A Citicorp vice president in charge of the banking giant's lobbying of the D.C. government authorized the payment this year of at least $28,200 of the bank's funds to Woodrow Boggs Jr., the political adviser to City Council member Charlene Drew Jarvis, Citicorp said yesterday.
Jarvis (D-Ward 4), chairwoman of the council committee that oversees bank licensing in the District, directed bank companies seeking to acquire or open banks here to meet with Boggs beginning last summer to discuss how to comply with community investment requirements of the city's new banking laws. Boggs, who operates a consulting firm called Decisions Inc., has no official ties to the City Council.
In a terse statement, Citicorp said that Vice President Lucius P. Gregg signed a contract with Boggs in February and authorized four payments totaling $28,200, all without the authority of Citicorp headquarters. Gregg, Citicorp's chief lobbyist in the District for the past year, has been recalled to New York pending the outcome of an internal investigation, the statement said.
"Neither the contract nor the payments were authorized by anyone other than Mr. Gregg at Citicorp," the statement said. " . . . . While we have not found any violation of law, the matter is still under investigation . . . "
Albert Turkus, a lawyer recently hired to represent Jarvis' campaign committee, said last night that for the time being he had asked Boggs not to make any public comments.
Jarvis, chairman of the council's Housing and Economic Development Committee, said, "Mr. Boggs is a businessman and Citicorp is a business. My only comment is that it the payments is interesting."
Jarvis wrote a letter last week in support of Citicorp's bid for permission to purchase an ailing District savings and loan, which Citicorp wants to convert to a retail bank.
U.S. Attorney Joseph E. diGenova said yesterday that federal prosecutors have received allegations of possible improprieties involving Boggs and Jarvis in connection with out-of-state banks. DiGenova said that his staff is evaluating the information to determine whether an investigation is warranted.
If an investigation were opened, diGenova said, prosecutors would attempt to determine whether any effort was made to use Jarvis' powers as a City Council member to influence any bank's decision to hire Boggs as a consultant.
DiGenova said that his office has already been contacted by the D.C. police department's Public Integrity Unit for assistance in a police investigation of the handling of Jarvis' 1984 reelection campaign funds, which were the subject of a critical audit this week by the Office of Campaign Finance. Keith Vance, director of the office, referred his audit last week to the police department, which opened an investigation.
A police source, who asked not to be identified, said the police investigation, among other things, is looking into whether Boggs misused any Jarvis campaign funds.
The Washington Post reported yesterday that Jarvis directed representatives of five large bank holding companies, including Citicorp, to meet with Boggs to discuss how to win council approval to open or acquire banks in the District, although Boggs had no official connection with the council.
Citicorp is locked in a bidding war with oil billionaire Gordon Getty over the right to purchase National Permanent Bank, an ailing District savings and loan that federal regulators put up for sale in February in hopes of restoring the institution to financial health.
Last week, Jarvis wrote to the chairman of the Federal Home Loan Bank Board, the federal agency that regulates thrifts, saying she favored giving the award to Citicorp because it has been the only bank holding company that has promised to comply with the District's community investment requirements.
Jeffrey N. Cohen, a local developer, said yesterday that Boggs has billed himself as a middleman here on behalf of Citicorp and other banks seeking to move into Washington.
Cohen said that Boggs has stated that he could help influence Citicorp and other out-of-state banks' decisions on where to make loans here. As a condition of doing business here, the city is requiring out-of-state banks to invest in local projects, particularly those involving minority firms.
"Woody is obviously well connected," said Cohen, who is a close political supporter of Mayor Marion Barry. "Not just with Charlene Jarvis but with certain banks that would like to come into town, which he tells people . . . . I think he certainly makes representations that he has access to some of the out-of-state banks that want to come into town."
"Whenever you saw Citicorp's Lou Gregg walking around town, many times you'd see Woody Boggs walking along with him. He Boggs apparently has some degree of access. That is not unimportant.
"Woody has what otherwise is known as apparent access to some of these banks," Cohen said. "If that is true, that is a valuable commodity."
Cohen said that in the last few years Jarvis has worked hard at making her committee influential on helping shape economic development in the city. "She's made it a powerful committee."
"You would have to be blind, dumb and deaf not to know of Woody's relationship to Charlene," Cohen added.
Cohen, who is currently seeking city approval for $9 million in revenue bonds to help finance the renovation of several vacant properties in Shaw, said that he is considering hiring Boggs as a consultant on another project unrelated to the Shaw project. Cohen said he did not want to specify the other project because it had not yet been made public.
"Anybody doing business in the city certainly would consider the possibility of hiring Decisions Inc." (Boggs' firm) for advice on economic development matters, Cohen said.
When asked if Boggs or his company have been paid money by other bank companies or other businesses that are lobbying the Housing Committee, Jarvis said, "I don't know Mr. Boggs' activities and I'm not a message carrier. Why should I know Mr. Boggs' business?