WASHINGTON -- As a big-time Washington insider, Commerce Secretary Ron Brown has fashioned a lucrative career in and around politics. But his deals and handshakes have also generated persistent suspicions that now threaten to overshadow his remarkable success.
In the new GOP-dominated political landscape, Republicans have turned a spotlight on Mr. Brown's finances. At their urging, the Justice Department is reviewing his business dealings, the first step in an investigative process that could lead to the naming of a special prosecutor.
Mr. Brown, who as chairman of the Democratic National Committee helped boost Bill Clinton into the White House, has been one of the Democrats' most valuable players and a widely admired commerce secretary. "The toast of Corporate America," said Business Week.
Until recently, it was expected Mr. Brown, 53, would head the president's re-election campaign. But a new ethics bonfire -- fed by freshly emboldened Republicans -- has all but torched that plan, and even his future as a Cabinet member is uncertain.
"He's starting to look like a man under siege," said Charles Lewis, executive director of the Center for Public Integrity, an ethics watchdog group.
At the center of the latest controversy is the question of how Mr. Brown came to earn more than $400,000 as a shareholder in a company in which he invested no money, whether he disclosed and paid taxes on some of those earnings, and whether -- as commerce secretary -- he provided favors for anyone involved in the business.
Mr. Brown, the highest ranking African-American in the administration, has denied any wrongdoing. "At no time during my tenure as secretary have I been involved in any matter which would cause a conflict of interest or create an appearance of a conflict of interest," he wrote last month to Republican Rep. William F. Clinger Jr. of Pennsylvania, chairman of the House Government Oversight Committee.
But that assertion and others have not satisfied Republicans. Mr. Clinger, who has been investigating Mr. Brown's finances for the past year, said he may hold hearings this spring because Mr. Brown has not answered questions to his satisfaction.
Other GOP House members have written to Mr. Clinton calling for Mr. Brown's resignation, while 14 Republican senators called for the Justice Department probe.
Questions about Mr. Brown's business deals are nothing new. A former partner in the well-connected Washington law and lobbying firm of Patton, Boggs & Blow, his financial disclosure forms have long been dizzying and intricate lists of investments, divestments, purchases and sales that have at times raised eyebrows.
In his first year as commerce secretary, the Justice Department opened a criminal investigation into accusations that Mr. Brown accepted a $700,000 bribe from the Vietnamese government in exchange for his efforts to lift the U.S. trade embargo against that country. The department closed the case last year, saying it had found no wrongdoing.
The latest tangle of questions revolves around his 1990 partnership with businesswoman Nolanda Hill in an investment company called First International Inc.
In 1992, after being named to the Clinton Cabinet, Mr. Brown listed First International as his single biggest asset, valued at between $500,000 and $1 million. But Mr. Brown invested no money in the firm, and said in his letter to Mr. Clinger that he had "no involvement in either its management or operations."
To avoid conflicts of interest, Mr. Brown sold many of his holdings when he became commerce secretary in 1993, but he held onto First International. He explained that the nature of the company, at the time involved in projects in Eastern Europe, made it unlikely that any conflict of interest would arise.
Congressional investigators have revealed that First International's major asset was an $875,000 promissory note from Corridor Broadcasting Corp., a TV business owned by Ms. Hill that defaulted on two federally guaranteed loans costing taxpayers a total of $40 million in 1993.
Corridor was making interest payments of $12,000 a month to First International, for a time the firm's only source of income. The Federal Deposit Insurance Corp. last month began an investigation into Corridor's loan defaults at the urging of Mr. Clinger and other House members.
Republicans say the commerce secretary, who is involved in federal communications policy, should have revealed that he was receiving money from a broadcast business. But Mr. Brown has said he did not know that Corridor was the chief source of income for First International.
Mr. Brown sold his interest in the firm to Ms. Hill in December 1993, after what he called "unwarranted and unfair press inquiries," and reported his earnings from the sale at between $250,000 and $500,000, according to his financial disclosure statement.
To buy out his share of the partnership, Ms. Hill, after defaulting on the two loans, paid off $190,000 of Mr. Brown's personal debts -- including mortgages and credit card debts -- and forgave an $87,000 loan he owed to Know Inc., another of her companies.
Mr. Brown also received three checks of $45,000 each during April, July and October of 1993 -- marked "partnership distribution" -- that Republicans say he did not report on his financial disclosure form.
Reid Weingarten, Mr. Brown's lawyer, says the three checks, totaling $135,000, were part of Mr. Brown's payment for the sale of his interest in First International.
Together, the debt payment, forgiven loan and three checks come to $412,000.
Edmund Amorosi, a spokesman for Mr. Clinger, said the complex transaction is curious. "Anytime there is that kind of windfall from an entity with no successful business ventures -- a company he admits he invested no money in -- it raises questions," said the aide.
But Mr. Weingarten said such arrangements with prominent people viewed as "potential rainmakers" are routine. "If he chose to get out of government, can you imagine the compensation package [investment firms such as] Goldman Sachs or Shearson Lehman would dangle in front of him? And he would not have to invest anything.
"Nolanda Hill is a hard-nosed, competent businesswoman who looked at the possibilities in doing business with him and highly valued him."
Mr. Clinton has offered public support for Mr. Brown. When asked last month if Mr. Brown was in trouble, Mr. Clinton responded, "He's been a great commerce secretary."