Reno Launches Probe Into Gore’s Fund-Raising Calls

WASHINGTON —  Atty. Gen. Janet Reno, armed with new information, on Wednesday launched a 90-day preliminary investigation into Vice President Al Gore’s White House fund-raising calls--a step that could result in the naming of an independent counsel.

The review will examine only the 45 telephone calls that Gore made to donors from his government office during the 1996 campaign.

Despite the narrow focus, a decision to name an independent counsel could have much broader implications. Such an inquiry could expand to include other controversial aspects of Democratic fund-raising on behalf of President Clinton’s reelection--which Reno has been resisting--and could plague Gore throughout his expected presidential bid in 2000.

The review does not need to find evidence of wrongdoing by Gore to result in the naming of an outside prosecutor. Justice Department investigators merely need to conclude there is “reasonable grounds to believe that further investigation is warranted.”

An aide to Gore, who has been interviewed twice by Justice investigators, said the vice president did nothing wrong.

“At whatever stage this review process ends, we are confident it will once again conclude that everything the vice president did was legal and proper,” Gore spokesman Christopher S. Lehane said.

Reno is also weighing whether to open a separate 90-day inquiry into allegations concerning Harold M. Ickes, the former White House deputy chief of staff who orchestrated the Clinton-Gore reelection effort.

This is the second time that Reno has initiated a 90-day inquiry into Gore’s calls. She determined in December that there was not sufficient grounds to ask for an independent counsel.

The attorney general also has steadfastly rejected Republican demands that she request an independent counsel to look into an array of questionable Democratic fund-raising abuses during the ’96 campaign, despite coming under increasing pressure from her own aides to do so. Both FBI Director Louis J. Freeh and Charles G. LaBella, who recently stepped down as the head of the Justice Department’s campaign finance task force, urged her to call for a broad independent investigation of the Democratic campaign. And earlier this month, a House committee recommended that she be held in contempt of Congress for refusing to provide it with internal memos that recommend such an appointment.

Reno reopened the Gore matter last month with an initial 30-day review after the White House turned over to the Justice Department ambiguous handwritten notes by a senior Gore aide from a November 1995 White House meeting. The notes raise questions about whether Gore--contrary to his claims--knowingly raised funds to be used directly to support the presidential ticket’s reelection.

Gore has insisted that in his calls, he was soliciting only “soft money”--which could only be used by the Democratic National Committee for party activities--rather than “hard dollars,” which could be spent on television ads directly urging Clinton’s reelection. Some of the money that Gore raised was later diverted into hard dollars for direct campaign activities. Gore has said that this happened without his knowledge.

The seemingly arcane distinction is important because Reno has said that soft money is not covered by federal election laws, including an 1883 prohibition against soliciting funds while on federal property. This was the principal reason that she decided last year not to request a full-scale outside investigation of Gore’s activities.

The Nov. 21, 1995, meeting in the White House Map Room was attended by Clinton, Gore, Ickes and other top White House and Democratic officials. The purpose, said a participant, was “to talk about what additional money would need to be raised to keep the [Democrats’] issue ads on the air” and “what events and calls would need to be scheduled.”

The so-called issue ads touted the accomplishments of the Clinton administration but stopped short of telling viewers to vote for the president or against the Republicans. Democrats said that permitted them to lawfully pay for them with a combination of soft and hard dollars, according to a standard formula.

On a copy of a five-page memo, David Strauss, then-Gore’s deputy chief of staff, hand wrote “65% soft/35% hard” next to a line that referred to a $10-million “Media Fund.”

Elsewhere, Strauss wrote, apparently quoting Gore, “Count me in on the calls” next to a line indicating that Clinton and Gore together were to raise $1.2 million through telephone solicitations.

Strauss, now executive director of the Pension Benefit Guaranty Corp., declined to comment.

Peter J. Kadzik, a Democratic attorney familiar with the campaign fund-raising investigation, said: “They are Strauss’s notes from the meeting and reflect that the money to be spent had to be a mix of hard and soft money, which is consistent with what the DNC has said and always known. But it doesn’t address the issue of raising money.”

Kadzik added: “The vice president’s phone calls were made for amounts of money that could only be soft money contributions and portions of those donations only became hard money contributions because of reallocations by DNC employees of which the vice president was unaware.”

When Reno announced her decision not to ask for an independent counsel to investigate Gore’s calls in December, she said that, even if Gore had knowingly raised hard money, the law prohibited her from seeking an independent counsel because individuals had not previously been prosecuted for soliciting money from a federal building unless there were “aggravating factors.”

But, if it is determined that Gore misrepresented his knowledge of how the money was to be used, that could be such an aggravating factor, said an individual familiar with the case.

Under the independent counsel law, the 90-day preliminary inquiry will be conducted without many of the tools normally available to prosecutors: the authority to convene a grand jury, issue subpoenas, grant immunity or plea bargain.

If Reno finds reasonable grounds for further investigation, she would make the request for an outside counsel--who would have such investigative tools--to a special three-judge panel.

James F. Neal, Gore’s attorney, said in a statement: “I am totally satisfied that Vice President Gore has fully, completely and honestly answered every question asked of him.”