Ex-NASA Chief Calls for Meese Apology in Fraud Case

Former NASA Administrator James M. Beggs said Monday that he would welcome an apology from Atty. Gen. Edwin Meese III over defense-contracting fraud charges that were dropped against him, but he insisted he is not bitter.

At a news conference, Beggs criticized U.S. Atty. Robert C. Bonner in Los Angeles--where the indictment against him, General Dynamics and three other executives of the firm was returned 19 months ago--and two top Justice Department administrators, charging that they had failed to properly supervise the aborted prosecution. Beggs formerly headed the General Dynamics Pomona division.

“I hope when Ed Meese gets back off his drug bust, he might give me an apology,” Beggs said, referring to Meese’s current two-week European trip promoting anti-drug efforts. “That would be nice.”

Cites Evidence

“He’s free to ask for anything he wants,” Bonner said in Los Angeles. “At the time the case was indicted, the evidence appeared to warrant (it).” He added that after the complex issues in the case had been studied, “we came to the conclusion that the continued prosecution couldn’t be supported, wasn’t viable.”

Assistant Atty. Gen. William F. Weld, while saying he was speaking “with deepest respect” for Beggs, declined “the invitation to embrace the language of apology.” Instead, he said, he would trust public opinion to recognize that “in a criminal case if no conviction is obtained, no blemish should attach.”

The Justice Department dropped the criminal charges Friday after conceding that there was insufficient evidence to prosecute the four executives for alleged fraudulent mischarging on a contract to build the Sgt. York anti-aircraft gun system. Beggs resigned as chief of the National Aeronautics and Space Administration after the indictment in 1985.

Fears Adverse Impact

Weld, who heads the Justice Department’s criminal division, said he is “very concerned” that dropping the case will have an adverse impact on the department’s high-profile drive against defense contracting fraud.

Weld’s concern was echoed on Capitol Hill. Sen. William Proxmire (D-Wis.), noting that the latest action marks the second time in a month that the Justice Department has decided against proceeding criminally against General Dynamics, said it “shows there is something drastically wrong with the way the Justice Department handles defense fraud cases. . . .

“The federal government simply lacks the capacity, the competency and the will to prosecute these cases,” Proxmire said. In May, the Justice Department announced that it had found insufficient evidence that the company defrauded the government on a nuclear submarine project.

Accounting Techniques

The indictment in the Sgt. York case alleged that General Dynamics used illegal accounting techniques to hide the true costs of its Sgt. York prototype, charging off many contract costs to research and development accounts and an account reserved for costs of bid preparation. The government contended that those charge-offs were illegal because the contract provided for a $39-million fixed price to cover development costs.

General Dynamics argued that the contract simply required the company to make its best effort to produce the weapon within the contract allocation and that the charge-offs were legal.

Weld said the government could have “let nature take its course” and let the case go to trial, with the expectation that it would be dismissed on motion by the defense. Such a posture would “be not only dishonorable, but would not be ethical,” Weld said.

Weld responded for the government Monday because Associate Atty. Gen. Stephen S. Trott, who was among the two Justice Department officials Beggs singled out for criticism, was out of the country. Beggs also criticized former fraud section chief Robert W. Ogren.