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But the day after the interview appeared, Hayes said that the Post had asked him a series of hypothetical questions and then misinterpreted his answers. Said Hayes: "Nothing was done wrong. There was no scheme or backdating or negative balance." The Post stuck by its story. Billy Carter was unavailable for comment; he was confined to Long Beach (Calif.) Naval Medical Center for treatment of alcoholism. When questioned six months ago by an Atlanta grand jury about the loans, he took the Fifth Amendment a number of times.
Charles Kirbo, the Atlanta attorney and old family friend who is trustee for President Carter's majority interest in the peanut business, also denied any wrongdoing. But Kirbo did admit that warehouse records "do reflect that there were delays in billing and collecting accounts receivable and transmitting the checks to the National Bank of Georgia." A special committee of the bank's directors concluded two months ago that the loan had been "poorly managed." Kirbo acknowledged that "on the bank's recommendation," the warehouse had hired an outside agency to expedite collections and payments.
Jimmy Hayes' statements prompted Republicans on Capitol Hill to increase pressure on the Justice Department to appoint a special prosecutor to get to the bottom of both Lance's activities and the problems with the Carter loan. The 1978 Ethics in Government Act, noted Maryland's Senator Charles Mathias, authorizes the appointment of an outsider to handle such explosive issues. Presidential Candidate Robert Dole called for the appointment, as did Senate Minority Leader Howard Baker, who is also expected to join the race for the White House.
The man who would choose the special prosecutor was still considering his decision, although he clearly began with serious reservations about the idea. Attorney General Griffin Bell, trying to raise morale in the Justice Department, told
Republicans that he favored having career prosecutors handle such cases. Bell argued that it was poor practice to name an outsider every time a key figure's integrity was challenged on a sensitive issue.
Justice Department officials also pointed out that a newcomer would have to start again on the Lance investigation, which has already taken 18 months, longer than it took the Watergate special prosecutors to investigate and indict Nixon Administration officials.
Still, the political pressures might induce Bell to change his mind. At week's end the Justice Department acknowledged that it had begun to sound out some lawyers about taking the post. Bell has promised that he would decide this week whether an insider at Justice or an outsider would look into the financial affairs of his old friends from Plains. —