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Kohl Admits to Secret Funds
Former German Leader Says Illicit Donations Were Never Bribes

By William Drozdiak
Washington Post Foreign Service
Wednesday, December 1, 1999; Page A36

BERLIN, Nov. 30—In a dramatic confession by one of Europe's most respected statesmen, former German chancellor Helmut Kohl said today he used a system of secret accounts while running the government to mask illicit donations that were channeled to regional branches of his Christian Democratic party.

After meeting with fellow party leaders to discuss a scandal that threatens his reputation and the future electoral prospects of the Christian Democrats, Kohl said he assumed full responsibility for any errors in judgment during his years in office and expressed regret if the hidden accounts broke Germany's political financing laws.

It was the first time that Kohl admitted that the secret accounts existed, and that they may have been illegal. Parliament has opened an investigation that could determine whether bribery or corruption charges should be filed against him. Kohl has denied that any of the money involved payoffs or kickbacks. The accounts were closed last December when Kohl stepped down as party chairman, and in the absence of hard evidence it was unclear whether he could be prosecuted.

Even so, the mushrooming scandal has clearly tarnished Kohl's 16-year legacy as chancellor, when he steered Germany through the fall of the Berlin Wall in 1989 and the country's subsequent reunification. Kohl, who was voted out of office last year, was the longest serving German chancellor since Otto von Bismarck, who ruled from 1871 to 1890.

"The Kohl monument is crumbling," the influential newsmagazine Der Spiegel wrote this week, even before his admission today. "Will the political life of the chancellor of unity end in sordid money tales?"

The controversy also has sparked renewed cries for greater transparency in Germany's obscure political finance laws. It threatens to erode public trust in the country's political leadership, which has long prided itself on its integrity and felt itself to be immune to the kind of corruption cases that regularly have plagued countries such as France, Italy and Spain.

The scandal erupted earlier this month when prosecutors opened a tax evasion probe of Walther Leisler Kiep, a former treasurer for the Christian Democrats, when they could not trace a $530,000 donation an arms dealer made in 1991. The money, contained in a metal suitcase, was passed to Kiep during a secret encounter in a Swiss parking lot.

Kiep denied taking the money for himself and later acknowledged the cash went into a secret slush fund Kohl managed to cover political operations and ensure the loyalty of local party chiefs. Last week, Parliament launched an inquiry to determine if the undeclared gift was connected to a decision by Kohl to authorize the sale of 36 tanks to Saudi Arabia on the eve of the Gulf War--a link the former chancellor vehemently denied today.

"I reject in the strongest terms all allegations--in whatever form--that political decisions made by me could be bought," Kohl said at a news conference. "Anyone who knows me knows that the only responsibility I felt, and still feel, was toward the good of our country."

Wolfgang Schaeuble, Kohl's trusted lieutenant and his chosen successor as leader of the Christian Democrats, said the party leadership listened to Kohl's explanation of the secret accounts with "great respect." He said the board unanimously concluded that there had been no venal motives behind the former chancellor's financial dealings.

"We are quite certain that nobody enriched themselves," he said. "And there is absolutely no doubt that decisions in the Kohl era were not for sale."

But Schaeuble acknowledged there were serious misgivings about the peremptory manner in which Kohl put himself above the party, and possibly above the law, in gathering donations of dubious origin and then doling out funds to his political allies.

"Helmut Kohl led the party in a patriarchal way," Schaeuble said. "He took care of and really cared about everyone. But this patriarchal style meant that the rules were not adhered to exactly in the way we might want today."

Schaeuble said "a gray zone" involving political financing of questionable legality evolved under Kohl, who dominated the Christian Democrats as party chairman for 25 years. German law requires that all political donations be publicly declared.

Kohl, however, said he felt justified in setting up and operating the secret funds network after the Christian Democrats encountered financial difficulties during the 1980s. They came in the wake of political finance reforms brought about by a scandal that involved donations to major parties by a wealthy industrialist, Baron Friedrich Flick.

"During my term as party chairman I considered it necessary to treat certain matters secretly, such as special payments to party branches and organizations in order to give crucial assistance in the financing of their political work," Kohl said.

"Running accounts separately from the normal accounts of the party treasury seemed to me to be appropriate. If the consequence of this action was a lack of transparency and perhaps violations of rules on party financing, then I regret that. I did not want this; I only wanted to serve my party."

© Copyright 1999 The Washington Post Company

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