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75–238 2001

S. HRG. 106–1073

THE CHARLES LA BELLA MEMORANDUM

HEARING

BEFORE THE

SUBCOMMITTEE ON ADMINISTRATIVE OVERSIGHT

AND THE COURTS

OF THE

COMMITTEE ON THE JUDICIARY

UNITED STATES SENATE

ONE HUNDRED SIXTH CONGRESS

SECOND SESSION

MAY 2, 2000

Serial No. J–106–78

Printed for the use of the Committee on the Judiciary

(II)

COMMITTEE ON THE JUDICIARY

ORRIN G. HATCH, Utah, Chairman

STROM THURMOND, South Carolina

CHARLES E. GRASSLEY, Iowa

ARLEN SPECTER, Pennsylvania

JON KYL, Arizona

MIKE DEWINE, Ohio

JOHN ASHCROFT, Missouri

SPENCER ABRAHAM, Michigan

JEFF SESSIONS, Alabama

BOB SMITH, New Hampshire

PATRICK J. LEAHY, Vermont

EDWARD M. KENNEDY, Massachusetts

JOSEPH R. BIDEN, JR., Delaware

HERBERT KOHL, Wisconsin

DIANNE FEINSTEIN, California

RUSSELL D. FEINGOLD, Wisconsin

ROBERT G. TORRICELLI, New Jersey

CHARLES E. SCHUMER, New York

MANUS COONEY, Chief Counsel and Staff Director

BRUCE A. COHEN, Minority Chief Counsel

SUBCOMMITTEE ON ADMINISTRATIVE OVERSIGHT AND THE COURTS

CHARLES E. GRASSLEY, Iowa, Chairman

JEFF SESSIONS, Alabama

STROM THURMOND, South Carolina

SPENCER ABRAHAM, Michigan

ROBERT G. TORRICELLI, New Jersey

RUSSELL D. FEINGOLD, Wisconsin

CHARLES E. SCHUMER, New York

KOLAN DAVIS, Chief Counsel

MATT TANIELIAN, Minority Chief Counsel

(III)

C O N T E N T S

STATEMENTS OF COMMITTEE MEMBERS

Page

Leahy, Hon. Patrick J., a U.S. Senator from the State of Vermont .................... 3

Sessions, Hon. Jeff, a U.S. Senator from the State of Alabama .......................... 8

Specter, Hon. Arlen, a U.S. Senator from the State of Pennsylvania ................. 1

Thurmond, Hon. Strom, a U.S. Senator from the State of South Carolina ........ 7

WITNESS

La Bella, Charles G., Supervising Attorney, Campaign Financing Task Force,

U.S. Department of Justice, Washington, DC ................................................... 9

SUBMISSIONS FOR THE RECORD

Committee on the Judiciary, U.S. Senate, Washington, DC, letter to Attorney

General Janet Reno, dated July 22, 1999 .......................................................... 37

La Bella, Charles G., memorandum, November 30, 1997 .................................... 138

La Bella, Charles G., Supervising Attorney, Campaign Financing Task Force

and James DeSarno, Assistant Director, CAMPCON Task Force, Federal

Bureau of Investigation, Washington, DC, Interim Report, July 16, 1998 ..... 41

Specter, Hon. Arlen, a U.S. Senator from the State of Pennsylvania, letter

to Attorney General Janet Reno, dated September 29, 1999 ........................... 38

(1)

THE CHARLES LA BELLA MEMORANDUM

TUESDAY, MAY 2, 2000

U.S. SENATE, SUBCOMMITTEE ON ADMINISTRATIVE OVERSIGHT

AND THE COURTS, COMMITTEE ON THE JUDICIARY, Washington, DC.

The subcommittee met, pursuant to notice, at 9:33 a.m., in room

SD–106, Dirksen Senate Office Building, Hon. Arlen Specter presiding.

Also present: Senators Thurmond, Sessions, and Leahy.

OPENING STATEMENT OF HON. ARLEN SPECTER, A U.S.

SENATOR FROM THE STATE OF PENNSYLVANIA

Senator SPECTER. Good morning, ladies and gentlemen. The hour

of 9:30 a.m. having arrived, the subcommittee on Department of

Justice oversight will now proceed.

This hearing had originally been scheduled for May the 3rd but

was moved back a day when the committee had scheduled hearings

on the matter involving young Elian Gonzalez so that notice was

given for today’s hearing. Our hearing today will focus on the report of Charles La Bella, on his recommendation to the Attorney

General for the appointment of independent counsel to inquire into

campaign financing for the 1996 Presidential election covering both

Republicans and Democrats. It is part of a broader series which

also involved a report from FBI Director Louis Freeh dated November 24, 1997, where Director Freeh, like Mr. La Bella, recommended that the Attorney General appoint independent counsel.

It is the intention of the subcommittee to hear from Director Freeh

on this subject and on his memorandum of November 24, 1997,

where he recommended independent counsel.

Another memorandum has been prepared by FBI General Counsel Larry Parkinson dated November 20, 1998, and it may be that

we will call Mr. Parkinson as a witness as well.

It is not within the subcommittee’s choosing to have a hearing

in the midst of the Presidential election. Very strenuous efforts

have been made to obtain this La Bella report for a long time. The

La Bella report is dated July 16, 1998. One week later, on July 23,

1998, I wrote to the Attorney General requesting a copy of the La

Bella report and received no response.

On July 22, 1999, Senator Hatch and I wrote to the Attorney

General requesting all documents relating to the 1996 Federal election campaigns which would have comprehended the La Bella reVerDate 26-SEP-2001 04:59 Oct 02, 2001 Jkt 075238 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 E:\HR\OC\A238.XXX pfrm01 PsN: A238
2

port, and the staff of the Department of Justice responded by providing a smattering of information but no La Bella report.

On September 29, 1999, a follow-up letter was written to the Attorney General requesting documents which included the La Bella

report, and again no response.

The La Bella report has not been made available to committees

looking into campaign finance reform such as the Governmental Affairs Committee, but very heavily redacted copies were made available to chairmen and ranking members of some congressional committees with the prohibition against taking notes and the prohibition against having any copies.

I finally had consent to have my Judiciary Committee counsel

David Brog invited to the DOJ offices to review the partially redacted copy of the report on March 15 of this year, and when he

got there, he was denied access to the report. And, finally, the Judiciary Committee on a party-line vote, 10–8, issued a subpoena on

the La Bella report and the Freeh report and the Parkinson report

and the Brian report, and other documents were turned over to the

committee under an arrangement where they were deposited in S– 407, which is not in strict compliance with the subpoena; but at the

risk of not receiving the documents at all, they were received in S– 407 under restrictions which first limited access even to members

of this subcommittee, which has subsequently been broadened, but

prohibiting taking out of those reports from S–407, which I think

is not a valid restriction but in the interest of caution have not

challenged that determination. So we will be proceeding today

without having documents present, but I have read them, others

have read them, so we are in a position to proceed. And we will

deal with the broader public disclosure of those documents at a

later time.

The issues which are involved here relate in very substantial

measure to soft money and the so-called issue ads, and it was even

before the La Bella report when efforts, unsuccessful efforts, were

made to obtain information from the Department of Justice on this

issue.

Slightly more than 3 years ago, I questioned the Attorney General in a Judiciary Committee hearing about the so-called issue ads

on soft money, and the following day, May 1, 1997, wrote her a

lengthy letter, which I will cite only one of the ads, because it sets

the foundation for Mr. La Bella’s testimony. And this is one of the

so-called issue ads: ‘‘Protecting families. For millions of working

families, President Clinton cut taxes. The Dole-Gingrich budget

tried to raise taxes on 8 million people. The Dole-Gingrich budget

would have slashed Medicare $270 billion, cut college scholarships.

The President defended our values, protected Medicare, now a tax

cut of $1,500 a year for the first 2 years of college. Most community

college is free. Help adults go back to school. The President’s plan

protects our values.’’

Now, inexplicably, at least in my judgment, this has been categorized as an issue ad which can be paid for by soft money, which

does not count against so-called campaign contributions. I wrote to

the Attorney General on May 1. She wrote back on June 19 declining to comment, saying the matter was for the Federal Election

Commission. The subject was pursued by me with the Attorney

3

General at a later hearing, pointing out that there were criminal

provisions to the violations and that the Department of Justice and

the Attorney General as chief law enforcement officer had jurisdiction there, but, again, to no avail in receiving a response.

Today’s hearing will involve discussion, extended discussion of

the independent counsel statute, and on one specific provision

where, under a 1987 amendment, the Congress added a provision

that the Attorney General shall not base a determination that

there are no reasonable grounds to believe that further investigation is warranted upon a determination that such person lacked

the state of mind required for the violation of criminal law involved

unless there is clear and convincing evidence that the person

lacked such state of mind. That provision of law was added because

on so many occasions the Department of Justice had declined to

proceed with an investigation under the independent counsel statute on the excuse that there was not a showing of criminal intent.

And the conference report cited the example of Attorney General

Edwin Meese in the Environmental Protection Agency case where

the Attorney General declined to appoint independent counsel, request independent counsel, to investigate whether Edward

Schmults, the Deputy Attorney General, had obstructed a congressional inquiry, with Attorney General Meese saying there was a

lack of evidence of criminal intent, notwithstanding very substantial evidence to the contrary, which led to this rule of law in the

statute that there could be no declination to proceed in the absence

of clear and convincing evidence that there was not criminal intent

since that had been the excuse in the past.

Now, that is, believe it or not, a somewhat abbreviated statement

of some of the very complex issues we will be facing in today’s

hearing, but I thought we ought to lay some of the groundwork,

which I have just done.

I yield now to the ranking member of the full committee, Senator

Leahy.

STATEMENT OF HON. PATRICK J. LEAHY, A U.S. SENATOR

FROM THE STATE OF VERMONT

Senator LEAHY. Well, thank you, Senator Specter. I appreciate

you making the opportunity for me to make an opening statement.

As we know, Senator Torricelli, who is the ranking member of this

subcommittee, had made it clear some time ago that he could not

be available today. And I am aware of the way schedules were

changed around.

The chairman has outlined for the committee the scope of the

campaign finance investigation he wished to pursue in the earlier

statements and would hope this would not be dealing with campaign finance generally but would be targeted at the three convictions obtained by the Justice Department’s campaign finance task

force pursuant to plea agreements with John Huang and Charlie

Trie and Johnny Chung. And, of course, it is within the rights of

the Republican majority to review the plea agreements and sentences in these three cases if that is their priority, if that is how

they choose to focus the attention of this committee. And I have

stated that before. It is their determination and their right to have

as many investigations as they want.

4

Incidentally, it is nice to see you again, Mr. La Bella.

Mr. LA BELLA. Nice to see you, Senator.

Senator LEAHY. And I enjoyed our other talks we have had with

Senator Hatch and you earlier.

To the extent that the plea agreements for Johnny Chung and

Charlie Trie and John Huang are deserving of this subcommittee’s

scrutiny, Mr. La Bella actually may be able to resolve the concerns

of some of our members. Mr. La Bella, you were the supervisor of

the task force September 1997 to June 1998. During that time the

plea agreement for Mr. Chung was negotiated by attorneys of the

task force. It was approved and signed by Mr. La Bella.

In addition, as I understand it, the Trie case, in which an indictment was returned on January 29, 1998, was well underway, and

given the publicly expressed criticisms of the resolution of these

matters achieved by Mr. La Bella’s task force, I hope that the subcommittee will use the opportunity to voice their concerns to Mr.

La Bella, and I think he should have the opportunity to respond.

Frankly, I think that is far afield from the limited focus on those

three plea agreements to use this hearing in the subcommittee to

reiterate the recommendation of Mr. La Bella that the Attorney

General appoint an independent counsel. That topic has been explored with the Attorney General before this committee and with

Mr. La Bella before other committees of this Congress. Indeed, as

I understand, Mr. La Bella has offered public assurances that,

whatever his disagreements with the Attorney General, he believes

that her integrity and independence were beyond reproach. He also

recently reiterated that whatever his frustration with the Department of Justice, he does not believe that the Attorney General in

any way, shape, or form was protecting anybody, or anyone else at

the Justice Department was politically protecting anybody. We can

go over that ground again, but I thought his answer was pretty

clear on that.

Now, on the other hand, a review of the shortcomings in the campaign finance law would be helpful. According to a recent press account, Mr. La Bella identified in his investigation certain flaws in

the current campaign finance laws, including the fact that serious

campaign finance offenses are only misdemeanors and the applicable statute of limitations only 3 years. I agree with Mr. La Bella

that these are serious flaws. That is why I cosponsored S. 1991, a

bill that would amend the Federal Election Campaign Act in just

these areas and treat as felonies violations involving improper contributions aggregating more than $25,000 in any calendar year.

And it would increase the statute of limitations to 5 years, which

is the standard statute for Federal offenses.

It would give increased direction to the Sentencing Commission

in the area of Federal election violations, and hopefully we might

go into questions of that.

We may well be embarking on a much more free-ranging endeavor than previously announced. This inquiry has moved from examining events in Mount Carmel, TX, to the ongoing matter of Wen

Ho Lee, to the plea agreement in the case of Peter Lee. It is now

turning its attention to fundraising activities in the 1996 Federal

elections. These have been explored for a number of years by other

congressional committees. They are under active review at the DeVerDate 26-SEP-2001 04:59 Oct 02, 2001 Jkt 075238 PO 00000 Frm 00008 Fmt 6633 Sfmt 6602 E:\HR\OC\A238.XXX pfrm01 PsN: A238
5

partment of Justice. In fact, they have a task force to conduct a

thorough analysis and investigation. And that task force, which for

a time was headed by Mr. La Bella, had launched 121 investigations by the end of last year. Perhaps we should review all 121.

But as of March 31 of this year, the task force had initiated 24

prosecutions, obtained the conviction of 15 individuals and one corporation. I hope we will not be going back and second-guessing

every one of those.

Questions about the financing of the 1996 Federal elections have

already been the subject of multiple, expensive, overlapping, repeated, and continued congressional hearings. For example, in

1997, the Senate Committee on Governmental Affairs held 32 days

of hearings, calling 70 witnesses, at a cost to the taxpayers of $3.5

million to investigate campaign finance violations relating to the

1996 Federal elections. And that doesn’t count the millions of dollars spent by those people who were called.

Then they had another hearing this fall to review the investigation of Charlie Trie. The House Committee on Government Reform

and Oversight has been investigating campaign finance violations

since June 1997. Chairman Burton has included over 45 days of

hearings. In November 1998, the House committee issued a fourvolume interim report and in 1998 reports spending already $4 million. That was a year and a half ago.

The Senate Judiciary Committee has already focused extensively

on the campaign finance question in hearings with Attorney General Reno on April 30, 1997, July 15, 1998, March 12, 1999. We

have talked to her about her decision not to call for the appointment of an independent counsel. We have talked to her about this

to some extent. The chairman actually threatened to sue her over

her decision and, of course, that is up to him.

Now, we have not questioned her about the times that she has

recommended the appointment of independent counsel over the last

7 years. I do find it disappointing that we are revisiting the matter

of campaign fundraising in 1996 as we approach the general elections of November 2000. I wish we were looking at some of the

other matters. We have at least showed some wisdom in cancelling

the Elian Gonzalez hearing tomorrow, as though there is anything

more to know, a hearing which I think would have been a form of

congressional child abuse to call that little boy up here, Lord knows

why, and fortunately, cooler heads prevailed.

But in the last 2 weeks, we have witnessed the anniversary of

the shooting deaths of 15 at Columbine High School in Littleton,

CO. We have seen the senseless shooting of children at the National Zoo here in Washington. We had the apparent hate crime

shooting spree last week, saw the shooting of a Jewish woman, two

Asian Americans, a man from India, an African-American man, but

we can’t bring up sensible gun safety laws. We have bottled up action on updated hate crimes legislation, the Violence Against

Women Act reauthorization, and we won’t fill the 79 judicial vacancies. Those are all things this committee could do. We won’t move

forward on hate crimes. We won’t move forward on violence against

women. We won’t move forward on the juvenile justice bill which

is bottled up in a conference because the gun lobby tells us not to,

but we will continue on campaign finance violations.

6

We can investigate but apparently not legislate. We know that

a lot of investigations go on. Independent Counsel Kenneth Starr

up to September 30 spent $52 million. We still don’t know how

much more he spent, but his successor has spent another $3 or $4

million. As of May 1999, the Justice Department had detailed 96

employees to help Mr. Starr in his investigations. Ninety-six, 78 of

them FBI agents. He still spent $1.5 million on other investigators.

We love to investigate. I wish we would legislate. I wish we

would move the hate crimes legislation. I wish we would move the

violence against women legislation. I wish we would move the juvenile justice bill, notwithstanding the gun lobby’s opposition to it, at

least vote on it up or down. But if we are going to have investigations, we can go on for them, I am pleased at least that this committee finally showed enough sense to say that tomorrow we

wouldn’t be dragging poor Elian Gonzalez and his father or anybody else before us to rehash that matter over and over again.

So thank you, Mr. Chairman, for letting me sit in for Senator

Torricelli.

Senator SPECTER. Thank you, Senator Leahy.

One other comment with respect to timing because, as noted earlier, we had made very substantial efforts to get the La Bella report early on. It had been the subcommittee’s hope to conclude any

inquiries on the campaign finance matters early on. When we were

talking about structuring the subcommittee last October, the suggestion was made that we would put campaign finance ahead of

Chinese espionage, try to conclude it late March, early April. But

that bipartisan agreement could never be worked out. So while

there may be talk about the millions spent by the Governmental

Affairs Committee and the millions spent by the independent counsel run by Mr. Starr, this subcommittee spent zero, no money, or

extra money. Staffing has been done with the Senators so that we

have proceeded as best we could, and I think rather expeditiously,

with major reports on Wen Ho Lee and hearings on Dr. Peter Lee

and other matters.

Now, Mr. La Bella, if you will stand for the administration of the

oath? Do you solemnly swear that the testimony you will give before this subcommittee of the Judiciary Committee of the Senate of

the United States will be the truth, the whole truth, and nothing

but the truth, so help you God?

Mr. LA BELLA. I do.

Senator SPECTER. Mr. La Bella, we appreciate your being here.

For the record, you are under subpoena. For the record, your report

and all related memoranda and documents are also under subpoena.

We had sought a relaxation of the rules put on by the Department of Justice on not bringing reports over here, but at least for

the moment, we do not have that. The Department of Justice is

being represented by Ms. Cheryl Walter, whom I met yesterday for

the first time, a little after 6 p.m. She brought over a long ream

of material so that they wouldn’t be given to us after the hearing,

she said, but before the hearing. Staff worked long hours into the

night to review that material. I wish I had it so I could at least

weigh it or show it. And we would ask again, Ms. Walter, that you

reconsider our request to bring those documents over. One way or

7

another we are going to do it. It would be more convenient to do

it now.

The Department of Justice has not lodged any objection to our

subpoena as to Mr. La Bella. I don’t think the Department of Justice would have any standing or any objection to our subpoenaing

Mr. La Bella’s report, which we intend to ask him about. Is there

any comment, Ms. Walter, that you would care to make on behalf

of the Department of Justice?

Ms. WALTER. No, thank you, Mr. Chairman.

Senator SPECTER. Thank you.

We have been joined by our illustrious, distinguished President

Pro Tempore of the U.S. Senate, former chairman of this committee

and most other committees in the Senate. Senator Thurmond,

would you care to make an opening statement?

STATEMENT OF HON. STROM THURMOND, A U.S. SENATOR

FROM THE STATE OF SOUTH CAROLINA

Senator THURMOND. Thank you very much, Mr. Chairman.

Mr. Chairman, I am pleased that Mr. Charles La Bella is with

us today to discuss his memorandum regarding the need for an

independent counsel to investigate campaign finance irregularities.

Mr. La Bella was personally chosen by Attorney General Reno in

September 1997 to lead the Department’s investigation into campaign fundraising abuses because the matter was being poorly handled by the Department’s Public Integrity Section. At the time, he

was widely praised by the Department of Justice. He was a distinguished career prosecutor who had a reputation for being aggressive, tough, fair, and effective.

Less than a year later, he strongly urged the Attorney General

to appoint an independent counsel in a now famous document that

the Department of Justice has made every effort to keep secret.

Even though his views were consistent with those of many, including FBI Director Louis Freeh, the Attorney General steadfastly rejected his advice. He was suddenly criticized and was passed over

to be a U.S. Attorney in California. His detailed report confirms

what we have known for some time: The Attorney General has a

duty and obligation under the independent counsel statute to appoint an independent prosecutor to investigate the campaign fundraising irregularities during the Clinton-Gore re-election campaign

in 1996. Although the Attorney General did open some extremely

narrow inquiries under the independent counsel statute, she would

always close them. It is clear that her approach to this case has

always been far different from that of any independent counsel

probes that she had approved in the past.

It should be noted that since Mr. La Bella’s departure, the task

force has not been entirely dormant. It has successfully prosecuted

some participants, including Maria Hsia, who was integral to the

Vice President’s 1996 fundraiser at the Buddhist temple. However,

the task force has also entered some plea agreements such as for

John Huang. In any event, its accomplishments will be greatly limited if the matter is not turned over to a special prosecutor.

This subcommittee will later investigate some of these issues. Although many leads and opportunities have probably been lost forever, it is still my sincere hope that the Attorney General will do

8

what is right and appoint an independent prosecutor in this matter. It is the only way to restore public trust and confidence in this

investigation. I welcome Mr. La Bella and look forward to his testimony. Thank you, Mr. Chairman.

Senator SPECTER. Thank you very much, Senator Thurmond.

Senator Sessions.

STATEMENT OF HON. JEFF SESSIONS, A U.S. SENATOR FROM

THE STATE OF ALABAMA

Senator SESSIONS. Thank you, Mr. Chairman. I know time is

short, and we want to hear from the witnesses. I would just say

that, with regard to Mr. La Bella, I observed from afar his selection

to head this task force. I believe, and it was said then, that he was

the kind of professional with integrity that could handle this investigation and, therefore, we would not need an independent counsel,

that the Department of Justice could do it itself, and that we had

a man of integrity and ability in Mr. La Bella who was going to

undertake it. And the result has not been such that it placed great

credit in my view on the Department of Justice. I am sad to say

that, having spent 15 years of my life working in the Department

of Justice. I believe in the ideals of equal justice under law. I believe that you can find truth, and I believe you can determine

whether or not people have violated laws, and I believe that no one

is above the law. I think that is consistent with American heritage.

So when Mr. La Bella was not allowed, was not able to complete

the investigation, I thought that was a stunning and significant

event. And then when he was going to be named for the U.S. Attorney’s job in California, I thought it was very, very sad that he was

denied that position simply for doing his work as a professional, it

seems to me.

Now, I am willing, I am open, I want to hear the whole facts,

but it strikes me as very unhealthy what happened here, and his

opinions are the opinions of a professional and career prosecutor,

entitled to great respect, and I am glad we are going to be hearing

from him today.

I would also note that he handled the plea bargain of Johnny

Chung in California and handled it in a way that is, I believe, fairly consistent with what a professional would do in a plea bargain

arrangements. He insisted on cooperation. He got it before he made

the recommendations for final recommendation of downward departure and had a plea to legitimate charges. I am very disturbed to

learn that after he left the Department, with regard to the John

Huang case, who had raised $1.6 million for the Democratic National Committee and the Clinton-Gore campaign, that Mr. Huang

was allowed to plead guilty to $7,500 in contributions to the mayor’s race of Los Angeles and not one dime of his plea affected his

fundraising to the Democratic National Committee, really for the

benefit of the Clinton-Gore campaign. And he got a sweetheart

plea, and his cooperation was never fully obtained. So I would like

to ask him a little bit about that.

Those are some of the things that are on my mind, Mr. Chairman. Thank you for going through this. It is a thankless task, your

work, but this is a Government of laws and not of men. I just left

a meeting with members of the Russian Duma. They say corrupVerDate 26-SEP-2001 04:59 Oct 02, 2001 Jkt 075238 PO 00000 Frm 00012 Fmt 6633 Sfmt 6602 E:\HR\OC\A238.XXX pfrm01 PsN: A238
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tion is the thing they are most concerned about in their country.

I believe it is a stain on us that we must constantly fight against,

we must constantly be alert to, and bringing these things to light

are important, and thank you for doing so.

Senator SPECTER. Thank you very much, Senator Sessions.

Mr. La Bella, again, you are here under subpoena. Your report

is under subpoena. And we would ask you at this time to proceed

with your testimony as to what your investigation found and what

your report said.

Mr. LA BELLA. You want me just to go to a narrative?

Senator SPECTER. Well, I would be glad to ask you questions.

STATEMENT OF CHARLES LA BELLA, SUPERVISING

ATTORNEY, CAMPAIGN FINANCING TASK FORCE

Mr. LA BELLA. Let me just begin by saying that, you know, I

have been subpoenaed. My documents, the documents I prepared

when I was a Department employee, were subpoenaed. My testimony has been subpoenaed. And with respect to the Department,

the Department has not given me any, you know, instructions or

directions. And in fairness to the Department, I think that is because it doesn’t want to be perceived as, you know, trying to shape

or mold my testimony or my actions.

With respect to the report, I’m aware of the communications back

and forth between the Senate and the Department of Justice concerning my report and the production of my report and the conditions placed upon the production of my report. Basically, with respect to my producing my version of my report, which I still have,

and my exhibits, the addendum, the problem is I’m flying by my

own lights with respect to the report and my testimony. And I’m

just going to tell you what my best judgment tells me to do because

no one has told me what to do. And the temperature between the

Department of Justice and myself changed quite dramatically after

our September 2, 1998, meeting, briefing on the Hill. After that

time, I really had very little to do—I had nothing to do with the

campaign financing issues. I was not included in any discussions,

and perhaps rightfully so, because I had moved on to another post

at that point.

Before that time, after I handed my report in, in July, towards

the end of July, within a week the result of the report had been

reported in the New York Times. On August 4 or 5—I forget the

date—I testified in the House Oversight Committee, and at that

time I was asked whether I had discussed the report with the Attorney General. My response was no. We hadn’t had a chance to

discuss it between the time I handed my report in in that meeting.

Senator SPECTER. Have you ever discussed the nuts and bolts of

this report with the Attorney General?

Mr. LA BELLA. Well, following that hearing, the Department put

together a meeting, I think it was on August 13 or 14, 1998, ostensibly to discuss my report. We met with the Attorney General. We

discussed some very generic issues. I think the major issue we discussed was whether or not there was anything in the report that

would require us to trigger an Independent Counsel Act inquiry at

that time. But it was a very generic, macro discussion. We didn’t

get into the nuts and bolts or a substantive discussion at that time.

10

Senator SPECTER. At any time?

Mr. LA BELLA. Not after that, no. After that, I was really

gone—— Senator SPECTER. Never had, as you put it, a nuts and bolts discussion with the Attorney General of your report?

Mr. LA BELLA. No. No, I mean, we never really discussed line by

line or chapter by chapter or heading by heading. We had that one

generic discussion on August 14, but that was about it.

But, in fact, I had been replaced, though. In fairness to the Department, I had been replaced as chief of the campaign financing

task force. Someone else was in that position from June on, and,

you know, I had moved on—— Senator SPECTER. When were you replaced as head of the task

force?

Mr. LA BELLA. Well, I guess—I was appointed U.S. Attorney,

Acting U.S. Attorney in June 1998, and I kept loose affiliation with

the task force and the Department vis-a-vis campaign financing

issues through the September 2 meeting, and then after that we

really kind of severed ties with respect to campaign financing.

Senator SPECTER. And what was the cause of your being replaced

as head of the campaign finance task force?

Mr. LA BELLA. Because I went out to San Diego to replace the

U.S. Attorney, interim U.S. Attorney—to act as interim U.S. Attorney to replace the U.S. Attorney who had just left. And that was

the reason I left.

So with that time line in mind and the fact that I’m really flying

by my own lights and my own moral compass, I’m glad to talk

about certain issues in the report. I really feel compelled—and I’ll

just tell you this. I don’t know how else to deal with people except

up front. OK? I’m somebody to just lay it out on the table. I may

have differences with the Department. The Department may have

differences with me. But I was a Department lawyer for nearly 17

years. I have a certain amount of loyalty and respect for the office

of Attorney General and for the Department of Justice. I don’t

want to do anything to disparage the office of Attorney General or

to disparage the men and women who work for the Department of

Justice.

I feel as a former prosecutor and a former public servant that it’s

really incumbent upon me to respect the Department’s views with

respect to the deliberative process as much as, you know, any ego

in me would love my report to come out, because I think it’s a

sound report. I think it was well written. I think it was well reasoned. I think it was a sound legal document.

I think the deliberative process is important, and I really would

ask that we do not go into the nuts and bolts of the evidence underlying my conclusions. I’m happy to discuss my conclusions. I’m

happy to generically discuss my conclusions. If we have to go into

closed session, I’d be happy to do that. I have nothing to hide. I

stand by my report. I stand by my career. But I don’t want to jeopardize the important work that the Department continues to do,

and I don’t want to—also, frankly, I don’t want to have—give someone grist for criticizing me publicly, because in one sense I have not

been given any instructions. I’m left to fly by my own moral compass, and I’m doing that. But I know if I step—if I say something

11

inappropriate, there are people waiting, just waiting to jump on it,

and so I’m cautious of that, too.

So, cognizant of all that, I’m happy to answer questions. I want

to answer questions. I think Senator Leahy brought up a good

point that one of the issues we really should be talking about is

campaign financing reform. I know Senator Thompson—and it’s cosponsored—has some pending legislation that’s very important

that—and I say that because all my suggestions in my report are

included, I think, in that piece of legislation. I think it’s a wonderful piece of legislation. It would be an important step in the right

direction, and I think that’s a useful road to go down.

With respect to the problems with the law, the problems with the

Independent Counsel Act, the problems with maybe generically

how we handled things in the Department, that’s all fair game for

questions. I just am a little reluctant to answer questions as to, for

example, why Mr. X—why I thought Mr. X, his conduct required

the appointment of an independent counsel. If I get into the nuts

and bolts of Mr. X’s conduct and the evidence, I really just think

that I’m giving away the deliberative process that’s so important to

the Department’s ability to do what it needs to do, whether I agree

with the Department or not. And I did not agree with the Attorney

General on this issue, but I think that has to be preserved.

So, you know, I’ll do the best I can to answer all your questions,

and you want to know something that really goes to the heart of

why I reached a certain decision, I think we really do have to go

in closed session or at least discuss amongst ourselves how we

best—how I can best answer the question, give you what you need

to do your job, and preserve the integrity—my own integrity plus

the integrity of the deliberative process that the Department really

needs.

Senator SPECTER. Mr. La Bella, we understand your position and

have structured this in a way which is designed to the maximum

extent to make it obvious that you are responding to a subpoena,

a compulsory process. And you and I compared your report. You

had your report within your possession, and I went over the report

in S–407 that the Department of Justice had provided on the redacted items and said to you that we would not ask you any questions about the redacted items, so that will be respected.

The inquiries made by the subcommittee of the Department of

Justice relate only to the deliberative process, and the Judiciary

Committee, as I said earlier, by a 10–8 party-line vote decided that

the public interest and public policy in oversight of the Department

of Justice, as it touches quite a number of matters—number one,

just pure oversight as to how the Department is functioning. The

second aspect of our inquiry is what we ought to do by way of legislative change, and I have sponsored and cosponsored campaign finance reform legislation. And there is a bipartisan group sponsoring legislation to put back the independent counsel statute, so

that the experience here and your testimony is important on that

subject.

We will not go into matters which require closed session because

we are not going to go into any 6(c) or any redacted information.

And we are interested in your conclusions, but necessarily, in the

view of the subcommittee, which is why we subpoenaed the report,

12

we may get into some of the specifics as to what you had your conclusions for. And I know what your conclusions are, and I know

what the specifics are because I have read the report. But we will

just move along and handle it in a way which is consistent with

all of our professional responsibilities, and emphasizing again that

the Department is represented here and has raised no objection. I

repeat, which I don’t like to do, I don’t know that there is any objection they can raise, but they haven’t in any event.

Mr. La Bella, if you prefer, we will just start with questions.

Mr. LA BELLA. That would be better if I could answer questions.

Senator SPECTER. We can proceed in that manner.

Perhaps a good way to start would be, as you had commented to

me last night, on the index. What subject matters were comprehended within your report with respect to generalized topics of

investigation or individuals subject to investigation?

Mr. LA BELLA. I started with the statutory framework and our

investigative approach, to just set the stage for the Attorney General and the Director of the FBI. This was to the Attorney General

and the Director of the FBI. And then section 2, I went into information that myself and Jim DeSarno, who was the head of the

FBI, believed was sufficient to trigger a preliminary investigation

and to support a determination that further investigation was warranted under the ICA.

Senator SPECTER. And essentially what was the evidentiary base

for triggering a preliminary investigation and a follow-up investigation?

Mr. LA BELLA. My understanding of the law was that if there

was sufficient information from a credible source to warrant an investigation, then an investigation had to be conducted. We believed, Jim and I, after, you know, assembling all the evidence, we

believed that there was sufficient information from credible sources

to warrant the appointment of an independent counsel.

Senator SPECTER. With respect to the individuals, I believe you

label them as starting with Mr. Harold Ickes, the President, then

the Vice President, et cetera. Essentially what were your findings,

starting with the first on your agenda, Mr. Ickes?

Mr. LA BELLA. Well, with respect to Mr. Ickes, without going into

the nuts and bolts of the analysis, I obviously concluded that, you

know, for purposes—you know, with respect to the evidence that I

detailed and outlined in the, I guess, 20-some-odd pages that followed, that his conduct warranted the Attorney General appointing

an independent counsel. It wasn’t his conduct alone, but his conduct in connection with cross-cutting several of the investigations

that we had conducted at the task force.

Senator SPECTER. And which investigations were those?

Mr. LA BELLA. Well, he touched upon a lot of investigations. He

was someone who had cameo appearances in several investigations.

Senator SPECTER. What was your essential finding as to ultimate

control of the campaign by Mr. Ickes operating as Deputy Chief of

Staff?

Mr. LA BELLA. Well, I can refer to public documents, and there’s

certainly memos that—reflecting that, in fact, he functioned as

really the coordinator of the DNC during the critical years. He had

people report to him, and he made decisions, you know, budgetary

13

decisions and those sorts of things. So that was part of the analysis.

Senator SPECTER. And who was next on your itinerary?

Mr. LA BELLA. Well, I had—the captions are—you know, we

talked about the President, and under several topics, and then we

had the Vice President, the—— Senator SPECTER. What were the several topics with respect to

the President?

Mr. LA BELLA. Well, it’s going to be difficult for me to go into

those without really going into the underlying—the underlying

facts of the investigation. That’s—— Senator SPECTER. Well, Mr. La Bella, we want the underlying

facts. This does not really touch on the deliberative process where

you confer with the Attorney General, which, in fact, you didn’t, except for the one generic meeting that you have described. To understand the basis for your conclusion, we do need the facts. Regrettably, it has all been in the newspapers, anyway.

Mr. LA BELLA. Well, it hasn’t. I mean, that’s the dilemma I have.

There’s some—there’s been some reports of leaks of this report with

respect to positions taken, but not to the underlying evidence.

Now, if—for example, there’s no way—it’s very difficult for me to

discuss my analysis without getting into the nuts and bolts of the

evidence. I mean, I understand the Department’s view on this, and

I’ve got to respect it, that, you know, the deliberative process is

critical. They believe, the Department believes—and I’ve actually

testified earlier in front of the Government Oversight—House

Oversight Committee that it’s just—it’s just difficult for a former

prosecutor to—you know, to publicly go into the analysis that he

or she engages in in order to reach a certain conclusion.

I reached a conclusion as a 17-year prosecutor that there was

sufficient information from credible sources to warrant the appointment of an independent counsel.

Senator SPECTER. Mr. La Bella, when we talk about deliberative

process, we are talking about a report which an investigator in

your position submits to his superiors and the conversations which

you have and the way a judgment is formed and the way there are

discussions which are not chilled by somebody looking over your

shoulder at some time.

Now, there are circumstances where the case law has upheld

congressional oversight going into pending investigations, and we

have already had hearings on Peter Lee with line attorneys, strenuously objected to by the Department of Justice, where the committee has decided to overrule the Department’s objections. We are

not asking you for your conversations with the Attorney General,

and we don’t intend to because there is nothing to ask you about,

which is the reason we are not asking you about them. And perhaps we wouldn’t if there was something to ask you about. But

with respect to the factual matters that led to your conclusion, that

is not part of the deliberative process, as I see it.

Mr. LA BELLA. But this is a report to the Attorney General. This

is a conversation, the only conversation I had, but maybe a onesided conversation, but this is my conversation with the Attorney

General and the Director of the FBI as to why Jim DeSarno and

I thought an independent counsel needed to be appointed. So, I

14

mean, it really is a—it is a conversation in that I was—you know,

I put my heart and soul into this, and this is my best judgment

as to what went on. But I analyze evidence. I get very particular

about what went on and why I thought it was appropriate to appoint an independent counsel.

I am not shying away from that decision. I mean, don’t get me

wrong. I think I was right then, and I think I’m right now. But my

dilemma is I don’t want to go into the nuts and bolts of why I think

under—you know, under the caption, let’s take the President, why

I think—you know, the five areas that I thought triggered or demonstrated in a matter of evidence and information, why I concluded

based on that information and evidence that there was reason to

further investigate particular allegations.

The allegations are not a surprise to anybody. They’re very similar allegations that were—you know, have been public record.

What is not public record is my analysis and my piecing together

the different pieces of evidence.

Now, I know that there are probably some people who don’t want

this report to come out because circumstantially it’s fairly powerful.

But I think the greater concern is that it would compromise the

way the Department conducts its business in U.S. attorneys’ offices

around the country. And if a prosecutor can’t write an analysis like

this without fear that his or her analysis is going to become public,

it could chill that. I mean, it will chill that. And I think that’s the

critical issue that’s at stake here, and I’m glad to talk about—you

know, I stood on my own two feet and said that I think that an

independent counsel should have been appointed. The Attorney

General disagreed. I took the shots and I have moved on.

But I don’t know how to go into the nuts and bolts of why I think

an independent counsel should have been appointed vis-a-vis the

President, the Vice President, or Harold Ickes without going into

the nuts and bolts. It’s just not going to make sense to anybody.

I can talk about the conclusion, but to talk about the nuts and

bolts, it requires me to really draw upon the evidence. And I know

that’s frustrating, and I know it probably serves some people’s interest. But I’m concerned with the greater issue here, which is my

loyalty to the Department of Justice, not a person, not a bunch of

bricks, but to the Department of Justice and what it stands for.

And I can’t just sort of brush that aside because I maybe don’t have

a friendly relationship with the Attorney General of the United

States anymore.

Senator SPECTER. Well, Mr. La Bella——

Mr. LA BELLA. That’s where I am.

Senator SPECTER. I don’t propose to have an elongated discussion

as to the deliberative process, simply to say that it is my conclusion

that you are not talking about a deliberative process. The deliberative process involves deliberation within the Department where you

would make a report and where you would have a discussion, and

that did not occur here. What you were talking about is the work

of an individual lawyer, investigator, prosecutor who writes a report. That is not the deliberative process.

Now, whatever it is, the committee has already decided that we

want the facts, and that is what we intend to ask you about pointblank.

15

Mr. LA BELLA. OK.

Senator SPECTER. And we have already been through this with

others, with line attorneys; the Attorney General herself has appeared and has answered specific questions about a warrant under

the Foreign Intelligence Surveillance Act. It was in closed session,

but she answered that. She has also answered in public sessions

specific questions. So that is what we intend to deal with.

Senator SESSIONS. Mr. Chairman, I would just like to join you in

that, and I know Mr. La Bella has had witnesses before him that

didn’t want to testify also, and they thought for some reason or another they didn’t have to testify, but he has required them to testify. Isn’t that right, Mr. La Bella?

Mr. LA BELLA. Yeah, I—— Senator SESSIONS. A lot of times.

Mr. LA BELLA. Absolutely.

Senator SESSIONS. As a professional.

Mr. LA BELLA. Right.

Senator SESSIONS. Well, you are under subpoena here.

Mr. LA BELLA. Right.

Senator SESSIONS. And to my knowledge, there is no objection to

your testimony, and I don’t see why you ought not to give it. You

would recognize at some point that the Department of Justice is

subjected to some oversight, would you not?

Mr. LA BELLA. Absolutely.

Senator SESSIONS. And that if a professional who is investigating

a case is turned down by the Attorney General who serves at the

pleasure of the President, when the professional said that the

President should be subjected to an independent counsel, then I

think the people of this country have a right to have some understanding of what this is about.

Mr. LA BELLA. Right.

Senator SESSIONS. Because we don’t have an independent counsel

anymore.

Mr. LA BELLA. Well, I think if you——

Senator SESSIONS. This is all we got here is the U.S. Congress

to attempt to make sure the people understand what happens, and

if there is a good explanation, so be it. If it is not, we need to know

it.

Mr. LA BELLA. Well, I think if you want to ask me, you know,

what broke down in the process, that is a legitimate question. And

I’m not shy to tell you that, you know, the process within the Department I think was dysfunctional. And I’ve said that and I will

repeat it.

Senator SESSIONS. Well, I think the chairman’s asked you some

questions to which, to my knowledge, there is no real objection to,

and I would hope that you would answer them.

Mr. LA BELLA. Well, give me another question. I’ll try better.

Senator SPECTER. OK. Mr. La Bella, there has been a lot of concern about the Attorney General’s refusal to proceed with the investigation as to the Vice President on her finding that there was

lack of intent on the part of the Vice President to violate the Federal election laws. And I have already cited a statute which says

that the Attorney General may not stop an inquiry. ‘‘The Attorney

General shall not base the determination that there are no reasonVerDate 26-SEP-2001 04:59 Oct 02, 2001 Jkt 075238 PO 00000 Frm 00019 Fmt 6633 Sfmt 6602 E:\HR\OC\A238.XXX pfrm01 PsN: A238
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able grounds to believe that further investigation is warranted

upon a determination that such person lacked the state of mind required for the violation of criminal law involved unless there is

clear and convincing evidence that the person lacked such state of

mind.’’ And the Congress, in putting that provision in, cited Attorney General Meese letting the Deputy Attorney General go on his

unilateral finding that there was not criminal intent.

And the issue has arisen as to the Vice President’s state of mind,

and, again, I repeat, this would have been a good subject for inquiry in 1998 or 1999 as opposed to May 2 of the year 2000. But

we just got this report and have had a chance to go into specifics

as to what was before the Department of Justice.

Now, your report and Director Freeh’s report relate to the Vice

President having made so-called hard money calls because it was

the Clinton-Gore credit card which raised hard money as opposed

to soft money, which is raised by the Democratic National Committee. And there were 13 memoranda which had been sent from

Mr. Ickes to the Vice President from August 1995 until July 1996.

And these 13 memos contained divisions as to hard money/soft

money, and also using Federal contributions, which are equivalent

to hard money contributions.

And the Vice President is quoted as saying, quote, the subject

matter of the memos—memorandums would already have been discussed in his presence and in the President’s presence. And there

was an issue raised as to whether the hard money/soft money was

discussed in the Vice President’s presence, and Mr. Strauss, his

Deputy Chief of Staff, had a memorandum which related—specified

a 65 percent split in hard money and a 35 percent—65 percent soft

money and 35 percent in hard money.

And there was an issue raised by the Vice President as to whether he was present all the time, whether he had drunk so much iced

tea that he had a ‘‘restroom break’’ at that particular time, and the

Vice President’s further statement that he was experienced for

many years of campaigning.

There was also the question raised as to his credibility on the

false statement issue, and your memorandum noted that it was inconceivable that the topic of hard money/soft money was not addressed at these regular Wednesday night meetings in the light of

the Ickes memo, and you commented based on this memo and others penned by Ickes to the Vice President, everyone was on notice

about the need for the hard dollars.

Now, coming right down to the core conclusion where you recommended to the Attorney General that there be a further investigation, it was your conclusion that the matter could not be ruled

out as clear and convincing evidence that there was no criminal intent with so many of these facts in dispute, and the defense of advice of counsel where somebody says, well, I told my lawyer everything and I relied upon his advice and, therefore, I do not have the

criminal intent, is in the nature of an affirmative defense, which

is a jury question, not one which you can rule out as a matter of

law.

And the flavor of the report is that it is not a matter of prosecutorial discretion. A prosecutor can decide what to charge and what

not to charge, but a lot of the independent counsel statute that

17

says you can’t rule out criminal intent in the absence of clear and

convincing evidence.

My question to you is: What was your basis for recommending

independent counsel?

Mr. LA BELLA. Virtually all that is public information, so I can

talk about that. Let me just put it in its perspective, proper perspective, proper context.

When I arrived in September 1997, there was already underway

the initial investigation concerning the 607 violation, the phone

calls from the public office.

Senator SPECTER. 607 is exactly what, Mr. La Bella?

Mr. LA BELLA. 607 is the Pendleton Act. That was the alleged

violation.

Senator SPECTER. I just want to ask you for the record what 607

provides so it is clear.

Mr. LA BELLA. Well, I don’t have it in front of me, but it is basically the Pendleton Act.

Senator SPECTER. Paraphrase.

Mr. LA BELLA. In any event, the 607 violation was underway already when I got there. In December, early December, when it was

decided—like December 7 or 8 was the cut-off date. I at that point

had recommended to the Attorney General that I thought it was

appropriate to warrant further investigation. She decided that it

wasn’t.

The report was written in July—I mean, it was concluded in July

and handed in in July. At that same time there was the emergence

of or the surfacing of the Strauss memo and the Leon Panetta

interviews and those sorts of things that suggested additional facts.

In my memo—— Senator SPECTER. Let me interrupt you just on the point of the

Panetta memo, which has been in the public domain, and that is

that Leon Panetta, the Chief of Staff, has said that the Vice President was attentive during the course of discussions about the hard

money. Correct?

Mr. LA BELLA. Right.

Senator SPECTER. OK. Go ahead.

Mr. LA BELLA. In my July report, you’re right, the conclusion

was that it was inconceivable that at the Wednesday meetings that

hard money/soft money split wasn’t discussed. That was the best

evidence we had at that point. We had the Ickes memos, and we

had all that material that you’ve just alluded to.

Right after that, or at that same time, as I was writing this, the

Strauss memo emerged. The Leon Panetta interview occurred I

think in August 1998. I’m not exactly sure.

Senator SPECTER. And what was the Strauss memo?

Mr. LA BELLA. The Strauss memo was the notations of Strauss

that indicated the split of the hard and soft money.

Senator SPECTER. Sixty-five percent hard, 35 percent——

Mr. LA BELLA. Exactly—— Senator SPECTER. Sixty-five percent soft, 35 percent hard.

Mr. LA BELLA. Yeah, something to that effect. I don’t have it in

front of me, but there was a memo with the handwritten notes.

Senator SPECTER. At this point, Mr. La Bella, make it clear for

the record what the import was of the hard money, that that countVerDate 26-SEP-2001 04:59 Oct 02, 2001 Jkt 075238 PO 00000 Frm 00021 Fmt 6633 Sfmt 6602 E:\HR\OC\A238.XXX pfrm01 PsN: A238
18

ed as a contribution under the Federal election law, whereas the

soft money did not under the Department of Justice’s interpretation.

Mr. LA BELLA. Right. The initial analysis was—and I think it

was correct—that if you’re just soliciting soft money, that it’s not

soliciting contributions and it doesn’t come under 607. So there was

no—if it was just soft money, there could be no potential violation

of 607. If it was hard money——

Senator SPECTER. But if you’re soliciting hard money, there could

be a violation of 607?

Mr. LA BELLA. A potential violation.

Senator SPECTER. And 607 prohibited raising money on Government property.

Mr. LA BELLA. Right. It is a very old statute. It is a very technical statute. But, arguably, it did prohibit that sort of conduct.

Now, the issue, the only issue before us at that time was whether

or not there was sufficient evidence, sufficient information from

credible sources to warrant a further investigation. Based on that

and my 17 years as a prosecutor, I thought that was a ground ball,

that yes, indeed, there was enough information that you would

want to conduct an investigation. That’s not to say that at the conclusion of the investigation you would do anything with it, that you

would prosecute it. In fact, in my judgment, you know, based on

the facts and the evidence, you probably wouldn’t.

Senator SPECTER. Well, why was there enough information, as

you just put it, to conduct additional investigation?

Mr. LA BELLA. Because you had the memos, you had the Leon

Panetta interview, you had the Strauss memo, you had, I think, information from credible sources that there’s reason to believe that

the Vice President, you know, knew that he was raising, in part,

soft money and hard money. But, you know, it could be that he

didn’t. I’m not saying he did. I’m just saying——

Senator SPECTER. When you say the memos, you are——

Mr. LA BELLA. Possibility.

Senator SPECTER [continuing]. Talking about the 13 memos from

Ickes to the Vice President?

Mr. LA BELLA. Right, the 13 memos from Ickes to—I’m taking

your number as accurate. The number of Ickes memos to the Vice

President, the Strauss handwritten notes, the Leon Panetta interview, if you put all those together, it seems that a further investigation is warranted.

Again, not saying that a further investigation is going to result

in charges. Probably would not, based on my experience. But, you

know, in my judgment—and it was just my judgment and Jim

DeSarno’s judgment that at the early stage we thought there was

sufficient information, and then after the Strauss memo emerged

and the Leon Panetta interview occurred, there was additional information. But I guess it was still deemed insufficient.

Senator SPECTER. I am going to yield now to Senator Leahy. We

have not run the clock this morning because this discussion doesn’t

lend itself to 5-minute segments, and I conferred with Senator

Leahy about the procedure, and he said go ahead a few minutes

ago until you find a convenient spot. He has other commitments,

19

and there will be more questions, but this is a convenient spot, so

I yield now to the ranking member.

Mr. LA BELLA. Are you going to give me an easy one?

Senator LEAHY. Yes, let’s talk about our Italian ancestry. What

part of Italy does your family come from originally?

Mr. LA BELLA. My father’s from Sicily, my mother’s from northern Italy, so it made for interesting Sunday dinners.

Senator LEAHY. Whereabouts in northern Italy?

Mr. LA BELLA. The Genoa area.

Senator LEAHY. Mine is from the Friuli area over on the other

side. So that is the easy part.

Senator SPECTER. I think the Department of Justice objects to

this part of the dialogue. [Laughter.]

Senator LEAHY. And the chairman is absolutely right when he

said normally we put on a time, and I thought he had, in asking

his questions, an absolutely legitimate right, and I wasn’t about to

object to it. I was finding the questions interesting myself.

I know, Mr. La Bella, you are in somewhat of a rock and a hard

place here, and I know Senator Hatch and the Department of Justice have started negotiating on what would be the use of this material that was sent up here, and I guess those negotiations are

still going on, and in the meantime you are here.

I was pleased with what you said about the Thompson bill on

amending the Federal Election Campaign Act. That is S. 1991 that

was introduced by Senator Thompson, Senator Lieberman, Senator

Collins, and myself as a bipartisan piece of legislation. I think a

number of the issues that you have raised in your statements earlier, some of the private discussions you have had with members,

and also some of the public ones, some of the problems with the

Federal election campaign law could be taken care of there.

You have also alluded to the question of what is raising funds

on public or on governmental property, including the statute that

was put together before there were telephones and those things.

The idea that somebody might have written a note and mailed it

out on their way home but wrote the note in a public place probably would not have had any question now if they are doing basically the same thing but a telephone call isn’t.

I also am struck by one thing you said, and I want to re-emphasize it. In the special counsel law or special prosecutor law, or

whatever, one of the criticisms of it and one of the reasons why it

has not been renewed and one of the reasons why significant Republicans and Democrats whom I have a great deal of respect for

say they would not renew it in its present form—I think everybody

agrees it would not—if it were to be renewed, it would not be renewed in its present form because of the low threshold it has to

trigger an investigation.

You are an experienced prosecutor. Is it safe to say that you have

had a lot of cases where somebody brought something to you and

you said, it could be something, let’s just take a look at it, and thus

start an investigation, and then pretty soon said, there is nothing

there, let’s go on to something else?

Mr. LA BELLA. Absolutely.

Senator LEAHY. And wouldn’t that be pretty much the experience

of most prosecutors?

20

Mr. LA BELLA. Yes. I mean, you exercise a great deal of prosecutorial discretion, and the cases you decline on are never really public. I mean, it is only the rare one that becomes public, but I think

prosecutors, Federal prosecutors everyday decline on cases because

every technical violation of a Federal statute does not require the

full weight and majesty of the Federal law coming down on someone. So I mean there is a lot of prosecutorial discretion that is exercised everyday in U.S. attorneys’ offices, and appropriately so.

Senator LEAHY. It is on a far different level, but it is against the

law to go 1 mile an hour over the speed limit. Most of us would

wonder what was wrong with a prosecutor if suddenly a whole pile

of people were brought in for going 41 miles an hour in a 40-milean-hour zone.

But with the low threshold on the special prosecutor, did you

find that oftentimes there was, just in general, a discussion that

this may or may not trigger the special prosecutor law, but even

if it does, at the end of the day there is not going to be any special

prosecution.

Mr. LA BELLA. Right. I mean, that view was always expressed.

I mean, everybody had that feeling about many of these prosecutions. I mean, if I prosecuted every person who came into the grand

jury and lied to me, that is all I would have done. It is, you know,

a hazard of the job. You get a lot of people who come into the grand

jury and don’t tell you the truth. Some of them you have to prosecute as perjury.

You know, if it is significant, if it is a centerpiece of a criminal

activity, you go after it. But by and large, you know, the minor

ones you sort of let go. You have to let certain things go. But we

had that discussion. I mean, people discussed that openly. I can’t

say we ever had the discussion in front of the Attorney General

about that, but we certainly amongst ourselves—you know, between the lawyers in Public Integrity and the other supervisors

around the table, you would scratch your head at some of these

things and say, you know, 10 out of 10 prosecutors are ultimately

going to decline this case, but we need to sort of go through the

numbers.

And that is where I sort of parted company with some of the people, because I said, it is the law, we need to go through the numbers, we need to go by the numbers. That is not to say all of them

would, and you never know what you are going to find if you do

the investigation. But, you know, that was certainly part of our discussions.

Senator LEAHY. Well, let me take one example. There were two

special prosecutor investigations, costing millions of dollars, on the

Vincent Foster suicide, and at the end they both found exactly the

same thing. Millions of dollars were spent, but both found at the

end we had a suicide.

On a lesser thing, as a State prosecutor, you always have the experience of somebody who comes in after a bitter divorce case. And

with diametrically opposed testimony, it is obvious somebody lied,

and they say—usually the person who came out on the short end

of the stick—we want a prosecution, but there isn’t one.

You have got a contractor who does something. One person sues.

The contractor promised to do such and so for this money. The conVerDate 26-SEP-2001 04:59 Oct 02, 2001 Jkt 075238 PO 00000 Frm 00024 Fmt 6633 Sfmt 6602 E:\HR\OC\A238.XXX pfrm01 PsN: A238
21

tractor says, I never promised to do such and so for that money.

Somebody is lying, but you don’t prosecute.

These things, however, are difficult because in the public domain

we may have set the threshold to trigger the special counsel law

too law. That is my feeling. I don’t know if you have a feeling on

that.

Mr. LA BELLA. I think there is two things. I think you have the

double whammy. It is a very low standard, but in addition, you are

hamstrung by a lack of investigative tools. You can’t use subpoena,

you can’t immunize witnesses, and these are the tools of the prosecutor. Without subpoena power, without the right to immunize

witnesses, it is very difficult to get to the bottom of a situation.

Senator LEAHY. Well, isn’t it safe to say if you have a case involving a whole lot of people, at some point you are going to take somebody out and say, all right, we are going to put you on the bubble,

we are going to immunize you, but—— Mr. LA BELLA. Right. I mean, in a white-collar case that is generally the way you have to go. You have to immunize somebody to

get an insider to testify as to what went on inside the white-collar

conspiracy. That is just the way it is.

Senator LEAHY. Unless you got really lucky on a piece of evidence or had a wiretap or something like that, there is probably

not much you can do.

Mr. LA BELLA. Right, if you get lucky on a search warrant or

something like this. But in cases like this, these are generally very

public investigations and people know you are coming, you know,

miles before you are there.

Senator LEAHY. Now, Mr. La Bella, I know you have a great deal

of respect for people in the Justice Department, and I do too, and

I have said this. The professional and career people—I have probably given more speeches about my respect for them in both Republican and Democratic administrations. As a lawyer and as a prosecutor, I have dealt with some of them and I think that the country

has been darn lucky to have the men and women that you are referring to.

You described in your report that the circumstantial evidence

was powerful, but there was also some significant dissent among

other career prosecutors within the Department about your conclusions. Is that correct?

Mr. LA BELLA. There is some dissent among career people in the

Justice Department. My difference with you is that my definition

of a career prosecutor is different than just someone who has

worked for the Department of Justice for 20 years.

Senator LEAHY. What is your definition, then?

Mr. LA BELLA. Someone who has tried cases and stared down juries and has gone into the grand jury substantial amounts of times

who has done significant prosecutions, who knows his or her way

around the courtroom, his or her way around the grand jury room.

Senator LEAHY. That is my definition, too.

Mr. LA BELLA. Yes, and I think that there are people in the Department of Justice who are career bureaucrats, and that is not to

demean the fact that they are career bureaucrats. There is a place

for that. I mean, we need people in the Department to be concerned

about, you know, policy and issues that are more national in scope,

22

but I wouldn’t necessarily call them a career prosecutor. But, you

know, I think that you could probably get—you could find career

prosecutors who may disagree with me. I haven’t met any.

Senator LEAHY. But you have had this same thing in some cases

before where you have had this back-and-forth on whether there

should be a prosecution.

Mr. LA BELLA. Absolutely.

Senator LEAHY. And sometimes your side wins out and sometimes the other.

Mr. LA BELLA. Right.

Senator LEAHY. Would you say, if you were the one making the

ultimate decision on a case that might be a close call, would you

encourage this debate in presenting a recommendation to you?

Mr. LA BELLA. I started out as a line assistant and I ended up

as U.S. attorney, so I held every position along the way. And I was

very often in the position of having to argue for a position and very

often in the position of having to make a decision as Chief of the

Criminal Division or as U.S. attorney.

So you really do need to encourage vigorous debate, but you need

to encourage real debate and you also need to encourage the fact

that once the debate is over, there is a professional respect and closure to the debate. I mean, in a U.S. attorney’s office, when we had

knock-down, drag-outs about whether we should proceed with a

case, we walked out of the room respecting each other and not casting aspersions on each other. So, yes, I think that is something you

need to encourage.

Senator LEAHY. In fact, when you testified before the House

Committee on Government Reform and Oversight, you said, and I

am going to quote this, ‘‘The last thing I want to see as the prosecutor heading this task force is that this memo ever gets disclosed.

I don’t think it should ever see the light of day because this, in my

judgment, would be devastating to the investigations. I can’t see a

set of circumstances under which this report should see the light

of day.’’

Is that a basically accurate recompilation of what you said, and

if so, do you feel that way today?

Mr. LA BELLA. It sounds like something I would say. Oh, yes, I

think, you know, then there were greater concerns because things

were actively under investigation. I think a lot of that has been

mooted, but I think just to make public the document, because you

can’t make this document public in a vacuum—you would have to

make the responses public and the whole debate would have to become public that was internal. The Lee Radek response to my

memo would have to be made public.

I understand from the Department that Jim Robinson wrote a

memo analyzing my memo. And, you know, once you go down that

slippery slope, there is no stopping, and that is the problem.

Senator LEAHY. Is that why you wanted a subpoena to appear

here today?

Mr. LA BELLA. Yes. I don’t want to—let me just tell you, I am

not a reluctant public servant, but I just—you know, I don’t want

to seem to be a volunteer on this. I feel strongly about this. I felt

strongly when I wrote it, I feel strongly today. But I just think

23

that, you know, there are issues we need to deal with and we

should probably move on to those issues.

Senator LEAHY. You have spoken about the Attorney General’s

integrity and independence. And when you testified before the

House Government Reform Committee on August 4, 1998, you said

you thought that the task force was adequately staffed and the attorneys and FBI agents working on the investigation were competent and professional.

You said that neither the Attorney General nor the White House

prohibited the task force from interviewing any witnesses, or prohibited them from bringing any charges or seeking any indictments. Do you still feel that way today?

Mr. LA BELLA. Yes. I had finished my work then, so nothing has

changed. I didn’t do any more work with the task force, but we had

adequate staff. You know, there were legitimate debates inside the

Department as to one road or another, but I think we did—as long

as I was there, we did the job as best we could.

Senator LEAHY. And whether you agree or disagree with any decisions of the Attorney General, do you still feel that her integrity

and good faith and independence are clearly obvious?

Mr. LA BELLA. She made no decisions, you know—and I have

said this before—my perception is she made no decisions to protect

anyone. You know, she listened to the advice of certain people and

she followed that advice.

Senator LEAHY. I worry, as your testimony has indicated you do,

about anything that may come into question of second-guessing

what prosecutors do because of all the decisions they have to make

every single day. I am not suggesting that this committee does not

have the authority and the right to look into aspects of the Department of Justice. Of course, it does.

But we seem to have those who are going to be the prosecutors,

the line prosecutors and all—we have gone a long way from decades ago where you put the county chairman’s weak-brained nephew in for a place, for a job. We now have extraordinarily good people. At least that has been my experience in the U.S. attorneys’ offices I go to.

So because of that, do you think if we are going to ask questions,

they ought to be at least at the supervisor level and not at the line

prosecutor level?

Mr. LA BELLA. Yes, I think it is helpful to keep line people out

of it. Supervisors are responsible for the decisions that are made

ultimately. And, you know, if heads need to roll, theirs should be

the heads that roll. The line assistants generally—and, again, I

have filled all these positions. They are just doing their job, and

they do them to the best of their abilities. And we are supposed to

as supervisors—when I was a supervisor, we are supposed to be

providing them guidance, and if we fail, then we should be held responsible for it.

Senator LEAHY. In fact, would it be safe to say when you were

a line attorney, there were times you would probably come in and

do a devil’s advocate debate on whether a case should be brought

or not?

Mr. LA BELLA. Oh, sure, yes.

24

Senator LEAHY. But you didn’t want to see that next week before

a congressional committee?

Mr. LA BELLA. Right. I mean, you would have to take positions

and argue the other side of a position very often to flesh out all

the pros and cons, and that was a technique we used in the U.S.

attorneys’ offices all the time.

Senator LEAHY. Now, we have had criticism of the plea bargains

struck and the results obtained in the Johnny Chung, Charlie Trie,

and John Huang cases prosecuted by the Campaign Finance Task

Force. Did you have involvement with any of these plea agreements

at any stage?

Mr. LA BELLA. No, no. I did the Chung agreement, but that is

the only one I did. I think everything else happened after I left.

Senator LEAHY. On Chung, did you approve the final version of

that agreement?

Mr. LA BELLA. Yes, yes, I did.

Senator LEAHY. And, to your knowledge, did these include provisions requiring cooperation?

Mr. LA BELLA. I put it in my agreement. I know that one.

Senator LEAHY. And was that important to you?

Mr. LA BELLA. It was important to me, yes.

Senator LEAHY. And why was that, sir?

Mr. LA BELLA. Just to advance the investigations, and it is

standard in a situation like this where you believe someone has information to provide that you want to make sure that you have an

agreement and an understanding with that person that they have

an obligation to provide that to you. So they are not just doing it

out of the goodness of their heart. You want to make sure that that

is part of the deal, part of the final agreement with that person.

Senator LEAHY. In fact, it is probably unusual that somebody

might be making a plea just because they want to be a good citizen.

Mr. LA BELLA. Generally, people don’t plead guilty to crimes because they want to be good citizens. They generally plead guilty because they are guilty and if they can cooperate, they want to get

themselves out of a jam and advance the investigations.

Senator LEAHY. In fact, is it safe to say, given the appropriate

circumstances, that has always been a very effective tool for the

prosecutor?

Mr. LA BELLA. Cooperation agreements?

Senator LEAHY. Yes.

Mr. LA BELLA. Very effective.

Senator LEAHY. Mr. La Bella, as I say, it is good to see you

again. Maybe sometime at a later moment, we can talk about some

of our shared ancestry. But I appreciate you being here and I appreciate the difficult situation you are in, but I also appreciate very

much your feeling that—or your very candid assessment both about

the integrity of the Attorney General, but also about the fact that

these are issues where indeed there are debates that go on and differences of opinion. Thank you.

Thank you, Mr. Chairman.

Senator SPECTER. Thank you, Senator Leahy.

Senator Sessions.

25

Senator SESSIONS. Mr. La Bella, the question and what your

memo was directed to was simply whether or not an independent

counsel should be appointed. Is that correct?

Mr. LA BELLA. That is correct.

Senator SESSIONS. In other words, the Federal law says if there

is a sufficient amount of evidence involving a covered person that

an independent counsel shall be called.

Mr. LA BELLA. That was the law then, yes.

Senator SESSIONS. And that is gone now.

Mr. LA BELLA. That is gone.

Senator SESSIONS. But it was the law then, and you weren’t making an opinion as to whether or not the prosecution should ultimately go forward. In other words, even if there were a violation

of a law, a prosecutor might decline to prosecute it, for various reasons.

Mr. LA BELLA. Right, and there is also the discretionary clause,

too. It is not only the mandatory clause, but there was a discretionary clause if the Attorney General believed there was a conflict

of interest or some reason why the Department should not do it.

It was not mandatory. There was also that discretion to do it.

Senator SESSIONS. Well, the whole deal of the independent counsel and the covered person is that the Congress did not desire that

the person serving at the pleasure of the President, the Attorney

General, should be called upon to make decisions in areas of tough

criminal law involving the President or his highest associates. Isn’t

that right?

Mr. LA BELLA. I mean, I have been through the legislative history and that is my understanding of it.

Senator SESSIONS. And so that was why you felt like somebody

else ought to make this decision other than the Attorney General?

Mr. LA BELLA. Yes, and I felt a lot of these calls were very close

calls and what we call jump balls and they could go either way.

And in order for the people to have faith in the integrity of the decision, it was always my position that it was better made by someone who was independent.

Senator SESSIONS. And you did note in your remarks earlier that

based on what you knew then, it might be that a prosecutor would

not go forward with the case, but it is always possible something

else would come up.

Mr. LA BELLA. Absolutely.

Senator SESSIONS. And isn’t it a fact, Mr. La Bella, just based on

your core experience as a prosecutor—and I was in it 15 years—

isn’t it a fact that the real deal sometimes comes down to how determined a prosecutor is when conducting plea bargains and negotiations with defendants, how determined they are to insist that

that person tell the full truth?

Mr. LA BELLA. Well, sure. I mean, the prosecutor is probably one

of the most important elements in that formula because he or she

really controls whether or not the plea is accepted, you know,

whether or not it gets to court because he or she has to determine,

yes, I am going to accept this plea.

Senator SESSIONS. Well, let’s say you have a defendant that

wants to plead guilty, and you have a case against him, but he

26

wants a sweetheart deal and wants to tell you about one-tenth of

the truth. That is not unusual, is it?

Mr. LA BELLA. No. I mean, you——

Senator SESSIONS. And so it is down to that prosecutor’s personal

judgment and integrity on whether or not they insist that the full

truth is—you probably, like I have, have rejected pleas by the fact

that, well, that is about half the truth, Mr. Defendant, and if you

are not telling the whole truth, I have got enough to convict you

and you can go to jail. Is that right?

Mr. LA BELLA. There are stories about me in the Southern District of New York where I would pound the table and leave a proffer session and call people and tell people that they weren’t——

Senator SESSIONS. But that is your obligation, isn’t it?

Mr. LA BELLA. It is your obligation.

Senator SESSIONS. I mean, that is your duty.

Mr. LA BELLA. It is.

Senator SESSIONS. If you are going to put that person on the witness stand or say he deserves a recommendation of leniency, he or

she should tell the full truth.

Mr. LA BELLA. Right.

Senator SESSIONS. Now, I guess what I am saying to you is, isn’t

that another reason you need an independent counsel? Aren’t there

some areas in which the person prosecuting the case has some reluctance to do so? There are a lot of stages in the case in which

they could perhaps be a bit soft and not pursue as aggressively as

they could.

Mr. LA BELLA. Cooperation is a process.

Senator SESSIONS. And I believe the Radek memorandum—Mr.

Radek is not a trial lawyer?

Mr. LA BELLA. He may have tried some cases.

Senator SESSIONS. Not in your recent knowledge, is that right?

Mr. LA BELLA. Not in my recent knowledge, no.

Senator SESSIONS. There is a difference when somebody is trying

to evaluate a case who knows what the evidence is going to be and

has some experience about how a jury will react to it, and I think

you are correct.

With regard to the Attorney General, the Attorney General had

never served in the Department of Justice, had she, before becoming Attorney General?

Mr. LA BELLA. Not that I am aware of.

Senator SESSIONS. Had never prosecuted RICO cases or Hobbs

Act cases or traditional tough Federal corruption cases, had she?

Mr. LA BELLA. I don’t believe so. I don’t know her background

as far as——

Senator SESSIONS. Well, she was just basically a State prosecutor

that supervised a substantial staff of people involved in murders

and robberies and rapes and things that are very important. But

it is a different category of crime, some of these white-collar corruption cases, aren’t they?

Mr. LA BELLA. They are peculiar.

Senator SESSIONS. Well, I would just say that under those circumstances I think you were correct that there was a basis for a

case to be brought here.

27

Let me ask you this: has there been a declination by the Department of Justice on the matters you recommended an independent

counsel on as of this date?

Mr. LA BELLA. I am assuming so. I assume that they just decided

there was nothing that warranted triggering the Independent

Counsel Act. But I don’t know. I was gone then, so I don’t know.

Senator SESSIONS. Well, there is something good to be said for

that independent counsel who issues a report and declines to prosecute and sets forth some reasons why. Isn’t that healthy when you

are involving the highest level of the Government of the United

States?

Mr. LA BELLA. That would have been a nice closure to this.

Senator SESSIONS. I don’t think we have had that. I think it has

soured and been a bitter pill in the body politic. And the Attorney

General—the chairman of this committee and the chairman of this

subcommittee, Senators Hatch and Specter, and others, have urged

her to not do this, to allow it to go forward, as you recommended,

and we would have been a lot better off. There is no doubt in my

mind about this.

Let me ask this one more thing, and I know the chairman has

a lot to ask. When you interviewed the Vice President, and during

the other interviews of the Vice President that we are aware of,

was he ever asked specifically and in detail about the Buddhist

temple fundraising activity?

Mr. LA BELLA. I only participated in one interview, and that was

the one in November 1997, and he was not asked any questions in

that interview.

Senator SESSIONS. And you supervised that?

Mr. LA BELLA. I was at that interview.

Senator SESSIONS. Did you supervise that interview?

Mr. LA BELLA. Yes. I mean, myself, Lee Radek, the line assistants who were conducting the investigation, and the FBI agents

who were conducting the investigation were there.

Senator SESSIONS. And why didn’t you ask about that?

Mr. LA BELLA. Because the understanding was that we had a

very particular area that we wanted to talk to him about. That was

really about the Pendleton Act and the phone calls from the Government office and the use of the telephones. That was the investigation that was underway at that point. We had time pressures.

We had to get that interview conducted with respect to that particular investigation.

It was our understanding that if at any time we needed to go

back to talk to the Vice President, he was going to be made available. I don’t know that the Buddhist Temple case was ripe at that

point to ask him questions about it. But as that case developed and

the Maria Hsia case developed, you know, maybe they went back

to him. I don’t know.

Senator SESSIONS. Do you know or not know whether they——

Mr. LA BELLA. I don’t know. I don’t know if they did or not.

Senator SESSIONS. Mr. Chairman, I am through.

Senator SPECTER. OK, thank you very much, Senator Sessions.

Mr. La Bella, when you accurately say that the judgment is only

as to continuing to investigate, it is not possible for an investigator

28

or prosecutor to know until the investigation is finished whether

there will be a basis for prosecution or not.

Mr. LA BELLA. That is absolutely true, and the decision has to

be made by that person at the end of the process.

Senator SPECTER. Could be, might not be, might or might not be,

depending on the evidence. But the independent counsel statute is

designed to remove the Attorney General from making that decision as to covered people where you have the close association or

the appointing power, as with the President or where there is a

conclusive conflict of interest a la the enumerated people who are

so-called covered people, correct?

Mr. LA BELLA. Right. If there is sufficient information from credible sources, the Act is triggered.

Senator SPECTER. And that is what you call the mandatory provision.

Mr. LA BELLA. Right.

Senator SPECTER. The law says we shall proceed with the investigation, and if sufficient evidence occurs, is uncovered, to proceed

to appoint independent counsel.

Mr. LA BELLA. Right.

Senator SPECTER. And then the second part which you talked

about, the discretionary part, says may proceed where there are

reasons to conclude that there is a conflict of interest with somebody else, although not the lofty so-called covered persons.

When Senator Leahy had started to ask you about dissent among

the career personnel, career prosecutors, you got off on the discussion as to who is a career prosecutor and who is not. I don’t think

you came back to the question of whether there was dissent. And

you mentioned Mr. Radek, and Mr. Radek wrote a memorandum

against appointing independent counsel because, as he put it, there

was not evidence of a willful violation. Is that the essence as to the

Radek memorandum?

Mr. LA BELLA. It was a lengthy memo. I know that that was

probably in there somewhere, and I don’t know what specific point

that was addressed to. I don’t know exactly what he was talking

about there. I know he used those words. I think he used those

words, but——

Senator SPECTER. You wrote a reply to Mr. Radek’s memorandum, correct?

Mr. LA BELLA. Well, I wrote an addendum to my interim report,

yes, I did.

Senator SPECTER. OK, in the nature of a reply. You did it once

Mr. Radek had written and you wanted to respond to some of his

points.

Mr. LA BELLA. Right.

Senator SPECTER. Mr. Radek’s standard was disagreed to by others in the Department, was it not? Assistant Attorney General

James Robinson disagreed with the standard which Mr. Radek had

stated?

Mr. LA BELLA. I don’t have a copy of the Robinson memo. That

was——

Senator SPECTER. There is no way you could. The Department of

Justice won’t let us bring it into this room. It is not sanitized.

29

Mr. LA BELLA. Yes. I don’t know what he said. That was after

my tenure.

Senator SPECTER. Well, we looked at it last night together, Mr.

La Bella.

Mr. LA BELLA. Yes.

Senator SPECTER. We will get into this at a later time with the

committee, so in the absence——

Mr. LA BELLA. But there was something about the standard that

he disagreed with. I don’t know what it—I don’t remember as I sit

here now what exactly it was, but it was something about the

standard.

Senator SPECTER. Well, the specific language which Assistant Attorney General Robinson, head of the Criminal Division, picked up

in disagreeing with Mr. Radek was that there was a rejection by

Mr. Radek of willful intent. Mr. Radek’s conclusion was you

couldn’t prove willfulness, and Mr. Robinson responded that that

wasn’t determinative for stopping the investigation because the

statute specifically left open that issue unless there was clear and

convincing evidence. So Mr. Robinson concluded Mr. Radek had applied the wrong standard in disagreeing with your recommendation

about independent counsel.

Does that refresh your recollection?

Mr. LA BELLA. Yes, that seems right, and I had said in my memo

that I thought he applied the wrong standard because he used sufficient evidence from a credible source. I said it is information. He

said that is a silly distinction. I thought it was a real distinction.

Senator SPECTER. Pretty big difference for a prosecutor as to

whether it is evidence or information.

Mr. LA BELLA. Well, if I go to a Federal judge and say, Your

Honor, I offer this information, he is going to look at me and take

my head off, or she is going to take my head off. If I offer evidence,

then I have a colorable claim to get into evidence.

Senator SPECTER. But then you are a career prosecutor.

Mr. LA BELLA. Right. I think there is a difference between evidence and information.

Senator SPECTER. Well, of course there is.

Mr. LA BELLA. And I think that the Congress, when they wrote

it, they intended it.

Senator SPECTER. Well, for the record, state what the difference

is between evidence and information.

Mr. LA BELLA. I mean, evidence is more directed, evidence is

more substantive; it has the earmarks of reliability. Information

can be much more generic, can be much more general. Information

can be hearsay. Evidence, if it is hearsay, has to have an exception

to get into evidence. I mean, lawyers just know it. I mean, you

know the difference between evidence and information.

Senator SPECTER. Evidence is the standard for what you can say

in a courtroom, compared to information which is the standard for

what you can say on the floor of the Senate.

Mr. LA BELLA. Right. I mean, evidence is what is admissible in

a court of law. Information is anything that can be heard on the

Internet or with your own ears.

30

Senator SPECTER. So when you proceed to have an investigation

based on information, it is obviously an articulation of a much

lower standard.

Mr. LA BELLA. A much lower standard.

Senator SPECTER. And when Mr. Radek is requiring evidence, he

is not following the standards set for by the Congress in the independent counsel statute.

Mr. LA BELLA. In my effort to be fair to him, he just argues that

they use the words interchangeably, but for him they mean the

same thing. And Public Integrity has always applied the right

standard; they just interchange the words and it is form over substance. And that was his point in his addendum, as I recall. I

mean, I disagree with that. I don’t—— Senator SPECTER. These words have a lot of specific meanings for

lawyers in courtrooms, or for application of standards of statutes,

don’t they, Mr. La Bella?

Mr. LA BELLA. Well, I mean, as a former prosecutor, you deal

with the laws that Congress passes. You don’t deal with the laws

as you think they should have been passed.

Senator SPECTER. When the comment is made that there was

dissent among career prosecutors, is that true? To your knowledge,

was there dissent within the Department of Justice among career

prosecutors, if you move out Mr. Radek, whom we have already

said applied the wrong standard and interchanged evidence and information?

Mr. LA BELLA. It is hard for me to know who was in the debate

because I wasn’t in the debate after I left. But I mean, you know,

Jim Robinson was a former U.S. attorney, so I mean I don’t know

how—I mean, you have to ask these people how many cases they

tried, you know, how many investigations they have conducted. I

mean, people call themselves career prosecutors, and I just don’t

know. I don’t know the resumes of all those people.

Senator SPECTER. How many cases would you have to try to

qualify? I want to know if I qualify, in your opinion.

Mr. LA BELLA. I think it depends. I think a Federal prosecutor,

after about eight or nine trials, can be a trial lawyer because, you

know, they can be month-long trials.

Senator SPECTER. If you are only a district attorney, more than

that?

Mr. LA BELLA. Well, district attorney—they usually put like 150

under their belt each year, so I think after about 2 or 3 years they

are pretty much seasoned trial lawyers.

Senator SPECTER. Mr. La Bella, coming back to the information

as to the others, there is a section of your report which deals with

Loral on the technology transfer from Loral to the People’s Republic of China. And there was a recommendation as to proceeding as

to an investigation for the chief executive officer of Loral, Mr. Bernard Schwartz, who had contributed some $1,500,000 to the Democratic National Committee. And there was the judgment that you

had articulated that if the matter was to be opened as to Mr.

Schwartz, it ought to be open to President Clinton as well.

Mr. LA BELLA. Let’s assume that the allegation that appeared in

the paper was that, you know, someone had given contributions

and, as a result of the contributions, had received some benefit.

31

Senator SPECTER. A presidential waiver for technology transfer.

Let’s put that in the assumption.

Mr. LA BELLA. OK.

Senator SPECTER. You are postulating a hypothetical question.

Mr. LA BELLA. Hypothetical. And if, hypothetically, you are going

to investigate the person who gave the contribution because you

think something was wrong with that because they were seeking

a quid pro quo, then it seems to me that part of the area of investigation would be the person who received the contribution. I mean,

that just is my analysis, you know, so——

Senator SPECTER. So, hypothetically, if you proceed as to A, Mr.

Schwartz, you would proceed as to B, Mr. Clinton, hypothetically?

Mr. LA BELLA. Well, hypothetically, I would think you would

have to because it is part of the same subject area, but that would

be just my reaction as a—that would be my reaction as an investigator.

Senator SPECTER. Mr. La Bella, in the second part of the report

which you submitted, dated August 14, 1998, you raised the issue

of further investigation, ‘‘The Vice President may have given false

statements.’’ What was your approach on that particular item?

Mr. LA BELLA. Well, by that time, what had surfaced—in addition to what was in my initial report of July, the Strauss memo

had surfaced. In my initial report, I think I was basing it on the

Ickes memorandum and the fact that it was generally discussed in

the memos that went into the Vice President from Ickes. I concluded that, you know, it was inconceivable to me to rule out that

it was an issue that he knew nothing about.

After the report, the Strauss memo surfaced, and then following

that the Leon Panetta interview had occurred, I think, before my

addendum, or at just about the same time, and those were additional facts that came forward.

Senator SPECTER. And your report made a comparison of the Vice

President’s not recalling the Ickes memoranda, the 13 memoranda;

as you put it, ‘‘reminiscence of the lack of recollection of the Buddhist Temple matter.’’

Mr. LA BELLA. That sounds like a phrase I used, yes.

Senator SPECTER. It sounds like a phrase you used?

Mr. LA BELLA. It sounds like a phrase I used.

Senator SPECTER. With respect to your recommendations, Mr. La

Bella, with which I agree totally, but I think it would be good for

the record to amplify why you think that these campaign finance

violations ought to be categorized as felonies as opposed to misdemeanors.

Mr. LA BELLA. I think for two reasons. Number one, it sends a

message publicly that we are going to take these things seriously,

because for years I think we have not taken them seriously because

they have been denominated as misdemeanors. And when you denominate something in the Federal law as a misdemeanor, that

sends a message to prosecutors. That means no one really cares

about it, and it is something that you use when you really want

to give somebody a good deal. You would look for a misdemeanor

to get them out of their predicament, and that is a fact of life that

prosecutors view misdemeanors as an escape hatch, as a way out.

32

Felonies are what prosecutors are about; that is what they do.

If conduct is important enough to be brought into a Federal criminal courtroom, it is important enough to be a felony. And I think

it sends a public message that these are serious—this is serious

conduct, and if you violate this conduct, it goes to the integrity of

our electoral process and therefore we are going to take this seriously.

It also gives the prosecutor much more room to move when he

or she is investigating a crime. You know, if you have a misdemeanor, you have got a floor and there is nowhere you can go

except a get out of jail free card and let them walk out the door.

If you have got a felony, at least you have got some gradations,

and if a case requires a misdemeanor disposition, then you can go

down to a misdemeanor. But if it requires and screams out for a

felony prosecution, you can do your job and use a felony prosecution.

I think the other issue is the statute of limitations has to be

changed, and there are other issues about the present state of the

law. But I think that goes a long way—making it a felony goes a

long way into showing how serious we consider this conduct.

Senator SPECTER. Before moving to the statute of limitations

issue, because I want to take that up specifically with you because

it is a very important provision, the felony categorization also carries a substantially stiffer penalty.

Mr. LA BELLA. Right, and I am sorry. That is really the second

prong of it because you can use that obviously to extract cooperation. Now, some people are repulsed by the idea that a prosecutor

can use a heavy jail sentence as a mechanism to extract cooperation from someone. But if you have served as a prosecutor, you

know people don’t willingly cooperate, especially against their

friends in a white-collar case. It just doesn’t happen unless you

have got something to hold over their heads.

And fortunately for prosecutors—and I know the public sometimes doesn’t like to hear this—but, fortunately, you can use that

severe sanction as a way that someone can, you know, give full cooperation and you can make sure that you are getting truthful testimony before they get any break whatsoever. So it is a tool that

prosecutors use, so it is an important tool and if you have that tool,

you can advance investigations.

Senator SPECTER. And the statute of limitations, for explanation,

is the period of time in which a prosecution must be brought after

the acts are completed.

Mr. LA BELLA. Correct.

Senator SPECTER. And you have made a recommendation that

the statute of limitations be extended from 3 to 5 years?

Mr. LA BELLA. Yes.

Senator SPECTER. And would you amplify why you think that is

an important legislative change?

Mr. LA BELLA. Well, virtually all Federal statutes are 5 years.

So if any of us commit a Federal offense, other than an election violation, the prosecutor’s office has 5 years—the FBI or Customs or

Immigration, whatever agency is going to investigate, and the prosecutor have 5 years to investigate and bring that case to closure,

bring that case to an indictment.

33

Three years is an incredibly short amount of time when you are

dealing with a white-collar case; it can be. It sounds like a long period of time, but when you are talking about hundreds of thousands

of documents that have to be reviewed and many witnesses that

have to be interviewed and grand-juried, it goes very rapidly, especially if the prosecutor doesn’t learn about the conduct until 2 years

after it is committed, or 21⁄2 years. Then you have 6 months to

close your case, which is virtually impossible.

So you have got to understand that prosecutors don’t learn about

the conduct always right when it happens. It could be a year, it

could be 2 years in a white-collar situation before someone comes

forward and drops a dime on someone, as we say, and says, hey,

you should look at this, because, you know, sometimes it is a disgruntled employee. So you never know where you are going to get

the lead from in a white-collar case, but 5 years is appropriate.

Senator SPECTER. Mr. La Bella, when you conducted your inquiry, were you aware of the issue of the e-mails that were not collected by the White House that may have been relevant to your investigation?

Mr. LA BELLA. The task force was aware, and I was in contact

with White House counsel about the e-mails during our investigation. We did broach that subject. They had a lot of difficulty pulling

the e-mails up and it was a constant source of discussion between

myself and White House counsel.

Senator SPECTER. Did you feel at that time or do you feel now

that you got an adequate response from the White House on the

e-mail issue?

Mr. LA BELLA. White House counsel was always very straightforward with me and I never had a problem with them. I don’t

know if they were being given the information, accurate information, but I always trusted what they told me. I never had reason

to question what either Lanny Brewer or Chuck Ruff told me in

that regard. But I don’t know—because they were depending on

other people to give them the information, I don’t know if they

were getting the straight information.

Senator SPECTER. Mr. La Bella, there is a distinction as to in an

electioneering message which contrasts with the two categories of

advocacy ads and issue ads. The ad that I read at the outset of the

proceeding is categorized as an issue ad because it doesn’t say ‘‘vote

for x, vote against y.’’

There is an in-between message which is called an electioneering

message, which is a distinction made by the Federal Election Commission and was adopted by the Tenth Circuit, although not mentioned in the Supreme Court decision on the Colorado case.

The FEC has concluded that electioneering messages should not

be paid for with soft money, and the FEC confirmed that. Yet, the

Attorney General found clear and convincing evidence that the

President and the Vice President lacked intent. Wouldn’t that come

under the category, as you put it, of jump ball or ultimately an

issue for a jury?

Mr. LA BELLA. That you do so in the context of the electioneering

message?

Senator SPECTER. Yes.

34

Mr. LA BELLA. You know, not having read the whole thing, I

think there were a series of close calls. You know, that may be one

of them. I would really have to investigate that further, but I think

that certainly may be one of them.

I think you bring up a good point, though, about the FEC, and

part of the report that I think is worth talking about is the fact

that the FEC is absolutely impotent by design. And I have said

that before and I said it in the report, and I think if there is going

to be some way to—there has to be some way to address that. It

can be a significant organization just like the SEC is and it can actually root out campaign financing violations, but it needs to be restructured. It can’t operate by committee and it just is absolutely

ineffective.

Senator SPECTER. Your report included evidence that high-ranking officials from the Democratic National Committee were aware

of illegal contributions from both foreign donors and executive

branch officials. Was there a sufficient basis for appointment of

independent counsel on the basis of the failure of the White House

to take action there?

For example, on the issue of campaign contributions to the President, when it was determined that Charlie Trie had gathered for

the legal defense fund contributions which were inappropriate,

then, as your report specified, Mr. Trie continued to raise money

for the Democratic National Committee without the President’s

campaign fund alerting the recipients of additional funds raised by

Mr. Trie that they came from inappropriate or illegal sources.

Would you comment on that?

Mr. LA BELLA. It gets very close to the nuts and bolts, but I will

try to do it in a sort of generic way.

Senator SPECTER. Well, do it hypothetically, since you don’t like

nuts and bolts.

Mr. LA BELLA. Well, I will try to use a corporate analogy. If an

individual is on the board of directors of a charitable corporation

and is the heart and soul of that charitable corporation, and in the

context of that charitable corporation inappropriate conduct occurs—someone gives money to the company that is questionable,

not per se illegal but questionable, comes from questionable

sources, and the charity decides not to take that money. They make

a determination that we don’t like this, it doesn’t fit.

Now, if the corporation were to take that same money, it would

be illegal, as opposed to the charity. The charity—it wasn’t illegal

for it to take it; it was just inappropriate. But for the company, it

would be illegal to take that money.

Now, if on the board of directors of that charity is also a member

of the board of directors of corporation x, and if he or she sits at

corporation x and watches the same person come in with similar

money, query: do you have an obligation to advise your fellow directors for the company that, you know what, in my other life, with

my other hat on, this conduct happened with this person, therefore

I think you may want to look at closely his activities in connection

with this corporation. I think we have an obligation to do that.

Now, I believe that is a sound principle of law. I know Mr. Radek

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where in the middle. But as a prosecutor, that is the way I analyzed it.

Senator SPECTER. Senator Sessions, do you have anything further to inquire on?

Senator SESSIONS. Well, let me just say that Mr. Radek’s position

was Chief of Public Integrity?

Mr. LA BELLA. Yes, sir.

Senator SESSIONS. And that is a political appointment of the Attorney General?

Mr. LA BELLA. I don’t know.

Senator SESSIONS. Or a discretionary appointment of the Attorney General. It is not a career-type position. He is a career attorney. He can drop back to a career position, but he was temporarily

holding a position at the pleasure of the Attorney General. Isn’t

that right?

Mr. LA BELLA. I believe the position is appointed by the Attorney

General.

Senator SESSIONS. All of the chief of divisions, I think, are that

way. So you are not aware of any career prosecutor that ever disagreed with your opinion on this matter?

Mr. LA BELLA. It really depends on who you—I mean, I don’t

know the resumes of all the people in the Department when I was

there and when I left, and there may have been people who read

and said, no, he is—— Senator SESSIONS. But you are not aware of it?

Mr. LA BELLA. I am not aware of it.

Senator SESSIONS. All right. I think that even though this might

have been a case, the phone calls of the White House-type case

using Government phones, that ultimately did not need to result in

a full prosecution, I believe you are correct that there was ample

evidence, and certainly information, to indicate that a law had been

violated, and therefore an independent counsel should have been

called. And they could have concluded the case one way or the

other, and they could have declined officially and stated their reasons, and this matter would have been a lot better off and this Nation would have been better off.

So, that has concerned me about this, and it does appear that the

Attorney General reached out and made a decision here that leaves

people to be able to say that she did not use objective decisionmaking processes. I am not happy with that. I think that was an

error in the Department of Justice.

With regard to the e-mails, were you aware of all the e-mail material that has been in the paper, and that certain people were told

not to disclose this information? How much did you know about

what was available from the computer search?

Mr. LA BELLA. We were told that the system was limited and it

was an archaic system and it would take a long time to retrieve

e-mails. And it was a very slow process, and I knew they had called

in a company to try to retrieve e-mails, but it was a very slow process. And I think it was 8 months or even longer before we could

hope to get certain e-mails. That is what I was told when I was

there and—— Senator SESSIONS. And who was telling you this, the White

House counsel?

36

Mr. LA BELLA. The White House counsel, right. That is my best

recollection. It was a long time ago, but I think it was something

like that. It was a long time to retrieve them because it was an archaic system.

Senator SESSIONS. Well, apparently, that is not accurate from

what we read in the papers.

Mr. LA BELLA. Yes. I don’t know. I mean, I have read the same

articles.

Senator SESSIONS. So you said White House counsel was straight

up with you. Apparently, perhaps not?

Mr. LA BELLA. Well, I don’t know if they were getting—I don’t

think they were actually doing the investigative work. I think they

were relying upon other people to tell them on the staff what could

you do and what could you not do as far as retrieval.

Senator SESSIONS. Well, a lawyer has an obligation to make accurate representations under those circumstances. You just don’t

do it off the seat of your britches when you tell the chief counsel

that you can’t get documents. You should have a basis for that,

should you not?

Mr. LA BELLA. Yes, and they weren’t telling us they couldn’t get

them. They said that it was going to take a long time, and I don’t

know what happened with respect to the e-mails, whether they got

them or not, the task force. I just don’t know.

Senator SESSIONS. I would just add, Mr. Chairman, I agree very

much that the 3-year statute of limitations is too short. In fact, in

some ways it needs to be longer than the normal 5 because these

things take time. Election issues and those kinds of things take

time.

I suspect—and I have seen it in my State, a short statute of limitations on election cases—that if you lose the election, it takes the

new guy a long time to figure out what is happening. By the time

he does, the statute has run. It really is a problem, and has complicated some of my efforts as attorney general in State court.

So many of the cases involving corruption and fraud and extortion, would you not agree, Mr. La Bella, get prosecuted in the

fourth and fifth year of the statute of limitations?

Mr. LA BELLA. Very often, we are right up against it before you

bring the indictment.

Senator SESSIONS. It just takes a long time, and 3 years is exceedingly short. In these kinds of cases, if anything, it should be

longer than 5, and I thank you for raising that point.

Senator SPECTER. Thank you, Senator Sessions.

Before we wrap up, just one more factual point. The Vice President admitted making these calls in March 1997, but there was no

investigation started by the Public Integrity Section or anybody

else in the Department of Justice until July 1997, some 4 months

later. Do you know why there was that delay?

Mr. LA BELLA. I wasn’t privy to that, but I remember the fact

that before that time they thought they were all soft money calls.

And it wasn’t until around July that someone realized, based on

documents, I think, or testimony, that—well, I think it was documents because there was no testimony at that point—that there

was a hard money/soft money component to the calls. I don’t think

it was until July that someone realized that.

37

The Attorney General initially—and I know this all from, you

know, documents I have seen—said, well, this is all soft money,

there can be no violation. And then later it was determined that

there was hard money component to it, and therefore I think the

investigation was started then.

Senator SPECTER. But the question wasn’t even raised, no inquiry, for some 4 months.

Mr. LA BELLA. Right.

Senator SPECTER. Well, Mr. La Bella, we thank you very much

for coming. I believe that your testimony is extraordinarily important. I believe your report is extraordinarily important.

In September 1997, the Governmental Affairs Committee was

conducting an investigation into campaign finances, and we had a

closed-door session with the Attorney General, the FBI Director

and the CIA Director where we found out that the CIA had information about what was in the FBI’s files which the FBI hadn’t disclosed to the Governmental Affairs Committee.

And that was a very rugged session; we broke some furniture. It

was a closed session in the Intelligence Committee room. And it

was shortly thereafter that you were brought in. The Attorney General did not want to appoint independent counsel, but she wanted

to come close to it, and she brought you in as an experienced prosecutor, 17 years’ experience, or 15 at that time, whatever it was,

and known for integrity.

And as soon as you wrote your report on July 16 and it became

public knowledge, in 1998, I wrote to the Attorney General asking

her for it, and 1 week later, as I put in the record earlier, renewed

those requests and had the chairman of the full committee join me

in those requests. And we had started earlier than that, even back

in 1997, April 30, asking these questions in a very pointed way

about the soft money, and had asked the Attorney General for a

judgment as to violation of law.

Those letters will be put in as a part of this record. They have

been put in the Congressional Record.

[The letters referred to follow:]

U.S. SENATE,

COMMITTEE ON THE JUDICIARY,

Washington, DC, July 22, 1999.

Hon. JANET RENO,

Attorney General of the United States, U.S. Department of Justice, Washington, DC.

DEAR MADAM ATTORNEY GENERAL: We are writing to request that you provide to

the Judiciary Committee all documents in the Department’s possession relating to

(1) the Department’s investigation of illegal activities in connection with the 1996

federal election campaigns, and (2) the Department’s investigation of the transfer

to China of information relating to the U.S. nuclear program. Your submission

should include a copy of Charles La Bella’s report recommending appointment of a

campaign finance independent counsel. In addition, your submission should include,

but not be limited to, any and all memoranda, reports, agreements, notes, correspondence, filings and other documents pertaining to:

1. The allegations against, cooperation from and plea bargains with Peter H. Lee.

2. The allegations against, cooperation from and plea bargains with Johnny

Chung.

3. The allegations against, cooperation from and plea bargains with Charlie Trie.

4. The allegations against, cooperation from and plea bargains with John Huang.

5. The Department’s reported decision not to prosecute Mr. Wen Ho Lee.

6. Any other individuals who were or still are under investigation by the Department for campaign finance violations.

38

7. Any other individuals who were or still are under investigation by the Department for passing nuclear technology to China.

These matters—for which we now seek documents—are at the heart of this Committee’s oversight responsibilities. Indeed, it would be difficult to imagine more compelling cases for this Committee’s oversight than those involving the Department’s

investigation and prosecutorial decisions concerning the possible theft of the nation’s

nuclear secrets and the possible violation of our campaign finance laws. The fulfillment of these oversight responsibilities is imperative to ensure that our national security and campaign finance interests are adequately protected, and to identify any

shortcomings in current law or procedure so that any necessary corrective action can

be taken in a timely fashion. Moreover, the information we seek herein is imperative if this Committee is to meaningfully address various matters left outstanding

following your appearances before this Committee on March 12, May 5 and June

8, 1999.

We would appreciate a response within ten days as to whether you intend to comply with this request, including a timetable for document production.

Thank you for your cooperation.

Sincerely.

ORRIN G. HATCH.

ARLEN SPECTER.

Additional signatures for the July 22, 1999 letter to Attorney General Reno signed

by Senators Hatch and Specter.

BOB SMITH.

JON KYL.

JEFF SESSIONS.

STROM THURMOND.

CHUCK GRASSLEY.

MIKE DEWINE.

U.S. SENATE,

Washington, DC, September 29, 1999.

Hon. JANET RENO,

Attorney General, Main Justice Building, Washington, DC.

DEAR ATTORNEY GENERAL RENO: On behalf of the Senate Judiciary Committee

Task Force on Department of Justice Oversight, I am writing to request information

referred to in the U.S. Department of Justice, Office of the Inspector General Special Report on the Handling of FBI Intelligence Information Related to the Justice

Department’s Campaign Fiance Investigation (July, 1999). To conduct its oversight

of the Department’s activities, the Judiciary Committee Task Force needs to be able

to assess the reliability of the ten pieces of intelligence information described in the

report, and to do so in the context of any prosecutions, plea agreements or other

actions by the Justice Department to which these ten pieces of information pertain.

Therefore, the Task Force requests the ten pieces of intelligence information mentioned in the report, as well as any analysis available to the Department of Justice

related to the validity of the information and its suitability for use in a prosecution

or relevance to a plea agreement.

Any classified information responsive to this request should be delivered to the

Office of Senate Security, Room S407, The Capitol, to the Attention of Mr. Dobie

McArthur.

Your prompt attention to this request is appreciated.

Sincerely,

ARLEN SPECTER.

Senator SPECTER. But we have persevered, and these are big, big

questions as they will affect the future of independent law enforcement. The independent counsel statute, I predict, will come back.

It is an oddity that none was appointed here and we had the Starr

investigation, and then Judge Starr recommends against independent counsel. But we need to think these matters through, and

your work is very important.

Your report is still under subpoena, Mr. La Bella. We haven’t

physically taken it from you, and don’t intend to, but the subpoena

remains. And we are discussing in the committee that some of the

39

members believe this ought to be in the public domain, as I do, and

we want to be as careful as we can not to politicize this matter.

We have been very delicate in going through the matters today,

and you have hypothesized here and there and you have referred

to some matters in the public domain.

But I think a few nuts and bolts have been spread upon this

record; as we lawyers say, spread upon the record, I think, in the

public interest. And we are going to pursue it. We are not going

to be worn out by these matters, however late the Department of

Justice records come to us and however voluminous they are. Dobie

McArthur spent a good part of the early morning hours going

through those thick reports, as did David Brog and the others who

have functioned really in Senator Sessions’ and Senator Grassley’s

and Senator Thurmond’s and Senator Torricelli’s and Senator

Feingold’s and Senator Schumer’s staffs. This is the least expensive

investigation in the history of Congress, and it is a record which

will never be broken. You can’t get any less than zero in expenditures on an investigation.

But your contribution has been very important, and you have

been the model of circumspection in what you have had to say

about it.

May the record show that Mr. La Bella finally smiled.

And when Mr. Vega was appointed in your place, in September

of 1998, I raised hell about it and said there ought to be a Judiciary Committee hearing, not that I have any concerns as to Mr.

Vega, but I have concerns as to what happened to Mr. La Bella.

And Mr. Vega still hasn’t been confirmed. He is the U.S. Attorney

for the San Diego area as a matter of court appointment, and I do

hope yet that we will have a hearing on Mr. Vega. That is an appropriate forum to go into questions which I am not going to except

to reference.

But you are one of the heroes around here, Mr. La Bella, in my

opinion, and this is a town without many heroes.

Do you want the last word, Jeff?

Senator SESSIONS. I do, because I have been pretty aggressive

about making this record public. And I have served in the Department and I understand Mr. La Bella’s concern that internal deliberations be made public. But with regard to the special counsel

law, the Attorney General was required to act. This was not an

area in which prosecutorial discretion was at stake, in my view.

There is a real question about whether or not she performed her

duty under the law, a requirement under the law. If there was sufficient evidence, she shall call for an independent counsel. And to

say that this body can never inquire into that is to say that the

Attorney General doesn’t have to abide by that law, and there

would be no way to find out if she did or did not. So, reluctantly,

I believe we have had to go into this. I know you and Senator

Hatch called for the independent counsel earlier, and we wouldn’t

be here today if they had answered your call.

Senator SPECTER. Well, the law is plain that we have oversight

authority to get reports like this, to question line attorneys, to deal

even on pending prosecutions as we are pushing ahead on the

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terred and we are not going to be worn out. And we have tried, and

I think succeeded, in depersonalizing this inquiry today.

We are looking to the future. We want to know how we are going

to handle the Department of Justice investigations in the future

and how the statute ought to be changed, and if we go back to an

independent counsel statute, the finance matters, statute of limitations, and felonies—and if we go back to an independent counsel

statute, how we will learn and how we improve the processes for

the future.

This is not a matter as to the Attorney General personally. We

had a closed-door session on Wen Ho Lee and the Foreign Intelligence Surveillance Act, and one of the members of the Judiciary

Committee raised some very hard questions. And I sided with the

Attorney General not raising issues as to integrity or competency.

But there are laws to be followed and we are going to do our very

best to see to it that when these issues arise in the future—and

they will come up just as surely as the sun will rise tomorrow in

Washington, D.C., going back to Teapot Dome and before—that we

use the experience that you have brought to bear, Mr. La Bella to

improve the system.

Mr. LA BELLA. Well, I promise you I am not going to leave the

country with my report. I will stay in the country.

Senator SPECTER. Thank you.

That concludes our hearing.

[Whereupon, at 11:46 a.m. the subcommittee was adjourned.]

[Submissions for the Record follow:]

NOTE: Redacted to delete information the disclosure of which could adversely affect a pending criminal investigation or prosecution or would violate Rule 6(e) of the

Federal Rules of Criminal Procedure. Redactions completed on March 24, 2000.

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