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Edwards Investigation Should End This Week

February 26, 1985

NEW ORLEANS (AP) _ A federal grand jury’s lengthy investigation of Gov. Edwin Edwards’ links to health care projects in Louisiana is expected to end this week, and Edwards maintains the evidence does not justify an indictment.

Lawyers for Edwards and others involved in the probe met with the Justice Department officals Monday in Washington.

Edwards was in Washington, too, but did not attend the session. He met with Interior Department officials to discuss offshore oil revenues and joined other governors at the White House for talks with President Reagan.

Although he has conceded the possibility of an indictment, Edwards, who has maintained his innocence, said Monday he does not expect to be indicted.

″The facts do not justify (an indictment),″ he said.

Edwards’ lawyer, James Neal of Nashville, Tenn., spent almost two hours in the office of Assistant Attorney General Stephen S. Trott, head of the Justice Department’s Criminal Division.

Afterward, Neal declined comment on the discussions.

U.S. Attorney John Volz of New Orleans told reporters he was in Washington ″to meet with targets of the investigation.″ He declined further comment.

Volz had said earlier that the grand jury was expected to conclude later this week an investigation into Edwards’ approval of hospital and nursing home applications by former associates, with whom he made $2 million in business ventures. The probe began last fall.

A New Orleans television station, WDSU, in a report from Washington, said it had learned that Edwards and his lawyers had been told that a racketeering indictment will be presented to the grand jury.

Any indictment under the Racketeer Influenced and Corrupt Organization Act must be submitted to the Justice Department for approval, and WDSU quoted unidentified sources as reporting that the approval had been given.

Taking part in the Justice Department meeting was attorney Don Beckner, who represents Ron Falgout, a former state health undersecretary, and James Wyllie, a consultant, both of whom were associates of Edwards in four state- approved hospital ventures between Edwards’ second and current terms.

Also at the meeting was Jack Martzell, a lawyer for Marion Edwards, the governor’s brother.

Justice Department spokesman John Russell said Criminal Division officials and lawyers from the department’s organized crime section were involved in the meeting.

The focus of the grand jury probe is on Edwards’ approval, after taking office last March, of eight health-care project applications, including five from Health Services Development Corp., a Metairie consulting firm operated by his former associates. He also imposed a moratorium on other applications.

Edwards, a Democrat, on Monday again said the investigation is politically motivated.

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