Corruption: Feeling the Heat

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Farther south, the government of Argentina last week gave B.C.C.I. 48 hours / to pack up and leave the country. Authorities were particularly worried by the appearance of links between President Carlos Saul Menem and Saudi billionaire Ghaith Pharaon, a B.C.C.I. front man who is building a Hyatt Hotel in Buenos Aires and is a friend of Javier Gonzalez Fraga, the former president of Argentina's central bank. "We already know that the next scandal is going to tie President Menem with Ghaith Pharaon," an official said.

The B.C.C.I. debacle even rubbed off on the U.N. and its Secretary-General, Javier Perez de Cuellar. The U.N. sullenly confirmed reports that Perez de Cuellar twice took trips in 1986 and 1987 on planes owned by Pharaon. The diplomat has said he was unaware at the time of problems at B.C.C.I.

In stark contrast to the havoc that B.C.C.I. spread from London to Lima was the studied calm at the White House last week. Senior officials described the scandal as more an annoyance than a real concern. Said Press Secretary Marlin Fitzwater: "The Justice Department has been looking into it for some time, and we're satisfied with the way they're handling it." He added, however, "It's clear that the Democrats are going to try to make some political hay out of it. Unfortunately, it looks like everything is going to be political between now and next November."

So far, other than complicating the Gates nomination, the scandal has in no way implicated the West Wing. But with the Gates hearings, congressional investigations and upcoming grand jury indictments all vying for headlines, B.C.C.I. could become an uncomfortably hot issue as the parties head into the 1992 campaign.