Former Synthetic Fuels Corp. president Victor A. Schroeder displayed "especially bad judgment" in offering to help a fellow director's private business, but it is not clear whether he violated federal law, according to the corporation's inspector general.
The Justice Department has decided that there is "insufficient evidence" to pursue the allegation that Schroeder broke the law, a report released yesterday by the inspector general's office said. He resigned Aug. 18, but is still one of seven directors of the federally funded corporation.
Schroeder's resignation followed Senate testimony about his late-night conversation last March with fellow director Milton M. Masson Jr. After asking Masson to support his plan to reorganize the corporation the following day, Schroeder agreed to contact a friend at an oil company subsidiary to ask whether the firm had any business that might be performed by Masson's private engineering comapny.
Inspector General S. Kenric Lessey Jr. said he investigated the allegation that Schroeder and Masson had struck a "deal." He said "the most troubling aspect of the conversation . . . is the juxtaposition of a request for a personal business favor with a discussion of corporation policy decision-making."
This, the report said, "raised questions which might have involved violations of federal criminal law . . . . It was certainly an indiscretion and may well have given rise to an appearance of wrongdoing . . . .
"It was especially bad judgment for the corporation's president . . . and another director to allow the possibility of a perception that personal business interests were being mixed with decisions on the corporation's policies," the report said. " . . . This conduct demonstrated at the very least an insensitivity to how public officials are viewed."