MEMORANDUM OF DAVID E. STEVENS ATTORNEY WORK PRODUCT The purpose of this second interview was to discuss Mr. Stevens' letter to the Senate Ethics Committee dated October 26, 1990 (Exhibit 2). The letter states that Mr. Stevens was writing "to make sure that you (Senate Ethics Committee) have access to all of the relevant facts pertaining to the airplane flights taken by Senator McCain and his family on ACC corporate aircraft. These facts are sometimes contrary to the public statements which have been made by Senator McCain." Mr. Stevens states that "These facts seem to support the conclusion that the intent of the Senator was always to reimburse for the costs associated with flights on corporate jets that he took personally. I never saw any evidence that he originally intended to reimburse for the cost of his wife and baby sitter. On all of the flights for which reimbursement was provided on a timely basis, his wife was also a passenger. This is contrary to his public position that the entire matter was completely an oversight." Mr. Stevens continues by saying, "I just feel that one of the Senator's advisors or staff, or perhaps the Senator himself, made a conscious decision to not reimburse for the cost of family members. No effort was ever made to reimburse for flights of family members until after the onslaught of adverse publicity following the ACC bankruptcy. Senator McCain's public explanations have not pointed out these facts." As additional support to his theory, Mr. Stevens discusses in his October 26, 1990 letter, a telephone discussion he had with J. Brian Smith, Senator McCain's political consultant. He contacted Mr. Smith in February, 1989 to discuss the issue of personal use of ACC corporate aircraft by Senator McCain and his family which was raised by the Internal Revenue Service in their audits of ACC's 1984 and 1985 Income Tax Returns. In the first paragraph of page 2 of Mr. Stevens' October 26, 1990 letter he indicates that, "Mr. Smith said that he thought it MEMORANDUM OF DAVID E. STEVENS ATTORNEY WORK PRODUCT was the Senator's practice to reimburse for the costs of his own flights on the corporate jets, but not necessarily for those of his family." the McCain I asked Mr. Stevens if he had developed his theory that it was Senator McCain's intention to only reimburse ACC for his personal use of corporate aircraft when we initially met on June 7, 1990. He stated that, during this interview, he was uncomfortable with the ACC attorney being present in that he did not have a good relationship with him. He said that at the time of the interview he was in the early stages of forming his opinion but had not formed the opinion or someone on his staff fully concluded that Senator McCain knowingly did not reimburse ACC for his family's personal use of corporate aircraft. Mr. Stevens recalls that he mentioned to us his February, 1989 telephone discussion with Mr. Smith wherein Mr. Smith stated that he was not concerned about reimbursement for Senator McCain's family's personal use of ACC corporate aircraft and Mr. Stevens believed that this was sufficient information for us to make the connection as to his then developing theory.' Mr. Stevens also said that he did fe it uncomfortable coord not share his theory with us during our initial interview because he was instructed by AEE & decided to bankruptcy attorneys to only answer the questions which were asked. He stated that we did not pursue the family reimbursement issue, and, therefore, he elected not to offer the additional information. Mr. Stevens indicated that he does not blame us for failing to The June 7, 1990 Memorandum of Interview (Exhibit 1) mentions the telephone discussion between Mr. Stevens and Mr. Smith (Exhibit 1, Page 3) but does not mention the substance of the conversation. Notes taken during the June 7, 1990 interview indicate that Mr. Smith said that he knew the Senate rules would prohibit Senator McCain's personal use of ACC corporate aircraft, but he was unsure of how the rules treated family members. MEMORANDUM OF DAVID E. STEVENS ATTORNEY WORK PRODUCT question him about the family reimbursement issue in our June, 1990 interview since, prior to the interview, we were unaware that Mr. Stevens was the ACC employee most familiar with the travel reimbursement issue as it related to Senator McCain. Additionally, Mr. Contacted Stevens fully expected to be called as a witness by the Senate Ethics Committee (the Committee) sometime following our June, 1990 interview and believed that he would have a second opportunity to state his view. When it became clear to Mr. Stevens that he would not be contacted, he considered writing a letter to the Committee in September, 1990. However, he became aware of newspaper reports of the preliminary findings of the Special Counsel. He believed that if the investigation was concluded as to Senator McCain, then writing a letter as to additional information on Senator McCain's personal flights would not be useful. However, when he became aware that the Committee would hold a hearing on all five Senators, he made the decision to write his October 26, 1990 letter. Mr. Stevens stated that he was motivated to write the October 26, 1990 letter because he had not been contacted by the Committee and that he believed that he had additional cast some doubts on information which had not been considered which refuted prior public statements by Senator McCain relative to his intentions to reimburse ACC for personal use of corporate aircraft for himself and his family. Mr. Stevens did not talk to anyone other than his wife and a few close friends prior to sending his letter to the Committee. At the end of the interview, however, I asked Mr. Stevens if he talked to anyone about his letter between the MEMORANDUM OF DAVID E. STEVENS ATTORNEY WORK PRODUCT date of his letter and the date of the first contact by the Committee. Mr. Stevens stated that he heard no response on his letter in the three to four weeks after mailing it. During this time, he read newspaper reports of "tension" between Senator McCain and Senator DeConcini during the hearing. Based upon these factors, he sent a copy of his October 26, 1990 letter to Senator DeConcini along with a "letter of support" of Senator DeConcini dated November 16, 1990 (Exhibit 3). The letter to Senator DeConcini begins, "I am writing to express my support as you undergo the travesty which is being labeled as a Senate Ethics Committee hearing. I feel that you have been unfairly singled out and chastised for doing nothing more than what you felt your duty was. I am especially concerned with the uneven treatment given to you and to Senator McCain." I asked Mr. Stevens if his opinion of Senator DeConcini and his actions relative to ACC and Charles Keating was a motivating factor in the preparation of the October 26, 1990 letter. He originally stated that it was not the primary factor, but that he was influenced to some extent by his opinion of Senator DeConcini. When I pressed Mr. Stevens to describe the extent by which he was motivated to prepare the October 26, 1990 letter by his opinion of Senator DeConcini and the Senator's actions, he backed off from his earlier comment and said, "My personal opinion about Senator DeConcini had nothing to do with the October 26, 1990 letter." He stated further, "The primary motivation for preparing this letter was to provide additional information" as to Senator McCain and his family's personal use of ACC aircraft,and to "set the record straight." He had no discussions with either Senator DeConcini or his staff prior to writing his October 26, 1990 letter. He MEMORANDUM OF DAVID E. STEVENS ATTORNEY WORK PRODUCT does believe that Senator DeConcini's action was courageous in his support of a major employer in Arizona and believes that Senator McCain left "at the first sign of trouble." He indicated that he sent a copy of his October 26, 1990 letter to Senator DeConcini because he had not been contacted by the Committee and he believed that there was a information. kiume aware if greater chance that the Committee would consider his views. I asked Mr. Stevens to describe any contacts or discussions he had after sending his "letter of support" to Senator DeConcini. He stated that he received a call from Senator DeConcini personally on Monday, November 26, 1990. Mr. Stevens said Senator DeConcini thanked him for his support and asked Mr. Stevens if he had heard anything from the Committee in response to his October 26, 1990 letter. Mr. Stevens indicated that he had received no response from the Committee. Senator DeConcini then asked Mr. Stevens if he would mind if the Senator's staff brought his October 26, 1990 letter to the attention of the Committee and Mr. Stevens replied that he didn't mind, and in fact he had hoped that the Committee would consider his views in that letter. Mr. Stevens explained to me that his October 26, 1990 letter to Senator Howell Heflin and his November 16, 1990 letter to Senator DeConcini were both addressed to the United States Senate in Washington, D.C. He indicated to Senator. DeConcini that he found it curious that he received no-responsefrom the Committee in four weeks yet Senator DeConcini responded to his November 16, 1990 in just over one week: Senator DeConcini stated that the lack of attention paid to Mr. Stevens' October 26, 1990 letter by the Committee was just another example how he was being treated unfairly throughout the investigation, and he went on to describe other |