Predicted reaction: The Atty General gets charged with contempt of
Congress.


Reno Rejects Clinton Campaign Probe

WASHINGTON (AP) -- Despite House Republican allegations, the Justice
Department says there is no ``specific and credible information'' that
President Clinton's former campaign manager received an illegal $1 million
payment in connection with a controversial office building development.

Attorney General Janet Reno announced Thursday that she was ending the
investigation into lawyer and lobbyist Peter Knight, a former top aide to Vice
President Al Gore who ran Clinton's re-election campaign in 1996. The decision
means that no independent counsel will explore Knight's financial dealings.

Knight received $1 million from Tennessee developer Franklin Haney shortly
before becoming Clinton's campaign manager. Republicans on the House Commerce
Committee issued a report last month questioning whether the money was an
illegal contingency fee for helping get the Federal Communications Commission
to move to Haney's Portals development in Southwest Washington.

Haney and Knight both have said the $1 million payment represented legal fees
for Knight's work on several Haney projects over a three-year period.

Committee Republicans criticized Reno's decision Thursday.

``The legal burden is on the attorney general to show why the evidence
contained in the report is not specific and credible,'' the committee said in
a statement. ``The Justice Department's cursory response utterly fails to meet
this legal obligation. We expect a full explanation of this decision.''

Acting Assistant Attorney General Dennis Burke said in a letter to the
committee chairman, Rep. Thomas Bliley Jr., R-Va., that the allegations
against Knight were investigated as part of a Justice Department campaign task
force's probe of Haney.

``The task force concluded that the evidence does not support the report's
view that Mr. Haney's payment to Mr. Knight was a contingency fee,'' Burke
wrote.

As a result of the task force's investigation, Haney, a longtime supporter of
Gore, was indicted last month on 42 counts alleging he made illegal donations
to the 1996 Clinton-Gore campaign and to two senatorial candidates.


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