Sen. Howard H. Baker Jr. (R-Tenn.), the Senate Republican leader, called yesterday for the appointment of a special prosecutor to investigate the Carter family peanut business and the loans it received from Bert Lance's National Bank of Georgia.
Baker's request followed a Washington Post report Sunday that quoted a former bonded warehouseman for the Carter business as saying he altered warehouse records and used the same collateral twice in an effort to conceal a $500,000 deficit in payments owed the bank in 1976.
The Post report was challenged yesterday by the former warehouseman, Jimmy Hayes, in interviews from Bainbridge, Ga., with other newspapers and television stations.
In an interview with the Atlanta Constitution, Hayes indicated that the irregularities described by The Post had not occurred and that his Post interview had been inaccurately represented.
The Post is printing excerpts of a taped interview with Hayes in today's editions.
The Justice Department is already investigating the Carter warehouse finances to see whether banking laws were broken in the business' handling of the loans. The activities described by Hayes in an interview with The Post -- if they indeed occurred -- could be potential violations since they would represent efforts to mislead the bank.
Baker, recalling the use of a special prosecutor to investigate Republican President Nixon, said failure to appoint one in this instance would "raise the question of a political double standard in American life."
Baker, a potential Republican presidential candidate, echoed the sentiments of Sen. Robert Dole (R-Kan.), another presidential contender, and of several House Republicans in requesting a special prosecutor. The Justice Department has said it will respond to these requests within the next two weeks.
Attorney General Griffin Bell last week told inquiring members of Congress that he was inclined against the use of people outside the department to conduct or monitor investigations and that he had "confidence" in department investigators' ability to handle sensitive matters objectively.
Senate Majority Leader Robert C. Byrd (D-W.Va.) yesterday echoed Bell, telling the Senate that he thought appointing a special prosecutor now might actually slow down the Justice Department investigation.
The federal inquiry into the Carter ware-house loans grew out of its investigation of Lance's activities as president of the National Bank of Georgia. The Lance investigation is now completed, the department says, and the results are being reviewed. The Carter ware-house investigation is continuing independently.
Hayes, the former bonded warehouseman, worked for an independent company monitoring the collateral backing up the NBG loans to the warehouse.
At the Carter business, that collateral primarily consisted of peanuts stored in the ware-house. As the shelled peanuts were released from the warehouse to buyers, the warehouse was to send checks in repayment of the loans to NBG.
In an interview with the Atlanta Constitution, Hayes said his company never found anything unusual with the Carter warehouse loan repayments.
In a taped Post interview, however, Hayes said that at one point in 1976 the warehouse was $500,000 behind in the repayments. He was asked whether his company -- the New York Terminal Co. -- was ever worried about this.
"Fortunately for me," Hayes told The Post, "they didn't come and check during that time... Now if they had, I would have certainly been behind."
He said that he and Billy Carter engaged in a practice similar to check "kiting, you know, like writing a bad check and beating it to the bank."
This was done by using the peanuts which were collateral for one NBG loan to borrow additional money. "That's the reason he [Billy Carter] could put his hands on a lot of money."
"... Even though it looks like it's [borrowing] twice on the same collateral, no. Because we changed the identification of those peanuts."
Asked if they were still the same peanuts, he said "Yeah. Yeah. I agree with that."