. Someone else had asked us to do him a favor. He was working on US/China relations and kind of a cultural exchange.
The third one that I am thinking of was, I believe, a surgeon or someone. I am not sure.
Question. Any others that you can remember?
Answer. Not off the top of my head. Again, there may have been others, but I am not recalling.
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Question. Now, how was Mr. Middleton able to arrange these tours?
Answer. I believe he spoke with someone at the White House and through—probably the Public Liaison Office, and asked someone on the staff to clear them in, to meet them, et cetera and so forth.
Question. Do you know if Mr. Middleton stayed in contact with anyone from the White House while he was at CommerceCorp?
Answer. Yes.
Question. Okay. Who did you stay in contact with?
Answer. Yusuf Khapra, who I believe was his intern at one time. I know he talked to Mack McLarty's assistant. And there were a number of people that called that were his friends.
Again, it is—you know, I was working on projects, so I am not sure of who all his friends were from the White House and things of that sort.
Question. You said Mack McLarty's assistant. Do you remember that person's name?
Answer. No.
Question. Did he ever speak to Mack McLarty?
Answer. Not that I know of. I wouldn't know.
Question. Do you know if Mr. Middleton ever took clients or prospective clients to eat at the White House mess?
Answer. Again, I know that the Widjaja family did go on a tour. I don't know if they ate in the mess or not.
Question. Okay. So other than that, do you have any knowledge of Mr. Middleton taking clients or prospective clients to eat at the White House mess?
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Answer. No, no other clients that I can think of.
Question. And do you know how Mr. Middleton arranged to bring people into the White House mess while he was employed at CommerceCorp?
Mr. LUSKIN. Let me stop you a minute. You asked a general question before she gave you a specific answer. She said she could think of it on one occasion.
Mr. DHILLON. You are right. I will go back and ask the question differently.
EXAMINATION BY MR. DHILLON:
Question. Do you know how Mr. Middleton was able to bring the Widjajas into the White House mess?
Answer. Again, I don't know who the specific contact was for that.
Mr. BALLEN. Also, the witness said she didn't know whether or not the Widjaja family went into the White House mess.
Mr. DHILLON. Is that an objection?
The WITNESS. Right.
Mr. BALLEN. It is an objection to the question because she is——
Mr. LUSKIN. It does assume a fact that may or may not be in evidence.
EXAMINATION BY MR. DHILLON:
Question. Did Mr. Middleton maintain a voice mail message at the White House?
Answer. Not that we knew of, until it came out in the papers that there was some message on the machine.
Question. You said, ''not that we knew of.'' Who are you referring to when you say ''we''?
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Answer. I remember the day that came out in the papers, that there was a message at the White House which said, for Mark Middleton, call this number; for Mack McLarty, call this number; for Yusuf Khapra, call this number. We were not aware of that until that showed up in the papers and we kind of—we called the number to verify that that is what was going on, and it was a surprise to us.
But no, there was no voice mail system anywhere that we were aware of. We did, however, find out that that message was on the machine.
Question. When you say ''we,'' who are you referring to?
Answer. Mark Middleton and myself.
Question. Anybody else?
Answer. That found out on that day?
Question. Who knew about the——
Answer. I read it in the paper.
Question. When you said ''we,'' I just wanted to make clear that you are referring to yourself and Mr. Middleton.
Answer. Right. Right.
Question. So then I—to the best of your knowledge, that number was never used by Mr. Middleton prior to that time?
Answer. No.
Question. You never saw that—do you know what phone number that was?
Answer. No.
Question. Are you aware of the phone number itself that you had called?
Answer. I was told after the fact, when it came out in the newspaper, that it was—by the intern, Yusuf Khapra, that it was his desk phone. And he would answer phone calls for Mark and Mack when he was at the White House and when he left the White House to go to another Department—I don't remember if it was Labor at that time; he moved around quite a bit.
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But when he left the White House, he put a message on there so that—because every now and then they would get the occasional call for Mark and Mack, he left the message on the phone without really telling anyone, thinking that's what you do when you leave.
He again put on the message, for Yusuf Khapra, call this number; for Mack McLarty, call this number; and for Mark Middleton, call this number. And that's how I found out how it came to be. But we didn't know about that until it surfaced in the papers. It was kind of a surprise to us.
Question. I am not clear on one thing. Who told you that? Was it Mr. Khapra who told you that?
Answer. Yes.
Question. So Mr. Khapra told you that he was the one who put the message on the machine?
Answer. Yes. He was the intern for Mark and Mack, I believe.
Question. So did Mr. Middleton have any business cards with that number printed on them?
Answer. Not that I have seen, no.
Question. Do you know who at the White House knew that Mr. Middleton—that this message was on that machine?
Answer. No; only Yusuf. But, again, by that point he had left the White House and was working for another Department.
Question. Was it your understanding that he was employed there or he was an intern there—Mr. Khapra?
Answer. I am not sure.
Question. So the first time you and Mr. Middleton discussed the voice mail message was when you two discovered it as you previously described; is that correct?
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Answer. Correct, when it came out in the papers.
Question. Did you ever—I think I know the answer to this, but did you ever check the messages on that machine?
Answer. Yes, we did call the number to see, because we couldn't believe it. I mean, we just thought it was the greatest example of——
Mr. LUSKIN. I think he may have been asking a different question.
The WITNESS. I am sorry.
EXAMINATION BY MR. DHILLON:
Question. I can break it down. Prior to your discovery of the phone number or prior to reading the article in the paper——
Answer. Right.
Question. Is that how you discovered it?
Answer. Yes.
Question. Prior to reading that, did you ever check or do you know if anyone—if Mr. Middleton ever checked for messages left at that number?
Answer. No.
Question. After that, the day you discovered it, or after that day, what did you do with respect to calling the phone number? Did you ever call that phone number?
Answer. Yes, on that day that we found out from the papers we called the number, because we were curious to see what it said.
Question. Was there—did the recording have the—or did the recording you listened to purport to be able to record messages from people?
Answer. I don't know, honestly. I was there when we called, but then, you know, Mark took the phone, so I don't remember if there was a beep at the end or what. That's what you are asking?
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Question. Yes, yes.
Answer. Okay.
Question. Did you or Mr. Middleton attempt to retrieve messages at that point from the recording?
Answer. No.
Question. Did Mr. Middleton have business cards which identified him as a White House employee or which were imprinted with the Presidential seal?
Mr. LUSKIN. Excuse me. Subsequent to the time that he left the White House; is that the question?
Mr. DHILLON. Let me re-ask the question.
EXAMINATION BY MR. DHILLON:
Question. While Mr. Middleton was employed at CommerceCorp, did he have business cards which identified him as a White House employee which were imprinted with the Presidential seal?
Answer. When I was going through some old boxes, I found a stack of White House cards with a rubber band around them that were his cards when he did work at the White House, but it was in a box under some things under my desk. I have never seen him use or ever otherwise ever seen any White House symbol or business card, no.
Question. You—let me just clarify that last answer.
Answer. Sure.
Question. You never saw Mr. Middleton use White House business cards after he left the White House?
Answer. That is correct.
Question. Did Mr. Middleton ever arrange any tours for DNC donors, tours of the White House?
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Answer. I don't know.
Question. Have you ever spoken with Ann Stock in her capacity as a White House employee?
Answer. I may have. Her name is familiar, but I don't recall specifically any circumstances where I would have.
Question. Have you ever met Mack McLarty?
Answer. No.
Question. What is Mr. Middleton's relationship with Mack McLarty?
Answer. I believe they are good friends. I know Mark always speaks very highly of Mack, that he was a good man and a great friend. He was friends with his wife as well.
Question. Was there any business relationship with Mr. McLarty, between Mr. Middleton and—let me—let me go back. Did Mr. Middleton and Mr. McLarty have any business relation while Mr. Middleton was at CommerceCorp?
Answer. No.
Question. Did Mr. McLarty ever contact Mr. Middleton at CommerceCorp?
Answer. Not to my knowledge.
Question. Did Mr. Middleton ever meet with Mr. McLarty at the White House while Mr. Middleton was employed at CommerceCorp?
Answer. Not to my knowledge.
Question. Did Mr. McLarty assist Mr. Middleton with CommerceCorp business?
Answer. Not to my knowledge.
Question. Did Mr. Middleton ever set up any meetings with Mr. McLarty for Mr. Middleton's clients, CommerceCorp clients?
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Answer. I don't know.
Question. Have you ever heard of a person named Molly Varney?
Answer. Yes, I have heard her name before.
Question. Do you know who she is?
Answer. I think—I think she worked in Mack's office.
Question. When you say ''Mack,'' you mean Mack McLarty?
Answer. Mack McLarty's office, yes.
Question. Did you ever have any contact with her?
Answer. I believe I did, but I am not—again, I am not sure—I don't recall the circumstances. It wasn't very often.
Question. Did you ever call Ms. Varney to arrange meetings with Mr. McLarty—between Mr. McLarty and Mr. Middleton?
Answer. Not that I can recall.
Question. Do you know if Mr. Middleton ever contacted Ms. Varney to arrange meetings with Mr. Middleton and Mr. McLarty?
Answer. Again, I know he spoke with Mack—Mark Middleton spoke with Mack McLarty's office. But I don't know the nature of the conversations or with whom he spoke specifically.
Question. Have you ever met Yusuf Khapra?
Answer. Yes.
Question. When was the first time you met him?
Answer. I don't recall. I believe it was fairly recently, when he was applying for graduate school.
Question. How many times have you met him?
Answer. I would say I have seen him five or six times.
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Question. Over the course of what period of time?
Answer. The last 6 months. He came to—we were helping him with graduate school recommendations, and he came up to pick up the recommendations.
Question. You said five or six times. Were all those meetings at CommerceCorp or at another location?
Answer. At CommerceCorp.
Question. Did you ever contact Mr. Khapra in his capacity as an employee or intern at the White House?
Answer. No, not that I can recall.
Question. Do you know if Mr. Middleton ever contacted Mr. Khapra in his capacity—Mr. Khapra's capacity as an employee or intern at the White House?
Answer. I know they spoke. Yusuf would call us. They were friends. I don't know the nature of the conversation.
Question. Did those conversations occur or did they—when you first started at CommerceCorp, was Mr. Middleton speaking to Mr. Khapra on the phone in conversations like you have described? When do you recall the first conversations between Mr. Middleton and Mr. Khapra at CommerceCorp?
Answer. Oh, he—gosh, I don't remember when they started, but he has called off and on. Yusuf has called us off and on since I started.
Question. Okay. Do you know if Mr. Khapra ever scheduled any White House appointments for Mr. Middleton?
Answer. I don't know.
Question. Do you know why Mr. Middleton and Mr. Khapra would speak on the phone?
Answer. I know Yusuf was interested in pursuing other positions, and I know he would ask for Mark's advice on where to work, who to work for, you know, who was a—who was a nice person to work for, what department would be helpful, advice on going to graduate school, all sorts of things.
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Question. Do you know if Mr. Middleton—do you know if Mr. Khapra ever scheduled any appointments for Mr. Middleton at the White House?
Mr. LUSKIN. I think you just asked that.
Mr. DHILLON. Did I just ask that? I am sorry. That's why I was looking at that twice. I was listening so intently to your answer, I forgot what the question was.
Mr. LUSKIN. She was just looking at the stack of pages.
The WITNESS. I was wondering if you were going through all of those pages.
EXAMINATION BY MR. DHILLON:
Question. We are, but I am going through them very quickly. I think you will be happy to know that. I am marking a lot of things off.
Do you know where Mr. Khapra worked after he left the White House?
Answer. No, I don't recall. Again, it may have been Labor, but I am not sure.
Question. When you say ''Labor,'' you mean——
Answer. Department of Labor.
Question. Do you know if Mr. Middleton had any business with or before the Department of Labor?
Answer. No.
Question. Okay. Bad question.
Answer. Yes.
Question. No, you don't know, or no, he didn't?
Let me back up. Let me just ask a better question so the record is clear. Did Mr. Middleton have business with or before the Department of Labor?
Answer. No.
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Question. Do you know if Mr. Middleton ever met with anyone employed by the Department of Labor on business issues?
Answer. Not that I know of.
Question. Does Mr. Middleton presently maintain contact with Mr. Khapra?
Answer. Yes.
Question. Do you know where Mr. Khapra is presently working?
Answer. I believe he was working for an electronics association.
Question. Do you know the name of it?
Answer. Not the correct name, no.
Question. Do you have an incorrect name that might have the right title or the right——
Answer. I have his card somewhere. American Electronics Association—something like that. I don't know. It is pretty basic.
Question. Does Mr. Khapra presently do any work with CommerceCorp or with Mr. Middleton?
Answer. No.
Mr. DHILLON. Okay. The document with control number CC-H-000545, which is marked as Deposition Exhibit No. 1, is an October 4th, 1996, memorandum from Mark Middleton to Bob Nash regarding Arthur Davis.
Just so you know, with each exhibit, if there is an exhibit number, then I am going to state the deposition number and then give a brief description and then ask a question.
[Weymouth Deposition Exhibit No. 1 was marked for identification.]
[Note.—All exhibits referred to may be found at the end of the deposition.]
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EXAMINATION BY MR. DHILLON:
Question. That exhibit is before you, and I ask that you please review it.
Do you recognize Exhibit 1?
Answer. Only in that I believe I have seen it in the documents that were turned over to the committee.
Question. Do you know who Bob Nash is?
Answer. I know he works at the White House, only because in my previous job someone came from the NEC/NSC and I remember hearing of Bob Nash in relation to that work. But I don't know what his current title is.
Question. Do you know who Arthur Davis is?
Answer. Yes, I have met him. I believe he is in either—I am guessing. Maybe I shouldn't guess.
Mr. LUSKIN. Don't guess. If you know, yes.
The WITNESS. I am not sure what he does.
EXAMINATION BY MR. DHILLON:
Question. Do you know, does Mr. Middleton do any business with Mr. Davis?
Answer. At one time they were going to work together, and then I believe Mark told him that he wouldn't be able to help him—he didn't have time to devote to him, you know; he wouldn't be able to work on any projects for him.
Question. Do you know approximately what time that was?
Answer. This past summer, but again I am guessing. I am sorry, I don't recall exactly.
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Question. Do you know what type of project Mr. Davis and Mr. Middleton were talking about?
Answer. Again, I believe Mr. Davis is involved in real estate development. That's what we were going to work on. But it is not anything that came to fruition, so I am not clear. I think that's his business.
Question. Did you do any projects in preparation for that?
Answer. No.
Question. Or, I mean—let me rephrase the question and make it clear on the record. Did you do any projects in preparation for the conversations or discussions that Mr. Davis and Mr. Middleton had regarding their project?
Answer. No. Only that we do have a client who is involved in real estate and there were some preliminary discussions of how they may be able to work together, and I believe it was Arthur Davis. That's why I think he is the gentleman that is involved with real estate. But nothing ever came of that, and then Mark told him he wouldn't be able to help him out.
Question. Do you know why Mr. Middleton was assisting Mr. Davis in pursuing a Presidential appointment?
Answer. No.
Question. Did you ever speak to Mr. Davis?
Answer. Again, I believe I met him once. I believe he came to the office. He is a very elderly man, very sweet man. I think they were friends or business acquaintances previously. I am not sure of the nature of Mark Middleton and Arthur Davis' relationship.
Mr. DHILLON. All right. Let's go to the next exhibit, the document with control number CC-H-000502, which is marked as Deposition Exhibit 2, which is a September 9th, 1996, letter from Mark Middleton to Michael Brown, the CEO of Foxwoods Resort Casino. Exhibit 2 is now before you, and I ask that you please review Exhibit 2.
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Mr. LUSKIN. Okay.
[Weymouth Deposition Exhibit No. 2 was marked for identification.]
EXAMINATION BY MR. DHILLON:
Question. Do you recognize Exhibit 2?
Answer. No.
Question. Do you know who Mr. G. Michael Brown is?
Answer. No.
Question. Do you know what type of position he was seeking in the administration?
Answer. No.
Question. Do you know if Mr. Middleton ever forwarded Mr. Brown's bio to Mr. Nash?
Answer. No.
Question. Did Mr. Middleton have a business relationship with Mr. Brown?
Answer. No.
Question. All right. Let me re-ask that question.
Answer. Sure.
Question. Well, do you know if he had a business relationship with Mr. Brown?
Mr. LUSKIN. She just answered that.
The WITNESS. I know him to not have had a business relationship.
Mr. DHILLON. Okay. I wasn't sure we were being clear on that.
Mr. LUSKIN. Sometimes you ask, ''do you know whether or not,'' and the answer to that is yes, and when he asked you what is the business relationship——
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Mr. DHILLON. I asked the question correctly, but you answered it so quickly, I was afraid you misunderstood me.
Mr. LUSKIN. Thank you.
When he asks questions, ''do you know,'' he is simply asking whether you have knowledge rather than necessarily asking the impregnated questions behind it.
The WITNESS. Okay.
Mr. DHILLON. Correct.
EXAMINATION BY MR. DHILLON:
Question. Did Mr. Middleton have a business relationship with Foxwoods Resort Casino?
Answer. Not that I know of.
Question. Did Mr. Middleton ever approach Michael Brown about contributing to the DNC or the Clinton-Gore campaign?
Answer. I don't know.
Question. Did any other individuals come to Mr. Middleton for assistance in contacting the White House for recommendations for Presidential appointments?
Mr. LUSKIN. I am objecting in terms of ''any other.'' She said she has no knowledge of this.
EXAMINATION BY MR. DHILLON:
Question. Are you aware of any individuals who came to Mr. Middleton for assistance in contacting the White House for Presidential appointments?
Answer. No, I don't know. I don't recall any.
Question. Have you ever heard of Evan Ryan?
Answer. Yes.
Question. Who is Evan Ryan?
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Answer. Evan Ryan works in the first lady's office, I believe.
Question. Have you ever met Evan Ryan?
Answer. No.
Question. Have you ever communicated with Evan Ryan in any way?
Answer. Yes.
Question. How?
Answer. I believe we have sent to Evan—there was a request—from time to time there would be requests that would come in from people, and one of those was a woman reporter who wanted a chance to speak with the first lady, and we just called the first lady's office and found out where we would direct such a request, who we would send it to, things of that sort. I don't recall any other specific circumstances.
Question. You said ''we.'' Were you talking we——
Answer. Mark Middleton and I.
Question. Okay. In this particular case that you are thinking of or that you just described, it was regarding a female news reporter?
Answer. I believe she was female, yes.
Question. You said we called the White House. Did you make the call, did Mr. Middleton make the call?
Answer. I called the White House.
Question. Besides that, do you know anything else about Evan Ryan's association with Mr. Middleton and/or CommerceCorp?
Answer. No, not that I recall.
Question. Did Mr. Middleton make any recommendations for Presidential appointments?
Answer. I mean, not that I recall. I mean, this appears to be one, but I have never seen this before, so not that I know of.
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Question. Okay. Did Mr. Middleton ever meet with Maggie Williams at the White House?
Answer. I don't know.
Question. Did Mr. Middleton ever meet with the first lady at the White House?
Answer. I am not sure. I believe there was one occasion when he was in the White House on a tour, and the first lady was scheduled in two meetings and there was going to be a walk-through, courtesy handshake or something of that sort, but I am not aware of any meetings, no.
Question. So the only thing you are aware of is a walk-through, handshake type of thing?
Answer. Uh-huh.
Question. Do you recall when that occurred?
Answer. I believe that was with the Widjaja family.
Mr. LUSKIN. Do you recall when?
The WITNESS. Oh, I'm sorry. October. It would have been during the time of the World Bank, IMF Conference, in 1996; I believe that was October of 1996.
Mr. LUSKIN. Is this a good time to take a short break?
Mr. DHILLON. Sure.
[Recess, 11:14 a.m. to 11:24 a.m.]
Mr. Dhillon. Mr. Ballen has a statement he wants to make for the record at this point. Mr. Ballen.
Mr. BALLEN. Thank you, Mr. Dhillon. I have about 10 minutes of questions and I wanted to know, for the record, we have been going on for about an hour and I wanted to ask my questions now, and that is going to be deferred until later on; is that correct?
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Mr. DHILLON. Yes, Mr. Ballen. In this situation, we are always open to discussing those matters, and we did discuss it off the record. I would ask that we continue with the protocol as set forth by the committee, which means, at this point, Majority counsel continues with the questioning and the Minority counsel can conduct its questioning at the conclusion of Majority counsel's questioning. We are of course open to, at a later point, questioning by Minority counsel, even before Majority counsel is finished. But at this point, Majority counsel will proceed. Thank you.
EXAMINATION BY MR. DHILLON:
Question. Did Mark Middleton arrange a walk-through with the first lady for the Widjaja family?
Answer. Is that everything?
Question. That is the question. Do you want me to re-ask it?
Answer. Sure.
Question. Did you understand it?
Answer. I believe I understood it. I was thinking you were going to clarify something or change something. No—excuse me.
Question. Did Mr. Middleton arrange a walk-through of the White House—hold on a second.
Did Mark Middleton arrange with the first lady to have the first lady meet with the Widjaja family?
Answer. Again, I believe that when Mr. Middleton took the Widjaja family on a tour of the White House, he found out that the first lady had two meetings and would be walking through where they would be. I don't know that he arranged that, per se, specifically, but he did find out that she was having two meetings and would be going through that reception area, and—or I guess arranged for her to stop in and shake hands. But my specific knowledge is not very good. I didn't work on that.
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Question. Other than the Widjajas, did Mr. Middleton arrange meetings for any other CommerceCorp clients with the first lady?
Answer. Not that I know of.
Question. Did Mark Middleton have a personal relationship with the first lady?
Answer. I don't know.
Question. Have you ever heard of Vanessa Weaver?
Answer. It sounds vaguely familiar.
Question. Do you know in what context it sounds familiar?
Answer. No.
Question. You have heard of the name, but you don't know anything about her?
Answer. No.
Question. Bad question. You heard of the name, correct?
Answer. I believe so.
Question. Do you know anything about Vanessa Williams?
Answer. No—Vanessa Williams or Weaver? She is a singer. More than we want to know.
Question. So the record is clear, that was supposed to be Vanessa Weaver.
Have you ever heard of Phu Huynh, and I am happy to show your client the name in writing if it would help?
Mr. BALLEN. I think that would be a good idea.
Mr. DHILLON. We will do that.
EXAMINATION BY MR. DHILLON:
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Question. P-H-U, first name is P-H-U; last name is H-U-Y-N-H.
Answer. No, I don't recognize the name.
Question. Have you ever heard of Marsha Scott?
Answer. Yes.
Question. Who is she?
Answer. I don't know her current title. I saw her picture in Time a couple weeks ago.
Question. Did you ever have any contact with Miss Scott?
Answer. No.
Question. You just recognize her name?
Answer. Yes.
Question. Did—was she ever a client of Mr. Middleton's?
Answer. No.
Question. Do you know if Mr. Middleton ever had any contact with her?
Answer. I don't know.
Question. Have you ever heard of Doris Matsui?
Answer. Yes.
Question. Who is she?
Answer. Doris Matsui works in the White House. I believe it is the Office of Public Liaison.
Question. Have you ever spoken with Ms. Matsui?
Answer. Not personally.
Question. Have you ever spoken to her some other way?
Answer. I have been in a meeting where she was present.
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Question. And where was that meeting?
Answer. That was a meeting at the White House.
Question. When did that meeting occur?
Answer. That was the summer of 1996. I am not sure of the exact date.
Question. Besides you and Ms. Matsui, who else was present at the meeting?
Answer. Mark Middleton, Mr. Zhou, John McAlister, and I believe it was two other women that were interpreters or administrative staff for Mr. Zhou and Mr. McAlister.
Question. Mr. Zhou, could you please spell that?
Answer. Z-H-O-U.
Question. And what language were the interpreters interpreting?
Answer. It was either—it was Chinese. There is some Peruvian connection there, that is why I wasn't sure, I think Peruvian descent or something.
Question. There is some Peruvian connection. Could you please describe that?
Answer. One of the women worked in the Peruvian office and I believe they had business in Peru or the family was part Peruvian, so I wasn't sure if the language they were interpreting in was Spanish or was Chinese. I believe it was Chinese.
Question. You said a woman, one of the women was in an office in Peru, whose office?
Answer. Mr. Zhou's party. There were two women, I believe, that accompanied him, that were either administrative staff, slash and/or interpreters, and they have an office in Peru, I believe, and I am not sure if it is Mr. Zhou, but just as there are many Japanese people in Brazil, there was some type of connection with part of his family being from Peru and the woman spoke Spanish and they had extensive dealings in Latin America, and I never heard them specifically translate, but I believe it was Chinese because he is Chinese.
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Question. Now this meeting occurred at the White House?
Answer. Yes.
Question. Where in the White House?
Answer. In Doris Matsui's office.
Question. And what was discussed?
Answer. Just a very general courtesy meeting. Mr. Zhou was interested, and he is the gentleman I referred to earlier as the property developer, and he was very interested in just general U.S.-China relations and Peruvian education, understanding between the two countries. He is a property developer.
Mr. McAlister kind of gave a broad presentation that, you know, he was an up and coming private businessman in China and as such is very interested in seeing U.S.-China relations stable, understanding the importance of that. I believe he was interested in helping with some educational programs that would send U.S. students to China and vice versa, and Mark also just opened with Doris that, you know, this is just a general courtesy meeting. I believe Mr. Zhou had just—it was his first visit to the United States and was just really interested in getting to know more about the country and figuring out some type of program or ways that they could help just general understanding.
Question. Who arranged the meeting?
Answer. Our office did.
Question. Did you arrange it personally?
Answer. I believe I sent faxes through requesting meetings and sending over clearance information.
Question. Did Mr. Middleton instruct you to do so?
Answer. Yes.
Question. Did you ever attend any other meetings at the White House while you were employed at CommerceCorp?
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Answer. No, I believe that is the only one.
Question. Was Mr. Zhou a client of CommerceCorp?
Answer. No, he was not.
Question. Did Mr. Zhou ever compensate CommerceCorp for setting up this meeting?
Answer. No, he did not. The meeting was actually requested through Mr. McAlister, who works for Mr. Zhou as a U.S. citizen, and I believe—I don't know how actually he came to know Mr. Middleton, but he was the one that was putting together Mr. Zhou's program here in Washington, and he arranged most all of Mr. Zhou's schedule and just asked us to help out on a few meetings.
Question. Did you ever contact or speak with Ms. Ann Eder?
Answer. I don't know. I know there were a couple of Anns that I dealt with, but I don't remember that person specifically, no.
Question. Do you know if Mr. Middleton ever contacted Ms. Eder?
Answer. I don't know.
Question. Do you know what the US-ASEAN Council is?
Answer. The US-ASEAN Council, it is a nonprofit, nongovernmental organization here in Washington, D.C., that promotes U.S. business interests in trade with Southeast Asia.
Question. Did Mr. Middleton work with Ms. Matsui on matters related to that council?
Answer. I don't know.
Question. Was Mr. Middleton involved in that council?
Answer. Our company is a member of the US-ASEAN Council, just like most businesses that deal with international business in Asia.
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Question. Do you know how your company got involved with that council, how CommerceCorp got involved with that council?
Answer. Initially, no, but, again, anyone who does business in Southeast Asia is a member or pretty much everyone because they are a great source of information and things of that sort, and very well respected here.
Question. Did Mr. Middleton have any responsibilities in connection with the council?
Answer. No, it was just general membership, as far as I know.
Question. Do you know who Harold Ickes is?
Answer. Yes.
Question. Do you know if Mr. Middleton ever met with Mr. Ickes at the White House?
Answer. I don't know.
Question. Do you know if Mr. Middleton ever discussed DNC fund-raising with Mr. Ickes?
Answer. I don't know.
Question. Did Mr. Middleton ever attend any meetings related to the DNC at the White House?
Answer. I don't know.
Question. I am using the phrase ''DNC.'' Just for the record, that is Democratic National Committee?
Answer. Yes.
Question. Did you understand that?
Answer. Yes.
Question. Did Mr. Middleton ever arrange meetings for clients with Mr. Ickes?
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Answer. Not that I know of.
Question. While you were employed at CommerceCorp, was Mr. Middleton affiliated in any way with the Democratic National Committee in 1996?
Answer. Not that I know of.
Question. Did Mr. Middleton participate in any DNC fund-raising activities in 1996?
Answer. Not that I know of.
Question. Okay. We are going to an exhibit, Number 3, please. The document with control number CC-H-000067-68 is marked as Deposition Exhibit 3, and is a memo message to Mark Middleton relating to a White House dinner which Mr. Middleton was, quote, working on, closed quote. Exhibit 3 is before you and I ask that you please review Exhibit 3.
Answer. Okay.
[Weymouth Deposition Exhibit No. 3 was marked for identification.]
EXAMINATION BY MR. DHILLON:
Question. Do you recognize Exhibit 3?
Answer. Yes.
Question. What is it?
Answer. It looks like bullets of messages that came through to Mark that were faxed to him while he was out of town.
Question. That is page 2 of Exhibit 3, right?
Answer. Yes. The first page is just a cover letter, I believe.
Question. It is the facsimile transmission cover sheet?
Answer. Yes.
Question. Did you write Exhibit 3?
Answer. Yes.
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Question. You——
Answer. Typed it.
Question. Typed Exhibit 3. Was the White House dinner referred to in Exhibit 3 a fund-raising event?
Answer. I don't know.
Question. Did Mr. Middleton participate in the dinner or find—let me re-ask the question.
Did Mr. Middleton participate in the dinner or did he participate in finding invitees to the dinner?
Answer. Not that I know of.
Question. The bottom of the memo notes that the fax was sent to various individuals. And there is a list of, it appears to be first names. I am going to ask you questions about those individuals. Who is Gus?
Answer. What is the relevance?
Mr. LUSKIN. Where are you directing her attention to?
The WITNESS. To this, which has nothing to do with this.
Mr. DHILLON. At the very bottom, faxes sent to, and there is a list of names, left message for John Huang, and a couple of other names.
The WITNESS. The sheet that you are looking at is a composite of different messages, either from myself, regarding work I was doing, or telephone conversations, or phone calls that came in from Mark. Each bullet connotes a separate thing, therefore, the third bullet has nothing to do with the first bullet. I would be happy to answer the question, but I don't see the relevance.
EXAMINATION BY MR. DHILLON:
Question. Let's do that, then. Who is Gus?
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Answer. Gus Nilo.
Question. And who is Titiek?
Answer. Titiek is Siti Hediati, the daughter of the President of Indonesia.
Question. And who is Sukma?
Answer. Sukma Widjaja, one of the principals of the Sinar Mas Group.
Question. Karim. Who is Karim?
Answer. Karim, I don't recall his last name or company.
Question. Who is Neil?
Answer. I don't recall.
Question. Who is Nina?
Answer. Nina would be Nina Wang.
Question. Can you spell the last name?
Answer. I believe it is W-A-N-G, but I am not sure.
Question. And who is Munk?
Answer. Peter Munk.
Question. And what fax was sent to these individuals?
Answer. It would have been different faxes to each of the individuals, and I don't recall, it is just various—this appears to be a time when Mark was out of town and this is just a way of letting him know that the letters that he had left with the secretary, receptionist had been delivered to the different individuals, so they would have been different letters on different matters.
Question. And who is Peter Munk?
Answer. Peter Munk I believe is the chairman of Barrick, Gold Corporation.
Question. Can you spell that, Barrick?
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Answer. B-A-R-R-I-C-K.
Question. Did Mr. Middleton ever contact the White House regarding DNC fund-raising matters?
Answer. I don't know. I mean—well, I don't know. I don't know.
Question. We will go to another exhibit, the document with control number CC-H-00046-48, which is marked as Exhibit 4, and is an August 19, 1996, memo from you and Mark Middleton to Nancy Hernreich, at the White House, regarding a fund-raiser during the Democratic National Convention, hosted by Walter Shorenstein. Exhibit 4 is before you and I ask that you please review it.
[Weymouth Deposition Exhibit No. 4 was marked for identification.]
EXAMINATION BY MR. DHILLON:
Question. Why did Mr. Shorenstein forward these invitations to Mr. Middleton?
Mr. LUSKIN. If you know.
The WITNESS. I don't know.
EXAMINATION BY MR. DHILLON:
Question. Why did you and Mr. Middleton forward the invitations to Nancy Hernreich?
Answer. I mean, from time to time, people would just send things over to us and ask us to pass them along and we would. We would just pass them along and ask that they be sent to the appropriate person or sent to the appropriate channels and that would be the end of it. I don't even particularly remember this fax, but I am sure Mr. Shorenstein probably sent the same thing to 15 other people to try to get it in as many ways as possible.
Question. You don't know that, you are guessing?
Answer. Oh, no. I am guessing, yes.
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Question. Did Mr. Middleton ever discuss the reception that is set forth in Exhibit 4 with Mr. Shorenstein?
Answer. I don't know.
Question. Did you ever discuss the reception that is described in Exhibit 4 with Mr. Shorenstein?
Answer. No, not that I can recall.
Question. Did you ever speak to Mr. Middleton about the reception?
Answer. Maybe just in general passing. I don't—I mean, I don't have a great memory of it. It was no big deal.
Question. How was Mr. Middleton involved in the receptions that are described—or the reception that is described in Exhibit 4?
Answer. I don't know. I believe he attended. Beyond that, I am not sure.
Question. Did the President or the Vice President attend the Shorenstein reception that is described in Exhibit 4?
Answer. I don't know.
Question. Did Mr. Middleton assist in the planning of the reception that is described in Exhibit 4?
Answer. I don't know.
Question. Did Mr. Middleton invite anyone to the reception that is described in Exhibit 4?
Answer. I believe he attended with a guest. Beyond that, I don't know of him working with the reception.
Question. The next document is the document with control number CC-H-000063. It is marked as Exhibit 5 and is an undated memorandum to Mark Middleton regarding a fund-raiser on July 30, year unknown. Exhibit 5 is before you and I ask that you review Exhibit 5.
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[Weymouth Deposition Exhibit No. 5 was marked for identification.]
Mr. DHILLON. The record should reflect that Mr. Waxman is present. As a courtesy to a Member who is present and with the concurrence of Minority counsel, I shall defer questioning until the Member has completed his questioning.
Mr. Ballen, you are the designated Minority counsel at this deposition; do you concur?
Mr. BALLEN. I do.
Mr. DHILLON. Thank you. Congressman Waxman, would you care to question the witness?
Mr. WAXMAN. Yes, I would.
Mr. DHILLON. You may proceed.
Mr. WAXMAN. Thank you very much.
Ms. Weymouth, good to see you here today. Since you began working for MEM in February of 1996, have you ever known Mark Middleton to solicit any political contributions from anyone?
The WITNESS. No.
Mr. WAXMAN. Have you ever seen any documents or check stubs or bank account records or any other kind of evidence that suggested to you in any way that Mark Middleton was soliciting campaign contributions from any person or corporation for government?
The WITNESS. No.
Mr. WAXMAN. Have you ever known Mark Middleton to solicit any campaign contributions from any foreigner or foreign government?
The WITNESS. No.
Mr. WAXMAN. Did he ever receive phone calls from anyone at the DNC asking for his help in fund-raising?
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The WITNESS. Yes.
Mr. WAXMAN. And from whom?
The WITNESS. Anne Brazil.
Mr. WAXMAN. How frequently?
The WITNESS. Not very frequently. Infrequently.
Mr. WAXMAN. Infrequently, meaning more than five? Less than five?
The WITNESS. Well, she would call a lot because he didn't always call back, but, you know, not very often.
Mr. WAXMAN. Did he ever receive similar calls from John Huang?
The WITNESS. I don't know.
Mr. WAXMAN. What was his response to the call from Anne Brazil?
The WITNESS. Very typically Mark, very polite, encouraging them, and, you know, very energetic. They would often call wanting names of people who they might approach or just his recommendation, since he had been involved in fund-raising, so he would encourage them, but he always dropped it, I mean, he never really worked on it, he didn't call back, you know, because sometimes he would get a little flustered because he had a lot of things going on with the business and he was really trying to get his business going, and I remember him saying, you know, these guys are always calling for my knowledge and my experience but I don't have time to deal with this, I am trying to run a business.
Mr. WAXMAN. How did you know about this?
The WITNESS. How did I know about that?
Mr. WAXMAN. His reactions.
The WITNESS. I was in the office. I walked into the office to work on a project we were working on and he had just hung up the phone.
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Mr. WAXMAN. When he received calls—the only call you know of that he received dealing with campaign contributions was Anne Brazil?
The WITNESS. Well, she would call just to let him know things that were going on and to ask for advice or who he thought might be interested in things, but beyond that, I don't recall. I don't recall anyone else or who may have called.
Mr. WAXMAN. Did he agree to help her?
The WITNESS. Well, he would always say sure, sure, I will try to help out, but it never really came to much.
Mr. WAXMAN. Do you know whether he actually tried to help?
The WITNESS. No.
Mr. WAXMAN. No, you don't know?
The WITNESS. Yes, I know, and, no, I never saw him help.
Mr. WAXMAN. Have you ever seen any evidence that he tried to assist the Democratic National Committee or the Clinton-Gore campaign in fund-raising?
The WITNESS. Not that I have seen, no.
Mr. WAXMAN. Are you familiar with what is involved in lobbying?
The WITNESS. Yes.
Mr. WAXMAN. And how are you familiar with lobbying?
The WITNESS. Well, the firm I came from, we did a lot of work for an American textile company and we did have to file, you know, lobbying papers, et cetera and so forth, and it was something I didn't particularly like, so when I interviewed with Mark, I asked a lot of questions about what we did with our clients, both the U.S. and otherwise, and whether or not we would be lobbying either the administration or Congress, and, you know, he said no.
Mr. WAXMAN. He said no, but did you know whether lobbying was a part of his business when you joined CommerceCorp?
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The WITNESS. Well, we had extensive discussions on it, just because I was very concerned that I didn't want to get into anything that came close to lobbying, I really wanted to be involved in the more creative business side, and he had the regulations, both the FAR regulations and the lobbying registrations, and he asked me—this is even after I came on board, excuse me, after I started, he asked me to read over those and make sure I understood what they meant and to highlight the different points and to, you know, tell him if I thought that there was any way what we were doing for the clients could fall under that, and there really wasn't anything there.
Mr. WAXMAN. So in other words, you didn't do any lobbying?
The WITNESS. No.
Mr. WAXMAN. Okay. And he told you that you didn't have to do any lobbying?
The WITNESS. Correct.
Mr. WAXMAN. And in your experience he has been good to his word on that promise, that you wouldn't have to do any lobbying?
The WITNESS. Definitely, or I wouldn't be there.
Mr. WAXMAN. In your work have you sometimes contacted executive branch agencies for clients of CommerceCorp?
The WITNESS. Yes.
Mr. WAXMAN. For what purpose?
The WITNESS. Mostly just contacting through general public information, fax retrieval systems, calling to get general information on countries, sectors, things of that sort.
Mr. WAXMAN. Have you ever helped to set up meetings with the White House officials or officials of executive branch agencies for CommerceCorp clients?
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The WITNESS. No.
Mr. WAXMAN. Have you personally ever contacted the White House or an executive branch agency or any government official to try to get them to take any action for any CommerceCorp clients?
The WITNESS. No. To my knowledge, we have never had any action pending before anyone.
Mr. WAXMAN. Have you ever known Mark Middleton to contact any government official to try to get them to take any action for a CommerceCorp client?
The WITNESS. No.
Mr. WAXMAN. Have you ever seen any evidence that Mark Middleton or CommerceCorp engaged in lobbying of any government official for any purpose?
The WITNESS. No.
Mr. WAXMAN. Have you ever met Charlie Trie?
The WITNESS. Yes.
Mr. WAXMAN. Is he a business associate of Mr. Middleton?
The WITNESS. No.
Mr. WAXMAN. What were the circumstances of you meeting him?
The WITNESS. He came by the office one day, and I am trying to think. It was around Secretaries Day because he brought perfume to all the women in the office, but it was just a personal courtesy meeting.
Mr. WAXMAN. With you?
The WITNESS. With Mark Middleton, yes.
Mr. WAXMAN. Have you ever seen any evidence that they have a business relationship?
The WITNESS. No.
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Mr. WAXMAN. Has Mark Middleton ever handled any funds from Mr. Trie or any of his businesses?
The WITNESS. No.
Mr. WAXMAN. Has Mark Middleton ever given any money to Charlie Trie?
The WITNESS. Yes.
Mr. WAXMAN. Would you describe the circumstances?
The WITNESS. In a very typical Charlie fashion, he kind of came in ruffled one day and I remember Mark saying, this is after Charlie left, and Mark said, he is such a great guy, he works really hard and he tries really hard, but he was having trouble with his business, as I understand it, and was short on funds and he had asked Mark to give him a loan and Mark did so.
Mr. WAXMAN. Do you know how much money was involved in the loan?
The WITNESS. I think it was $5,000.
Mr. WAXMAN. Do you know what Mr. Middleton thought of Charlie Trie?
The WITNESS. Yes.
Mr. WAXMAN. Is that a yes?
The WITNESS. Yes.
Mr. WAXMAN. And is that based on something he said to you?
The WITNESS. Yes.
Mr. WAXMAN. And what did he say to you?
The WITNESS. Again, as I stated, he would just say that Charlie was a great guy with a good heart, he was a really hard worker but that he wasn't super sophisticated or super bright and he was having trouble with his business and wanted some—needed some help financially, but I always got the impression that he thought he was a really good guy, trying hard. I always thought of Charlie as kind of like a puppy or something, with a good heart but not always knowing what he was doing.
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Mr. WAXMAN. That is your impression?
The WITNESS. That is my impression. But I got my impression mostly from Mark because I only met Charlie on that one occasion.
Mr. WAXMAN. And you had several conversations with Mark about Charlie Trie?
The WITNESS. Probably two or three that I can think of.
Mr. WAXMAN. Do you know what that loan of $5,000 was for?
The WITNESS. No.
Mr. WAXMAN. Do you know whether it has been repaid?
The WITNESS. No, it has not.
Mr. WAXMAN. It has not been repaid?
The WITNESS. Right.
Mr. WAXMAN. And when was that loan extended?
The WITNESS. I'm sorry, I don't recall the date. It was in '96. It was open on the books at the end of the year.
Mr. WAXMAN. So it was a loan in 1996?
The WITNESS. Yes.
Mr. WAXMAN. Early in the year or later in the year?
The WITNESS. My impression is it would have been spring, spring of '96.
Mr. WAXMAN. Okay.
The WITNESS. I'm sorry, I don't recall the exact date. It was a personal loan, as I understood it, just to help him cover his cost of living.
Mr. WAXMAN. And you know it has not been repaid?
The WITNESS. Right. Yes, it has not been repaid.
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Mr. WAXMAN. Well, we appreciate you being here to give this deposition and answering these questions. We will probably have other questions for you later. Thank you and I thank counsel for allowing me to proceed.
Mr. DHILLON. Thank you, Mr. Waxman. May I proceed?
Mr. WAXMAN. Certainly.
EXAMINATION BY MR. DHILLON:
Question. I believe we left off at Exhibit 5 being placed before you.
Answer. Sure.
Question. And I would ask you to review Exhibit 5. Have you done so?
Answer. Yes.
Question. Did you write Exhibit 5?
Answer. Yes.
Question. Do you know what event Exhibit 5 refers to?
Answer. No, not specifically. No, I mean this is a typical example of a request that would come in from people who knew Mark had been involved in fund-raising asking for information or help and I would take the message and pass it along, and in fact, I remember this person, Dinah Dale, simply because of her accent and name, calling several times, and I don't believe Mark ever even returned the phone calls or got back in touch with her office because she did call several times wondering, you know, if he was going to be able to help and I don't think he did.
Question. Okay. Let me ask you that question, then. Did Mr. Middleton host this event that is set forth or described in Exhibit 5?
Answer. No, not to my knowledge.
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Question. Now let's go to the next document, the document with control number CC-H-0049, which is marked as Deposition Exhibit 6, and is a September 9, 1996, letter from Mark Middleton to Benny Hu, H-U, the president of China Development Corporation. Exhibit 6 is before you and I ask that you please review Exhibit 6.
[Weymouth Deposition Exhibit No. 6 was marked for identification.]
EXAMINATION BY MR. DHILLON:
Question. Do you recognize Exhibit 6?
Answer. No.
Question. Did you prepare Exhibit 6?
Answer. No.
Question. In Exhibit 6, Mr. Middleton makes a reference to it being hectic here since the campaign has heated up, and he goes on to state that he would like to come over next month, but his responsibilities make the timing of the trip uncertain.
Do you know what Mr. Middleton was referring to when he made that statement in the letter?
Answer. No.
Mr. LUSKIN. Which statement are you referring to? Are you asking what responsibilities he is referring to?
Mr. DHILLON. Let me back up. I will break it down into two different questions.
EXAMINATION BY MR. DHILLON:
Question. What responsibilities was Mr.—let's just take the part that refers to responsibilities. What responsibilities was Mr. Middleton referring to?
Answer. I don't know.
Question. He also said it was very hectic since the campaign had heated up. How had it been hectic at CommerceCorp since the campaign heated up?
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Answer. I don't know what he was referring to.
Question. Was Mr. Middleton involved in any way in the 1996 Presidential campaign?
Answer. Not that I know of.
Mr. LUSKIN. Just for clarification of the record, and I don't want to step on your questioning, but let me ask, are you aware of any responsibilities that Mr. Middleton had, other than his CommerceCorp responsibilities? We may want to close the loop here.
Mr. DHILLON. That is a fine question. If you could answer that, I would appreciate it.
The WITNESS. I just work with him on CommerceCorp issues and it was always hectic on our business issues, so I don't know.
EXAMINATION BY MR. DHILLON:
Question. Okay. The next document is the document with control number CC-H-000020, and it is marked as Exhibit 7, and it is a June 11, 1996, facsimile message to Mark Middleton from Holli Weymouth. That is before you and I ask you to please review it.
[Weymouth Deposition Exhibit No. 7 was marked for identification.]
EXAMINATION BY MR. DHILLON:
Question. Do you recognize Exhibit 7?
Answer. Yes.
Question. What is it?
Answer. It is a facsimile transmission that again appears to be a series of messages left for Mark that were faxed through to him when he was out of the office.
Question. And did you prepare that?
Answer. Yes, I did.
Question. And did you take the message described in Exhibit 7 from Arthur Davis?
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Answer. I don't recall if his office spoke with me directly or spoke with someone else in our office, and I am just summarizing here. I don't recall.
Question. Is the Arthur Davis referred to in Exhibit 7 the same Arthur Davis that Mr. Middleton recommended for an ambassadorial appointment?
Answer. I believe he would be. That is the only Arthur Davis I know.
Question. Did Mr. Middleton attend the coffee with Mr. Davis?
Answer. I don't know.
Question. Did Mr. Middleton assist in making the arrangements for the coffee?
Answer. I don't know.
Question. Why did Mr. Middleton call Mr. Davis about this coffee—I'm sorry, why did Mr. Davis call Mr. Middleton about this coffee. Strike the last question.
Answer. You know, I don't know, and it is not clear from the memo and I can't remember. It could be we were working on a meeting and he just mentioned, you know, that he might be going to this because of Mark's past activities. I honestly don't—I mean, I don't know. My memory is limited to what is here because it wasn't anything. I just took the message and passed it along.
Question. Did Mr. Middleton attend any White House coffees?
Answer. I don't know.
Question. A question or two ago I asked you about why Mr. Davis and Mr. Middleton were communicating, and you said it might have something to do with Mark's past activities. What did you mean by ''past activities''?
Answer. Oh, I'm sorry. Meaning that he was involved with fund-raising many years prior, or in the '92 campaign.
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Question. Were you assisting in campaign activities at all, whether for the DNC, the Clinton-Gore re-election campaign or any other campaign activities, you?
Answer. No.
Question. Did anyone else employed by CommerceCorp or who worked for CommerceCorp at any time participate or assist in any campaign activities?
Answer. No.
Question. Who was the person, Luz, L-U-Z, identified in the Exhibit 7?
Answer. Luz is the assistant to Mark Jiminez, at Future Tech.
Question. Future Tech?
Answer. Yes.
Question. And what information was Luz working on for the 26th?
Answer. I honestly don't recall.
Question. Did Mr. Middleton regularly talk to anyone at the DNC?
Answer. Again, messages came in from Anne Brazil, is really the only name I can recall.
Question. Do you recall if there were other individuals that called from the DNC whose names you can't recall?
Answer. I don't know.
Question. Do you recall calls, but you just can't recall the name of who called?
Answer. I don't recall calls because I don't really know who works with the DNC. The only person I know that worked with the DNC is Anne Brazil, therefore, if there were calls, I wouldn't know, I wouldn't recognize the names as being DNC individuals because I really don't have a lot of knowledge of the DNC.
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Question. Did Mr. Middleton ever speak with Richard Sullivan?
Answer. I don't know.
Question. Do you know who Richard Sullivan is?
Answer. I do now.
Question. Did you ever see Richard Sullivan at the CommerceCorp offices?
Answer. No.
Question. Do you know if Mr. Middleton ever met with Mr. Sullivan any place—did Mr. Middleton ever meet with Mr. Sullivan that you know of?
Answer. I don't know.
Question. And have you ever spoken with Mr. Sullivan?
Answer. Not that I recall.
Question. Was Mr. Middleton in contact with Marvin Rosen?
Answer. I don't know.
Question. Do you know who Marvin Rosen is?
Answer. Again, I do now.
Question. Okay. Do you know what he looks like now?
Answer. No.
Question. You know who he is now, though?
Answer. Yes.
Question. Did you ever see Mr. Rosen at the CommerceCorp offices?
Answer. No, not that I know of.
Question. Okay. Do you know if Mr. Middleton ever met with Mr. Rosen at any place other than the CommerceCorp offices?
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Answer. I don't know.
Question. Was Mr. Middleton ever in contact with a person named Don Fowler?
Answer. Again, I don't know.
Question. Do you know who Don Fowler is?
Answer. Yes.
Question. Did you ever see Don Fowler at the CommerceCorp offices?
Answer. No.
Question. Do you know if Mr. Middleton ever had any meetings with Don Fowler outside the CommerceCorp offices?
Answer. I don't know.
Question. Have you ever heard of Susan Lavine?
Answer. Susan Lavine, yes.
Question. Who is she?
Answer. I believe that—I am not sure if she worked for the DNC or worked with the DNC. She is someone that initially, when I came on board, would help with arranging tours of the Capitol or whatever people wanted to see in Washington.
Question. Okay. How did you interact with her; was she in your office?
Answer. No.
Question. Okay. So how did you interact with her?
Answer. We called her.
Question. Okay. When you say ''we called her,'' you are referring to?
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Answer. Our office would call her.
Question. And that would be either you, right?
Answer. Right.
Question. Or Mr. Middleton?
Answer. Right.
Question. Or one of the other individuals you described as answering the phone?
Answer. Correct.
Question. Did you ever meet Susan Lavine?
Answer. Yes.
Question. Okay. Where?
Answer. She came by our office.
Question. On how many occasions?
Answer. I would say I have probably seen her two or three times. She borrowed an umbrella from Linda and she brought it back and then she came by months later just to say hello.
Question. Approximately when did these events occur?
Answer. Oh, goodness. I would say it would have to be spring of '96.
Question. And did she meet with anyone while she was there in a formal capacity?
Answer. No.
Question. Did she ever meet with Mr. Middleton?
Answer. No, she usually missed him when she came by.
Question. What was her purpose in coming by?
Answer. Just to drop by and say hello.
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Question. Was one of her purposes to meet with Mr. Middleton?
Answer. To say hello, yes. She would just kind of float in and say hello to everyone and float out.
Question. The next document, a document with control number CC-H-000012, is marked as Deposition Exhibit 8. It is a facsimile from Holli Weymouth to Mark Middleton dated April 19, 1996, sent to an overseas fax number. Exhibit 8 is before you and I ask that you please review Exhibit 8.
Answer. Yes.
[Weymouth Deposition Exhibit No. 8 was marked for identification.]
EXAMINATION BY MR. DHILLON:
Question. Do you recognize Exhibit 8?
Answer. Yes.
Question. What is it?
Answer. It is a facsimile transmission sent to Mark. It is a list of messages, appears to have been a list of messages that came through for him that day.
Question. Is the Susan mentioned in Exhibit 8 at the very bottom last word, Susan Lavine?
Answer. I don't recall. It may have been. It may have been Mr. Sudarma's assistant. I am not sure.
Question. Mr. Sudarma's assistant was also named Susan?
Answer. I mean, I don't recall. I don't recall the specifics of this.
Question. What country was Mr. Middleton in at the time—strike that. What country did you fax this document to?
Answer. 6221 is Indonesia.
Question. And why was Mr. Middleton in Indonesia at the time you faxed Exhibit 8 to him?
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Answer. Just a general business trip through Asia.
Question. Did you speak to Mr. Sudarma?
Answer. Yes. In fact, Mr. Sudarma called and I took his call, and if I remember correctly, he had called and I had—I can't remember if I mentioned it to Mark. Mark didn't know who he was, Mark couldn't remember, and the gentleman explained, oh, I met Mark such and such places, and Mark said, well, you know, do what you can to be helpful for him if he is visiting Washington, but Mark didn't really remember who he was.
From time to time, friends of business acquaintances or friends of family would come to Washington and they would want to know where to go, what to see, you know, how to tour the Capitol, how do you see the White House, et cetera and so forth.
Question. Where is Mr. Sudarma from?
Answer. I don't know. He called from California, I believe. I think I remember looking at his phone number and I think I remember him—that he called from California, 415. My sister lives in San Francisco, that is why I remember.
Question. Do you know where Mr. Middleton met Mr. Sudarma?
Answer. Only what it says here, and that was according to Mr. Sudarma. Again, Mr. Middleton didn't remember.
Question. So your recollection is Mr. Middleton did not remember Mr. Sudarma at all?
Answer. Correct.
Question. Prior to this call from Mr. Sudarma that you took, did Mr. Middleton ever mention Mr. Sudarma to you?
Answer. No.
Question. Do you know how Mr. Sudarma knew the Riady family?
Answer. No.
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Question. Do you know what the relationship between Mr. Sudarma and the Riady family is?
Answer. No. Only what it says here.
Question. Do you know how Mr. Sudarma knew John Huang?
Answer. No.
Question. Do you know anything about the relationship between Mr. Sudarma and Mr. Huang?
Answer. No.
Mr. LUSKIN. May I ask for clarification? Is what is written down here on this bullet point on Exhibit 8 information that Mr. Sudarma related to you?
The WITNESS. Yes, it is, and that is all the information I have.
Mr. DHILLON. This would be a good time for lunch for us. We can go off the record.
[Whereupon, at 12:21 p.m., the deposition recessed, to be reconvened 1:00 p.m., this same day.]
Mr. DHILLON. You have all heard the kinds of questions I am asking, and I haven't heard any objections to them, so I feel comfortable sort of picking up the pace and speeding up a little more.
Mr. LUSKIN. I have been trying not to harass you by not objecting.
Mr. DHILLON. And I appreciate that. And these will be sort of the same. As you have probably guessed by now in this deposition, this is going to be the same sort of thing, just fill in the blanks. So I will go through it as quickly as I can.
EXAMINATION BY MR. DHILLON:
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Question. I am going to give you another document, the document with control No. CC-H-000015, which is marked as Deposition Exhibit No. 10, an August 5th—okay. Let's go back up a couple here. The document with control No. CC-H-000010 is marked as Deposition Exhibit No. 9 and is an April 23rd, 1996 facsimile to Mark Middleton from Holli Weymouth.
Exhibit 9 is before you, and I ask you to please review it.
[Weymouth Deposition Exhibit No. 9 was marked for identification.]
EXAMINATION BY MR. DHILLON:
Question. Do you recognize Exhibit 9?
Answer. Yes.
Question. What is it?
Answer. It is a fax from me to Mark Middleton.
Question. Did Mr. Sudarma and his family go on the scheduled tour referred to in Exhibit 9?
Answer. Yes, they did.
Question. Did Mr. Middleton meet Mr. Sudarma at the White House?
Answer. No, he did not.
Question. How do you know that?
Answer. He was out of town, out of the country. And it is a different date. I apologize. I was thinking since this fax is sent out of the country that he wouldn't have been there for the tour, and I don't believe he had returned by that time. I believe he still was out of the country or out of town anyway. Sorry.
Question. Okay. Was Mr. Sudarma ever a client of CommerceCorp?
Answer. No.
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Question. Was he ever a prospective client of CommerceCorp?
Answer. No.
Question. The document with control No. CC-H-000015 is marked as Deposition Exhibit 10. It is an August 5th, 1996 facsimile from Holli Weymouth to Mark Middleton at an overseas facsimile number. That is before you, and I ask that you please review Exhibit 10.
Answer. Yes.
[Weymouth Deposition Exhibit No. 10 was marked for identification.]
EXAMINATION BY MR. DHILLON:
Question. Who is Robyn—do you recognize Exhibit 10?
Answer. Yes, I do.
Question. What is it?
Answer. It is a fax from me to Mark.
Question. Who is Robyn Buzby?
Answer. Robyn Buzby is a personal friend of Mark's, someone who he went to high school with in Arkansas.
Question. Is Robyn Buzby a man or a woman?
Answer. It is a woman.
Question. Is she a client of CommerceCorp?
Answer. No.
Question. Is Ms.—is Ms. Buzby affiliated with the DNC in any way?
Answer. No.
Question. Why did Ms. Buzby call Mr. Middleton to arrange a White House tour?
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Answer. Again——
Mr. LUSKIN. If you know.
EXAMINATION BY MR. DHILLON:
Question. All questions assume that.
Answer. I am sorry?
Question. Why did Ms. Buzby call Mr. Middleton to arrange a White House tour?
Answer. I don't know.
Question. Did either you or Mr. Middleton arrange a White House tour for Ms. Buzby?
Answer. I can't recall.
Question. Did Mr. Middleton solicit campaign or DNC contributions from Ms. Buzby?
Answer. No.
Question. On Exhibit 10 there is a notation that Craig Smith phoned for Mr. Middleton. Did Mr. Smith call Mr. Middleton often?
Answer. Excuse me? I don't see the notation you are referring to.
Question. Exhibit 10, second line down, Craig Smith.
Answer. These are not notations that people called. I think this was just a request for phone numbers.
Question. Okay. So Mr.——
Answer. I am not sure. I think—yes, I think it was just a request for information off the Rolodex.
Question. If I could just—let me just go to Exhibit 10 then.
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Answer. Sure.
Question. Was this memorandum—I am sorry. Was this facsimile transmission generated by you in response to a request by Mr. Middleton for the information contained in Exhibit 10?
Answer. I believe so.
Question. Okay. Did the Mr. Smith, whose name appears on Exhibit 10, call for Mr. Middleton often?
Answer. Not that I recall.
Question. Do you know who Craig Smith is?
Answer. No, not particularly.
Question. Do you recall ever having met Craig Smith?
Answer. No.
Mr. DHILLON. I am sorry, counsel?
Mr. LUSKIN. I am sorry. I kicked her and I apologized.
Mr. DHILLON. I wasn't sure if you were interposing an objection.
Mr. LUSKIN. No. I was apologizing to my client.
Mr. DHILLON. I see.
EXAMINATION BY MR. DHILLON:
Question. There is a person on Exhibit 10, Mr. Fuerst?
Answer. Uh-huh.
Question. Did Mr. Fuerst regularly contact Mr. Middleton?
Answer. Mr. Fuerst works with Future Tech International, which was one of our clients, so he did call off and on.
Question. Do you know—did you ever meet Mr. Fuerst?
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Answer. No.
Question. Did Mr. Middleton solicit campaign or DNC contributions from Mr. Fuerst or Mr. Jimenez?
Answer. No.
Question. And I threw Mr. Jimenez in there. Mr. Jimenez is also mentioned on that document?
Answer. No.
Question. Have you ever heard of Howard Glicken?
Answer. Yes.
Question. Who is he?
Answer. I think he has either a consulting group or something of that sort named the Americas Group.
Question. Have you ever met him?
Answer. Yes.
Question. When?
Answer. I don't recall when.
Question. Where?
Answer. He came by our office once.
Question. On how many occasions?
Answer. Just once, that I recall.
Question. And who did he come by to meet with?
Answer. He met with Mark Middleton.
Question. The next document is a document with control No. CC-H-000095. It is marked as Exhibit 11, Deposition Exhibit 11, and is an April 22nd, 1996 memo from Howard Glicken to Mark Middleton regarding a CEO dinner in Miami.
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Exhibit 11 is before you, and I ask that you please review Exhibit 11.
Answer. Okay.
[Weymouth Deposition Exhibit No. 11 was marked for identification.]
EXAMINATION BY MR. DHILLON:
Question. Do you recognize Exhibit 11?
Answer. No.
Question. You had previously testified a few moments ago that Mr. Glicken came to the—Mr. Glicken came to the office to meet with Mr. Middleton?
Answer. Yes.
Question. What were they meeting about?
Answer. I don't know.
Question. Was Mr. Middleton working with Mr. Glicken on fund-raising matters?
Answer. Not that I know of.
Question. Did Mr. Middleton assist Mr. Glicken in the endeavor that is described in Government's—sorry, Deposition Exhibit 11?
Answer. I don't know.
Question. Okay.
Mr. LUSKIN. For the record, Exhibit 9 reflects that Mr. Middleton was apparently in Indonesia on the date——
The WITNESS. This is not Indonesia, but somewhere.
Mr. LUSKIN. Or somewhere out of the country at the time of April 22nd or 23rd.
The WITNESS. The time this fax was received.
EXAMINATION BY MR. DHILLON:
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Question. The document with control number CC-H-000094 is marked as Deposition Exhibit 12 and are telephone messages for Mark Middleton for April 22nd, 1996.
Exhibit 12 is before you, and I ask that you please review Exhibit 12.
Answer. Okay.
[Weymouth Deposition Exhibit No. 12 was marked for identification.]
EXAMINATION BY MR. DHILLON:
Question. Do you recognize Exhibit 12?
Answer. No.
Question. All right. Is Exhibit 12 sort of a phone record that CommerceCorp routinely keeps?
Answer. It is one type of record that we have used.
Question. Do you recognize it as that—as the type of record that CommerceCorp keeps?
Answer. Yes.
Question. Do you recognize the handwriting on Exhibit 12?
Answer. I'm not sure who wrote these.
Question. So you don't recognize the handwriting?
Answer. Well, it would have been one of the two individuals that answers our phone, but I'm not certain which one it was.
Question. And those are the two individuals you already described before. I am sorry, what were their names, Ann was it——
Answer. Sandy and Linda.
Question. Okay. Have you spoken to Mr. Middleton about your testimony here today?
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Answer. Only to inform him that I had received a notice.
Question. Have you spoken to him—did he ask you to testify in a particular way?
Answer. No.
Question. Did you discuss with him any of the matters you thought might be asked by any of the counsel here today?
Answer. No.
Question. Okay. Is Mr. Middleton paying your attorney's fees?
Answer. Yes.
Question. Is he—is Mr. Middleton or is CommerceCorp?
Answer. I am sorry. It is Commerce—gosh. It is the company.
Question. CommerceCorp is paying your attorney's fees?
Answer. Yes.
Question. Is Mr. Middleton also represented by your counsel here today?
Answer. Yes.
Question. Okay. Have you ever heard of John Huang?
Answer. Yes.
Question. Do you know who John Huang is?
Answer. Yes.
Question. Have you ever met him?
Answer. No.
Question. Have you ever spoken to John Huang?
Answer. I can't recall if I have or haven't.
Question. So then it's possible you have spoken to him?
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Answer. I don't recall speaking with him.
Question. Did John Huang ever call CommerceCorp?
Answer. I have seen notes here that he called, but I don't recall speaking with him.
Question. Do you know who John Huang spoke with when he called CommerceCorp?
Answer. No.
Question. Did you ever have any conversations at all with Mr. Huang?
Answer. Not that I recall.
Question. Was Mr. Middleton in contact with Mr. Huang in 1996?
Answer. Again, I have seen notes, and I believe Mr. Huang may have called infrequently.
Question. Did Mr. Middleton ever discuss his relationship with Mr. Huang with you?
Answer. No.
Question. Did he ever discuss his relationship with Mr. Huang to someone else in your presence?
Answer. No.
Question. Do you know when Mr. Middleton first met Mr. Huang?
Answer. No, I don't.
Question. Did Mr. Huang ever come to the CommerceCorp offices?
Answer. Not that I know of.
Question. Did Mr.—did Mr. Middleton ever work with Mr. Huang on any fund-raising matters in 1996?
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Answer. Not that I know of.
Question. Did Mr. Middleton ever work with Mr. Huang to arrange for individuals to attend a coffee with the President?
Answer. I don't know.
Question. Have you ever heard of Pauline Kanchanalak?
Answer. Not prior to the press reports.
Question. Okay. Had you ever met Pauline Kanchanalak?
Answer. No.
Question. Do you know if Mr. Middleton assisted Pauline Kanchanalak in attending a coffee with the President at the White House?
Answer. I had never heard her name before the press reports.
Question. When was the first time you heard her name?
Answer. When it came out in the newspapers in conjunction with fund-raising activities.
Question. Before, after a certain date?
Answer. No, I don't recall when she first emerged.
Question. Was Mr. Middleton ever in contact with Ms. Kanchanalak?
Answer. No. The only context I have ever heard of her is in the press reports.
Question. Okay. So CommerceCorp does not do any business with the Ban Chang Group?
Answer. Not—no.
Question. Does Ban Chang Group mean anything to you?
Answer. No.
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Question. Have you ever heard of that group before?
Answer. No.
Question. Have you ever heard of Martha Schoffner?
Answer. Not that I recall.
Question. Have you ever met Ms. Martha Schoffner?
Answer. No.
Question. Did Mr. Middleton ever visit Mr. Charlie Trie at Mr. Trie's apartment at the Watergate?
Answer. I don't know.
Question. Do you know who Keshi Zahn is? And again, we are happy to write those names down if you need to see them in writing.
Answer. I believe she worked with Charlie or for Charlie.
Question. Did you ever meet Ms. Zahn?
Answer. No.
Question. Did you ever talk to Ms. Zahn?
Answer. Yes. She may have called to leave messages, but I don't recall anything specific.
Question. Do you recall how you have the impression that she worked with Mr. Trie in some capacity?
Answer. Well, I know I have the memory from reading it in the newspaper, but I think—I think I called her Keshi, which is why I remember her. I am not sure how I saw her name, but I do—I might have taken a message from her before.
Question. Do you know who Lap-Seng Ng is?
Answer. Yes.
Question. Okay. Have you ever met Mr. Ng?
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Answer. May I clarify my answer?
Question. Yes.
Answer. I have heard the name, and I know the name by sight because it is so unusual, but, no, I have never met him, and I don't really have a great knowledge as to who he is.
Question. Have you ever spoken to him, to Mr. Ng?
Answer. No.
Question. We overlapped. Have you ever spoken to Mr. Ng?
Answer. No.
Question. Do you know who Elin Outlaw is?
Answer. No; neither one.
Question. Elin Outlaw?
Answer. No.
Question. Do you know who E-Mei Trie is?
Mr. LUSKIN. I was making a remark off the record to my client. I interrupted you. Maybe you should ask the question again.
EXAMINATION BY MR. DHILLON:
Question. Do you know who E-Mei Trie is?
Answer. No.
Question. Do you know who Antonio Pan is?
Answer. I have heard the name, but I don't know who he is.
Question. Have you ever met Antonio Pan?
Answer. No.
Mr. LUSKIN. I think this part of the deposition is harder for you than for the witness.
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Mr. DHILLON. Right.
EXAMINATION BY MR. DHILLON:
Question. Was Mr. Middleton conducting any type of business with Mr. Trie?
Answer. No, not that I know of.
Question. How much time did Mr. Middleton spend with Mr. Trie?
Answer. I have no idea. He called once in awhile. That's all.
Question. Did Mr. Trie stop over at the office more than once while you were there, at the CommerceCorp office?
Answer. Once, maybe twice.
Question. Did Mr. Trie and Mr. Middleton have any clients together?
Answer. Not that I know of.
Question. Did they ever form a corporation or partnership?
Answer. No.
Question. Did Mr. Middleton or—and Mr. Trie ever travel together?
Answer. Not that I know of.
Question. Did you ever travel with Mr. Trie?
Answer. No.
Question. Did Mr. Middleton and Mr. Trie ever meet while they were in the same country, other than the United States?
Answer. I don't know.
Question. Have you ever heard of Winston Wang?
Answer. I don't recall the name, no.
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Question. So you never met a person named Winston Wang?
Answer. No.
Question. Let me re-ask that question. Have you ever met a person named Winston Wang?
Answer. No.
Question. Are you aware of any meetings between Mark Middleton and Winston Wang?
Answer. No.
Question. Do you know anything at all about Winston Wang?
Answer. No idea.
Question. Did Mr. Trie loan Mr. Middleton his car?
Let me re-ask that question. Did Mr. Trie ever loan Mr. Middleton Mr. Middleton's car—Mr. Trie's car? Let me re-ask the question again.
Answer. Sure.
Question. I object to my own question. I strike the question and I am re-asking it.
Did Mr. Trie ever loan Mr. Middleton Mr. Trie's car?
Answer. I have no idea. No, not that I know of.
Question. That wasn't worth the three questions it took to get the answer.
Now we will go with another document here. The document with control number CC-H-001147 is marked as Deposition Exhibit No. 13 and is a check dated May 22nd, 1996, for $5,000.
Exhibit 13 is before you, and I ask that you please review Exhibit 13.
Answer. Yes.
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[Weymouth Deposition Exhibit No. 13 was marked for identification.]
EXAMINATION BY MR. DHILLON:
Question. Do you recognize Exhibit 13?
Answer. Yes.
Question. What is Exhibit 13?
Answer. It is the check I referred to earlier where Mr. Middleton made Charlie Trie a personal loan.
Question. Did Mr. Trie ever perform any services for Mr. Middleton?
Answer. No, not that I know of.
Question. Did Mr. Middleton participate in any fund-raising activities with Mr. Trie?
Answer. No, not that I know of.
Question. Was the loan personally made from Mark Middleton, or was it from CommerceCorp?
Answer. The check is written from CommerceCorp.
Question. Is the loan on the books for CommerceCorp?
Answer. Yes, and my notation on the books made at that time was for a personal loan.
Question. Did Mr. Middleton participate in any fund-raising activities with Mr. Trie?
Answer. Not that I know of.
Question. Did Mr. Middleton loan money to friends or any—on any other occasions while you were at CommerceCorp?
Answer. He gave some money for a scholarship fund for a friend from Arkansas. He loaned me money.
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Question. Did Mr. Middleton loan money to anyone else while you were at CommerceCorp?
Answer. Other than those two circumstances I just mentioned, no, not that I know of.
Question. Did Mr. Middleton assist Mr. Trie in any type of fund-raising activities?
Answer. Not that I know of.
Question. Did Mr. Middleton assist Mr. Trie in getting White House tours?
Answer. Not that I know of.
Question. Did Mr. Middleton recommend Mr. Trie as a member of the commission on U.S. Pacific Trade and Investment Policy, also known as the Bingaman Commission?
Answer. I don't know.
Question. Did Mr. Middleton or anyone at CommerceCorp contact the White House regarding Charlie Trie's appointment to the commission?
Answer. Not to my knowledge.
Question. Did you ever discuss—did you ever discuss the Bingaman Commission with Mr. Trie?
Answer. No.
Question. Did Mark Middleton ever discuss the Bingaman Commission with Mr. Trie?
Answer. I don't know.
Question. I am sorry?
Answer. I don't know.
Question. Did CommerceCorp obtain any information from the Bingaman Commission proceedings?
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Answer. Not that I know of. I don't recall.
Question. Did Mr. Middleton ever obtain such information?
Answer. I don't know.
Question. Did Mr. Middleton ever communicate with Kenneth Brody regarding the commission?
Answer. I don't know.
Question. Did you ever communicate with Kenneth Brody regarding the commission?
Answer. Not—no, not that I know of.
Question. Was Debbi Shon involved with the commission in any way?
Answer. I don't know.
Question. Do you know who Debbi Shon is?
Answer. Only that I believe she used to work at—not through CommerceCorp. Through my previous employment I think she was with the administration. I am not even sure if it was White House or USTR. She is now with a law firm in Australia, I believe.
Question. Do you know—did you ever have any communication with Ms. Shon?
Answer. No.
Question. Do you know if Mark Middleton ever had any—strike that.
Did Mark Middleton ever have any communications with Ms. Shon?
Answer. I don't know.
Question. Was Bob Nash involved in the commission in any way?
Answer. I don't know.
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Question. Do you have any knowledge that relates to Mr. Nash and the Bingaman Commission?
Answer. No.
Question. Do you know if Mr. Middleton ever contacted Mr. Trie while Mr. Trie was overseas?
Answer. I don't recall.
Question. Did Mr. Middleton arrange a meeting with the Lippo Group for the Bingaman Commission?
Answer. I don't know.
Question. Next document, the document with control number CC-H-000034-35, is marked as Deposition Exhibit 14. It is a September 12th, 1996 facsimile cover sheet from Holli Weymouth to the office of Mr. Hashim Djojohadikusumo.
Answer. That's very good. I don't know how to say that.
Question. Attached is an August 29th, 1996 letter from Mark Middleton to Hashim Djojohadikusumo.
Exhibit 14 is before you, and I please ask you to review it.
Answer. Okay.
[Weymouth Deposition Exhibit No. 14 was marked for identification.]
EXAMINATION BY MR. DHILLON:
Question. Do you recognize Exhibit 14?
Answer. Yes.
Question. What is it?
Answer. It is a cover sheet from me to Hashim with an attached letter.
Question. Who is Hashim Djojohadikusumo?
Answer. I don't know his business specifically.
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Question. Did you ever meet that gentleman?
Answer. No, I did not.
Question. The letter portion of Exhibit 14, which is the second page, notes that Mr. Middleton saw Mr. Djojohadikusumo in Jakarta recently.
Answer. Uh-huh.
Question. When was Mr. Middleton in Jakarta?
Answer. I don't recall the dates of his travel.
Question. In the letter portion of Exhibit 14, Mr. Middleton also states that his, quote, friends at the Export-Import Bank were very impressed by your operation and professional management, closed quote.
Do you know who Mr. Middleton is referring to as his friends at Ex-Im?
Answer. No, I do not. And I should tell you that Mark gave me this letter to forward, and I did the cover letter, but I did not prepare the letter, nor do I have knowledge of the information that's in the letter.
Question. Do you know who the senior directors are that are referred to in the letter portion of Exhibit 14?
Answer. No, I do not.
Question. Do you know if Mr. Middleton—strike that.
Did Mr. Middleton arrange a meeting at the Export-Import Bank for Mr. Djojohadikusumo?
Answer. I don't know.
Question. Did Mr. Middleton contact any other agencies on behalf of Mr. Djojohadikusumo?
Answer. I don't know.
Question. Did Mr. Middleton arrange any meetings with Mr. Djojohadikusumo for the commission?
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Answer. I don't know.
Mr. LUSKIN. By ''commission'' are you referring to the Bingaman Commission again?
Mr. DHILLON. The Bingaman Commission, yes.
The WITNESS. Yes. In fact, I never heard that name.
EXAMINATION BY MR. DHILLON:
Question. Have you ever heard of a person named Ernie Green?
Answer. No.
Question. Had you ever seen anyone named Ernie Green at CommerceCorp?
Answer. No.
Question. You never met anyone named Ernie Green?
Answer. No.
Question. And there were no—no business—did anyone named Ernie Green do any business with CommerceCorp?
Answer. I have never heard of anyone named Ernie Green at all.
Question. When was the last time you spoke to Mr. Charlie Trie?
Answer. Probably Secretary's Day 1996, when he gave us perfume.
Question. What was, very briefly, the substance of that conversation?
Answer. Thank you very much.
Question. When was the last time Mr. Middleton was in contact with Mr. Trie?
Answer. I don't know.
Question. The next document is a document with control number CC-H-000057-59. It is marked as Deposition Exhibit 15. It is a July 31, 1996 memo from Yau Lop Poon to Mark Middleton.
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Exhibit 15 is before you, and I ask you to please review it.
[Weymouth Deposition Exhibit No. 15 was marked for identification.]
EXAMINATION BY MR. DHILLON:
Question. Do you recognize Exhibit 15?
Answer. Yes, I do.
Question. What is it?
Answer. It is the letter received from Mr. Yau in our office.
Question. When was the first time you saw Exhibit 15?
Answer. When it came through the fax on or about this date, July 31st, 1996.
Question. Did you discuss Exhibit 15 with Mr. Middleton?
Answer. Yes, I did.
Question. What did Mr. Middleton tell you with respect to Exhibit 15?
Answer. Well, I remember he was just really surprised when he read through the questions. I remember him being very surprised and just kind of annoyed by the whole thing.
Question. I am sorry. You were surprised and annoyed?
Answer. He was.
Question. Mr. Middleton was?
Answer. Mr. Middleton was.
Question. Did he make any comments about the letter, any specific comments about the letter?
Answer. Not at that time. I mean, later, I remember him saying he thought he knew who the source of this was; it was someone that he had met on a business meeting who was disgruntled because a deal didn't go through or something of that sort.
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Question. Did Mr. Middleton prepare a point by point response to the letter?
Answer. He prepared a response in the form of a letter. I don't believe it went point by point.
Question. Did Mr. Middleton discuss—let me back up. Exhibit 15 is three pages long, correct?
Answer. Yes, it is.
Question. And it has numbered paragraphs which number up to 12 on the third page.
Answer. Yes.
Question. Did Mr. Middleton discuss—and those numbered paragraphs—and if you need to glance at it, to look at it again to answer this question, that's fine. But those numbered paragraphs are questions to Mr. Middleton; is that correct?
Answer. Correct.
Question. Did Mr. Middleton discuss any of the—of these questions or his answers to these questions with you?
Answer. Again, I saw the response that he sent out, and, again, the only thing I remember him saying was just that, you know, again, that it was—he thought he knew who the source was; that it was someone that was disappointed in a business deal that didn't go through.
Question. Did he discuss point by point his response to these questions with you?
Answer. Not any specifics that I can recall.
Question. Were any drafts of a response, a point by point response, ever made to these questions?
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Answer. No. The only response that was made was the—I think it was a one- or two-page letter that Mark sent back to Mr. Yau where he did address the issues that were raised.
Mr. LUSKIN. Did he indicate whether or not he thought that the allegations were true?
The WITNESS. I mean, he thought it was ridiculous.
Mr. LUSKIN. I am sorry. You just said a moment ago that someone was saying it because they were disgruntled. Is there any implication that was conveyed there?
The WITNESS. No, sorry. He thought it was ridiculous, and I think he was a little bit incensed. He wanted to be helpful because this is a decent publication. He did want to respond to the editor there to clarify anything that could have been confusing, and I believe he did try to convey to him that, you know—that there was absolutely nothing here, and that he would hate to see him print something and, you know, just that—you know, that it was ludicrous.
Mr. DHILLON. It is a little early for a break, but I could use one for 5 or 10 minutes, if you don't mind.
[Recess.]
EXAMINATION BY MR. DHILLON:
Question. The next exhibit is a document with control No. CC-H-000056, is marked as Deposition Exhibit 16. It is an August 5th, 1996 facsimile from Holli Weymouth to Yau Lop Poon.
Exhibit 16 is before you, and I ask that you please review it.
Answer. Okay.
[Weymouth Deposition Exhibit No. 16 was marked for identification.]
EXAMINATION BY MR. DHILLON:
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Question. Do you recognize Exhibit 16?
Answer. Yes, I do.
Question. What is it?
Answer. It is a fax from me to Mr. Yau, the editor-in-chief.
Question. And is it a fax that's in response to something?
Answer. Yes, it is in response to the fax list of questions that we received.
Question. And that was the document marked as Deposition Exhibit 15?
Answer. Yes.
Question. Now, in the letter which is marked as Exhibit 16, you state that you will be willing to get answers to some of the preliminary factual issues about which Mr. Yau Lop Poon inquired. Did you, in fact, do that?
Answer. I believe the only response that we sent was the letter that Mark eventually wrote.
Question. And that would be a letter other than this letter?
Answer. Yes.
Question. So you didn't obtain any of the information that is described in the letter?
Answer. No, I——
Mr. LUSKIN. Which letter?
Mr. DHILLON. You are right. We have a couple.
EXAMINATION BY MR. DHILLON:
Question. Did you ever obtain any of the answers to some of the preliminary factual issues as you set forth in Exhibit 16?
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Answer. No. We never sent him any other response, other than the letter that Mr. Middleton wrote.
Question. In that letter, which is marked as Exhibit 16, you state that Mr. Middleton is traveling in Asia during the month of August. Do you know specifically where Mr. Middleton went during that time?
Answer. No, I don't recall.
Question. Are there any records at CommerceCorp that would indicate where Mr. Middleton traveled during that time?
Answer. If there are, I am sure we have turned them in. I don't have a list of itineraries, no.
Question. Do you routinely keep itineraries for Mr. Middleton's travel?
Answer. No.
Question. Do you recall anyone who Mr. Middleton met with during that 1996—that August 1996 Asia trip?
Answer. No.
Question. The next document is the document with control number CC-H-000543. It is marked as Deposition Exhibit 17, and it is a September 24th, 1996 letter from Mr. Middleton to
Yau Lop Poon.
Exhibit 17 is before you, and I ask you to please review it.
[Weymouth Deposition Exhibit No. 17 was marked for identification.]
EXAMINATION BY MR. DHILLON:
Question. Do you recognize Exhibit 17?
Answer. Yes, I do.
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Question. What is it?
Answer. It is the letter of response sent by Mr. Middleton to Mr. Yau.
Question. Did Mr. Mark Middleton—or did Mr. Middleton write this letter?
Answer. Yes, he did.
Question. Did he have any assistance from anyone else in drafting the letter?
Answer. I don't know.
Question. Did you assist Mr. Middleton in drafting the letter?
Answer. I assisted in typing it.
Question. You typed the letter?
Answer. Yes.
Question. Okay. You didn't assist him in writing the letter?
Answer. No.
Question. In Exhibit 17, Mr. Middleton refers to a trip to Singapore. When did Mr. Middleton travel to Singapore?
Answer. Can I guess?
Mr. LUSKIN. Do the best you can.
The WITNESS. I am assuming on the letter here, on what I have seen right now, that was probably one of the stops on his travel in August was to Singapore.
EXAMINATION BY MR. DHILLON:
Question. So when I asked you previously about the August 1996 trip——
Answer. Right.
Question. From the documents that you have seen before you as exhibits, you have concluded that Singapore was probably one of his stops; is that correct?
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Answer. Yes, that's correct.
Question. Mark Middleton also mentions Oei Hong Leong. Do you know who that is?
Answer. Oei Hong Leong, yes.
Question. How do you know him?
Answer. He is a business contact of Mark's in Singapore. He is related to the Widjaja family in some way.
Question. Okay. How is he related to the Widjaja family?
Answer. I think he is a brother. Their businesses are all separate.
Question. Is Mr. Leong a client of CommerceCorp?
Answer. No.
Question. In Exhibit 17, Mr. Middleton states that Mr. C.P. Chan is a primary source for the questions posed to Mr. Middleton. Who is C.P. Chan?
Answer. I do not know. I had not heard his name until this letter.
Question. Did you ever speak to C.P. Chan after the letter was written?
Answer. No.
Question. Did Mr. C.P. Chan ever come to the CommerceCorp offices?
Answer. No.
Question. Do you have any knowledge about what C.P. Chan does or anything else about him?
Answer. No, only that I believe he is a consultant.
Question. Okay. Do you know where?
Answer. No.
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Question. Okay. Do you know if Mr. C.P. Chan goes by any other names?
Answer. I don't know.
Question. Have you ever heard of Chao-Ping Chan or Chao-Ping Chin?
Answer. No. Again, this Chan, that's the only Chan I know. I don't know whether those initials stand for the same thing or not.
Question. Okay.
Mr. LUSKIN. Off the record.
[Off-the-record discussion.]
EXAMINATION BY MR. DHILLON:
Question. Let's go back on the record.
Who is Mr. Leong the brother of?
Answer. Sukma and Tegugh Widjaja.
Question. Do you know who Liu Tai-ying is?
Answer. Again, it is a name I only became familiar with in the context of this letter.
Question. Did Mr. Middleton invite Mr. Lui Tai-ying to the United States for the purpose of meeting with President Clinton?
Answer. I have no idea.
Question. Did Mr. Middleton take Mr. Tai-ying to a fund-raiser which was attended by the President?
Answer. I have no knowledge of that other than press reports.
Question. What do you know about Lui Tai-ying?
Answer. Nothing really, other than what I have read in the papers.
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Mr. LUSKIN. I don't want to divert you from any line of questioning you want to pursue, but my understanding is that these allegations and the interaction with Dr. Lui are basically between April and October of 1995, which is before the witness had any contact with Mr. Middleton. You certainly are free to ask anything you want. I am just putting that out there for whatever benefit it gives you.
Mr. DHILLON. Just so counsel is aware, one of the reasons I am asking what would be probably a very broad kind of question is because if the answer is what it was, I can more quickly go through the deposition.
Mr. LUSKIN. Right.
The WITNESS. I understand.
Mr. LUSKIN. And please don't understand me as interposing an objection here.
Mr. DHILLON. I understand. That's fine.
EXAMINATION BY MR. DHILLON:
Question. Do you know a person named Fred Li, last name L-I?
Answer. Again, only through the allegations made.
Question. Do you know anything at all about Fred Li other than what you have read in Exhibit 17?
Answer. No.
Question. You never met him?
Answer. No.
Question. He never came to CommerceCorp's offices, did he?
Answer. No.
Question. Mr. Middleton never talked about him to you?
Answer. No.
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Question. Did Fred Li have any business relation with CommerceCorp?
Answer. No.
Question. Did Mr. Charlie Trie ever—or did Mr. Charlie Trie accompany Mark Middleton on the August trip abroad to Asia?
Mr. LUSKIN. Was this August of 1996?
Mr. DHILLON. 1996. I am sorry.
EXAMINATION BY MR. DHILLON:
Question. Strike that last question.
Do you know if Mr. Charlie Trie accompanied Mr. Mark Middleton to the August 1995 trip to Taiwan that's referenced in that letter?
Answer. I don't know.
Question. Does CommerceCorp do any business with Formosa Plastics?
Answer. No.
Question. The next document is a document with control number CC-H-000157. It is marked as Exhibit—Deposition Exhibit 18. It is a September 6th, 1996 memo from Mr. Middleton to Mack McLarty regarding a meeting on September 9th, 1996.
Exhibit 18 is before you, and I ask you to please review it.
Answer. Yes.
[Weymouth Deposition Exhibit No. 18 was marked for identification.]
EXAMINATION BY MR. DHILLON:
Question. Do you recognize Exhibit 18?
Answer. No.
Question. Do you know who the ''meeting participant'' referred to in Exhibit 18 is?
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Answer. No.
Question. Deposition Exhibit 19 is a receipt bill from the Hay-Adams Hotel. It does not have a document control number. Exhibit 19 is before you, and I ask you to please review it.
[Weymouth Deposition Exhibit No. 19 was marked for identification.]
EXAMINATION BY MR. DHILLON:
Question. Do you recognize Exhibit 19?
Answer. Other than I have never seen it before, no.
Question. At the top of Exhibit 19 is the name ''Riady James Mr.,'' and below it says, ''C/O H. Weymouth.''
Answer. Yes.
Question. Is that you?
Answer. I guess. I would assume so.
Question. The address on the document, on Exhibit 19, is 1455 Pennsylvania Avenue, Suite 560, Washington, D.C. Is that the address of CommerceCorp?
Answer. Yes, it is.
Question. Why was Mr. Riady's bill for the Hay-Adams Hotel made to your care?
Answer. It looks like we made a reservation for him, and they secured it with our card, and we paid for his room.
Question. Okay. Do you—were you the person that did that?
Answer. Yes, I would have been. I think he paid for it——
Mr. LUSKIN. Pardon?
Mr. DHILLON. I can ask some questions.
Mr. LUSKIN. Yes, why don't you. Just clarify this.
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EXAMINATION BY MR. DHILLON:
Question. Did CommerceCorp pay for Mr. Riady's stay at the Hay-Adams that is reflected in Exhibit 19?
Answer. Yes, I believe we did.
Question. Was that done through a credit card?
Answer. Yes, it would have been through a credit card.
Question. And is that a credit card issued to CommerceCorp?
Answer. Yes.
Question. And you had access to that card and that card number for the purposes of making such reservations?
Answer. Yes. Yes.
Question. Why did Mr.—why did CommerceCorp pay for Mr. Riady's hotel stay at the Hay-Adams Hotel?
Answer. He is a friend of Mark's. I assume Mark was—I mean, I would be venturing a guess, that they were working on something together.
Question. Do you know why CommerceCorp paid for Mr. Riady's hotel?
Answer. No.
Question. Did Mr. Middleton meet with Mr. Riady while he was staying at the Hay-Adams Hotel?
Answer. I don't know.
Question. Is Mr. Riady, Mr. James Riady, a client of CommerceCorp?
Answer. No, he is not a current client.
Question. Was he ever a client of CommerceCorp?
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Answer. I am sorry. No, he wasn't.
Question. Did Mark Middleton set up a meeting between Mr. Riady and Mr. McLarty around the time of Mr. Riady's stay at the Hay-Adams Hotel as evidenced by Exhibit 19?
Answer. I don't know.
Question. Do you know if there was a meeting held at all involving Mr. Middleton or Mr. Riady while Mr. Riady was in town——
Answer. I don't know. It is——
Question. During——
Mr. LUSKIN. Wait for him to finish his question before you answer.
The WITNESS. I am sorry.
EXAMINATION BY MR. DHILLON:
Question. During the time reflected on the bill, which comprises Exhibit 19?
Answer. I don't know. I don't really have much recollection of Mr. Riady being in town.
Question. Did Mr. Riady attend any campaign or DNC fund-raising events during his visit to Washington, D.C. during the times reflected—in or about the times reflected by the hotel bill which constitutes Exhibit 19?
Answer. I don't know.
Question. Did Mr. Middleton have lunch at the White House the week of September 4th, 1996, with Mr. Riady?
Answer. I don't know.
Question. You didn't attend such a lunch, did you?
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Answer. No.
Question. The next document is a document with control number CC-H-000522-523. It is marked as Deposition Exhibit 20 and is a September 16th, 1996 facsimile from Mark Middleton to James Riady.
Exhibit 20 is before you, and I ask that you please review it.
Answer. Okay.
[Weymouth Deposition Exhibit No. 20 was marked for identification.]
EXAMINATION BY MR. DHILLON:
Question. Do you recognize Exhibit 20?
Answer. No.
Question. Do you know why Mr. Middleton faxed this document—strike that question.
Do you know why Mr. Middleton faxed Mr. Riady this document?
Answer. No.
Question. Did Mr. Middleton ever work with any—on the fund-raising matters with Mr. Riady?
Answer. Not that I know of.
Question. Did Mr. Middleton assist Mr. Riady in organizing a July 30th, 1996 dinner attended by the President?
Answer. Not that I know of.
Question. Did Mr. Middleton ever solicit any contributions, political contributions, from Mr. Riady?
Answer. No, not that I know of.
Question. Did Mr. Middleton ever solicit any contributions from any member of the Riady family?
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Answer. No, not that I know of.
Question. Did Mr. Riady visit the CommerceCorp offices at any time?
Answer. Yes.
Question. Okay. When?
Answer. Oh, goodness. Maybe—the summer of 1996. I am guessing. I honestly don't recall. I only met him once briefly.
Question. How many times did Mr. Riady visit the CommerceCorp offices?
Answer. Just once, that I know of.
Question. Did anybody accompany Mr. Riady?
Answer. No.
Question. What did Mr. Riady do when he arrived?
Answer. He and Mr. Middleton left for dinner.
Question. Did Mr. Riady ever call Mr. Middleton at CommerceCorp?
Answer. Yes.
Question. How often would he call?
Answer. Off and on. Not very often, that I know of.
Question. More than once a week; less than once a week?
Answer. I didn't take all the phone calls, so I don't even have a good estimate.
Question. Once a month?
Answer. Once every couple of weeks maybe. I am not sure honestly.
Question. Other than the ones you took, though, just excluding that, were there other ones that others may have taken or calls that you answered that Mr. Riady was involved?
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Answer. That would have been very infrequently, you know, just now and then.
Question. But you believe he called at other times when you didn't answer the phone?
Answer. I am assuming. I don't know.
Question. Did Mr. Riady ever call you?
Answer. Not that I recall.
Question. Does Mr. Riady correspond with you, or has Mr. Riady corresponded with you or Mr. Middleton?
Answer. He has never corresponded with me, and I don't recollect any specific correspondence to Mr. Middleton.
Question. Has Mr. Middleton ever arranged any meeting with any government officials for Mr. Riady?
Answer. I don't know.
Question. Have you ever arranged any meetings with government officials for Mr. Riady?
Answer. No, not that I recall.
Question. Now, do you know who Mochtar Riady is?
Answer. I believe it is James Riady's father.
Question. Have you ever met him?
Answer. No.
Question. Has Mr. Middleton ever arranged any meeting with any government officials for Mochtar Riady?
Answer. I don't know.
Question. Have you ever arranged any meetings with any government officials for Mochtar Riady?
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Answer. No. My knowledge of Mochtar Riady is only through reading biographies and things about James Riady, and they mention Mochtar as his father; again, press reports.
Question. Do you know who Hashim Ning is?
Answer. Excuse me?
Question. Hashim Ning?
Answer. It doesn't sound familiar. I don't recollect, no.
Question. So you don't know anything about Hashim Ning?
Answer. Not that I recall.
Question. Let me ask the question this way. Do you know anything about Hashim Ning?
Answer. No.
Question. Did Mr. Middleton ever mention Hashim Ning to you?
Answer. No.
Question. Have you ever heard of Arief Wiriadinata?
Answer. May I see the name?
Question. Yes.
Answer. Yes. It is familiar, but I am not sure who it is. I may have seen it on documents.
Question. Did you ever meet anybody by that name?
Answer. No.
Question. Did you ever talk to anybody on the phone by that name?
Answer. Unless it—no, not that I can recall.
Question. Do you know if Mr. Middleton ever talked to anybody on the phone by that name?
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Answer. I don't know.
Question. Do you know who Soraya Wiriadinata is?
Answer. No.
Question. Do you know anything at all about Soraya Wiriadinata?
Answer. No.
Question. Did Mr. Middleton ever mention anything about Soraya Wiriadinata to you?
Answer. No. I know them from the press. That's how I knew who they are. But I have only read the names in the newspaper. It finally dawned on me. Sorry.
Question. Okay. Do you need—are you answering the question differently?
Answer. No. I finally remembered why the name was familiar to me. It is from reading the press reports——
Question. Okay.
Answer. Where they are mentioned.
Question. Okay. All right. Are you familiar with the Sinar Mas Group?
Answer. Yes, I am.
Question. Okay. What is that?
Answer. The Sinar Mas Group is—they are one of our clients. They have four main businesses. We work on different issues for them.
Question. They have four main businesses?
Answer. Well, the Sinar Mas Group. It is—there are four areas that they work in.
Question. And the Sinar Mas Group is a client of CommerceCorp?
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Answer. Yes, it is.
Question. Are you familiar with the Widjaja family of Indonesia?
Answer. Yes, I am.
Question. And is there a relationship between the Widjaja family and this Sinar Mas Group?
Answer. Yes, the Widjaja family is the principal family that runs the company, that runs the Sinar Mas Group.
Question. Next document is a document with control number CC-H-000515. It is Deposition Exhibit 21 and it is a September 18th, 1996 memo from A.P. Nilo to Mark Middleton. And the document has been redacted. It is Exhibit 21 is before you, and I ask you, please, to review it.
Answer. Yes.
[Weymouth Deposition Exhibit No. 21 was marked for identification.]
EXAMINATION BY MR. DHILLON:
Question. Do you recognize Exhibit 21?
Answer. Yes.
Question. What is it?
Answer. It is a fax memo received to Mr. Mark Middleton, from the Sinar Mas Group. It doesn't say. I wasn't sure who it was from.
Question. What are the four companies or four—are there four companies that make up the Sinar Mas Group?
Answer. It is—the Sinar Mas Group is involved in four principal areas of business. They work in financial services, pulp and paper, real estate and agra business.
Question. Is that—is the group composed of four different companies that have responsibility for each of those areas?
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Answer. Not necessarily. They have many different—well, Asia Pulp and Paper is a group that we work with largely and that is the pulp and paper division.
Question. Were there any——
Answer. Whether they are direct companies, I don't think that they are direct companies that correspond to the other segments.
Question. Okay. So the other three divisions were just divisions of the Sinar Mas Group?
Answer. Right.
Question. Not separate entities or separate companies?
Answer. Correct.
Question. Let's go back to Exhibit 21. Who is A.P. Nilo?
Answer. Mr. Nilo worked with the Sinar Mas Group.
Mr. DHILLON. Let's go off the record for a moment, please.
[Off-the-record discussion.]
Mr. DHILLON. We will go back on the record, please.
Mr. LUSKIN. Staying off the record for a second.
Mr. DHILLON. Okay.
[Off-the-record discussion.]
EXAMINATION BY MR. DHILLON:
Question. Back on the record, please. Who is A.P. Nilo?
Answer. Mr. Nilo is employed by the Sinar Mas Group.
Question. And who is Adolf Ratulangi?
Answer. I am not sure. I believe he is someone's administrative assistant. He is the executive assistant to someone. I am not sure who that refers to.
Question. Who is Bp. Eka?
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Answer. Bp. Eka. Eka Widjaja is the father, or the oldest member of the Widjaja family who originally started the company back in the '40s.
Question. Have you ever met with Mr. Eka?
Answer. Yes.
Question. Where?
Answer. I met Mr. Eka Widjaja when he came to the United States, during the time of the World Bank, IMF Conference.
Question. And when was that?
Answer. That was in, I want to say October of 1996.
Question. And where did you meet him?
Answer. Well, first I met him with a van out on the street, in the hotel, downstairs, I should say, and we escorted them to the White House for their tour.
Question. And when you say ''we,'' who are you referring to?
Answer. Actually, myself, we, CommerceCorp, but me individually.
Question. And you had previously described a tour at the White House for the Widjaja family?
Answer. Uh-huh.
Question. Is that the tour you are referring to when you say you escorted them to their tour?
Answer. Yes, it is.
Question. Did you meet with Mr. Eka at any time after the tour?
Answer. No.
Question. So that was the only time you met with him?
Answer. Uh-huh.
Question. Was that the van escorting him to the tour?
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Answer. Yes, it was.
Question. Who attended the tour?
Answer. I will try to recollect. It was Mr. Eka Widjaja, his wife, I believe, Mr. Nilo, one of the Widjaja sons, I think it was—I am not sure which son, and his wife, but it was another son and his wife. I think it was Indra, Indra Widjaja.
Question. Did anyone of the Widjaja family ask Mr. Middleton to arrange for lunch at the White House?
Answer. Yes, I believe they did have a lunch at the White House.
Question. Did you make the arrangements for that?
Answer. I don't recall. I may have.
Question. Had you ever made arrangements before or after for anyone to have lunch at the White House with Mr. Middleton?
Answer. We made the arrangements for the Widjaja family, and the party with Mr. John McAlister, and Mr. Zhou, that we talked about.
Question. Did Mr. Middleton arrange for Bp. Eka to meet with the President?
Answer. No, not that I know of.
Question. Did Mr. Middleton arrange for Bp. Eka to meet with the First Lady?
Answer. I believe that that is the instance I was talking about, where I believe they were—no, wait. I don't know, honestly.
Question. Did Mr. Middleton arrange any meetings with other White House officials for Bp. Eka?
Answer. I don't recall what their schedule was. I know they were very busy with the IMF Conference, and I only remember meeting them and taking them over to the White House and leaving them at the gate. They had different ceremonies. He was being honored as the emerging market CEO of the year by the World Bank, IMF Conference, that is why he was in Washington.
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Question. Did Mr. Middleton arrange for any meetings between Mr. Eka and anyone from the DNC?
Answer. No.
Question. Do you know who Tegugh Ganda Widjaja is?
Answer. Tegugh Widjaja is one of the sons of Mr. Eka Widjaja.
Question. Did you ever meet him?
Answer. Yes, I believe. Hold on for a minute. No, I have not met Tegugh Widjaja.
Question. Did you ever talk to him on the phone?
Answer. No.
Question. Did Mr. Middleton arrange any meetings for Tegugh Widjaja with any government official?
Answer. Not that I know of.
Question. Did Mr. Middleton arrange any meetings for Tegugh Widjaja with anyone from the DNC?
Answer. Not that I know of.
Question. Do you know who Sukmawati Widjaja is?
Answer. Sukma is the daughter.
Question. Did you ever meet Sukmawati Widjaja?
Answer. Yes, I have.
Question. When?
Answer. I met her on several occasions. Once in Washington, once in diff