By Philip Shenon
February 3, 1999
Richard Holbrooke, President Clinton's choice to be the top American delegate to the United Nations, has agreed to pay $5,000 to the Justice Department to settle civil charges that he violated federal lobbying laws in his contacts with the American Embassy in South Korea, government officials and friends of Holbrooke said Tuesday.
Officials said the settlement did not require an admission of wrongdoing by Holbrooke and should allow his nomination for the U.N. post to be submitted this month to the Senate for confirmation. The terms of the settlement, which was reached between Holbrooke and the Justice Department public integrity section, are expected to be announced in days, after a final review by senior officials at the department, including Attorney General Janet Reno. Government officials said it was highly unlikely that senior officials would order major changes.
The Justice Department had accused Holbrooke of violating federal lobbying laws when, shortly after having resigned from the State Department in 1996, he contacted the embassy in South Korea for help in setting up an appointment with the president of South Korea and other Korean officials. Federal ethics laws bar officials leaving the government from a variety of contacts with former colleagues. Democratic congressional officials said that because there were no allegations of criminal wrongdoing by Holbrooke and because the lobbying violations appeared to have been minor, his nomination should be approved with relative ease.
In 1995, Holbrooke gained the admiration of many lawmakers, Democrats and Republicans alike, when he led the marathon negotiations that produced the Dayton peace accord that ended the war in Bosnia.
The nomination still has to be reviewed by the Senate Foreign Relations Committee and its often unpredictable chairman, Sen. Jesse Helms, R-N.C. A leading congressional critic of the United Nations, Helms has promised that he will scrutinize the Justice Department investigation to determine whether prosecutors had treated Holbrooke leniently. "We're going to walk through the evidence, walk through every step that the Justice Department took," said Marc Thiessen, a Helms spokesman. "We're not going to take the Justice Department's word on this. Sen. Helms is going to come to his own independent conclusion." He said Helms would closely question Holbrooke about the senator's call for significant budgetary and bureaucratic changes at the United Nations and about the perception that Holbrooke is too close to President Slobodan Milosevic of Yugoslavia. An agreement in October between Holbrooke and Milosevic that was supposed to have ended the fighting in the Serbian province of Kosovo has collapsed in recent weeks, leaving the United States and its NATO allies on the verge of a new round of talks and, possibly, air strikes against Serbia. "This confirmation won't be a cakewalk," said a senior congressional official who insisted on anonymity.
Holbrooke, whose nomination has been stalled for eight months as a result of a joint ethics investigation by the Justice and State departments, has denied wrongdoing in his contacts with the embassy in Seoul and Ambassador James Laney. Friends of Holbrooke say the contacts, which occurred within weeks of his resignation from the State Department in February 1996, were approved by senior State Department officials. Former senior American diplomats say that Holbrooke had been asked to contact American embassies as he traveled in his new job as vice chairman of the investment banking firm of Credit Suisse First Boston. Holbrooke, who remained an unpaid adviser to the State Department after joining Credit Suisse, visited South Korea in the spring of 1996 to deliver a lecture. He contacted Laney for help in setting up a meeting with President Kim Young-sam. Laney, a former president of Emory University, has said that the contact was "entirely appropriate" and that it would have been an insult to the embassy had Holbrooke not sought his help in scheduling the meeting.
The investigation of Holbrooke began in late June, when an anonymous letter to the State Department accused him of a possible violation of ethics laws involving his contacts for a consulting contract with the embassy in Hungary in 1995.
