The Ervin Committee's Last Hurrah

The Senate Watergate committee passed quietly into history last week--and with it an extraordinary episode in congressional annals. Having accomplished its primary objective--to inform the U.S. public about the facts and dimensions of the Watergate case--the committee bequeathed the continuing investigation to a host of other legislative and judicial bodies. But before it expired, it issued one last broadside: a 350-page staff report alleging, among other things, that leftover campaign funds had been used by President Nixon's good friend C.G. ("Bebe") Rebozo to pay for various major improvements to the Nixon properties at Key Biscayne and for a pair of platinum-set diamond earrings that the President gave to Pat in 1972 for her 60th birthday.

Then, finally, on a warm summer day, the committee assembled for a closing ceremony in the marbled Old Senate Caucus Room. At the long table sat the Senators and key staff members, like a senior class on graduation day. Only four of the committee's seven members were present: Chairman Sam Ervin, Lowell P. Weicker Jr., Joseph M. Montoya and Daniel K. Inouye. Vice Chairman Howard H. Baker Jr. was home in Tennessee; Herman E. Talmadge was busy elsewhere; and Edward J. Gurney was beset by troubles of his own (see story page 37).

Attention focused naturally on Sam Ervin, now serving the last of his 20 years in the Senate. Through some ten weeks of televised hearings last summer, he had become, at the end of his career, a folk hero, a landmark of integrity. As TIME Correspondent Stanley Cloud observed last week: "Sam Ervin hadn't been discovered as a result of Watergate; he had simply been there waiting, as though his entire life had been a preparation for this final service."

After paying tribute to his colleagues and to the committee staff, Ervin was presented with a 10-lb. sausage by Committee Counsel Samuel Dash, in recognition of White House Press Secretary Ronald Ziegler's denunciation of the committee's special report on Rebozo as "warmed-over baloney." Then Sam Ervin delivered a short speech, quoting right and left from his favorite writings, and it was over.

Without Demagoguery. Whatever its weaknesses--excessive leaking and petty rivalries--the committee accomplished its basic task. After a year and a half of existence, it had spent about $2 million of the public's money, produced 13 volumes and 5,858 pages of testimony and exhibits, and written a three-volume 2,217-page final report.

Without engaging in demagoguery and without acting as prosecutor or persecutor, the committee had laid out the basic story of Watergate as clearly and fully as it could. Moreover, it had largely carried out this task in public, so that the American people would be able to make their own decisions about who was telling the truth and who was not.

The committee's special report on Bebe Rebozo's expenditures was not particularly important for the amounts of money involved. Compared with the abuses of power already documented in the Watergate affair, for example, the allegation that Rebozo spent $4,562.38 in leftover campaign funds for earrings for Pat Nixon would not ordinarily have been of much consequence. But it was perceived as a vivid symbol, calling immediately to mind a much younger Richard Nixon who bragged on television that his wife wore only a "respectable Republican cloth coat." Strategically, the allegation was also important to investigators because it helped them trace the means by which much of Nixon's campaign funds had apparently been "laundered."

The report alleges that the $4,562.38 portion of the $5,650 spent on the earrings was originally derived from campaign funds and that Bebe Rebozo attempted to disguise the money's source by transferring it in and out of four separate Florida bank accounts. The $4,562.38, the report charges, was part of $6,000 that Rebozo withdrew on April 15, 1969, from the Florida Nixon for President Committee account in the Key Biscayne Bank and Trust Company --which he heads--and immediately deposited in a trust account in the name of his lawyer, Thomas H. Wakefield.

Nice Discount. Then, on June 28, 1972, the report continues, Rebozo (or his lawyer) transferred $4,562.38 to another Wakefield trust account in the Key Biscayne bank, immediately transferred $5,000 from this account to still another Wakefield trust account in the First National Bank of Miami, and finally bought a $5,000 cashier's check payable to New York Jeweler Harry Winston--all in the same day.

The rest of the cost of the $5,650 earrings was covered by two personal checks--one from Richard Nixon (for $560), the other from his personal secretary, Rose Mary Woods (for $90). The sale was apparently made by Winston's man in Washington, the late Don Carnavale, who was a close friend of Miss Woods. The earrings, containing 20 diamonds, were delivered to a presidential aide, Lieut. Commander Alex Larzelere, and the bill was marked "Please send to Rose Mary Woods." The earrings were subsequently appraised by Carnavale at $9,000--indicating that Winston gave Nixon a nice discount.

Rebozo admitted to the committee that the $4,562.38 had originated from campaign funds, but maintained that it was a proper reimbursement to him of money he had spent on campaign costs. The Ervin committee saw the transaction differently. "This complex four-stage process of payment for this gift," declared its report, "concealed the fact that the funds originated from contributions to the 1968 campaign and were ultimately used by Rebozo on behalf of President Nixon."

The report also charges that Rebozo used various trust accounts (again in the name of Thomas Wakefield or his law firm) for the deposit and transfer of at least $20,000 in $100 bills, and that these funds were subsequently used to pay for part of the $45,621.15 in improvements to the Nixons' Key Biscayne properties. These improvements included a new swimming pool and accessories, a fireplace, a putting green and a billiard table.

Whether specific laws were violated in the alleged use of campaign funds for private purposes is subject to varying legal interpretations. But certainly such funds would be taxable, and there is no record that the committee could find showing that the President paid any income tax on them. Nor, according to the committee, is there any record that Rebozo filed a required U.S. gift tax return for 1969, 1970, 1971 or 1972 on any improvements of more than $3,000 that he may have made to Nixon properties from his own funds. The committee noted that the only record of a reimbursement to Rebozo by the President had been a check for $13,642.52, issued in August 1973 at a time when Rebozo's affairs were being actively investigated by the Internal Revenue Service as well as by the Watergate committee itself.

Indeed, Rebozo seems to have conducted his business affairs with consistent vagueness. When asked by the Watergate committee earlier this year whether he had ever been reimbursed for bills that he paid for improvements to the Nixon properties, he replied: "Yes, I say, usually, I'm not going to nitpick with the President. If there's something I think he should have, I might just go ahead and do it without even him knowing about it. He just doesn't concern himself at all with financial problems; never has."

The committee failed in what had been a primary purpose of the Rebozo investigation: to establish a definite link between Rebozo's expenditures on the President's behalf and the $100,000 campaign contribution from Billionaire Howard Hughes. The report alleges but does not prove that, contrary to Rebozo's sworn testimony, he did not leave the Hughes contribution intact in a safe-deposit box for three years before returning it to a Hughes representative in June 1973. As previously reported, the President's former lawyer, Herbert Kalmbach, told the committee that Rebozo had told him that he gave part of the $100,000 to the President's brothers, Edward and F. Donald Nixon, to Miss Woods, and to "unnamed others."

Special Account. The report contains some fascinating details about Rebozo's role as a part-time political fund raiser. In February 1969, according to a White House memorandum, Nixon asked Rebozo to solicit Billionaire J. Paul Getty in London for "major" campaign contributions--only a few months after he had completed his victorious campaign for the presidency. Getty subsequently contributed $125,000 to the 1972 Republican campaign. In early 1969, Rebozo established a special account in his Key Biscayne bank to pay for what he described as "Administration-connected costs"; this was the account from which the "earring" funds were withdrawn on June 28, 1972.

The special report on Rebozo and his friends was but one part of the complete report that the Senate Watergate committee issued. Within this exhaustive document, based on the testimony and other evidence, are 35 suggestions for governmental reform.

Spending Ceiling. Among these would be the establishment of an office of "public attorney" -- a sort of permanent version of the Special Watergate Prosecutor -- who would prosecute criminal cases involving conflicts of interest within the Executive Branch. The committee favored setting up a nonpartisan elections commission to enforce statutes governing campaign contributions and expenditures. It proposed that cash contributions by an individual be limited to $100; that total contributions by any person to a presidential candidate be limited to $6,000; and that the overall spending in any presidential campaign be limited to an amount equal to 120 for every citizen of voting age. (This would hold the 1976 campaign funds to approximately $17 million.)

At the closing ceremony last week, a reporter asked Sam Ervin why the committee had failed to state in its report any conclusions about the responsibility for the Watergate scandal. Ervin replied that it was possible to draw a picture of a horse in two ways. You could draw the picture of a horse, with a very good likeness. Or you could draw the picture and write under it, "This is a horse." Well, said Sam Ervin, "we just drew the picture."

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