By Michael Grunwald
Washington Post Staff Writer

Wednesday, August 19, 1998; Page A06

Attorney General Janet Reno is "seriously considering" seeking the appointment of an independent counsel to investigate former White House aide Harold M. Ickes, a move she has resisted despite two years of calls for an outside probe of alleged campaign finance abuses by the 1996 Clinton-Gore reelection effort, federal law enforcement sources said.

The sources said Reno is "as close as she's ever been" to seeking a campaign finance outside counsel as she weighs whether to recommend a probe into Ickes's activities as the White House's point man for 1996 fund-raising. But they emphasized that no final decision has been made.

In the past, Reno has refused to preempt her department's own investigation of Democratic fund-raising abuses, resisting intense pressure from congressional Republicans as well as forceful recommendations by her top campaign finance prosecutor and FBI Director Louis J. Freeh.

The sources also confirmed a report in yesterday's Wall Street Journal that the Justice Department has reopened its review of the legality of Vice President Gore's fund-raising calls from the White House. But they said they did not expect that probe to go too far, since Reno publicly rejected the appointment of an independent counsel for those calls in December, describing the allegations of wrongdoing as "insubstantial."

Ickes, a longtime loyalist of President Clinton who served as his deputy chief of staff, was the White House's key liaison with the Democratic National Committee in the 1996 campaign.

Ickes and his attorneys did not return calls yesterday, and Gore's office declined to comment.

Reno has always said she would seek an independent counsel the moment she felt that she had seen "specific and credible evidence" of a crime committed by an official covered by the Independent Counsel Act. A confidential memorandum to Reno last month by Charles G. LaBella, the outgoing head of her campaign finance task force, has refocused her attention on Ickes, the sources said. Ickes is not technically covered by the act, but the sources said Reno is considering LaBella's suggestion that she trigger it anyway because Ickes was so close to the president.

"It sounds like she's pretty close to triggering the act," one source said. "And if she does, that's a big deal. I don't see how you can limit the investigation to Ickes alone, when there's all that money flowing in and flowing out." Another source said Reno expects to make a decision about how to proceed on the Ickes matter by late next week.

Ickes and Gore have both denied wrongdoing, although the White House has acknowledged that Ickes improperly used a government fax machine and telephone line for political purposes. A few of Reno's advisers who opposed an independent counsel have changed their positions, but sources cautioned that the attorney general's decisions are notoriously difficult to predict.

"She's as close as she's ever been, but you don't necessarily want to read too much into that," one official said. "In a football game, you can be the closest you've been to the end zone, but you still might be out at the 40-yard line. Her options are still open."

Republicans who have investigated the 1996 campaign have portrayed Ickes as the chief Democratic operator, chairing White House "money meetings," organizing presidential coffees for major donors and orchestrating the reelection strategy from the White House. A report by the Senate Governmental Affairs Committee alleged that he "simply seized the reins of financial power at the DNC. The DNC could not spend any money without prior White House approval."

The sources said an outside probe of Ickes could include allegations of perjury as well as campaign finance abuses.

During a rambunctious appearance before the Senate committee last year, Ickes vigorously denied that the White House helped the Teamsters during a labor dispute with Diamond Walnut Growers in California. But the committee later uncovered internal Teamsters memos asserting that Ickes had urged then-U.S. Trade Representative Mickey Kantor to intervene in the Diamond Walnut dispute, and an Ickes aide confirmed to the panel that her boss had asked her to make sure Kantor followed through.

Several officials said that, given the history of independent counsels, even a narrow probe of a few specific allegations about Ickes could become a wide-ranging investigation of the 1996 election. Republicans who have clamored for an outside probe believe this expansion would not only be inevitable, but desirable.

"Harold Ickes was at the center of the storm," said Rep. Dan Burton (R-Ind.), who recently started contempt proceedings against Reno because she refused to give memos by Freeh and LaBella to his Government Reform and Oversight Committee. "He oversaw the White House coffees; he oversaw the soft-money ads. He coordinated the whole fund-raising operation. No matter which part of the food chain you start going up, eventually you always get to Harold Ickes."

But that does not necessarily mean an independent counsel. In the past, Reno has argued that "soft money" donations are not covered by federal election laws, and her campaign finance task force has yet to indict anyone on the receiving end of Democratic donations.

The allegations about Gore's fund-raising calls to 45 Democratic donors from the White House seem even less likely to result in the appointment of an independent counsel, the sources said. In December, Reno said she had found "clear and convincing evidence" that Gore did not solicit any hard-money donations. Sources said new evidence has forced the department to reopen its inquiry into the calls, but one official still described it as "no big deal."

Reno said last year her department has had a "clear, longstanding policy" not to prosecute officials for solicitation from a federal building without evidence of "aggravating factors."

Staff writer Juliet Eilperin contributed to this report.

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