President Carter "appears to be obstructing justice" because he has continued a public friendship with former budget director Bert Lance during a federal investigation of Lance's finances, a Republican member of the Senate Judiciary Committee charged yesterday.
Sen. Malcolm Wallop (R-Wyo.) said a special prosecutor should be appointed in the case because the president's public praise of Lance "has a chilling effect" on both prosecutors and witnesses in the investigation of Lance's personal finances.
The former director of the Office of Management and Budget resigned last fall after allegations that he improperly used positions at two Georgia banks to increase his wealth.
The Justice Department, through a federal grand jury in Atlanta, is coordinating an inquiry into Lance's banking and personal financial practices. The Securities and Exchange Commission, the Internal Revenue Service and the Treasury Department also are taking part.
The grand jury, so far, has been used only to subpoena documents, a knowledgeable Justice Department source said yesterday. It is not believed to be hearing testimony yet as the basis for possible criminal charges.
Wallop made his comments yesterday in questioning Benjamin R. Civiletti on his nomination to be deputy attorney general. Republican members have used the hearings to raise questions about a number of Justice Department investigations.
Civiletti heatedly rejected Wallop's contention about the need for a special prosecutor. Raising his voice for the first time in the week-old hearings, he said there was no evidence that the president was interfering in the investigation or that the department wasn't pursuing it vigorously.
He said the senator seemed to be suggesting that Carter condemn Lance publicly or "cast off his old friend as a leper."
Wallop said his point was that someone at Justice should advise Carter to "cool it" in his public dealings with Lance until the investigation is completed.
He cited the president's appearance with Lance at a fund-raising dinner in Atlanta in January, and Lance's continued use of a diplomatic passport as signs leading to a public perception that Carter was interfering in the investigation.
Civiletti countered that the investigators "don't give a darn" whether Lance has a special passport. He said the president's future relationship with Lance was a personal, rather than a legal, question.
The verbal confrontation over the Lance investigation overshadowed a dispute among committee members earlier in the day over access to Justice Department documents relating to the dismissal to Philadelphia federal prosecutor David W. Marston.
Attorney General Griffin B. Bell had promised last week that he would make all such records available to the committee voluntarily. But since then, Democratic members have said serveral times that the committee would have to request such documents.
When Sen. Edward M. Kennedy (D-Mass.) raised that issue again yesterday, Wallop said angrily that he'd "run into a stone wall" on his request.And he accused the committee of "collaborating with the Justice Department and the White House to make this as sticky as possible."
Civiletti said he was concerned only because Wallop was asking for a large collection of documents that would include references to sensitive investigations as well as the Marston dismissal.
But after the hearing, Civiletti and Wallop met and agreed on procedures for examining some of the material. "We made some progress," Wallop said in a telephone interview. "We'll have to wait and see if this is enough."
Republican members asked for the phone logs, appointment books and memos of the Justice Department officials involved in the Marston dismissal to determine whether they may have been involved in obstructing justice in the case.
Russell T. Baker Jr., a former Civiletti aide who is a key figure in that dispute, was the first witness to be heard yesterday. But Republicans declined to question him because they said they needed the documents first.
The dismissal of Martson, a Republican, touched off a national furor when it was learned that a Democratic congressman called President Carter last Nov. 4 demanding the prosecutor's ouster while the congressman was a potential target of a criminal investigation by Marston's office.
Marston said he told Baker in mid-November that the President's caller, Rep. Johua Eilberg (D-Pa.), might be involved in a Philadelphia investigation. Baker said he passed the news on to Civiletti, but Civiletti said he does not recall it.
Baker testified yesterday that "either his (Civileti's) memory is wrong or my memory is wrong." But the conflict of recollection was "without significance," he said, because the possible investigation of Eilberg was not developed enough at the time to pass further up the chain of command.