FBI Head Blasted Finance Probe

FBI Director Louis Freeh wrote a memo in the earliest days of the Democratic fund-raising investigation suggesting a top Justice Department official was under pressure not to proceed with the probe to save Attorney General Janet Reno's job.

The memo, belatedly turned over to Senate investigators this week, also discloses that Freeh urged Reno and Justice Department public integrity chief Lee Radek to step aside from the investigation as early as December 1996 because of purported comments made by Radek.

The memo was described to The Associated Press by several government officials. They had seen it since the FBI turned it over to the Justice Department to produce to the Senate and House Judiciary committees investigating the fund-raising matter.

In the Dec. 9, 1996 memo to Deputy FBI Director William J. Esposito, Freeh recounted, third-hand, comments Radek allegedly made to Esposito suggesting he was being pressured in connection with the investigation into Democratic fund-raising improprieties during President Clinton's 1996 re-election.

Freeh's memo quotes Radek as telling Esposito he was "under a lot of pressure not to go forward with the investigation" because Reno's job "might hang in the balance," the officials said.

At the time, there were reports speculating in Washington on whether Reno, who requested the Whitewater independent counsel investigation, would serve a second term as attorney general.

She steadfastly resisted an independent prosecutor for fund-raising, but has named a total of seven independent counsels to investigate the president and his administration, at times angering Clinton's supporters.

Freeh wrote Esposito that he met with Reno and told her about Radek's purported comments and suggested “on that basis” both Radek and Reno should step aside from the investigation, the officials said.

Reached late Thursday, Radek said he never was under pressure to scrap the investigation to help Reno and did not recall ever making such comments to Esposito.

"I have no recollection of ever saying I was under pressure because the attorney general's job hung in the balance. Nor is it something I would have said because it has no basis in fact," Radek said in a prepared statement.

FBI spokesman John Collinwood declined comment.

The emergence of the Freeh memo comes at a sensitive time for the FBI and Justice Department, whose relations have been strained by very public disputes over the investigations into China espionage and fund raising.

Law enforcement officials say that Reno has received an internal report on the government's handling of the case of nuclear lab scientist Wen Ho Lee that criticizes both agencies.

The sources, who spoke only on condition of anonymity, said the report by prosecutor Randy Bellows blames the FBI for not providing enough oversight and resources into the early part of the investigation when leads of Lee's possile spying for China emerged.

After months of suggestions that Lee would be indicted for China espionage, the scientist was charged last December with lesser offenses of removing nuclear secrets from the Los Alamos lab with no suggestion he gave them to China.

The Bellows report sides with the FBI on one issue -- that the Justice Department had enough grounds to approve a warrant for electronic surveillance in the Lee case, the officials said. Justice had rejected the FBI's request, angering its agents.

But the Bellows report adds that the FBI did not provide the department with all the information it collected that could have helped in the decision.

The Freeh memo involving the fund-raising issue emerges more than two years after Congress first began reviewing the conduct and quality of the criminal fund-raising investigation, in which several Democratic donors and fund-raisers have been convicted.

Officials said the FBI did not disclose the existence of the memo to Justice officials until late last month and that it wasn't turned over to Senate investigators until this week.

Lawmakers mostly have focused on debates within Justice and the FBI in 1997, 1998 and 1999 to name an independent prosecutor to take over the probe of Clinton and Vice President Al Gore's fund-raising activities.

Freeh and the former head of the Justice task force that ran the investigation both have acknowledged they fervently argued later in the investigation for appointment of a special prosecutor, but Reno turned them down.

But Freeh's memo provides the first evidence that such arguments dated to the very beginning of the investigation in late 1996 and were based in part on concerns about possible political pressures.

According to the officials' description of the 1996 memo, Freeh wrote that Radek's public integrity section was not capable of conducting a thorough investigation and that Reno and Radek should recuse themselves from the investigation in favor of aggressive investigators, or "junk-yard dogs," according to the memo from outside the Justice Department.