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Starr Explains Decision Not To Discuss Whitewater Issue

By Marilyn W. Thompson
The Washington Post
WASHINGTON

Independent counsel Kenneth W. Starr said Thursday that his office had strong reason to believe President Clinton lied under oath in testimony stemming from the Whitewater land deal but decided late last year not to file an impeachment report relying exclusively on the truthfulness of Clinton's former business partner James McDougal.

With a draft referral to Congress already prepared, Starr said his office kept hoping for a breakthrough in negotiations with two other potential witnesses who might corroborate McDougal's account - former Arkansas Gov. Jim Guy Tucker and McDougal's former wife, Susan. This failed, leaving his office in the risky position of basing its referral on a single witness.

Prosecutors decided they would have trouble "establishing the truth with a sufficient degree of confidence," Starr testified to the House Judiciary Committee.

Although Democrats have criticized Starr for endlessly dragging out that investigation, they were critical of how he chose to announce that he had insufficient evidence to charge Clinton in the matter. Rep. Sheila Jackson Lee, D-Texas, twice tried, unsuccessfully, to block that part of Starr's remarks, saying he was "denying the president and any other parties the constitutional right of due process under the First Amendment.

In his statement, Starr said his office has won 14 criminal convictions, including cases brought against former Associate Attorney General Webster L. Hubbell and Tucker, who resigned following his indictment. But Starr said his office also takes pride in its "decisions not to indict" - including its rejection of a Senate Whitewater Committee criminal referral against Clinton friend Susan Thomases for possible perjury. She answered "I don't recall" 184 times in Senate testimony.

The investigation into the Whitewater land deal and the tangled affairs of Madison was Starr's original mandate, inherited from former special prosecutor Robert Fiske in 1994. Starr testified that his plan when he went to Little Rock, Ark., that August was to sort through allegations made by former Arkansas municipal judge David Hale and to seek indictments against the McDougals and others involved in fraudulent transactions.

By pursuing criminal charges against the McDougals, Starr's staff reasoned that it could eventually determine whether the Clintons were involved in questionable Whitewater or Madison matters. This straightforward course soon veered into other areas. Hubbell, who had worked with Hillary Clinton on Madison S&L legal matters as an attorney at the Rose Law Firm, pleaded guilty to embezzling from the firm during Starr's first year and agreed to cooperate, though he was of little help, Starr said.

The McDougals were indicted along with Tucker for fraud in 1995. All three were convicted in 1996, opening the doors for Starr's office to win cooperation in exchange for sentencing leniency. James McDougal, convicted of 18 counts, was the first to cooperate. He told prosecutors that Clinton lied when he testified in McDougal's trial that he had no knowledge of the fraudulent federally backed loan that was partially used to benefit the Whitewater investment.

By late 1997, Starr said, the office was uncertain whether it had the evidence to justify a referral to Congress - a month before the Lewinsky investigation even began.