A story yesterday incorrectly summarized the relationship between lobbyist Michael K. Deaver and three countries whose U.S. ambassadors he helped select while still in the White House. Deaver signed up one country, Canada, as a client and has sought business in the other two, India and Singapore.
The General Accounting Office told a House subcommittee yesterday that it has found evidence that former White House aide Michael K. Deaver may have violated federal conflict-of-interest laws and that it is referring its findings to the Justice Department.
The GAO findings, according to sources familiar with the probe, were provided to the subcommittee in the form of prepared written testimony by GAO Associate General Counsel James Hinchman, who is to testify in public Monday before the House Energy and Commerce subcommittee on oversight and investigations.
The panel, chaired by Rep. John D. Dingell (D-Mich.), is to question Deaver in a closed session Friday. The panel is examining Deaver's final months as White House deputy chief of staff and the months after he began his lobbying firm to determine whether he violated government ethics laws in soliciting business, much of it from foreign clients.
Among Deaver's duties in those final months in the White House, knowledgeable officials said this week, was playing a major role in selecting new ambassadors, including at least three in countries he later signed up for his firm.
The GAO's referral to the Justice Department has little practical effect, since the Federal Bureau of Investigation is already conducting a preliminary investigation of Deaver that could lead to the appointment of an independent counsel. Five Democratic senators, the Office of Government Ethics and Deaver have asked Justice to seek such an outside probe.
But the decision shows that the congressional watchdog agency -- after reviewing Deaver's work in the White House, his departure last May and his subsequent work as a Canadian government lobbyist -- has found reason to think that Deaver may have run afoul of the law. Deaver has denied doing anything improper for clients of his multimillion-dollar consulting firm, Michael K. Deaver & Associates.
The GAO probe is limited to Deaver's $105,000-a-year contract with Canada and his work on the issue of acid rain. Sources familiar with the probe said it does not contain any startling information not previously reported by news media.
One issue in the probe is whether Deaver violated laws by lobbying the executive branch on an issue in which he was "personally and substantially involved" as a White House official. Sources have said that Deaver was involved in selecting a special U.S. envoy on acid rain and in preparing for the U.S.-Canadian summit in March 1985.
The negotiations helped change the Reagan administration's stance on the issue and led to a multibillion-dollar agreement with Canada to combat acid rain pollution.
Another possible violation of law is the allegation by a Canadian source that Deaver had initial discussions about a possible agreement to represent Canada before he left the White House. Deaver and Canadian officials have insisted that the first contact came last May 16, six days after Deaver resigned.
The U.S. ambassador to Canada was among those recommended to the president by a small White House-State Department working group that Deaver chaired for a time early last year.
Former deputy secretary of state Kenneth W. Dam, one of the group's members, said Deaver and other members supported Foreign Service officer Thomas Niles as the ambassador last spring after political objections were raised to the leading candidate. Deaver was hired by Canada last fall.
Deaver and the rest of the group also agreed on John Gunther Dean as U.S. ambassador to India, turning back objections from State Department careerists that Dean, also a Foreign Service officer, has held too many posts abroad, according to Dam. He said Deaver knew both Niles and Dean.
Deaver and his wife were Dean's guests at the ambassador's residence on a business trip to New Dehli two weeks ago, said Deaver spokeswoman Pamela G. Bailey, confirming a report in The New York Times.
Dam said Deaver also helped approve the U.S. ambassador to Singapore, J. Stapleton Roy, another career Foreign Service officer. Deaver announced last fall that he had a $250,000 contract with Singapore, but the country eventually decided not to hire him.
Dam, one of a half-dozen people who attended the meetings with Deaver, the White House personnel director, and later White House chief of staff Donald T. Regan, said Deaver often acted as an arbiter between factions pushing career diplomats and political appointees.
A former White House official went further, saying that Deaver "took over" the key role in ambassadorial selections early last year. "Deaver had a list and a large number of our guys got in," he said.