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    Ex-Housing Chief Cisneros Indicted

    Henry Cisneros in 1992. (AP)
    By Toni Locy
    Washington Post Staff Writer
    Friday, Dec. 12, 1997; Page A01

    Former housing secretary Henry Cisneros was indicted yesterday by a federal grand jury on 18 felony counts of conspiracy, obstruction of justice and making false statements to the FBI involving more than $250,000 in payments he made to an ex-mistress.

    The indictment also charges the former mistress, Linda Medlar, 45, of Lubbock, Tex., with conspiracy and with making a false statement. Also indicted were two former Cisneros aides, Sylvia Arce-Garcia, 43, of Los Angeles, who was charged with conspiracy, and John D. Rosales, 41, of the Washington area, who was charged with conspiracy and two counts of making false statements.

    The 66-page indictment outlines a multifaceted conspiracy in which Cisneros, who headed the Department of Housing and Urban Development from 1993 through 1996, worked frantically before, during and after his confirmation to keep Medlar from disclosing the true nature of their long relationship and the full extent of payments he had made for several years to keep her quiet.

    Contrary to what Medlar and Cisneros had said at the time, the grand jury determined, Medlar had threatened to disclose publicly the relationship and the payments he had made to her. The grand jury also said Cisneros had made payments to a second woman with whom he had an affair, though it did not name her. Medlar knew about the other woman and was being paid to also keep that quiet.

    And despite what Cisneros told the FBI, he kept on paying Medlar after he became housing secretary. In 1993 alone, the grand jury said, Cisneros paid her $73,000.

    All of the lies, the grand jury said, became a conspiracy to impede the Senate in its confirmation responsibilities, the FBI in doing background investigations of Cabinet nominees and the Justice Department in determining who is worthy of top-secret national security clearance.

    Former prosecutors reached yesterday said the charges reflect the seriousness with which the government views instances of lying to the FBI, whether it occurs in a confirmation probe or some other proceeding. During the time that Attorney General Janet Reno was weighing the appointment of an independent counsel in the Cisneros case, senior FBI officials were privately pushing aggressively for one, arguing that it was critical to maintain the bureau's integrity.

    Cisneros, 50, was one of three members of President Clinton's Cabinet to come under scrutiny by independent counsels. An investigation of Commerce Secretary Ronald H. Brown was dropped when he died in a plane crash, and former agriculture secretary Mike Espy was indicted on charges of illegally soliciting and accepting more than $45,000 in gifts from companies with business before his department. He is awaiting trial.

    Unlike the two other probes, however, the investigation of Cisneros by independent counsel David M. Barrett has been done in relative quiet, with little criticism that the special prosecutor was overreaching. That charge was repeatedly lodged in the other investigations.

    Former federal prosecutors who scanned news accounts of the Cisneros indictment said last night that it appeared to be based on a solid foundation and not to be a case of overreaching by the independent counsel.

    "There's no smell I get here that anybody was out to get anybody," said John Q. Barrett, who prosecuted federal officials in the Iran-contra investigation and is now a law professor at St. John's University in New York. "Based on a wire story, it looks like a professional federal indictment, not a case of let's scrape up any old crime. . . . Lying to the FBI is a very serious thing, and federal law enforcement needs to react to that," said Barrett, who is not related to the independent counsel in the Cisneros case.

    The Cisneros probe, begun in 1995, lasted longer than the independent counsel had hoped. David Barrett hit a snag when Medlar stopped cooperating last year. She was indicted in September on charges that she lied to the independent counsel's investigators about various aspects of her dealings with Cisneros.

    Cisneros, the charismatic former mayor of San Antonio who was once viewed as an up-and-coming politician nationally, is president of Univision, a Los Angeles-based Spanish-language television network. His attorney, Cono R. Namorato, said in a statement, "While Mr. Cisneros has admitted that he has made mistakes in his personal life, he has attempted for many years to put these mistakes behind him."

    Namorato added, "While Mr. Cisneros and his family do not relish the prospect of further public airing of private events beginning a decade ago, he will defend himself vigorously and expects complete exoneration after a trial."

    Cisneros and Medlar began their affair in the late 1980s while he was mayor of San Antonio. He broke up with his wife, but they have since reconciled.

    In 1988, the relationship was made public. Since then, the issue has always been how much Cisneros had paid Medlar, who now goes by her maiden name, Jones. The grand jury said Cisneros paid her about $5,000 a month from 1990 through 1993 -- with the help of others, who were not named in the indictment.

    Cisneros also allegedly gave her an additional $16,000 -- split in two payments to avoid IRS detection. Medlar allegedly used the $16,000 to buy a house in Lubbock in the name of her sister and brother-in-law to conceal that Cisneros was the true source of the money.

    The grand jury listed several instances in which Cisneros met with representatives of then-President-elect Clinton's transition team to discuss his relationship and payments to Medlar. He even met with Clinton personally to discuss the matter, according to the indictment.

    After the FBI's first interview with Cisneros on Dec. 30, 1992, it became suspicious, according to the indictment. On Jan. 7, 1993, FBI agents were dispatched to question him again -- and urge him to be forthcoming and truthful, the grand jury said.

    But, the indictment said, Cisneros continued to lie.

    The grand jury said he denied that the payments to Medlar constituted "hush money." He said he was not "currently" paying her and said the highest single payment he ever made was about $2,500. The grand jury said he made payments of at least $15,000 on several occasions.

    Cisneros allegedly lied about his dealings with her during the confirmation process. He told the FBI that he had not had any lengthy conversations with her since early 1991. The grand jury said he talked with her numerous times, often immediately after he met with the FBI or representatives of Clinton's transition team.

    In addition, the grand jury said Medlar lied to the FBI in September 1996 when she said she had given original tapes to the IRS of conversations she had secretly recorded that she had had with Cisneros. The grand jury said Medlar knew that the tapes were copies.

    Staff writers John Mintz and Roberto Suro contributed to this report.

    © Copyright 1997 The Washington Post Company

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