Treasury Official Knew Boss’S Testimony Wrong Admission Upsets Whitewater Panel

The Treasury’s top lawyer admitted Monday that she knew Feb. 24 that her boss, Deputy Treasury Secretary Robert C. Altman, was giving inaccurate testimony to Congress about his Whitewater-related discussions with the White House. But she did nothing to correct him.

In testimony before the Senate Banking, Housing and Urban Affairs Committee, Treasury General Counsel Jean Hanson appeared to take responsibility for Altman’s failure to fully inform the panel about his discussions with the White House. Nevertheless, her admission only fueled charges that Hanson and Altman had acted improperly.

Altman, an old friend and former classmate of the president, is scheduled to be questioned by the committee today about his failure to testify fully in February about the extent of discussions between Treasury and White House officials after he learned that President Clinton and first lady Hillary Rodham Clinton had been named as possible witnesses in the investigation of a failed Arkansas savings and loan.

Treasury officials had recognized that word of the investigation by the Resolution Trust Corp. was sure to be embarrassing for the Clintons because they had been partners with James B. McDougal, owner of the S&L, in an Ozark real estate venture called Whitewater Development Corp. The RTC was looking into allegations that money from McDougal’s Madison Guaranty Savings & Loan had been diverted to Whitewater.

Like other administration officials, Hanson insisted that the Treasury did nothing wrong when it alerted the White House that the Clintons’ names had come up in connection with an investigation. She also downplayed as “not significant” the differences between her recollections and those of Altman about contacts with the White House.

But Democrats as well as Republicans criticized the Treasury’s decision to alert the White House and Hanson’s failure to correct Altman’s testimony.

Committee Chairman Donald W. Riegle Jr., D-Mich., who until now has defended the administration’s actions, severely admonished Hanson for failing to correct Altman’s testimony - if not at the Feb. 24 hearing, at least in the days that followed.

Earlier in the day, former RTC official William Roelle testified that he told Hanson in late 1993 that the president’s name was mentioned in letters from the RTC to the Justice Department regarding possible criminal conduct by Madison owners. He said he warned her that the information was confidential. He said that she should not have shared it with the White House.

Members of the Senate committee agreed with Roelle. Democratic senators as well as Republicans rejected Hanson’s assertion that she needed to tell the White House about it because the president’s aides needed to be prepared for press inquiries.

Hanson replied that it never occurred to her that contacts with the White House later would be viewed by the president’s critics as evidence of a possible coverup.