Clinton Goes Before Camera Today President Will Testify In Whitewater-Related Trial

When President Clinton raises his right hand and takes an oath at the White House this afternoon, he won’t be practicing for his second inauguration.

He will be testifying as a defense witness before a special videotaped proceeding in the Whitewaterrelated fraud and conspiracy trial of Arkansas Gov. Jim Guy Tucker and James and Susan McDougal.

During the past two months independent counsel Kenneth Starr’s prosecutors in Little Rock, Ark., have built a case around the claims of convicted financier David Hale, who testified that in 1985, Clinton, then governor of Arkansas, pressed him to make an illegal $300,000 loan to Susan McDougal.

Now under power of subpoena and pain of perjury, the president will pit his words against Hale’s and deny he joined or knew about an alleged scheme to steal hundreds of thousands of taxpayer-backed dollars. “The facts are what they are,” Clinton said Thursday. “And they’re plain for all to see.”

The jurors in U.S. District Judge George Howard Jr.’s courtroom may beg to differ. In nine days of mind-numbing and often confused testimony earlier this month, Hale told how he, Tucker - then an attorney and businessman - and James McDougal sat around Tucker’s kitchen table in the fall of 1985 and launched a fraud he said was designed to benefit Clinton and other members of the state’s “political family.”

At that time the McDougals were partners with Clinton and his wife, Hillary Rodham Clinton, in the Whitewater housing development. As a Rose Law Firm partner, Hillary Clinton did legal work for McDougal and helped him structure the Castle Grande commercial development, which is also under investigation. The Clintons face no charges, although they could in the future.

By 1987, prosecutors say, the defendants misused $3 million in loans from Hale’s Capital Management Services Inc. and James McDougal’s Madison Guaranty Savings and Loan. The thrift failed at a $60 million loss to taxpayers.

Finally, under pressure from investigators, Hale confessed and turned state’s evidence. He will begin serving 28 months in federal prison upon completion of the trial, which is based on a 21-count indictment Starr lodged in August.

During the early phases of the testimony the defense team argued that Hale had fabricated his story to obtain a reduced sentence. They also introduced evidence showing that Hale had stolen millions of dollars from government agencies and lied in past court proceedings.

Clinton’s testimony may help the defendants, but it will not determine the outcome of the trial, Susan McDougal’s attorney, Bobby McDaniel, said in a telephone interview Friday. “The president’s role,” McDaniel said, “will be to simply further impeach Hale’s credibility.”