Whitney North Seymour Jr., a former U.S. attorney in Manhattan, was named yesterday as the independent counsel to investigate allegations of improper lobbying by former White House aide Michael K. Deaver.
Seymour, 62, was named by a three-judge appeals court panel here and charged with examining whether Deaver violated federal conflict-of-interest laws in representing Canada and Puerto Rico since resigning as White House deputy chief of staff last May and setting up a multimillion-dollar consulting firm.
The Justice Department's seven-page report to the court, made public yesterday, cited specifically only the Canada and Puerto Rico allegations. But it said the independent counsel should look into "all other allegations" referred to the department by the General Accounting Office, Office of Government Ethics and five Democratic senators, as well as "any related matters" that develop during the probe.
The report cites the widely publicized allegations about Deaver's representation of Canada on the issue of acid rain. It also contains new information about Deaver's lobbying to preserve tax breaks for U.S. companies doing business in Puerto Rico.
Last July or August, about three months later he left the White House, Deaver discussed the tax issue with Robert C. McFarlane, then White House national security affairs adviser, accoring to the report. McFarlane was then one of the officials responsible for deciding whether the tax breaks should be retained in the administrative tax-revision proposal.
By contacting McFarlane on the issue, the report said, Deaver may have violated a federal law that barred him for one year after leaving, government from contacting anyone in the White House about a matter that had been pending while Deaver worked there.
In a statement from his New York law office, Seymour said: "My job as independent counsel is to let the chips fall where they may. I have pledged muself to conduct an impartial investigation, to make independent decisions on whether there have been any violations of law and to conduct any resulting prosecution vigorously and on the merits." He added that "the results will be made public upon completion."
Deaver, who requested an independent counsel, will cooperate with the investigation and does "not think it appropriate" to comment further during the probe, his spokeswoman, Pamela G. Bailey, said. "We have every confidence that Mr. Seymour will conduct a thorough and impartial investigation and that Mr. Deaver will be fully exonerated of any wrongdoing," she said.
In his telephone discussion witth McFarlane last year, the Justice Department report said, Deaver "identified himself as a representative of the Commonwealthh of Puerto Rico." It said Deaver "then proceeded to present to Mr. McFarlane the views of the Commonwealth of Puerto Rico" about the tax proposal.
However, sources said Deaver was representing a U.S. corporation that does business in Puerto Rico. James McDonough, a spokesman for Puerto Rico, confirmed that "the government of Puerto Rico has no contract with Mr. Deaver" and believed he was working for one or more U.S. companies.
Deaver made other high-level contacts on the tax issue, although there are no allegations the others were illegal. Last July, for example, administration sources said, Deaver arranged for Puerto Rico Gov. Rafael Hernandez Colon and several U.S. companies that do business on the island to meet with Treasury Secretary James A. Baker III on the issue. Deaver was Baker's deputy when Baker was White House chief of staff.
On his $105,000-a-year contract with Canada, the Justice Department said that Deaver may have violated a lifetime legal ban on lobbying the government on ia issue on which he "personally and substantially" participated while a White House offical.
In February and March 1985, while Deaver was in the White House, the Justice Department said it appears that "Mr. Deaver made recommendations, gave advice and otherwise participated substantially in the controversy" about how to combat acid rain pollution. Among other things, Deaver urged appointment of a special envoy on acid rain.
Last Oct. 25, Deaver and Canadian officials met in New York with "a senior official for the United States," Drew Lewis, the presidential envoy on acid rain, the report said. At the meeting, it said, "Mr. Deaver spoke out in the meeting, as Canada's consultant, and recommended a solution to a procedural dispute which had arisen in the course of the meeting."
Seymour's mandate includes two other issues cited by the Democratic senators in their letter to the Justice Department. One is Deaver's efforts on behalf of Rockwell International's push to build more B1 bombers, an issue on which Deaver met with Office of Management and Budget Director James C. Miller III. The other is Deaver's efforts to settle a Customs fraud case involving Daewoo Corp., a South Korean conglomerate.
Rep. John D. Dingell (D-Mich.), chairman of a House Energy and Commerce subcommittee investigating Deaver, has said the namingg of an independent counsel will not interface with the congressional probe.