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Justice Dept. Starts Probe of Commerce Secretary's Finances

By Jerry Knight and Pierre Thomas
The Washington Post
WASHINGTON

The Justice Department Thursday announced it has started a formal probe of Commerce Secretary Ronald H. Brown's personal finances that could lead to appointment of an independent counsel to further investigate the matter.

Attorney General Janet Reno announced the decision in a statement. Her finding was based on a preliminary review that found there were "specific allegations of wrongdoing from a credible source" - the standard set by the independent counsel act - that Brown violated federal laws.

This finding doesn't reflect any judgment by Justice about whether the allegations are true - only that they are from serious sources that can't be ignored.

The Justice Department statement did not discuss the specific allegations that are being investigated. Congressional Republicans, who requested the investigation, have contended that Brown violated financial disclosure laws by filing false or misleading financial reports about his financial dealings with Washington business executive Nolanda Hill.

Given the low threshold of evidence required to trigger an investigation under the independent counsel law, Justice Department officials said the probe had been likely after published reports that Brown received more than $400,000 from a company he owned with Hill, even though the business itself made no money.

"The law left Justice with no choice but to move to a preliminary investigation," said Reid Weingarten, Brown's attorney. "We are confident that at the end of their investigation they will be satisfied that no laws were violated."

Independent counsels - federal prosecutors with far-reaching authority to investigate allegations of wrongdoing by high government officials - already are probing President and Mrs. Clinton's Whitewater investments and gifts allegedly given to former agriculture secretary Mike Espy. Housing and Urban Development Secretary Henry Cisneros is the target of a preliminary Justice investigation, like that begun with Brown, into whether Cisneros lied to FBI agents about payments to a former mistress.

Justice Department officials said they began considering the preliminary investigation of Brown last month, even before a number of congressional Republicans called for the probe. Under the law, Justice has 90 days to determine whether to ask the U.S. Court of Appeals to name an independent counsel.

Brown's finances also are being investigated by the House Government Reform and Oversight Committee, whose chairman, William F. Clinger Jr., R-Pa., will decide next week whether to hold hearings on Brown's business dealings.