NEWS ANALYSIS : Questions Dog Lengthy D'Amato Investigation of Whitewater Scandal : Politics: Hearings show obfuscation but no cover-up by Clinton, aides. White House believes probe is trying to humiliate president in election year.

TIMES STAFF WRITER

Whenever Sen. Alfonse M. D'Amato (R-N.Y.) is asked what he has established in his committee's lengthy investigation of the Whitewater scandal, he responds without hesitation.

"I believe that they [the president and his aides] have engaged in a pattern of action that has kept the record from coming forward," D'Amato says.

He notes that key witnesses have failed to remember significant events in which they obviously participated. One administration official insisted that he lied to his diary, D'Amato observes, while another did not recognize her own voice on a tape recording.

But at that point, the normally expansive New York senator stops talking.

Although his investigation has endeavored mightily to unearth evidence of a White House cover-up in the Whitewater controversy, D'Amato has never publicly accused President Clinton or any of his associates of engaging in a cover-up or a conspiracy to obstruct justice.

The reason for D'Amato's reluctance to expand on his allegations is clear. While his hearings have revealed plenty of evidence that some administration officials have been dodging and obfuscating, he has been unable as yet to weave the many strands of the Whitewater saga into a single effort by the president to cover up the truth.

Nor has D'Amato demonstrated precisely what Clinton may have been trying to hide in those instances where his aides interfered in government investigations.

Nevertheless, D'Amato strongly rejects all suggestions that--as one witness recently put it--"there is no THERE there." The senator suggests that he is on his way to eventually uncovering serious evidence of wrongdoing at the heart of these jumbled events.

"I think there is a THERE there," he told the witness.

Predictably, Democrats and top White House officials are frustrated with D'Amato's determination to keep pursuing his investigation, which they view as nothing more than a politically motivated effort to humiliate the president as the 1996 election approaches.

To be sure, D'Amato is a strong supporter of Clinton's chief rival, Sen. Bob Dole (R-Kan.).

Sen. Paul S. Sarbanes (D-Md.), the panel's ranking Democrat, says that the inconclusiveness of the evidence so far causes him to be skeptical about the purpose of the committee inquiry. "It's not quite clear to me what they [the Republicans] are trying to prove," he says.

Sarbanes concedes that D'Amato's inquiry has yielded evidence that administration officials made some embarrassing mistakes in 1993 and 1994 in dealing with the mushrooming criminal investigation into events surrounding the Clinton investment in the Whitewater real estate development in Arkansas when the president was governor of the state.

But Sarbanes says nothing that Clinton's aides did wrong affected the outcome of the government's inquiry into Whitewater. To the contrary, he notes, the investigation has led to the indictment of a number of the president's friends and business associates.

"If people made mistakes," Sarbanes insists, "it didn't affect the ultimate outcome."

During weeks of intermittent hearings over the last year, D'Amato's committee has explored a number of key instances in which Clinton appointees appeared to be interfering--in one way or another--with efforts by government agencies to bring Clinton acquaintances to justice.

Even before Clinton was elected, the Resolution Trust Corp. recommended that the Justice Department pursue a criminal investigation of mismanagement of the failed Madison Guaranty Savings & Loan.

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The Little Rock thrift was owned by James B. McDougal, who was Clinton's partner in the Whitewater development. The president and First Lady Hillary Rodham Clinton were named as potential witnesses in the RTC's initial criminal referral, which suggested that money from the thrift was illegally diverted into the Whitewater venture.

After Clinton became president in 1993, Paula Casey, his handpicked U.S. attorney in Little Rock, declined to prosecute the RTC's case against McDougal. It was not until November 1993 that Casey yielded to the Justice Department's recommendation that she recuse herself from making decisions in the case.

At the same time, officials of the Treasury Department, which oversees the RTC, were passing along information about the case to the White House. And RTC investigator Jean Lewis alleges that her supervisors tried to discourage her from pursuing it.

As the Republicans see it, administration officials acted improperly in response to the RTC allegations. But Democrats argue that the RTC's initial case was weak and they note that the U.S. attorney's office energetically pursued later evidence provided by the RTC.

Likewise, Republicans argue that Clinton administration officials acted improperly when they heard the Small Business Administration was preparing to bring criminal charges against David Hale, a Little Rock municipal judge and owner of a government-backed small business development fund. Hale has claimed that he made improper loans to McDougal at the urging of Clinton.

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In recent Senate testimony, a White House attorney admitted contacting the SBA to inquire about the Hale case. He also requested documents related to the case but returned them promptly to SBA when the Justice Department advised that his intervention was improper.

To Sen. Christopher S. Bond (R-Mo.), these actions taken by the White House prove that the Hale case "was not handled like all other cases." But Sen. Christopher J. Dodd (D-Conn.) sees it differently: "The bottom line here is that, in fact, matters were handled appropriately."

As Whitewater-related cases stemming from the SBA and RTC investigations began to heat up in late 1993, David Kendall, the Clintons' private attorney, met in November with private lawyers and White House attorneys with knowledge of these matters.

D'Amato is known to view this meeting in Kendall's Washington office on Nov. 5, 1993, as a crucial part of the administration's efforts to limit the political fallout of Whitewater. His suspicions have been fueled by the refusal of those who were in attendance to discuss the meeting, which they say is protected by attorney-client privilege.

On Friday, the committee approved on a 10-8, party-line vote a subpoena for notes of that meeting by former associate White House counsel William Kennedy. If the notes are not turned over by Tuesday, the panel could take steps leading to a court fight with the administration.

"The meeting . . . was plainly privileged," Kendall said in a statement. "It was limited to past and present lawyers for the President and Mrs. Clinton and lawyers from the White House counsel's office . . . after six days of heavy Whitewater publicity."

But White House reaction to the RTC and SBA criminal cases is not nearly as controversial with the committee as one matter that has preoccupied the panel since its inception: White House actions following the suicide of presidential counsel Vincent Foster.

The suicide in July 1993 might never have been linked to the Whitewater scandal if Margaret A. Williams, Mrs. Clinton's top aide, had not removed documents from Foster's office shortly afterward--including a file dealing with the Clinton's Whitewater investment.

And Williams' actions might never have been questioned as closely as they have by the panel if she had been more forthcoming in her testimony. Just last week, the White House admitted that Williams misled the committee about her encounter with Clinton family attorney Robert Barnett in the White House residential quarters on July 27, 1993.

In her testimony, Williams said that she merely bumped into Barnett that day. But Barnett has said that Williams sat with him while he reviewed the files from Foster's office, which were transported later that day to his law office in downtown Washington.

D'Amato said Friday that New York attorney Susan Thomases--a friend of Mrs. Clinton's who has been subpoenaed for a third appearance before the committee on Monday--has given the panel new phone records this week. The records show that, before Foster's files were removed by Williams, Thomases twice called the residence where Mrs. Clinton was staying in Little Rock, Ark., and also called Williams.

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An attorney looking through files for another purpose at Thomases' law firm came across the phone records this week, Thomases' lawyer said in a letter to the committee. "The new phone records are consistent with her earlier testimony," attorney Benito Romano said.

On Monday, the committee also plans to grill Williams for a third time about the events surrounding her handling of Foster's files. Appearing with her and Thomases will be Barnett and Diane Blair of Springdale, Ark., another friend of Mrs. Clinton who was present in the White House residence that day.

As D'Amato now sees it, even though he has not been able to develop a coherent conspiracy theory, the failure of Williams and other administration witnesses to remember key Whitewater-related events is strong evidence that he is on the right track.

"Key people are continually feigning no recollection as it pertains to important matters," D'Amato observes. "This is a pattern, this is not an isolated event."

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