- The Washington Times - Monday, May 15, 2000

The last thing Al Gore needs is a campaign chairman who is under investigation by the government. But, in fact, that's what he has. Mr. Gore's chief strategist, Tony Coelho, is the target of at least three major federal investigations that could lead to court action against him.
The investigations are being conducted by the State Department's Office of Inspector General and the U.S. Securities and Exchange Commission. They are largely focused on whether Mr. Coelho used government perks and funds to grease his many business dealings, and whether he abused SEC laws and regulations.
But more than just Mr. Coelho's reputation is involved here. Indeed, this may be the first time in modern political memory that both a Democratic presidential nominee and his campaign chairman have been investigated by the government.
Mr. Gore is being investigated again in connection with the Clinton-Gore campaign's foreign fund-raising scandal. This time the issue is what he knew about the White House's mysteriously missing e-mail messages about the scandal that have been under subpoena for years, but have never been produced.
At the same time, Mr. Coelho's campaign strategy is being questioned as Mr. Gore's polls are falling in half a dozen states that the Democrats usually take for granted, such as Oregon, Washington and West Virginia; as morale drops among Gore campaign staffers under Mr. Coelho's blunt, brash, management style; and as some Democrats privately grumble that the campaign has no message.
Much of Mr. Coelho's political career has been marred by shady business dealings that have raised questions about his integrity. He abruptly left the House in 1989, a little more than two years after being named House majority whip, when details surfaced about his sweetheart purchase, at below-market lending rates, of a $100,000 junk bond.
He had failed to report the loan on his House financial disclosure statement and had misstated the date he had purchased the bond on his tax forms. The Justice Department investigated, but decided not to bring charges against him.
Now the State Department's Office of Inspector General is investigating accusations that Mr. Coelho abused his position as U.S. commissioner to the 1998 World Exposition in Lisbon, Portugal, to promote his business deals and a foundation he set up.
A preliminary IG audit cited a number of irregularities in the way Mr. Coelho handled the plum ambassadorial post. Among them: making the government liable for a $300,000 private loan; and leasing, at taxpayer expense, an $18,000-a-month luxury waterfront apartment for himself. Auditors also found that records were destroyed just before they arrived for an on-site inspection; questionable payments were made to contractors and consultants; and relatives and friends were put on the payroll.
But the core of the investigation has been focusing on how Mr. Coelho used his post to fly in and wine, dine and entertain associates who invested in his various business projects. "He was running a one-man show with Expo as a backdrop," a senior Foreign Service officer assigned to the U.S Embassy in Lisbon told the National Journal, which published an exhaustive expose in March that has been the buzz of Washington ever since. "He used all of the cachet and resources of his position to further his business interests," said the official.
At the same time, the SEC is conducting two investigations into Mr. Coelho's activities, one focused on questionable business dealings in the gambling industry, and the other on the government's Census Monitoring Board, which he co-chaired.
Mr. Coelho's lawyer, Stanley Brand, insists his client has done nothing wrong. Yes, there may been some "management lapses" in the way things were run in Lisbon, he said. "You don't hire Tony Coelho to balance the checkbook."
Mr. Brand has done well by Mr. Coelho, who hired him in 1998 to be the part-time counsel at the Census board at the rate of $60,000 a year.
Why hasn't there been more attention given to all of this? Certainly, the National Journal's thorough, in-depth investigation by journalist Bill Hogan did not get the news-media treatment it deserved. But in recent weeks, the media has shown new interest in Tony Coelho's past. Both Time and Newsweek, among other publications, have done pieces on his legal troubles in the past week.
Of the three investigations, the Lisbon probe has raised the most troubling questions and poses the greatest threat to Mr. Coelho. The IG's Office of Audits has sent its findings to the Office of Investigations, which handles criminal investigations. It has subpoenaed documents and witnesses. Inside sources say the matter could be sent to a grand jury.
"Gore doesn't need this. If the story grows and new developments occur, it could hurt him," said a veteran Democratic strategist. "If something significant develops, Tony will be out of there like a shot," another Democratic adviser told me. "He's not going to let this hurt Gore."
The way Mr. Gore's troubled campaign has been going lately, Mr. Coelho's departure would be a blessing in disguise. Mr. Coelho is from the old school of attack politics, and that era may be fading a little in presidential politics. "Let's face it, his take-no-prisoners, relentless attack strategy doesn't seem to be working," said one Democrat.


Donald Lambro, chief political correspondent of The Washington Times, is a nationally syndicated columnist.

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