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McDougal says her ex-husband lied about Clinton's Whitewater involvement
March 24, 1999 LITTLE ROCK, Arkansas (AllPolitics, March 23) -- Saying she has little new information to add to the Whitewater investigation, Susan McDougal testified Wednesday that she believes her late ex-husband James McDougal told Independent Counsel Ken Starr "stories" implicating President Bill Clinton to win a lighter prison sentence for his 1996 Whitewater conviction. Furthermore, McDougal said that her late ex-husband suggested that she should claim to have had a sexual relationship with Bill Clinton. McDougal believes that Starr's office urged Mr. McDougal to make that suggestion. "He told me this is something he had to do because he did not want to die in jail," McDougal testified. James McDougal did in fact die in prison in March 1998, while serving a three-year sentence for business fraud. Before he began cooperating with the special prosecutor, Mr. McDougal faced a possible sentence of 84 years in prison. The former business partner of Bill and Hillary Rodham Clinton recalled one conversation with her ex-husband in which he was rehearsing his new Whitewater story: "I have got a whole new twist, what do you think about the way I say this, does this sound believable?" She said her former husband told her that he had also promised to try and persuade her to cooperate with the grand jury, which she did not do. McDougal told the jury in her criminal contempt and obstruction of justice trial that James McDougal had urged her to tell Starr that Clinton was present for a discussion about a fraudulent $300,000 loan, claiming James McDougal told her "if you come in and say this you can write your own ticket." "If you don't tell this story, you're going to jail," McDougal testified that James McDougal also said. In another twist, McDougal said her husband told her, "You don't have to say Clinton pressured (former municipal judge David) Hale to give you the loan -- all you have to do is say that you had a sexual affair with Bill Clinton." McDougal served four months of her two-year sentence before being released after medical experts testified she suffered from painful spinal problems. Before his death, Mr. McDougal agreed to cooperate with the Office of the Independent Counsel, confirming Hale's allegation that Clinton knew about a fraudulent Small Business Administration (SBA) loan taken out in Susan McDougal's name. McDougal said that, after she and her husband were separated, he told her during a telephone conversation that Starr's office promised him "running around" money and that Starr would personally testify before the grand jury that Mr. McDougal was a "good Christian." Hale, a prosecution witness in the McDougals' 1996 trial, has said that Clinton pressured him to make the fraudulent loan, defrauding the SBA through his Capital Management company. McDougal continues to maintain that both Hale and James McDougal lied about Clinton's involvement. McDougal spent a second day defending herself on charges stemming from her refusal to answer questions before Starr's Whitewater grand jury. On Tuesday, McDougal began her testimony by publicly answering those questions she refused to answer for Starr, saying, as far as she knows, the president testified truthfully in 1996 about the controversial Whitewater land deal. "I did not hear anything untruthful," she said when asked by her attorney Mark Geragos if Clinton told the truth in his videotaped deposition in her 1996 Whitewater trial. McDougal also testified that she never spoke with Clinton about the fraudulent $300,000 loan in her name. Earlier in the trial an FBI agent testified that a $27,600 check made out to then-Arkansas Gov. Clinton was paid in a complicated series of financial transactions that led to the illegal loan that sent McDougal to prison in a previous trial. However, the agent also testified the check did not bear Clinton's endorsement nor any identifiable fingerprints. In 1996, the president testified at McDougal's first Whitewater trial that he knew nothing about the SBA loan. Starr's office pursued the current charges against McDougal after she refused to answer questions about the Clintons in September 1996 and again last April. McDougal has called the trial a "personal vendetta" by Starr. She has already served 18 months for civil contempt for refusing to answer grand jury questions. She has said she refused to respond because she believes Starr would twist her words to suit his purposes and may charge her with perjury if he doesn't get the testimony he wants. The McDougals were partners with the Clintons in the Whitewater real estate venture in northern Arkansas. If convicted, McDougal could face as much as 10 years in prison and a $750,000 fine. CNN's Terry Frieden, Bob Franken and The Associated Press contributed to this report. |
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MORE STORIES:Wednesday, March 24, 1999
• Clinton explains attacks to U.S. public • The politics of bombing • U.S. defense secretary: No indication of NATO casualties • Text of House Kosovo resolution • GOP pushes flag burning amendment • Jackson won't seek presidency in 2000 • McDougal says her ex-husband lied about Clinton's Whitewater involvement • Clinton urges Arafat to delay declaration of Palestinian state • Congress voices support for airstrikes, troops • Democrats criticize census bill, Census director criticized • Iran-Contra independent counsel suggests keeping the law • House approves $180 million for its committees • Anti-bigotry measure defeated after contentious House debate • Black-tailed prairie dog to be evaluated for endangered status • House approves $1.3 billion for Central America, farmers | ||||