SEN. LOTT AND THE NASA CONTRACTOR

Sen. Trent Lott (Miss.), the GOP gumshoe who searches for skeletons in the closets of Democratic appointees, has one rattling in his own closet.

Lott confirmed to us that his ties to Isadore Hyde, a political friend who was convicted last year of defrauding the federal government, have been investigated "by NASA officials, by the FBI and by others." Lott asserts he was cleared, but some government investigators maintain that the investigation didn't go as far as it should have.

In 1984, Hyde's company was awarded a NASA contract to provide security services at the Stennis Space Center in Mississippi. NASA investigators eventually uncovered that Hyde and his wife, Celestine, billed NASA for 24 unallowable expenses in 1985-86 -- amounting to more than $186,000 that the Hydes diverted for personal use. NASA's probe led to a grand jury investigation. In April 1993, Isadore Hyde and his wife were sentenced to prison for conspiracy to defraud the government.

NASA investigator John Batson, who headed the Hyde investigation, has come forward to tell us that NASA Inspector General Bill Colvin blocked his investigation once Batson began looking at Lott's ties to Hyde. The General Accounting Office is currently conducting a special investigation of Colvin, based on allegations that he has shut down sensitive investigations. Colvin refused to comment.

Batson had been pursuing leads furnished by former Hyde employees -- including allegations that Hyde used NASA resources to do political favors for Lott. One former Hyde employee told Batson that Lott's campaign headquarters in Moss Point, Miss., was provided free by Hyde.

Several other former Hyde employees told Batson that on one occasion, three Hyde employees parked cars and provided security for one of Lott's campaign functions. The incident allegedly happened during a normal workday, which would mean that Hyde employees were being paid with taxpayer funds from the NASA contract to do political work for Lott. "That's absolute news to me," Lott told us.

Hyde may have felt that he was in Lott's debt. Hyde received the NASA contract after then-Rep. Lott and his staff made persistent inquiries on his behalf. Less than two weeks before Hyde officially won the contract, Hyde put Lott's mother, who was 71 at the time, on the company's payroll. An April 1990 five-page memo that the IRS submitted to the U.S. attorney's office, detailing information obtained during a grand jury investigation of Hyde, explains how Iona Lott got the job.

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Hyde created a job of public relations/personnel director for Iona Lott in 1984, even though she had no experience in these areas. Lott did not resign from her state job with the Southern Mississippi Planning and Development District until Aug. 31, 1984, which meant that she was on two payrolls for several months.

"Lott's services to HSSI {Hyde's company} were minimum and meaningless as the HSSI personnel files she kept were duplicated and also kept" by several other employees, according to the memo. Lott was paid as a full-time employee for her first two years, even though she worked only 20 hours per week, and she received perks other employees did not enjoy -- including use of a company car.

Sen. Lott told our associate Ed Henry: "I didn't try to get her that job. In fact, the truth is I didn't even really want her to take that job. But I didn't have anything to do with her getting that."

When a Small Business Administration official asked Hyde why Mrs. Lott was on his payroll, according to the memo, Hyde responded that "she could open doors that would not be opened otherwise, and that she was his connection to Washington as she could talk to Congressman Lott when {Hyde} could not reach the congressman."

According to notes from a 1989 interview that an IRS investigator conducted with Mrs. Lott in conjunction with the grand jury investigation, she said: "Trent did tell her {Mrs. Lott} on one occasion that he was on a SBA board committee in Washington and he helped Isadore Hyde get an SBA loan." Mrs. Lott added that "during {Trent's 1988 Senate} campaign, Mr. Hyde worked hard... . Hyde told {Mrs. Lott} that Hyde owed {Trent Lott} because Lott helped him get an SBA loan."

Sen. Lott says his mother is mistaken. "She's 80 years old," said Lott. "I mean, at this point, you know, her memory's not always perfect. She probably got confused by the fact that I was on the Senate committee {that has jurisdiction over the Small Business Administration}, but I was never on the one in the House."

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