Senate investigators have concluded that President Carter and some of his closest aides deserve to be publicly chastised for poor judgment and unwise handling of Billy Carter's dealings with the Libyan government.
The subcommittee apparently found no violations of law in the course of its inquiry. It also said the Justice Department's investigation of Billy Carter's failure to register as a foreign agent "was honestly and conscientiously conducted" by the department's Criminal Division.
But in the draft of a report to be made public later this week, lawyers in charge of the inquiry suggested that the president should have known that using his brother as a middleman with the Libyans would have the "predictable effect" of both condoning the relationship and enhancing Billy Carter's stature and prestige with the radical Arab government.
The White House should also have realized, the draft report states, that "the enhancement of Billy Carter's importance in the eyes of the Libyans might be exploited by him for his own economic advantage."
"This possibility," the report adds, "was made more serious by the financial difficulties that, as the president knew, Billy Carter was experiencing."
In fact, the report discloses, Billy's telephone calls in pursuit of money and oil from the Libyans "increased dramatically" following the Nov. 27, 1979, meeting he arranged at the White House between White House national security affairs adviser Zbigniew Brzezinski and Libya's chief diplomat here, Ali Houderi.
The report, listing conclusions for the hurried inquiry that began in late July, is now being circulated among members of the special Senate subcommittee that conducted the investigation. A copy was obtained by The Washington Post.
Composed by staff lawyers Philip Tone, Michael Davidson and Robert Kelley, it has been revised once and is said to be in near-final form.
Attorney General Benjamin R. Civiletti, White House appointments secretary Philip J. Wise, CIA Director Stansfield Turner and Brzezinski all come in for their share of criticism.
In the course of it, the report discloses that the FBI had "information from intelligence channels" as early as last November and December that Billy Carter was trying to get a loan from the Libyans and to arrange for an increased allocation of Libyan oil for the Charter Oil Co. of Jacksonville, Fla.
The subcommittee said Civiletti might well have discovered that fact had he made any effort last April to determine whether his department had any information that could supplement other intelligence reports that he had just been told of and that he chose to keep to himself.
Coupled with what the FBI had heard last year, the various items of intelligence "could have been used in the investigation" earlier than they were "without compromising sources," the report states. But instead, the Senate lawyers noted, "the attorney general failed to share the classified information that came to him in April 1980 with any trustworthy subordinate who had the necessary security clearance."
White House appointments secretary Wise is accused in the report of being responsible for "some delay in the progress of the investigation." The Senate lawyers said he "was less cooperative than he should have been in returning calls by an FBI agent seeking to reinterview him."
The draft report also expresses disappointment over the fact that Wise "professed not to remember events relevant to the investigation which he could reasonably have been expected to remember."
In a footnote, or example, the Senate investigators say they are convinced that Wise arranged a State Department briefing for one of Billy Carter's associates about the status of some C130 military air transports the Libyans were trying to obtain. Wise, in his testimony before the subcommittee, said he had no recollection of playing any role in the January 1979 briefing for Henry (Randy) Coleman.
The subcommittee noted that one witness who accompanied Billy Carter on his first trip to Liby in 1978 recalled the president's brother telling his Libyan hosts "that he would try to do something to obtain the release of the C130 aircraft Libya had ordered." But beyond the 1979 briefing, the panel said it "found no evidence of further activity of Billy Carter with respect to C130s."
The report critizes "White House aides close to the president" for failing to warn him of Billy's 1978 trip despite its potential for embarrassment. The Senate investigators also faulted the president for not disassociating himself and his administration from his brother's second trip to Libya in the fall of 1979.
". . . [H]aving failed to dissuade him [Billy Carter] from returning to Libya," the report states, "the president should have either issued a public statement or sent a private message to the Libyan government, or both, that Billy Carter did not represent the United States and that the Libyans should not expect to gain any influence in the United States by cultivating their relationship with him."
The fact-finding segment of the report, which presumably will supply more detail, is to be distributed to subcommittee members in draft form today. The section devoted to conclusions, however, notes that "Libyan officials went to considerable trouble and expense in establishing and maintaining a relationship with Billy Carter.
"The initial contact," the report adds, "was the result of persistent efforts and a devious series of personal contacts aided by the participation of an important Libyan official."
The report said Billy's potential as a public relations man for the Libyan's did not last long and "surely did not extend beyond early 1979" when he hosted some Libyans on a controversial U.S. tour. But, the subcommittee lawyers said, "other purposes must have remained because the remarkable relationship between important Libyan officials and the brother of the president of the United States continued . . . ."
In fact, according to the draft, Billy's telephone calls about money and oil "continued at a relatively high level" after the Nov. 27 Brzezinski-Houderi meeting concerning the U.S. hostages in Iran. The Libyans paid the president's brother $20,000 on Dec. 27 and $200,000 on April 7.
In addition, the report states, "the Libyan government appears to have held out the promise of an increased oil allotment well beyond that [April 7] date."
By then, CIA Director Turner had already received a top-secret intelligence report concerning the projected Charter Oil deal, but furnished it only to Brzezinski with the request that it be shown to the president.
In doing this, the report states, Turner "denied another intelligence element missing portions of the information, which were unknown to it and which it had requested . . . he thus preempted the professional judgment of the other element" that might have felt the information should be sent to the FBI.
The "missing portions" of the report, according to informed sources, were the explicit identification of Billy Carter and Charter Oil; whose names had been deleted. The "other intelligence element" that asked for those details was not identified, but it is known that a copy of the report, without the names, was submitted to the State Department as well as the CIA and the FBI.
The subcommittee said it could not resolve the question of whether Brzezinski spoke with the president before or after Brzezinski warned Billy Carter against the Charter Oil transaction last April 1 or 2. Thus, is remains unclear "whether the president participated in the decision to comunicate at least some of the information [in the intelligence report] to Billy Carter."
The president and Brzezinski have both said Brzezinski called Billy first, before consulting the president. But if that sequence is correct, the report says:
". . . then Dr. Brzezinski (a) took it upon himself, without consulting the president, to do an act outside of his normal functions as National Security Adviser, [an act] that should have been done, if at all, only with the authority of the president and (b) kept to himself significant information about the president's brother for nearly two days, during which time he met alone with the president at least once. . . ."
Despite Brzezinski's disclaimers, the subcommittee concluded that his communicating a portion of the intelligence information to Billy "carried with it the risk that sources would be compromised" and that Billy might take steps to make his activities more difficult for Justice Department investigators to uncover.
"It is to be noted," the report states, "that within two weeks after receiving Dr. Brzezinski's admonition, Billy Carter accepted $200,000 from the Libyan government."
Civiletti draws sharp criticism at the same time for his judgment in withholding the Charter Oil intelligence report, and another foreshadowing the $200,000 payment, from his own subordinates.
"The subcommittee believes it is likely that the Billy Carter case would have come to an earlier conclusion if the attorney general had shared the information with a subordinate having knowledge of the case," the report states.
The Senate investigators also said they regarded as "persuasive" the evidence that Civiletti told his subordinates on June 11 -- the day Billy admitted getting $220,000 from the Libyans -- to take no action for 10 days.
The report says it would not have been improper for Civiletti to have informed the president of what the Justice Department knew of Billy's activities at that point. But it said the attorney general "should not have made what amounted to a prediction that criminal proceedings would not be instituted if Billy Carter registered" as a foreign agent. The Justice Department lawyers in charge of the investigation testified that they had not yet made that determination.
As a consequence, the report says, if the president had told his brother of Civilett's assurance, "the president's assurance would have made the later prosecution of a criminal case difficult or impossible."
Drawing several harsh parallel's between Civiletti's and Brzezinski's performances, the report pointed out that both men "made decisions about the use of intelligence information without calling for the facts available to the organizations they head, or to the government generally." In addition, "neither saw it to be his responsibility to present to the president for decision the issues arising from the intelligence information each had received" and, in effect, "acted to protect the president from taking personal responsibility."
The report says the subcommittee was unable to make a thorough study of the legislative problem it came across, such as the possible need for administrative subpoenas in enforcing the Foreign Agents Registration Act. But it called Libya's increasing efforts to gain political influence in this country "particularly troublesome and dangerous" and recommended intensive Justice Department investigation of those activities.