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Latest target of a probe: Babbitt

Attorney General Janet Reno wants a special prosecutor to examine whether Interior Secretary Bruce Babbitt lied to Congress about an Indian casino dispute, but she urged that the investigation not expand into a broader inquiry into campaign finance abuses.

Several Republican lawmakers predicted, however, that the Babbitt investigation could open the door to an examination of "the larger picture" of Democratic fund raising during the 1996 election.It is the first time a special prosecutor has been named in connection with the fund-raising controversy that has been the subject of congressional hearings and a Justice Department investigation.

Reno requested the limited independent counsel investigation Wednesday after concluding that Babbitt "may have testified falsely" before Congress about allegations that a senior White House official may have pressured him into rejecting a Wisconsin casino license in 1995. Indian tribes opposing the casino later contributed hundreds of thousands of dollars to the Democratic Party.

Babbitt has denied misleading Congress or that the casino decision was influenced by campaign contributions. He has said it was made by career Interior officials without White House influence.

A special court must decide whether to name the independent prosecutor and outline the scope of the investigation.

Republicans have argued that the casino investigation was intertwined with a broader investigation by the Justice Department into Democratic fund raising because rival Indian tribes opposed to the casino in Hudson, Wis., lobbied the White House and in 1996 gave at least $286,000 to the Democratic Party.

Sen. Fred Thompson, R-Tenn., chairman of the Senate Governmental Affairs Committee, applauded Reno's decision. "It permits an examination of the larger picture of political contributions and contacts that make the (casino) decision suspicious," he said.

Reno made clear in her request that the special prosecutor should limit the investigation to the casino issue, even though she left open the possibility of a broader probe. She acknowledged in some cases the counsel "may encounter witnesses or subjects" involved in the broader fund-raising investigation and in such cases should coordinate with her department.

Rep. Dan Burton, R-Ind., chairman of the House committee investigating campaign finance abuses, said he regretted that Reno "focused her opinion so heavily" on the perjury issue, although he said she also "has left the door partially open to a broader investigation of the (casino) decision itself."

If approved by the court, the Babbitt inquiry would be the fourth ongoing investigation by an independent counsel involving the Clinton administration. The others are Kenneth Starr's Whitewater probe of President Clinton, plus investigations into alleged misconduct by former Agriculture Secretary Mike Espy and former Housing Secretary Henry Cisneros.

Babbitt said he was disappointed with Reno's decision.

"If it's true that only an independent counsel can resolve a matter like this . . . then I think the list of hidden costs one has to pay for public service has just grown a little longer," Babbitt said.