October 26, 1998

Honorable James Hansen, Chairman
Honorable Howard Berman, Ranking Member
House Committee on Standards of Official Conduct
HT-2, The Capitol
U. S. House of Representatives
Washington, DC 20515

RE: Request for Investigation of Representative Henry Hyde

This letter constitutes a formal request for an inquiry into whether Representative Henry Hyde (R-IL), Chairman of the House Judiciary Committee, violated the House gift rule by receiving free investigative services from a private investigator, Ernie Rizzo.

According to news reports, Rizzo conducted an investigation of Tim Anderson, a critic of Chairman Hyde's role in the failure of Clyde Federal Savings and Loan ("Clyde"), and the unwillingness of the federal government to hold Chairman Hyde liable for part of the $67 million taxpayer bailout of Clyde. Chairman Hyde served on Clyde's board of directors between 1981 and 1984.

This request for inquiry is pursuant to House Rule 10, which authorizes the House Committee on Standards of Official Conduct ("Ethics Committee") to investigate "any alleged violation, by a Member...of the Code of Official Conduct or of any law, rule, regulation or standard of conduct applicable to the conduct of such Member...in the performance of his duties or the discharge of his responsibilities."⁽¹⁾

We are providing information to the Ethics Committee for the purposes of establishing an investigative subcommittee into this matter. Ethics Committee Rule 19 states that "the Committee may consider any information in its possession indicating that a Member...may have committed a violation of the Code of Official Conduct or any law, rule, regulation, or other standard of conduct applicable to the conduct of such Member...in the performance of his or her duties or the discharge of his or her responsibilities." Ethics Committee rules do not permit ethics complaints within 60 days of an election.
 

A: Request for Ethics Committee Inquiry into Whether Chairman Hyde Violated the House Gift Rule by Receiving the Services of a Private Investigator Free of Charge.

Republican Hyde denies he or anyone working under his direction hired the detective, but the House Judiciary Committee chairman acknowledges he was informed of the results of the investigation.

"I know he interviewed Anderson. I was apprised of the results of that interview," Hyde said. "I didn't hire him. I didn't pay him. I didn't direct him."⁽²⁾

Ernie Rizzo, the private investigator, said in an interview that he did the job for Hyde and his lawyer and was paid with a cashier's check in the mail.⁽³⁾

DB: Can I ask you what you were asked to investigate?

ER: Mr. Anderson, who he was, what his position was. What kind of information... apparently he had been disseminating information and my client wanted to know exactly what his position was in this case.

DB: How much were you paid for this investigation?

ER: I don't have any comments on that. It was a two month investigation.

DB: Did you call other people besides Mr. Anderson to find out if he was credible and if he was who he said he was?

ER: We made a total and complete investigation of Mr. Anderson.

DB: Just to give us a sense of the breadth of that investigation did you call six other people, twenty other people, did you call his friends, his neighbors...

ER: Quite a few people.

DB: Did they include people within his realm of existence, people he worked with, people who were friends with him?

ER: The standard people you'd usually talk to when doing some background on an investigation. Working people, neighbors, business associates, things like that.⁽⁴⁾

The exact cost of Ernie Rizzo's investigative services is unknown. However, according to Roll Call, "Rizzo told Roll Call he would normally charge about $10,000 for a job similar to the one he did on Anderson."⁽⁵⁾

The donor of the gift is unknown. The Tribune reported that:

Hyde says Rizzo became involved without his prior knowledge through "a mutual friend" who "thought he was helping me." But Hyde says he now doesn't remember who that friend was.⁽⁶⁾

Although it is commonplace for people to provide information to Members of Congress without that information constituting a gift, this case is different because the information was given to Henry Hyde pursuant to a lawsuit brought against him by the Resolution Trust Corporation in his capacity as a former director of a failed savings and loan, not in his official capacity as a Member of Congress.

In effect, this gift of private investigative services is no different from someone paying a portion of Chairman Hyde's legal fees. However, the allowable limit for contributions to legal defense funds was, and still is, $5,000 in a single year from any individual or organization.⁽⁷⁾ Since this gift of services was probably worth more than $5,000, it would not likely have been permissible under the rules governing legal defense funds.

In 1995, the House gift rule,⁽⁸⁾ prohibited the acceptance of gifts valued at more than $250, with certain exceptions or waivers granted by the Ethics Committee.

The gift of private investigative services meets the definition of a gift used in the House of Representatives at the time. The definition of a gift at the time was set forth by the House Select Committee on Ethics:

A payment, subscription, advance, forbearance, rendering, or deposit of money, services, or anything of value...unless consideration of equal or greater value is received by the donor.⁽⁹⁾

Sincerely,
 

Gary Ruskin
Director

1. House Rule 10, clause 4(e)(2).

2. Mike Dorning and Ray Gibson, "Hyde Denies Having Foe Investigated." Chicago Tribune, 18 October 1998. See Attachment #1.

3. Damon Chappie, "Private Eye's Work Linked to Hyde." Roll Call, 26 October 1998. See Attachment #2.

4. Transcript of Dennis Bernstein interview with Ernie Rizzo. KPFA Flashpoints radio news magazine, 20 October 1998. See Attachment #3.

5. Damon Chappie, "Private Eye's Work Linked to Hyde." Roll Call, 26 October 1998.

6. Mike Dorning and Ray Gibson, "Hyde Denies Having Foe Investigated." Chicago Tribune, 18 October 1998.

7. House Ethics Manual at 49-50.

8. At the time, House Rule 43, clause 4.

9. House Ethics Manual, p. 28. Quoting House Select Commission on Ethics, Advisory Opinion No. 7 (May 9, 1977), reprinted in Final Report of the Select Committee on Ethics, H. Rep. No. 95-1837, 95^th Cong., 2^nd Sess.