The Watergate Report

The seat next to Pat Nixon at a gala fund-raising dinner in Miami Beach for Republicans was assigned to Kenneth H. Dahlberg, Midwest finance chairman of the Committee for the Re-Election of the President. Graciously, he turned his chair over to Dwayne O. Andreas, a Minneapolis millionaire who earlier this year donated $75,000 to Hubert Humphrey's unsuccessful presidential primary campaign. Since then Andreas had given $25,000 to the Nixon committee--and that, Dahlberg thought, made him a man who ought to sit next to the First Lady. But by week's end both Dahlberg and Andreas had been drawn into the expanding cast of characters associated with the possible mishandling of Republican campaign funds.

Embarrassing to the Administration from the beginning, the investigation of the bugging of the Democratic National Committee headquarters at the Watergate office building last June had now grown legally as well as politically serious. The General Accounting Office, an independent auditing arm of Congress, charged that there were "apparent and possible violations" of law by Nixon's Re-Election Committee and sent its findings to the Justice Department for potential prosecution. The GAO claimed that up to $350,000 in funds were involved. The basic charge was that neither the receipt of these funds nor their disposition was properly recorded and reported by the committee as required by the Federal Election Campaign Act that went into effect on April 7.

While the GAO report did not concern itself with who might have directed the political espionage at the Watergate, it did confirm earlier accounts that $114,000 of the unreported funds had wound up in the Miami bank account of Bernard Barker, a former CIA agent arrested with four other men at the Watergate. Of this amount, $89,000 had reached Barker by a circuitous route: from some Texas contributors identified as Democrats, to a Mexican intermediary, back to Texas, then to the Re-Election Committee and on to Barker. The other $25,000 was given by Andreas to Dahlberg on April 9. He in turn gave the money to Maurice Stans, head of the C.R.P.'s finance division.

A key GAO claim is that for a time, all of the money, plus another $136,000 that did not wind up in Barker's hands, was kept in a safe in Stans' secretary's office. GAO charges specifically that the Re-Election Committee had failed to "keep and maintain adequate books and records" on this total of $350,000. A phony notation on a deposit slip, falsely indicating that the money was left over from the 1968 campaign, was used in later depositing the $350,000 in a Washington bank, the report said. Other investigators believe that the total of $114,000 that reached Barker was used to finance C.R.P. security work that included the bugging operation.

The GAO report had been scheduled for release earlier in the week but was delayed after Philip S. Hughes, chief of the GAO's Office of Federal Elections, flew to Miami to talk to Stans, who was attending the Miami Beach convention. At the same time, since some of the money had passed through Florida, an investigator for Florida State Attorney Richard E. Gerstein, a Democrat, served a subpoena on Stans in Miami Beach and interviewed him under oath. Also quizzed was Dahlberg, who had earlier claimed that he received the $25,000 from Andreas before the April 7 accountability deadline. But Dahlberg now conceded to the Florida authorities that he was given the money by Andreas on April 9. It was the Florida investigation that helped close some of the holes in the GAO probe.

It will now be up to Attorney General Richard Kleindienst just how hard--and how fast--the Justice Department acts on the charges. Just who might be prosecuted is also an intriguing question. Each violation of the act carries a possible penalty of one year in prison and a $1,000 fine. Eleven such possible violations are noted. At the time of the violations, the Re-Election Committee was headed by Kleindienst's former Justice Department boss, John Mitchell. The committee's finance chief, Stans, apparently would bear more direct responsibility than Mitchell, as would the former C.R.P. treasurer, Hugh Sloan. Not surprisingly, top Democrats have called for Kleindienst to disqualify himself from the case and let it be turned over to a special prosecutor.

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