The D.C. City Council will resume hearings May 24 on the District's cash management practices to determine whether city officials provided the council with false testimony and documents to justify their decision to invest with a securities firm that later went bankrupt.

Council member John Wilson (D-Ward 2) and Council Chairman David Clarke said they will request that District financial officers explain, under oath, why they submitted a backdated memorandum earlier this month to a joint hearing of the Finance and Revenue Committee and the Committee of the Whole.

"This deliberate falsification has placed a cloud over the testimony and documents procured at that hearing," Clarke said yesterday in a letter to Mayor Marion Barry. "It is inexcusable for any person, particularly a representative of government, to testify falsely before the council and I am sure that you will respect that the council cannot permit this to pass without further action."

Alphonse G. Hill, deputy mayor for finance, said that his office will fully cooperate with the council, including providing sworn testimony, but charged that Clarke was trying to make political hay with the investigation.

"The chairman is rather hasty in his judgment and is being misled by the press and Alvin Frost, a disgruntled employe," Hill said. "Furthermore, he's probably trying to upstage Mr. Wilson. It's strictly politics. I don't think he's after the facts but is more interested in press coverage."

Clarke and Wilson spearheaded a council review of the D.C. government's investments of nearly $100 million with Bevill, Bresler & Schulman Inc. before the New Jersey-based firm went bankrupt in early April and became the target of a federal fraud investigation.

Council members initially were troubled that Barry administration officials ignored warnings last December from Frost, the city's senior cash management analyst, who opposed investing with the "thinly capitalized" BB&S Inc.

However, since May 8, when The Washington Post reported that the administration submitted a backdated memorandum to the council, the focus of the probe has shifted to whether the administration has been telling the truth about its involvement with BB&S Inc.

The document in question, which briefly spells out the justification for the city's investing with BB&S Inc., was dated Dec. 7, 1984, but was drafted by Assistant Treasurer Fred Williams on April 11, 1985.

The mayor contended that the document offered an accurate transcription of notes made by Williams last December in reaching a decision to invest with BB&S and denied that Williams or others had attempted to deceive the council.

"In retrospect, I believe that it was an oversight that Mr. Williams did not attend to this transcription in a more timely fashion," Barry said in a letter to Wilson. "He also admits that once the BBS matter became an issue of public concern he went back to formalize the record and make certain that his actions were properly documented."

But Wilson and Clarke say they want to examine the accuracy of the testimony and other documents that were reviewed by the council at the first hearing on May 6.

"If we get false information this time, I assume it's perjury," said Wilson, chairman of the Finance and Revenue Committee. "That's the basic purpose, so that we can try to get the real information." Wilson also said that the mayor should fire Williams because "it has been proven Mr. Williams has given us false information."

The council is empowered to subpoena witnesses and documents as well as administer oaths to witnesses. However, the subpoena process is time-consuming, and Clarke and Wilson decided instead to invite Hill, Williams and other administration officials to return voluntarily to give sworn testimony.

In his letter to Barry, Clarke said that the council is prepared to issue subpoenas if the administration Hearing Set on Backdated Memo 'Strictly Politics,' Says Hill By Eric Pianin Washington Post Staff Writer

The D.C. City Council will resume hearings May 24 on the District's cash management practices to determine whether city officials provided the council with false testimony and documents to justify their decision to invest with a securities firm that later went bankrupt.

Council member John Wilson (D-Ward 2) and Council Chairman David Clarke said they will request that District financial officers explain, under oath, why they submitted a backdated memorandum earlier this month to a joint hearing of the Finance and Revenue Committee and the Committee of the Whole.

"This deliberate falsification has placed a cloud over the testimony and documents procured at that hearing," Clarke said yesterday in a letter to Mayor Marion Barry. "It is inexcusable for any person, particularly a representative of government, to testify falsely before the council and I am sure that you will respect that the council cannot permit this to pass without further action."

Alphonse G. Hill, deputy mayor for finance, said that his office will fully cooperate with the council, including providing sworn testimony, but charged that Clarke was trying to make political hay with the investigation.

"The chairman is rather hasty in his judgment and is being misled by the press and Alvin Frost, a disgruntled employe," Hill said. "Furthermore, he's probably trying to upstage Mr. Wilson. It's strictly politics. I don't think he's after the facts but is more interested in press coverage."

Clarke and Wilson spearheaded a council review of the D.C. government's investments of nearly $100 million with Bevill, Bresler & Schulman Inc. before the New Jersey-based firm went bankrupt in early April and became the target of a federal fraud investigation.

Council members initially were troubled that Barry administration officials ignored warnings last December from Frost, the city's senior cash management analyst, who opposed investing with the "thinly capitalized" BB&S Inc.

However, since May 8, when The Washington Post reported that the administration submitted a backdated memorandum to the council, the focus of the probe has shifted to whether the administration has been telling the truth about its involvement with BB&S Inc.

The document in question, which briefly spells out the justification for the city's investing with BB&S Inc., was dated Dec. 7, 1984, but was drafted by Assistant Treasurer Fred Williams on April 11, 1985.

The mayor contended that the document offered an accurate transcription of notes made by Williams last December in reaching a decision to invest with BB&S and denied that Williams or others had attempted to deceive the council.

"In retrospect, I believe that it was an oversight that Mr. Williams did not attend to this transcription in a more timely fashion," Barry said in a letter to Wilson. "He also admits that once the BBS matter became an issue of public concern he went back to formalize the record and make certain that his actions were properly documented."

But Wilson and Clarke say they want to examine the accuracy of the testimony and other documents that were reviewed by the council at the first hearing on May 6.

"If we get false information this time, I assume it's perjury," said Wilson, chairman of the Finance and Revenue Committee. "That's the basic purpose, so that we can try to get the real information." Wilson also said that the mayor should fire Williams because "it has been proven Mr. Williams has given us false information."

The council is empowered to subpoena witnesses and documents as well as administer oaths to witnesses. However, the subpoena process is time-consuming, and Clarke and Wilson decided instead to invite Hill, Williams and other administration officials to return voluntarily to give sworn testimony.

In his letter to Barry, Clarke said that the council is prepared to issue subpoenas if the administration does not cooperate.

Hill said that "there is no need for a subpoena" and that "as far as I'm concerned I can't wait to testify again . . . . " does not cooperate.

Hill said that "there is no need for a subpoena" and that "as far as I'm concerned I can't wait to testify again . . . . "