Whitewater Losses Split, Clintons Say President And First Lady Insist They Were ‘Passive Investors’
President and Hillary Clinton say in sworn statements made public Friday that they contributed almost as much money as James McDougal to the failed Whitewater resort development project, denying suggestions that Whitewater was a sweetheart deal in which McDougal put up most of the money.
In their most detailed response so far to the welter of Whitewater accusations, the Clintons insist that they were “passive investors” in a corporation run by McDougal, an Arkansas businessman and political supporter of Clinton during his days as Arkansas governor.
The Resolution Trust Corp., the federal agency assigned to cleaning up the savings and loan debacle, made public 55 pages of answers by the president and 77 pages of answers by the first lady to questions posed by corporation attorneys concerning the Whitewater investment and its relationship to the collapse of a savings and loan association owned by McDougal.
While professing ignorance about McDougal’s precise contributions to the corporation, the Clintons pointed to a letter from McDougal in 1986 that implied that total losses for the corporation were about $90,000, a figure the Clintons said indicated that both couples put up similar amounts of money. The Clintons maintain that they covered $46,600 of the losses.
In addition to the questions and answers, the corporation released hundreds of pages of letters, bank statements and other documents relating to the real estate project and its finances.
Perhaps most striking about the documents is the small scale of the investment. For instance, a letter, dated Aug. 5, 1982 from Madison Bank and Trust of Kingston, Ark., complains that the Clintons are paying only $285.13 per month on a $28,000 loan, $88.20 less than the amount needed to cover interest payments.
The answers were filed under oath, but there was no cross-examination. Both the president and the first lady flatly denied charges that McDougal and his wife, Susan, put up most of the money and assumed most of the risks as a favor to the then-governor. The Clintons and the McDougals each owned half of the corporation’s stock.
Hillary Clinton also denied McDougal’s claim that the failed Madison Savings and Loan Association paid a $2,000-a-month retainer, for which it received minimal services, to the Rose Law Firm of Little Rock, of which Mrs. Clinton was a partner at the time.