HUD Secretary Henry Cisneros Is Indicted for Lying to Federal Agents

Date December 11, 1997

U.S. Housing and Urban Development secretary Henry Cisneros, a rising star in the Democratic Party and a successful businessman and respected community leader, broke the public trust when he was indicted for conspiracy, lying, and obstructing justice by trying to hide facts regarding money he provided to a former mistress. He was convicted but served no prison time. The scandal ended his political career but not his business career.

Locale Washington, D.C.

Key Figures

• Henry Cisneros (b. 1947), mayor of San Antonio, Texas, 1981-1989, and head of the U.S. Department of Housing and Urban Development, 1993-1996
• Linda Jones Medlar (b. 1948), Cisneros’s former campaign aide and former mistress
• David M. Barrett (b. 1936 or 1937), White House independent counsel

Summary of Event

Henry Cisneros, the nominee for U.S. secretary of Housing and Urban Development (HUD) in late 1992, was under scrutiny by the Federal Bureau of Investigation (FBI) for misrepresenting facts about payments he made to his former campaign aide and mistress, Linda Jones Medlar. Cisneros never denied paying Medlar, and he even met with representatives of the transition team for president-elect Bill Clinton to discuss both his relationship with Medlar and his payments. However, what remained unclear to investigators was how much he paid her and for how long. What led to scandal was his failure to tell the truth to the FBI.

Cisneros, who was the first Latino mayor of a major U.S. city, had ended the affair with Medlar near the end of 1989 and reconciled with his wife, who had filed for divorce. He made a verbal agreement with Medlar to pay her $4,000 per month until she could find a job or until her daughter completed college. Cisneros admitted his payments were inconsistent and that he could no longer afford them once he became HUD secretary in January, 1993; he did continue to pay her some money for about one more year. In July, 1994, Medlar sued Cisneros for $256,000 for breach of contract. She maintained in the suit that he promised to pay her for emotional distress and loss of livelihood following their affair and that he publicly disclosed private information about her without her knowledge and consent.

On September 12, Medlar appeared on the television show Inside Edition and claimed that Cisneros had lied to the FBI during its background check of the nominee. Inside Edition also broadcast excerpts from audiotapes Medlar recorded without Cisneros’s knowledge. The tapes included statements made by Cisneros that contradicted what he told the FBI about the payments to Medlar. The U.S. Justice Department began its investigation in March, 1995, as U.S. attorney general Janet Reno requested an independent counsel to investigate the matter. David M. Barrett was appointed for that job in May. Soon after Barrett’s appointment, Cisneros settled Medlar’s 1994 lawsuit for $49,000. Barrett then granted Medlar immunity from prosecution in exchange for her cooperation in building a case against Cisneros. In January, 1997, Cisneros resigned as HUD secretary, stating that he needed to be with his family.

Close to one year later, on December 11, Cisneros was indicted by a federal grand jury on eighteen counts of conspiracy, making false statements to the FBI, and obstructing justice. The indictment charged that Cisneros made frantic efforts prior to, during, and after his confirmation as HUD secretary to ensure that Medlar did not reveal the true nature of the love affair, which began in 1987, and the actual amount of money she received from him. Cisneros denied the grand jury’s allegation that his payments to Medlar amounted to hush money. He said the payments were humanitarian in nature. The grand jury also maintained that Medlar had threatened to publicly expose the affair and payoff.

In June, 1999, Cisneros’s lawyers attacked Medlar’s credibility. One of Medlar’s former attorneys testified that Medlar had been lying, especially about more than thirty conversations with Cisneros that she had secretly taped between 1990 and 1994. Medlar claimed that she taped her conversations so that she would have a record of Cisneros’s promises of financial assistance. When payments ceased, Medlar took the tapes to her lawyers. She also claimed her lawyers told her to edit the tapes to remove any portions that could suggest she was threatening Cisneros. In September, 1996, an analysis of the tapes verified that they were altered.

Medlar would soon be charged in a case involving bank fraud in Texas and was sentenced to three and a half years in prison. Nevertheless, prosecutors agreed to seek a reduced sentence for the bank fraud conviction in return for her full cooperation in the Cisneros case. The subsequent hearings focused on the admissibility of the tapes after Medlar reaffirmed that she edited several of them. Prosecutors argued that the tapes, which contained discussions by Cisneros of ways to mislead investigators, were critical to the case, and the court agreed. Had the tapes not been allowed as evidence, the prosecution would have had to rely on Medlar’s testimony alone and on a complicated trail of financial records.

Cisneros pleaded guilty in September, 1999, to a single misdemeanor charge of lying to the FBI about the money. He had pleaded not guilty in January, 1998, to a felony charge of lying to the FBI about the payments. As part of a plea agreement, Cisneros admitted to lying to federal agents and paid a $10,000 fine. However, he was spared a prison sentence or probation and thus was free to seek elected office if he so desired.

Difficult issues affected both sides of the case. Barrett had to convince a jury that Cisneros committed a crime. Doing so was complicated because Cisneros had earlier acknowledged both the affair and the payments; his crime was understating the amount of money involved by lying to the FBI. Cisneros risked the embarrassment of having his private life made public. Both sides concluded that the plea agreement was the appropriate way to handle the case.

Impact

The payments controversy affected not only Cisneros’s personal life but also his professional life, and his prosecution confirmed the consequences of lying to the FBI. First, the Cisneros scandal was one in a line of controversies involving President Clinton’s cabinet. Others who were investigated by independent counsels include former agriculture secretary Mike Espy, commerce secretary Ronald H. Brown, interior secretary Bruce Babbitt, and labor secretary Alexis M. Herman.

Barrett would continue his investigation for several years after Cisneros was convicted, believing the Internal Revenue Service and the Department of Justice were blocking his inquiries. This investigation ended in early 2006 at a cost to taxpayers of about $22 million.

Second, the aggressive nature of the FBI’s investigation of Cisneros for lying to agents reflects the bureau’s insistence on maintaining its integrity and on investigating perjurers, even those in high government office. Third, the indictment and conviction changed Cisneros’s career plans. He had been a rising star in politics, but after the scandal, his plans did not include politics. He moved from San Antonio, severing deep family roots there, to Los Angeles to engage in new business ventures, but he reportedly returned to San Antonio. He was pardoned by President Clinton in 2001.

Bibliography

Henry, Christopher E. Henry Cisneros. Langhorne, Pa.: Chelsea House, 1994. One of a series of books on Latinos of achievement. Extols the qualities that made Cisneros an outstanding success in local politics.

Locy, Toni. “Ex-Housing Chief Cisneros Indicted.” The Washington Post, December 12, 1997. The leading newspaper of record in Washington, D.C., reports on Cisneros’s indictment for perjury, conspiracy, and obstructing justice.

Miller, Bill. “Cisneros Pleads Guilty to Lying to FBI Agents.” The Washington Post, September 8, 1999. The local news report on Cisneros’s plea in the federal case against him.

Roberts, Robert North. Ethics in U.S. Government: An Encyclopedia of Investigations, Scandals, Reforms, and Legislation. Westport, Conn.: Greenwood Press, 2001. A comprehensive encyclopedia documenting political scandals, ethical controversies, and investigations in the United States between 1775 and 2000.

Romero, Maritza. Henry Cisneros: A Man of the People. New York: PowerKids Press, 2001. A brief biography of Cisneros, written to inspire young readers.