The Justice Department has begun a criminal investigation of the role of Deputy Secretary of Commerce Guy W. Fiske in the proposed sale of the nation's weather satellites, according to government sources.
Fiske resigned from the government Tuesday, effective Saturday, after coordinating the weather satellite debate for 10 months. While he was handling the issue within the Commerce Department, he was meeting privately about a job with officials of the Communications Satellite Corp. (Comsat), the only interested buyer.
Sherman Unger, the department's general counsel, said in an internal memorandum April 14 that Fiske, the No. 2 man at Commerce, violated department standards of conduct by handling the Comsat proposal to sell the satellites and at the same time meeting with Comsat officials at their headquarters and the L'Enfant Plaza Hotel about a job.
In his April memo, Unger said: "By his actions Fiske created the appearance of (a) using public office for private gain; (b) giving preferential treatment to the Comsat corporation; and (c) losing complete independence or impartiality.
"Actual conflict of interest does not appear to exist in this case," Unger said, adding that Fiske did not have the responsibility to decide the satellite matter and that the job discussions appeared to be preliminary. Unger said that he thought that Fiske's removal from the matter was the appropriate response.
As part of the Justice Department investigation, the FBI has begun questioning Commerce Department employes, sources said. Justice also has asked that Fiske's files, including memos, meeting logs and telephone records, be turned over to the investigators.
Fiske has declined to comment on the matter, but he released testimony prepared for a congressional hearing that was to be held before the subcommittee of Rep. James H. Scheuer (D-N.Y.). Fiske said there was no impropriety in his relations with Comsat.
"Obviously, I was not careful enough because I did not avoid the potential for an appearance of conflict," Fiske's prepared testimony said. Fiske said that his relations with Comsat did not taint or influence the decision to sell the satellites.
"My undivided loyalty has been to my employer, the United States," Fiske's testimony said. "I did not try to sell that loyalty nor did any person associated with Comsat seek to buy it."
The meetings and calls between Fiske and Comsat representatives about a job, Fiske said, "never reached the point of actual negotiations . . . and at no time were any issues relating to the satellites discussed in the employment context."
Fiske said that him contact with Comsat began when he was an undersecretary at the Department of Energy in March, 1982. Comsat needed an executive vice president who could succeed Joseph V. Charyk as president and chief executive officer, Comsat documents show. A Comsat representative called Fiske, and the meetings between Fiske and Charyk began.
In April, 1982, Fiske accepted a transfer to the Commerce Department. The job talks with Comsat continued until May of that year, then were put on hold until last fall.
Fiske also exchanged more than 14 letters and telephone calls with Charyk and R. Blair Murphy of Spencer Stuart and Associates, an executive placement agency hired by Comsat.
The last meeting between Comsat and Fiske, the House investigators said, took place several days after the November, 1982, elections. A letter from Murphy to Comsat said that Fiske wanted to "re-energize" earlier job discussions, and the meeting resulted.
In his prepared testimony, Fiske said holding that November meeting "was a mistake."
At the time of these job contacts, the Comsat satellite proposal was being considered at Commerce.
Fiske has described his role as that of an "expediter." Commerce Secretary Malcolm Baldrige has testified that Fiske had no policy-making authority in the satellite matter.
Fiske said that he met three times with Comsat lobbyist James T. Lynn and spoke on the telephone with him another half-dozen times. Documents supplied to the House subcommittee also show that Comsat supplied him with documents promoting the satellite sale.
The government had been on record as opposed to sale of the weather satellites, and in April, 1982, the Cabinet Council on Commerce and Trade determined not to pursue the Comsat proposal to sell the satellites.
Baldrige said he reopened the issue after that meeting and invited Comsat to a meeting on the subject.
Comments from industry were then sought, and none except Comsat expressed any interest in the purchase of the weather and land satellites.
Government reports from NASA, the Defense Department and the Commerce Department warned of problems in selling the weather satellites. One concluded that the weather satellites are "inherently governmental."
But by November the Cabinet Council reversed itself and recommended sale of the satellites. The president's support of the sale was announced March 8, 1983.