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Burden of Proof

Clinton-Era Fallout: Did a Last-Minute Presidential Pardon Circumvent the Justice Department?

Aired February 9, 2001 - 12:30 p.m. ET


ROGER COSSACK, CO-HOST: Today on BURDEN OF PROOF: Clinton-era fallout on Capitol Hill. Did a last-minute presidential pardon circumvent the Justice Department?


JACK QUINN, COUNSEL TO MARC RICH: I remain to this day absolutely and unshakably convinced that the prosecutors constructed a legal house of cards in this indictment. At the heart of this case is a tax charge that I do believe is meritless.

REP. BOB BARR (R), GEORGIA: I think the president knew exactly what he was doing. You didn't request information so you could probably say, I don't know. In other words, have you ever heard of the concept of deliberate ignorance? Well, maybe not. Most prosecutors have.

ERIC HOLDER, FMR. DEPUTY ATTORNEY GENERAL: I will stand here and have people say that I have made a mistake, and I'll debate that. But you are now implying that I have done something that's essentially corrupt, and I will not accept that. That I will not accept.


ANNOUNCER: This is BURDEN OF PROOF, with Greta Van Susteren and Roger Cossack.

COSSACK: Hello and welcome to BURDEN OF PROOF. Greta is off today.

On his last day in the Oval Office, former President Bill Clinton pardoned 140 people. But none raised eyebrows as much as the pardon of billionaire Marc Rich, who has spent the past two decades living in Switzerland. Rich was wanted in the United States on charges of tax evasion and fraud. In fact, he was on the "Top 10" wanted list.

Critics argue the pardon was granted after his ex-wife, a Democratic Party contributor, gave generously to the former president's foundation. Now, yesterday in Washington, the House Government Reform Committee held hearings on how the pardon was secured and what the Justice Department knew about it.

(BEGIN VIDEO CLIP) HOLDER: Although I always acted consistent with my duties and responsibilities as deputy attorney general, in hindsight I wish that I had done some things differently with regard to the Marc Rich matter. Specifically, I wish that I had ensured that the Department of Justice was more fully informed and involved in this pardon process.


COSSACK: And joining us today from New York is former U.S. attorney Martin Auerbach. And here in Washington, Elizabeth Newland (ph), presidential historian Allan Lichtman, and Rhonda Bolden (ph).

First, though, let's go to Natalie Allen. There's a briefing in the State Department with Secretary of State Colin Powell.



COSSACK: We're back and we're talking about the presidential pardon of Marc Rich.

And joining us now is Martin Auerbach.

Martin, you were the prosecutor, I suppose, in this case of Mr. Rich. Let me play a little advocate, a little lawyer with you for a second. The argument is that Marc Rich deserved -- one of the reasons he may have deserved this pardon was because the case that was brought against him, in many ways, was indictive. It was brought under a section of the RICO Act, which, really, the Justice Department doesn't use anymore. In fact, he could have been charged civilly. He was charged criminally. Most people who get accused of doing the things that he does gets charged civilly and not criminally and therefore this was justified. I see you loading up to argue with me, so go ahead.

MARTIN AUERBACH, FMR. U.S. ATTORNEY: Well, first I'd like to say that President Clinton finally achieved bipartisanship in the committee that I appeared before yesterday, because it is the first time I have heard this committee uniformly condemn a decision that he made. This was not a partisan issue, and the merits were extremely clear to the panel, as they were clear to the prosecutors in this case and as they were clear to Mr. Rich's companies when they pleaded guilty and paid over $200 million to the United States government.

COSSACK: Well, Martin, there's a lot -- there's a major difference between paying a fine to the United States government and putting someone in prison, which is what this indictment was seeking to do -- or at least convict him and let the judge put him in prison.

Now, let's be more specific with me. You know, Quinn says -- Jack Quinn argues yesterday, look, this is a vindictive prosecution brought under the RICO Act. They don't do this anymore. He was almost -- Rich was sort of the last vestiges of the Justice Department using RICO in this way. It wasn't meant to be used this way. You know, answer those charges.

AUERBACH: Well, first of all, before these charges were brought, they were reviewed by the Justice Department. This wasn't just some vindictive prosecutor sitting in New York, this was a decision made by the Justice Department in Washington.

Second, while it is true that years after this prosecution the Justice Department stopped using RICO in tax prosecutions, it has never stopped using them in mail and wire fraud prosecutions. And, of course, there were extensive charges in this case having to do with mail fraud and wire fraud.

And so, once again, as was true of many of Mr. Quinn's attacks on the prosecution, they're just factually incorrect.

COSSACK: Well, Martin, let me interrupt for a second and just ask this: In the sense of wire fraud and mail fraud, you know, every prosecutor knows that every time you pick up the telephone to talk to someone, if it's part of a scheme, that's a wire fraud count; mail fraud if I send you a letter that includes a letter, a statement about -- that you believe would be in furtherance of a scheme. That's a mail fraud count.

Doesn't this all originate, though, from the tax counts, the wire fraud and the mail fraud? They're not really separate counts, they're part of the tax counts. And isn't that the argument that RICO isn't used like that anymore?

AUERBACH: Well, in fact, it's the cart before the horse. We all remember that Al Capone went to prison not because he was a gangster, but because he evaded taxes on the illegal money he had made.

This case is, in many respects, the same. The reason that Marc Rich and Pinky Green moved the money out of the country and hid it from the IRS was that it was unlawful money in the first place. And that's what the mail and wire fraud counts have to do with. It's the fact that this was illegally made money, made in violation of very specific regulations that made the money illegal and that prompted Mr. Rich and Mr. Green (ph) to use their companies and very elaborate, phony transactions to move that money out of the country and evade paying the taxes on it.

COSSACK: Martin, if, in fact, these same events took place today, and, in fact, this defendant was brought to your attention today, would you still file RICO charges against him like you did several years ago?

AUERBACH: I'm not sure that the charges that would be filed would be RICO charges or would be money-laundering charges. Now, I'm a defense lawyer and so I wouldn't be bringing any charges. And I often debate with the government whether the charges they have brought are sound. But given the activity in this case that involved the creation of phony invoices to move millions and millions of dollars that were hidden on other people's books out of the country into Marc Rich's pocket, I think that this would be a mail fraud case.

COSSACK: All right, let me go to Allan Lichtman for a second, presidential historian and scholar.

What about this pardon? We've heard the accusations that the president of the United States has acted outrageously in doing these kinds of things. But historically, do presidents act outrageously the day before they leave office, or a week before they leave office?

ALLAN LICHTMAN, PRESIDENTIAL HISTORIAN: Well, you now, of course, the common example of that is George Herbert Walker Bush, shortly before he left office, pardoned Caspar Weinberger and other figures involved in the Iran-Contra scandal. The argument was that this wasn't justified. It was kind of a washing of charges that may have implicated the president himself.

COSSACK: But, also, Caspar Weinberger hadn't donated several hundred thousand dollars to his campaign. I think that's part of what the sticky part of all of this is.

LICHTMAN: Well, look, I personally think the pardon of Mark Rich is pretty outrageous. I also thought the pardon of Weinberger was outrageous, because things could have come up in those trials that implicated the president.

COSSACK: All right, let's go back in history. Take -- first of all, the Founding Fathers gave the president this unfettered discretion to make the pardon. We talk about they didn't go through the Justice Department. No requirement to go through the Justice Department.


COSSACK: He can sit up and pick up the telephone and say, I've got an order. Pardon the next 400 people. So the fact that it didn't go through the Justice Department, while perhaps makes us uncomfortable, no requirement. Why did Congress give the president -- the Founding Fathers give the president the ability to do this?

LICHTMAN: There was a big debate over whether the president, in fact, had to get the consent of the Senate, and they rejected that. Alexander Hamilton wrote in "The Federalist" that a single individual as opposed to a collective political body would be much better able to judge cases of what he called, quote, unquote, "unfortunate guilt"; and moreover that the pardon power could be a very useful tools in times of insurrection.

COSSACK: So they wanted the president to have that alone.

LICHTMAN: Alone and unconditionally -- no limits on it.

COSSACK: All right, now, you know, let's talk about sacred people in America: George Washington, Hamilton, Jefferson. What did they do when they left office?

LICHTMAN: Well, none of them, you know, issued the great bulk of their pardons at the moment they left office, but there have been very controversial pardons in American history. George Washington used the pardon power in a very high-profile way to pardon those involved in the Whiskey Rebellion, anti-tax rebellion of 1794. That, of course, didn't hurt Washington at all and was well justified.

But five years later, John Adams used the pardon power to pardon those involved in another rebellion, the Freeze Rebellion. It was highly controversial. It probably hurt Adams politically. It hurt his party. But in the end he said, it consoles me to the end of my days that I did the right thing.

But the biggest controversy and the most unjustified use of the pardon was in Reconstruction by Andrew Johnson, you know, the guy who became president upon Lincoln's death, who issued hundreds and thousands of pardons to ex-Confederates who were not covered by the general amnesty. That outraged Republicans in Congress and contributed to his impeachment.

COSSACK: So it's just another pardon of a long saga of unpleasant acts. That's all the time we have for today. Thanks to our guests. Thank you for watching.

Today, we have a very special and, I'm afraid, sad goodbye. Our longtime executive producer Lauren Altarsh (ph), she's leaving us.

Greta, who couldn't be with us today, taped this goodbye message. Let's here from Greta.


GRETA VAN SUSTEREN, CO-HOST: I regret that I'm not here to say this in person, but I just want to let the viewers know that today BURDEN OF PROOF loses one of our originals: our executive producer Lauren Altarsh.

Five and a half years ago, Lauren moved to Washington to help launch BURDEN OF PROOF. She's poured her heart and soul into making BURDEN OF PROOF what it is today, and for that I'm grateful.

Lauren, thank you. And we will miss you.


COSSACK: And from a personal note, let me just say goodbye to Lauren, who, for some strange reason, has chosen to leave BURDEN OF PROOF so she could be home with her husband, Chris (ph), and her two wonderful children, Katie (ph) and Allison (ph). From a personal standpoint, Lauren, you know I'm going to miss you more than I can ever say. Who's going to walk me up to Union Station to get the soup with me? Come on, I'm all alone.

As a final note, let's just tell you about O.J. Simpson. He he's been arrested in Florida. Stay tuned for details coming up next on "CNN TODAY."

And join us again Monday for another edition of BURDEN OF PROOF. We'll see you then.



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