After an investigation that cost $52 million, took six years to complete, and became as controversial as its targets, Independent Counsel Robert Ray reported Wednesday that he had insufficient evidence to seek criminal charges against President Clinton and First Lady Hillary Rodham Clinton in the Whitewater land development deal.
Ray officially ended the tangled investigation into the Clintons’ investment in a small but suspect Arkansas land scheme, an investment they made when he was governor and she was a prominent lawyer in the Rose Law Firm of Little Rock. But the independent counsel stopped short of exonerating them, saying only that the evidence was inconclusive.
As he put it: “The office determined that the evidence was insufficient to prove beyond a reasonable doubt that either President or Mrs. Clinton knowingly participated in any criminal conduct … or knew of such conduct” in Whitewater-related financial dealings that resulted in the convictions of 14 people.
For three-quarters of Clinton’s administration, Ray and his two predecessors, Kenneth Starr and Robert J. Fiske Jr., tried to determine whether the Clintons were guilty of perjury and obstruction of justice in the Whitewater case and the related failure of Madison Guaranty, a Little Rock savings and loan association.
After that extended legal and political drama, which generated plenty of headlines and beget several investigations of the Clintons, their friends and aides, Ray’s report seemed anticlimactic.
Begun by Fiske in 1994 and taken over by Starr, the investigation mushroomed into multiple inquiries into scandals involving the Clintons, including Travelgate, Filegate, the Paula Jones sexual harassment suit and the Monica Lewinsky case, which led to the president’s impeachment.
The Clintons’ partners in the Whitewater land deal, James McDougal and his wife, Susan, were convicted in 1996 of fraud in connection with Madison Guaranty’s failure after evidence that some of its money had been put into Whitewater to keep it afloat.
Ray’s expected announcement created little surprise but much irony. Clinton will not face Whitewater charges, but his role in covering up the Lewinsky affair still haunts him. A federal grand jury summoned by Ray is investigating whether the president should be indicted for lying under oath and obstruction of justice after he leaves office.
The White House welcomed the independent counsel’s statement, but it did not touch off a celebration. Clinton ignored a question about it, and his press secretary, Joe Lockhart, said Ray was the latest to “conclude there are no grounds for legal action.”
Campaigning for the U.S. Senate in New York, Hillary Clinton said, “I’m just glad that this is finally over.”
Because Ray’s statement cast no further suspicion on the first lady, her supporters seemed relieved by the outcome.
Yet in her case and in the president’s case, Ray stopped short of an exonerating statement, saying only that he could not prove they were culpable. Susan McDougal, who went to jail rather than answer Starr’s questions about the Clintons, criticized Ray for not clearing them. “It would really please me if they would just be men and say there is nothing there,” she said.
At an Associated Press meeting in Albany, N.Y., Hillary Clinton, who Starr brought before a grand jury to testify in the case, said that “most New Yorkers and Americans made up their minds a long time ago” about the case. “I think taxpayers have a right to ask why was all this money spent especially since the conclusions were readily available five years ago.”
In his report, Ray cited “delays in obtaining evidence,” including Susan McDougal’s refusal to testify, the disappearance of Mrs. Clinton’s legal billing records for 18 months, and legal challenges to turning over White House lawyers’ notes of conversations with the first lady.
The legal case known as Whitewater may be over, but it lives on in a larger sense as an affair that set in motion events and other inquiries that tarnished Clinton’s presidency and seemed to turn Washington into a more partisan, scandal-obsessed capital.
Eventually the prosecution became as controversial as the prosecuted. Largely as a result of Starr’s handling of the Lewinsky case, support for the independent counsel law shrank and Congress did not renew its authority.
In seeking to wind up the independent counsel’s work after Starr’s resignation, Ray issued reports that cleared the president and first lady of wrongdoing in connection with the Travel Office firings and the FBI files cases, in which the agency’s files of former Republican office holders wound up in the White House.
Before sending his final report to a three-judge panel, Ray said he has unfinished business involving an appeal by former Arkansas Gov. Jim Guy Tucker, who was convicted of conspiracy and mail fraud, and an investigation into the White House’s failure to produce e-mail records.
All through the Whitewater affair, the president and the first lady insisted on their innocence despite embarrassing details that were uncovered.
For example, according to Ray’s statement, at Susan McDougal’s 1999 trial for criminal contempt, the prosecution produced two checks that appeared to implicate Clinton in the use of Madison Guaranty money to help the troubled Whitewater development.
The first check, for $27,600 and dated Nov. 15, 1982, was found among Madison Guaranty records in the trunk of a car. It was made out to “Bill Clinton.” In the second case, a microfilm copy of a $5,081 check signed by Susan McDougal on Aug. 1, 1983, had a memo on it: “Payoff Clinton.” The check covered the principal and interest on the Whitewater loan at the time, according to Ray.
Ray said that neither check “reflected a signature or endorsement by Bill Clinton,” who denied he had borrowed any money from the savings and loan. Ray said his office determined that the evidence was insufficient to prove Clinton had borrowed money from Madison Guaranty for Whitewater.
Similarly, the independent counsel said evidence was insufficient to seek charges against the first lady when her Arkansas law firm billing records mysteriously turned up in the White House after they had been subpoenaed 18 months earlier. The billing records indicated that the first lady had done legal work on a fraudulent land development near Little Rock owned by James McDougal.
Ray said evidence was insufficient to prove that supporters of the president engaged in a “criminal quid pro quo” to obstruct the independent counsel’s investigation when they obtained a series of jobs for Clinton’s friend Webster Hubbell. Hubbell had resigned under fire from the Justice Department in connection with an investigation that he overbilled clients at the Rose Law Firm.
