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Clinton Faces New Campaign Probe

President Clinton (AP file photo)

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Live Event: Campaign finance expert Dwight Morris answers questions today at 2 p.m. EDT.

Preliminary Probe Ordered in Ickes Case (Washington Post, Sept. 2)

Reno Orders 90-Day Investigation of Gore (Washington Post, Aug. 28)

By Roberto Suro
Washington Post Staff Writer
Thursday, September 3, 1998; Page A01

President Clinton is the subject of a new Justice Department probe to determine whether an independent counsel should investigate allegations that he personally violated campaign spending laws during his 1996 reelection effort, according to officials familiar with the inquiry.

The president's private attorney, David E. Kendall, met with top Justice Department officials yesterday in an effort to convince them that no further investigation was justified but that, if a formal inquiry does move forward, it should be directed at the 1996 campaign organization rather than at Clinton himself, officials said.

The review was prompted by new information suggesting that Clinton and his top political aides controlled advertising that was paid for by the Democratic National Committee but that was aimed at advancing Clinton's reelection effort, thus circumventing the spending limits on individual federal campaigns, officials said.

The basic questions being raised about Clinton and other Democratic officials have been debated within the Justice Department and among experts on election law since the closing days of the 1996 campaign. On at least three occasions, Attorney General Janet Reno has formally examined allegations related to the DNC ads and the funds used to pay for them. Each time, she has come to the conclusion that there are no grounds for an independent counsel investigation.

But for the White House, the new round of inquiry represents a time-consuming and perilous reemergence of a threat that officials there thought was behind them.

The controversy consumed the attention of lawyers and many political aides for much of 1997, but had seemed to be losing momentum as the year wound down. And in 1998, it was almost entirely eclipsed by the Monica S. Lewinsky controversy.

If an independent counsel is appointed, it would guarantee an exhausting new distraction for the White House. It comes at a time when both Vice President Gore and former senior White House aide Harold Ickes each face separate Justice Department investigations into whether they violated campaign finance laws. Both those probes, which could lead to the appointment of a separate independent counsel, are further along than the review now being made of Clinton.

The Justice Department inquiry of Clinton is at the very first stage of the independent counsel process and thus far does not reflect a finding of any wrongdoing by the president or anyone associated with his 1996 campaign. Under a deadline set by law, Reno has until the middle of next week to determine whether there are grounds to open a preliminary investigation, and it is only after that inquiry is completed that she would face the question of whether to seek an independent counsel.

What specific information triggered the new inquiry could not be determined last night, but officials familiar with the matter said that it arrived at the Justice Department three weeks ago and prompted a fresh review of Clinton's role in orchestrating the DNC's advertising efforts. To have triggered such a review, the information would have to be "sufficient to constitute grounds to investigate whether" the president or any other top administration officials "may have" committed a crime, according to the Independent Counsel Act.

At the heart of the new review are federal laws that limit spending on presidential campaigns and that strictly regulate how that money can be raised. The long-standing allegations against the 1996 Clinton-Gore reelection effort are that the DNC paid for advertisements that were supposed to advance broad Democratic views on political issues but that in fact were thinly disguised efforts to return Clinton and Gore to the White House, and thus should have been counted against the campaign's spending limits.

The Republican National Committee launched similar advertisements during the 1996 campaign that featured its presidential candidate, former senator Robert J. Dole (Kan.). One of the issues now before Reno is whether to open an inquiry into the broad question of political party advertising that would encompass both Republican and Democratic activities in 1996.

Asked about the new Justice Department review, James E. Kennedy, special adviser to the White House counsel, issued the following statement:

"The use of issue ads was entirely legal and appropriate. The ads focused on real issues before Congress and the American people and they made clear the differences between Democrats and Republicans on balancing the budget, Medicare, welfare and other policy concerns. They were cleared by legal counsel. There was no violation of campaign spending limits. We are confident that, at the end of its review, the Justice Department will arrive at a fair conclusion based on the facts and the law."

Under the Independent Counsel Act, Reno is limited in the questions she can consider in deciding whether to move on to a preliminary investigation, the next and final phase before seeking an independent counsel. The law states that at this stage of the process, the attorney general can consider only the "specificity" of the information received and the credibility of its source.

Moreover, at this stage, the attorney general is prohibited from considering whether the person being investigated intended to break a law. That can be a key question in cases involving campaign laws, which require a finding that a person knew that an act was illegal and specifically intended to break the law.

DNC press secretary Melissa Ratcliff said last night, "the DNC issue ads, like the Republican National Committee's, were reviewed and approved by counsel, and we are confident that the Department of Justice would find them lawful."

In the past, the president's defenders have pointed to the fact that the ads were reviewed and approved by legal counsel as proof that Clinton and his top advisers could not have had a specific intent to violate the law.

The review into Clinton and the DNC issue ads comes amid a new flurry of activity in the 20-month campaign finance investigation. In addition to the preliminary investigations into allegations against Gore and Ickes, Reno is in the midst of a fresh battle with congressional Republicans over a memorandum delivered to her July 16 by Charles G. LaBella, the former chief of the Justice Department's campaign finance task force, which recommended she seek an independent counsel to probe a wide range of allegations.

In a private, three-hour meeting yesterday, Reno surprised congressional leaders by letting them read a heavily edited copy of the LaBella memo. But Republican leaders continued to insist that Reno acted improperly in not taking LaBella's advice.

"Notwithstanding the recent announcements, this matter has now passed the point of reasonableness, and I am no longer willing to give the attorney general the benefit of the doubt: It is now beyond dispute that she is not living up to her duty to enforce the law," said Sen. Orrin G. Hatch (R-Utah), chairman of the Judiciary Committee.

Staff writers John F. Harris and Ruth Marcus contributed to this report.

© Copyright 1998 The Washington Post Company

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