Hillary Clinton Drafted Papers That Helped Whitewater Figure’s Evasion Fdic Report Doesn’t Accuse First Lady But Raises Questions

Federal regulators concluded Monday that a real estate document drafted by Hillary Rodham Clinton was used by her Whitewater partner’s savings and loan to evade regulations.

In a report requested by Senate Republicans, the Federal Deposit Insurance Corp. made no direct accusations against Clinton. But it raised more questions about her role in a troubled Arkansas real estate development that has cost taxpayers nearly $4 million.

The FDIC inspector general’s office described how executives at Madison Guaranty Savings & Loan arranged for Little Rock businessman Seth Ward to receive $300,000 for his role in a failed land development called Castle Grande. Ward is the father-in-law of Webster Hubbell, Hillary Clinton’s one-time law partner.

The regulators said Clinton drafted a May 1, 1986, real estate option that valued property owned by Ward at $400,000, more than double its appraised value. Ward later exchanged the land for $300,000 in loan proceeds from the S&L.

The option came up again when Ward sued the S&L in 1987 to get more compensation, winning a jury verdict of $392,000. The FDIC called the option “a critical issue” in the trial.

“The method of payment of commissions to Ward evaded regulations designed to protect the safety and soundness of the institution and violated the integrity of its books and records,” said the IG’s report.

“Madison Guaranty also concealed the true nature of the payments to Ward from the bank examiners, and apparently conceived the May 1, 1986, option to further this purpose,” the report added.

Clinton has said she does not recall working on the document.

Her Whitewater lawyer, David Kendall, said “The May 1, 1986, option was never exercised, so it did not facilitate the payment of a single penny of commissions to Mr. Ward.”