NEWSWEEK
  August 4, 1997
  
  Periscope/Exclusive:
  
  The Dark Side of the Money Trail
  
  By Michael Isikoff
  
  The proposal, marked "privileged and confidential," was a model of
  bluntness. Entitled "Background Research: Senator Don Nickles," the May 16,
  1997, document, obtained by NEWSWEEK, outlined an extensive plan to scour
  the Oklahoma Republican's life for embarrassing or incriminating details:
  searching courthouses for "civil, criminal, divorce and bankruptcy
  litigation"; hunting for "fictitious name filings"; reviewing his and his
  wife's "personal business activities." The goal was to show that Nickles
  was "linked to the oil industry." The memo's author: Terry Lenzner, a
  former Watergate counsel who now runs a private investigative firm with
  close ties to the White House. The Democratic National Committee is one of
  his top clients. This week, Lenzner may appear as an expert witness at
  the Senate campaign-finance hearings--where he'll sit across from his
  proposed quarry, committee member Nickles.
     How did Lenzner come to target Nickles? The answer goes back to an
  effort by Oklahoma's Cheyenne-Arapaho Indians to win return of their
  homelands, snatched by the government a century ago. During the '96
  campaign, Democratic Party officials offered to help them--in exchange for
  a $107,000 campaign contribution. Embarrassed when the incident came to
  light, the DNC returned the money. Then last spring, a business associate
  of the tribe's urged them to meet with Cody Shearer, described to them
  as a Washington "insider" and longtime friend of President Clinton.
     In May, Shearer advised the tribe the best way to advance their cause
  was to dig up dirt on Nickles. Like most Oklahoma legislators, Nickles
  opposes returning the land, which sits beneath a Department of Agriculture
  research station popular with local farmers and businessmen. Shearer said
  he knew just the man for the job: his old pal Lenzner, who asked for up to
  $17,000. But when Indian leaders saw Lenzner's memo, they balked,
  suspecting Lenzner had other political motives. Lenzner said he was just
  giving the Indians what he thought they wanted. "We're not a bunch of
  dummies," said James Pedro, a member of the tribe. "We know when we're
  being used."
  
  Michael Isikoff
  
==================================


        Senators Grill Witness Who
        Proposed Probe of Colleague

        By Susan Schmidt
        Washington Post Staff Writer
        Friday, August 1, 1997; Page A16
        The Washington Post 

        A private investigator summoned to testify about phony
        contributions to President Clinton's legal defense fund was
        attacked yesterday by members of a Senate panel outraged
        that he had proposed investigating a member.

        Terry Lenzner, chairman of Investigative Group Inc., was
        grilled about his offer last May to Oklahoma's
        Cheyenne-Arapaho tribes to investigate Sen. Don Nickles
        (R-Okla.). Lenzner proposed that the tribes hire him to check
        out tribal leaders' belief that Nickles or his wife had accepted
        money from oil and gas interests that oppose federal return of
        tribal lands, a position Nickles shares.

        Richard Grellner, an attorney for the Cheyenne-Arapaho
        tribes, told The Washington Post yesterday that Cody Shearer,
        a friend of Clinton's, called the tribes and brought them to
        Lenzner. Shearer told the tribes he would be seeing the
        president over the Memorial Day weekend and would lobby
        him personally about the return of the lands, Grellner said.

        The Justice Department and the FBI are investigating the tribes'
        claims that they were pressured for $107,000 in campaign
        contributions last year by Democratic Party officials who said
        the contribution would win them the return of their lands. After
        the election, tribal officials have said, Natham Landow, a
        longtime fund-raiser for Vice President Gore, pushed them to
        hire him and former Clinton-Gore campaign manager Peter
        Knight for exorbitant fees to lobby the administration for the
        lands.

        Grellner said that Shearer, a former IGI consultant, called him
        in May after news reports of the alleged shakedown attempt.
        Grellner and tribal leaders traveled to Washington to meet with
        Shearer at his home.

        "He said `This is going to be a big problem for Al Gore down
        the road, and they want to get it off their screen,' " Grellner
        recalled.

        Grellner said that Shearer told the tribes that they "need to hire
        IGI," and that the company could "check out" Nickles. Grellner
        said Shearer told tribal leaders getting the administration to
        return the lands would be simple. "He said he would go to the
        White House and get it done," said Grellner.

        Shearer and IGI have close ties to the Clinton administration.
        Shearer's brother, Derek, is ambassador to Finland. His sister,
        Brooke Shearer, has held a number of political posts in the
        administration, and her husband is longtime Clinton friend
        Strobe Talbott, now the number two official at the State
        Department. Both Cody and Brooke Shearer have worked at
        IGI.

        Grellner said Shearer questioned him and tribal leaders about
        what evidence the FBI had developed against Landow and
        Knight. "Cody said Landow is a liability. `The guy is toast.'

        "We told him the FBI had been out [to Oklahoma] twice. . . .
        He was also concerned about Peter Knight -- he was trying to
        figure out whether the evidence was there."

        Shearer did not return a telephone call seeking comment
        yesterday.

        After the May meeting at Shearer's home, Shearer took the
        tribal leaders to meet with Lenzner. The IGI chairman listened
        to their story and their complaints that Nickles had opposed
        return of their lands.

        Yesterday Sen. Arlen Spector (R-Pa.), displaying Lenzner's
        May 16 investigative prospectus, pointedly questioned Lenzner
        about his offer to "dig up dirt" on Nickles for the tribe.

        "The thrust of this memorandum . . . is to find information on
        Senator Nickles which, to put it mildly, would try to pressure
        him or persuade him to change his position," said Specter.

        Even Democrats went after Lenzner. "An attempt to investigate
        the personal lives of members of Congress as a way to affect
        their votes here, that's really an outrageous intrusion," said Sen.
        Joseph I. Lieberman (D-Conn.).

        A truculent Nickles told Lenzner: "You know I don't mind you
        messing with me, but I do mind you messing with my family."

        Lenzner said his proposal to the tribes was standard for the
        investigative industry and he was simply offering to check out
        the tribes' suspicions.

        Lenzner's firm has been investigating the legitimacy of
        contributions to the Democratic National Committee and the
        private fund set up to pay the Clintons' legal bills. He said he
        did not know then Nickles was a member of the Senate
        committee when he offered to investigate him. 

             © Copyright 1997 The Washington Post Company