April 4, 1997 in Nation/World

Hubbell Helped By White House Aides President Says Lining Up Financial Support ‘Compassion’; Whitewater Prosecutors Want To Know If It Was Hush Money

Newsday
 

President Clinton Thursday insisted two senior White House aides acted “just out of human compassion” when they canvassed business friends in 1994 to line up financial support for one of Clinton’s closest confidants after he had attracted the attention of Whitewater investigators.

The calls by former chief of staff Thomas “Mack” McLarty and current chief of staff Erskine Bowles helped steer nearly $500,000 in payments to Webster Hubbell, a longtime friend of the Clinton family. Hubbell quit as associate attorney general in March 1994 when he became embroiled in a billing dispute with his former Arkansas law firm. He later pleaded guilty to defrauding the firm and its clients and served an 18-month prison term.

The payments have sparked the interest of Whitewater prosecutors, who are examining whether the White House arranged a sudden influx of funds in an effort to buy Hubbell’s silence about the first family’s land and business dealings in Arkansas, complex transactions known as Whitewater.

Hubbell, part of the Clintons’ inner circle, is intimately familiar with their financial affairs. The White House has provided a conflicting series of statements on the matter and only this week acknowledged the calls made by McLarty and Bowles.

Thursday, a grand jury in Little Rock, Ark., heard testimony from a businessman who is a longtime financial supporter of the president’s and paid $18,000 to Hubbell in 1994. The businessman, Bernard Rapoport of Waco, Texas, has said he made the payment at the suggestion of Texarkana oilman Truman Arnold, one of the people contacted by McLarty. Arnold also made payments to Hubbell.

At a picture-taking session Thursday, Clinton defended McLarty and Bowles. “I do not believe they were improper,” the president said of the calls. “From what I know about them … they were people who were genuinely concerned that there was a man who was out of work, who had four children.”

Two other Clinton associates, then-U.S. Trade Representative Mickey Kantor and Washington, D.C., lawyer Vernon Jordan, also were involved in the effort to find lucrative work for Hubbell.

The White House this week also acknowledged that first lady Hillary Rodham Clinton, a former law partner of Hubbell’s, was told by McLarty about his efforts to help Hubbell.

The president Thursday insisted that no one seeking work for Hubbell had any clue he faced serious legal trouble. “At the time that was done, no one had any idea about what the nature of the allegations were against Mr. Hubbell or whether they were true,” Clinton said.

“Everybody thought there was some sort of billing dispute with his law firm and that’s all anybody knew about it so, no, I do not think they did anything improper.”

The same point has been made by lawyers close to Hubbell, who contend it would have been impossible for White House officials to have arranged hushmoney payments to Hubbell, because in early 1994 they would not have known he was bound for prison.

xxxx KEY EVENTS IN HUBBELL CASE Associated Press Key events in the investigation into efforts by President Clinton’s aides and supporters to secure financial help for confidant Webster Hubbell in 1994. March 13, 1994: President and Mrs. Clinton and several aides meet at the White House, and among other things, discuss Hubbell’s impending resignation as associate attorney general of the United States. March 14, 1994: Hubbell announces resignation, confirming reports that his former Rose Law Firm billing partners are questioning some of his billings to clients. He denies wrongdoing. Late March-Early April 1994: At least three presidential aides - Mack McLarty, Erskine Bowles and Mickey Kantor - make calls seeking to line up work or financial help for Hubbell and his family. March-December 1994: Several companies owned by donors or supporters of President Clinton hire Hubbell, reportedly providing him several hundred thousands of dollars in payments. Among them are Texas oilman Truman Arnold, Texas insurance magnate Bernard Rapoport, and a company controlled by the Riady family of Indonesia. Whitewater prosecutors began an investigation of Hubbell’s law firm practices. April 8, 1994: Hubbell formally leaves Justice Department. Fourth of July weekend, 1994: Hubbell meets with president and first lady at Camp David retreat. Hubbell says he discussed allegations, and told president they weren’t true but was lying. November 1994: Reports surface that Hubbell has been told by Whitewater prosecutors he is someone likely to be indicted. Soon after, it is reported he plans to plead guilty. Dec. 6, 1994: Hubbell pleads guilty to two felony counts of mail fraud and tax evasion, and agrees to cooperate with Whitewater prosecutors. He later frustrates prosecutors with lapses of memory. June 28, 1995: Hubbell is sentenced to 18 months in prison. Aug. 7, 1995: Hubbell begins prison sentence. Nov. 20. 1996: Hubbell is moved from prison to a federal halfway house to serve remainder of sentence. Feb. 13, 1997: Hubbell is released from custody.

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