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.
That launched
Barrett on four frustrating years of attempting tax evasion prosecution
in the face of Attorney General Janet Reno's obstructions. Permitted
by Reno to focus on only one year, the independent counsel could
not make the case of extended tax evasion.
According
to people with access to Barrett's draft, it goes into intense
detail about this obstruction and on the unprecedented seizure
of the Cisneros tax case by the IRS in Washington. That much in
the 400-page report has survived the three senior federal appellate
judges with supervising authority over the independent counsel.
Nevertheless,
the question remains what three judges -- David Sentelle (D.C.),
Thomas Reavley (Texas) and Peter Fay (Florida) -- blacked out
in 120 pages worth of redactions. Even after the report is released,
Barrett and his lawyers would face judicial sanctions if they
disclosed anything that was redacted.
The three
judges have lawyer-like arguments in favor of suppressing so much
material. For example, they claim the Barrett report on Cisneros
should not contain evidence that was collected after the plea
bargain with Cisneros.
However,
the judges have established an exception, or rather 535 exceptions,
to the rule that nobody can see what has been redacted. Any member
of Congress can read it merely by asking. Any such lawmaker, who
believes American taxpayers should see the product of $23 million
in expenditures, presumably could then publish the material without
fear of legal sanction.
But will
any senator or House member do it? Nobody is interested in further
prosecution of Henry Cisneros, an exceptional public figure who
might well have become the first Hispanic-American governor of
Texas and perhaps even president of the United States. Rather,
an unredacted Barrett report is an opportunity to observe how
the Internal Revenue Service decides when to prosecute, a place
where Congress until now has feared to venture.
