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U.S. Attorney in Minnesota Faces Probe
Prosecutor Accused by Staff of Abuse, Retaliation, Mishandling Classified Material

By Dan Eggen
Washington Post Staff Writer
Sunday, September 23, 2007

Immediately upon arriving in Minneapolis last year as the nation's youngest U.S. attorney, Rachel K. Paulose made little secret of her political views or her desire to focus on key Bush administration initiatives, such as pushing for "righteous sentences" in child pornography cases, according to current and former employees.

The effort did not go well. Paulose openly clashed with career prosecutors in the office over issues big and small, leading to open revolt last spring by senior managers who refused to work with her. Her connections to senior Justice Department aides suddenly became a liability instead of an asset after those aides became embroiled in the controversy over the firings of nine other U.S. attorneys.

Now, the 34-year-old Yale University Law School graduate is the subject of an investigation by the U.S. Office of Special Counsel into allegations that she mishandled classified information, retaliated against those who crossed her, and made racist remarks about a support staff employee, said multiple sources in Minnesota and Washington, who declined to be identified because the probe is still under way.

In addition, an internal Justice Department audit completed last month said her employees gave her very low marks, alleging that she treats subordinates harshly and lacks the requisite experience for the job, said several sources familiar with the audit. Her performance review was so poor that Kenneth E. Melson, head of the department's Executive Office for U.S. Attorneys, took the unusual step of meeting with her in Minnesota several weeks ago, two sources said.

The Justice Department's inspector general and Office of Professional Responsibility are also examining the Minnesota office as part of a broader investigation into personnel issues at Justice, although that inquiry does not specifically deal with Paulose's performance, sources said.

The case provides a key example of the unresolved challenges that will face former federal judge Michael B. Mukasey if he is confirmed to succeed Alberto R. Gonzales, who resigned as attorney general this month. Temporary appointees fill a quarter of the U.S. attorney offices and most of the department's senior jobs in Washington, while internal and congressional investigations into the problems at Justice are likely to continue well into next year.

"It's just one thing after another," said one Minneapolis lawyer and former federal prosecutor, who did not want to be identified because of regular dealings with Paulose's office. "I think a lot of people in the office were hoping for some oversight to change things. But right now people are just hunkering down and hoping they can survive another year or so and salvage their careers."

In a statement issued by her office in response to disclosure of the special counsel investigation, Paulose said: "I am confident the truth will be brought to light. I am focused on doing the work of the people, which is what I have been appointed to do." A spokeswoman for Paulose declined to comment on the Justice Department audit.

Paulose was one of more than a dozen Bush administration insiders who were appointed to U.S. attorney posts under Gonzales. Her predecessor, veteran prosecutor Thomas B. Heffelfinger, had been identified as a potential firing candidate by senior Justice aides, but he resigned on his own in early 2006 and said he never knew he had been targeted.

Born in India and raised primarily in the Minneapolis suburb of Eagan, Paulose was previously an aide in the deputy attorney general's office. She became Minnesota's first Asian American U.S. attorney upon Senate confirmation last December.

Former Gonzales aide Monica M. Goodling testified at the House Judiciary Committee in May that Paulose's conservative credentials were one reason that she was appointed as interim U.S. attorney in early 2006 instead of another candidate. Goodling also testified that Paulose and she had become personal friends during the hiring process.

Paulose's troubles burst into public view in April -- a month after she was formally sworn into office -- when her first assistant U.S. attorney, John Marti, and two other senior attorneys resigned their management positions, saying they did not want to work for her.

Marti then filed a complaint about Paulose in June with the U.S. Office of Special Counsel, an executive branch agency that handles whistle-blower cases, sources said. The existence of that investigation was first reported last week on a blog run by veteran Minnesota reporter Eric Black. Marti did not respond to a telephone message left at his office.

The complaint alleges that Paulose regularly left classified reports related to terrorism lying loose in her office, and ignored warnings from Marti until he reported the problem to superiors in Washington, said sources familiar with the probe. Investigators are also looking at whether Paulose then threatened to retaliate against Marti.

The special counsel's office is further examining allegations that Paulose retaliated against lawyers and support staff whom she viewed as disloyal, vowing to make one employee so miserable she would quit. In addition, the office is investigating an allegation that Paulose referred to an African American support employee as "fat," "black" and "lazy" in a conversation with another employee, the sources said.

James P. Mitchell, a spokesman for Special Counsel Scott J. Bloch, declined to comment on the investigation. Justice spokesman Peter A. Carr also declined to comment on the probes.

David Schultz, who teaches law at the University of Minnesota and business administration at Hamline University in St. Paul, said: "A lot of this stuff appears to go beyond the U.S. attorneys' issue and is just about her unprofessionalism. The real complaint may just be that she's a political hack who just isn't qualified to manage the office."

Even some of Paulose's detractors describe her as brilliant, and she has many fans among lawyers of both parties who have worked with her. A.M. "Sandy" Keith, a former Minnesota Supreme Court justice and a prominent Democratic lawyer in the state who has known Paulose since college, said Paulose's reputation has been unfairly maligned because of the Washington uproar over the U.S. attorney firings.

"She's gotten dragged into this, and I think it's unfortunate," Keith said. "I know she's an extremely competent lawyer. Everything she's ever done, she's done well. . . . If she has any problems, it could be administrative, because obviously she had never run anything before."

"I'm a strong-willed person," Paulose told the Star Tribune newspaper in Minneapolis in April. "I think that I'm also a generous and loyal and kind person."

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