Witness Says He Felt Push to Lie by Starr Staff

A businessman testified Friday that it seemed that Whitewater prosecutors wanted him to lie to help their criminal case against Gov. Jim Guy Tucker and President Clinton’s former business partners.

Bill Watt, a Little Rock traffic judge and former business associate of key prosecution witness David Hale, also testified that he was thinking about his $90,000-a-year job and $45,000 pension when he appeared before the Whitewater grand jury Aug. 17.

The next day, Tucker and Clinton’s former Whitewater partners, James B. and Susan McDougal, were charged with bank fraud and conspiracy in a 21-count indictment.

Tucker and the McDougals are accused of fraudulently obtaining $3 million in loans from two federally backed lending institutions--Hale’s Capital Management Services Inc. and the McDougals’ Madison Guaranty Savings & Loan Assn.

Hale was sentenced Monday to 28 months in prison and ordered to pay $2 million in restitution after pleading guilty to fraud charges.

As he cross-examined Watt on Friday, W.H. “Buddy” Sutton, a lawyer for Tucker, referred to a discussion that Watt said he had with a former Madison loan officer, Don Denton, on July 24.

“Did you tell Mr. Denton: ‘They want me to lie on Tucker, change the story the way they want it?’ ”

Watt said he did. On Thursday, however, Watt had testified that no one told him to lie.

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Watt acknowledged that he was thinking about his livelihood when he relented to pressure from independent counsel Kenneth W. Starr’s office--and a promise of immunity--and agreed to be a prosecution witness.

“These people held within their hands the power to grant you immunity, to release you from the burden of a trial . . . even from the decision to plead guilty or not guilty,” Sutton said to Watt. “That was on your mind, wasn’t it?”

“Yes, sir,” Watt said.

As the case against Tucker and the McDougals continued, an appellate court refused to rehear a decision that will allow Clinton to be tried on a sexual harassment complaint while he is still in the White House.

The case was brought by Paula Corbin Jones, a former state employee, who alleges that Clinton sexually harassed her in a Little Rock hotel suite in 1991. She has said she rejected Clinton’s suggestion that they engage in sex.

The president has denied her allegation. Clinton’s attorneys have 90 days to appeal to the U.S. Supreme Court after the U.S. 8th Circuit Court of Appeal’s Thursday ruling in St. Louis.