The D.C. Board of Elections and Ethics has cleared City Council Chairman Sterling Tucker of any intentional wrongdoing in Tucker's failure to list in his legally required personal financial reports a $25,000 trust fund established on behalf of his children in 1969.
Tucker has never had direct access to the fund and dissolved it on Oct. 13, 1976, following criticism in The Washington Star of the financial arrangement surrounding the fund's estbalishment.
In September, 1976, however, a complaint had been filed with the ethics board, alleging that Tucker had not disclosed the fund's existence in his 1975 and 1976 financial statements, which most elected officials in the District are required to file with the board.
The board's unanimous opinion, dated last Friday, said that under a "liberal reading" of the city code of laws, the fund was an "asset held" by Tucker and should have been reported.
The board also acknowledged that there could be a valid "difference of interpretation" regarding the nature of a trust that would justify not reporting it. In Tucker's case, the board noted, the beneficiaries of the trust were Tucker's children, not Tucker himself.
In addition, the board said, even though Tucker had not reported the fund in his 1975 and 1976 financial statements, he had included it among his "assets" in a June 6, 1974, financial statement when Tucker announced his candidacy for City Council. Thus, the board concluded, "the failure to report (the fund in 1975 and 1976) was not to conceal the asset . . ."
In a decision that is likely to set a precedent for future cases, however, the board said that from now on any trust funds like Tucker's would have to be reported.
The fund was established in January, 1969, when Tucker was a top official in the Washington Urban League.
The Taconic Foundation, a civil rights-oriented foundation in New York, gave the Urban League a $30,000 grant of which $25,000 was earmarked to establish the fund for the benefit of Tucker's two daughters.
The money was placed in a trust whose ownership would revert to Tucker 10 years and one month later - in February, 1979.
Two reports in The Star in September posed questioned about whether the arrangement amounted to diverting to Tucker's private use money intended for general Urban League operations. The propriety of the fund was questioned by some league officials, and several nationally known civil rights leaders told The Washington Post in October that the arrangement was unprecedented, to their knowledge.
Tucker maintained that there was nothing irregular in the fund arrangement. He told the league in a Sept. 23 letter, however, that "While the facts clearly support the conclusion that the trust was properly and lawfully established, the nature of media reporting of its existence leaves a cloud hanging heavy over the heads of my family and me."
He asked that the trust be "irrevocably assigned" to the league, which accepted that assignment on Oct. 13.
Tucker and his lawyer, R. Kenneth Mundy, consented to the board's decision, which was supported by board members Shari B. Kharasch and Robert G. McGuire Jr. Jeanus Parks, the board's newest member, did not participate in the decision, because he was not a member of the board during the time of most of the proceedings."