Clinton's legacy? The culture of coverup!

Clinton administration quashed fraud case against Cisneros...

From the NYT:

After the longest independent counsel investigation in history, the prosecutor in the case of former Housing Secretary Henry G. Cisneros is finally closing his operation with a scathing report accusing Clinton administration officials of thwarting an inquiry into whether Mr. Cisneros evaded paying income taxes.

The legal inquiry by the prosecutor, David M. Barrett, lasted more than a decade, consumed some $21 million and came to be a symbol of the flawed effort to prosecute high-level corruption through the use of independent prosecutors.

Mr. Barrett began his investigation with the narrower issue of whether Mr. Cisneros lied to the Federal Bureau of Investigation when he was being considered for the cabinet position. He ended his inquiry accusing the Clinton administration of a possible cover-up.

His report says Justice Department officials refused to grant him the broad jurisdiction he wanted; for example, Attorney General Janet Reno said he could look at only one tax year. And after Internal Revenue Service officials in Washington took a Cisneros investigation out of the hands of district-level officials in Texas, the agency deemed the evidence too weak to merit a criminal inquiry, a conclusion strongly disputed by one Texas investigator.

Former officials of the Justice Department and the I.R.S. dismissed Mr. Barrett's conclusions in appendices attached to the report, saying the findings were the product of an inquiry that was incompetently managed from the start.

After being indicted on 18 felony counts, Mr. Cisneros pleaded guilty in 1999 to a misdemeanor charge of lying to investigators. He was later pardoned by President Bill Clinton. (Thanks to Drudge for the heads up.)


Bob Novak has more:

What was contained in 120 pages removed by the judges?


The long-awaited final report by Independent Counsel David Barrett, to be released today [Thursday], was severely censored by court order but not enough to sufficiently obscure its importance. As long forecast, it alleges serious corruption in the Clinton administration's Justice Department and Internal Revenue Service (IRS). The question is what was contained in 120 pages removed by the judges.

These allegations explain why Barrett finally has closed down after 10 years the last prosecution under the lapsed independent counsel statute. Its target, Henry Cisneros, long ago resigned as secretary of Housing and Urban Development in a plea bargain after admitting he lied to FBI interrogators to gain Senate confirmation. What kept Barrett in business was what he and his prosecutors contend is a Clinton administration cover-up of income tax evasion charges against Cisneros.

Not only Barrett's stubbornness but also a tip from an IRS whistle-blower in San Antonio, Texas, meant the case did not end with Cisneros's personal disgrace. But for now, the cover-up has succeeded. No tax prosecution was brought against Cisneros, and IRS conduct has not been questioned. Friends describe Barrett, a Republican lawyer from Washington, as feeling at age 68 that he has failed fully to uncover the scandal and that it is now up to Congress to get out the truth.

This probably would have been just another undiscovered scandal had the whistle not been blown by John J. Filan, chief of the IRS's Criminal Investigation Division in the South Texas District. In a March 31, 1997, memo, Filan expressed outrage that the IRS chief counsel's office in Washington on Jan. 15 had pulled a tax evasion case out of San Antonio because it required "centralized review." Told to "box up" his evidence and send it to Washington, Filan wrote: "I am not aware of any other criminal tax cases that have been pulled from experienced District Counsel attorneys."

With the case now in Washington, the IRS declined to prosecute. In a second memo on April 25, Filan said IRS Assistant Chief Counsel Barry Finkelstein's conclusions "are just plain wrong." Payments to Cisneros's former mistress and money spent for other purposes exceeded declared income, said the whistle-blower, and "clearly proves Cisneros knowingly and willingly signed and filed false and fraudulent income tax returns" for 1991, 1992 and 1993. (Thanks to Drudge for the heads up.)