Both sides rest in Whitewater

Clinton denies any link to illegal loan

May 9, 1996
Web posted at: 6:20 p.m. EDT

LITTLE ROCK, Arkansas (CNN) -- In a surprise finish, both the defense and prosecution rested in the Whitewater fraud case Thursday afternoon, immediately following President Bill Clinton's videotaped denial that he ever applied pressure to former banker David Hale to secure an illegal loan.

"I did not put any pressure on David Hale," Clinton testified. "These things are not true. They simply did not happen."

Hale, the prosecution's star witness, alleged that Clinton, while governor, had pressured him to give loans to Clinton's business partners.

The president's testimony began at 1:17 p.m. EDT and ran 2 1/2 hours. Jurors listened intently and took notes as the tape began and the president's face flickered across an oversize TV monitor

Closing arguments are expected to begin Monday.

The president's testimony began after final defense questioning of James McDougal following the lunch break.

James McDougal, Susan McDougal, and Arkansas Gov. Jim Guy Tucker are on trial on conspiracy and fraud charges relating to government-backed loans in the 1980s.

"I think you'll find his testimony absolutely overpowering, from start to finish with no flaws, no glitches," James McDougal told reporters during the lunch break.

"He'll be the best defense witness we'll call in my case," McDougal predicted.

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McDougal was the partner of Bill and Hillary Clinton in the Whitewater Development deal, and the government's primary witness, David Hale, alleged that Clinton, while governor, exerted pressure for him to give loans to McDougal.

For the first time, the president's personal attorney, David Kendall, was present in the courtroom Thursday.

Prosecutor Ray Jahn completed his cross-examination of McDougal concerning where the proceeds went of a $300,000 loan.

The White House tried its best to put a positive face on the presidential testimony, with officials emphasizing that with the exception of the questions regarding Hale's charges, the prosecution made no real attempt to show any presidential wrongdoing.

Earlier in the day, in Washington, Clinton was eager to reinforce the point that he is not on trial. "All I want the American people to understand is that I was asked to testify because they thought I might have some evidence that was helpful and I was glad to testify."
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Clinton aides, though, are keenly aware of the possible political damage, and are not at all sanguine about the potential public release of the tape. A transcript will be released, but the last thing the White House wants is bits of the tape showing up in Republican campaign ads. The judge has sealed the tape for 30 days but he hasn't ruled on the longer term yet.

CNN's Claire Shipman contributed to this report.

Related stories:

• Clinton Denies Wrongdoing In Whitewater - April 29, 1996
• Barbour Takes A Jab At Clinton's Whitewater Testimony -- April 26, 1996

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