Watergate Ghosts Rise Again

By Bennett H. Beach

Two ex-officials win a pardon; two others have new troubles

Richard Nixon lives quietly on Manhattan's East Side nowadays, H.R. Haldeman works for a low-profile Los Angeles real estate firm, and Deep Throat has long since fallen silent. But as the events of last week emphasized, the ghosts of Watergate still rise into the nation's headlines from time to time. In three widely varied legal actions, prominent figures from that inglorious era were exonerated, embroiled in a new scandal or re-attacked for an old one. Without even petitioning for it, two top former FBI officials won a full and unconditional pardon from President Reagan for authorizing illegal break-ins aimed at the radical Weather Underground group in 1972 and 1973. In Phoenix, former Attorney General Richard Kleindienst, who succeeded John Mitchell in 1972, was indicted for perjury during a state bar investigation. Most interesting of all from a legal standpoint, former Vice President Spiro Agnew suffered some setbacks in an unusual taxpayers' suit that stems from his years as Governor of Maryland. The suit, scheduled to go to trial in Annapolis this week, is attempting to recover kickbacks that Agnew allegedly received from Maryland contractors.

Agnew's most serious legal problems had seemed at an end in 1973, when he agreed to resign the vice presidency and pay a $10,000 fine on pleading no contest to tax evasion charges. The unpaid taxes were traced to his failure to report as income the kickbacks that he supposedly received between 1967 and 1972 for the awarding of certain engineering contracts. But as part of the 1973 agreement, the Justice Department refrained from forcing him to admit any guilt in the alleged kickback scheme. Ever since 1976, however, Agnew has been fighting off a suit brought by three Maryland taxpayers, one of whom came up with the idea in a Georgetown law school class on legal activism. Their novel theory: the $200,000 in kickbacks that he allegedly took have been held by him "in trust" for the state and should be turned over to its treasury. Including interest, Agnew's liability would total $350,000 if the suit succeeds.

Despite the circumstances of his resignation, Agnew has always denied that he took any kickbacks. His hopes of making this contention hold up in court have now been damaged by two developments. First, Judge Bruce Williams ordered Agnew's attorney to give the plaintiffs seven years' worth of his client's tax returns, including the unpublished record of the 1973 tax settlement. Then, Co-Defendant Jerome Wolff agreed to testify against Agnew during the trial. As head of Maryland's roads commission between 1967 and 1969, Wolff was accused of receiving some of the same kickbacks. In return for his testimony, he will be dropped from the suit. A third defendant, Real Estate Developer I.H. Hammerman, paid the state $52,500 last November rather than continue fighting the charges.

Agnew not only faces a possible $350,000 judgment but also must contend with a multimillion-dollar libel suit filed by a former campaign manager and personal attorney who was named in his 1980 book Go Quietly . . .or Else. However, owing mainly to the international investment deals he packages, Agnew is believed to have a hefty in come. He owns a condominium in a waterfront high-rise in Ocean City, Md., and a lavish home in Palm Springs, Calif., where he surfaces sporadically to trim his golf handicap of 23.

The former FBI men who were pardoned are W. Mark Felt, 67, the second ranking official of the bureau during the final days of the Nixon Administration, and Edward S. Miller, 57, one of his deputies. They had authorized agents to make illegal break-ins at the New York-area homes of friends and relatives of members of the Weather Underground. The Weatherpeople were suspected of bombings at the Capitol, the Pentagon and other public buildings, and the FBI was seeking clues to their whereabouts. Last fall a federal jury convicted Felt and Miller, now retired, of violating the residents' constitutional protection against unlawful searches. They were given relatively light fines of $5,000 and $3,500, respectively.

From the start, Reagan had been troubled by the prosecution. A mere ten days after being inaugurated, he had White House Counsellor Edwin Meese contact Thomas Kennelly, the lawyer representing Miller. Meese asked for memos from both defendants' lawyers outlining reasons for pardoning them. By March 26 the pardons were signed, but the following week's assassination attempt delayed the announcement. Remarked a joyful Miller: "I certainly owe the Gipper one." Reagan, citing Jimmy Carter's pardon of "thousands" of Viet Nam-era draft evaders, explained: "We can be no less generous to two men who acted on high principle to bring an end to the terrorism that was threatening our nation." But in granting the pardon, Reagan went so far as to dispute the jury's findings. "The record demonstrates," he said, "that they acted not with criminal intent, but in the belief that they had grants of authority reaching to the highest levels of Government." That was too much for Special Prosecutor John Nields, already miffed by the White House's failure to consult him before acting. Said Nields: "Whoever wrote that 'criminal intent' language doesn't know the facts. The jury heard the facts for eight weeks and found precisely that. That's what the trial was all about."

The troubles for Kleindienst, who has been practicing law in Tucson for several years, apparently grew out of his role in a multiparty insurance deal in 1976. After a complex series of transactions, an Arizona insurance company claimed it had been bilked of $1.75 million, and the state bar launched a three-year investigation of Kleindienst's conduct in the affair. Last week a Maricopa County grand jury charged him with 14 counts of lying before one of the bar's committees. Ironically, in his reaction to the indictment, Kleindienst recalled, consciously or not, a famous denial made by his onetime boss Richard Nixon. Said Kleindienst: "I am not a liar."

--By Bennett H. Beach. Reported by Evan Thomas/ Washington

With reporting by Evan Thomas/Washington

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