Clinton, on Videotape, Denies Whitewater Plot

LITTLE ROCK, Ark. — President Clinton, in videotaped testimony played publicly for the first time Thursday, repeatedly and emphatically denied any knowledge of a criminal conspiracy in which he allegedly participated with his Whitewater investment partners, James B. and Susan McDougal, and current Arkansas Gov. Jim Guy Tucker.

Clinton appeared relaxed and confident during the 2 1/2-hour grilling by lawyers representing the government, the McDougals and Tucker that was recorded on tape at the White House on April 28.

He even seemed to enjoy reminiscing about his friendship with the three defendants and sparring with the attorney prosecuting them on charges of conspiracy and fraud.

Moments after Clinton’s testimony ended, the defense abruptly rested its case--a bold move that means defense lawyers are counting heavily on the president’s credibility to prevail in the trial. McDougal was the only other defense witness to testify.

The weight that the defense gave to Clinton’s remarks is ironic given that the massive Whitewater investigation was touched off by his election nearly four years ago. Since then, a number of former Clinton associates have been charged in peripheral cases but the president has not been accused of criminal wrongdoing.

Prosecutors have said they are hoping that convicting Tucker and the McDougals would encourage them to provide evidence that could implicate the president.

Not only did Clinton deny any knowledge of the alleged conspiracy at issue in the trial, but he also calmly answered every question raised by prosecutor Ray Jahn, an assistant to independent counsel Kenneth W. Starr, about his investment with the McDougals in the controversial Whitewater resort development in the Ozark Mountains. The prosecution failed to produce any evidence to shake Clinton’s story.

The president was asked repeatedly by both the defense and the prosecution to answer allegations made by the government’s central witness, David Hale, who testified earlier that he, McDougal, Tucker, Clinton and others conspired in the mid-1980s to defraud both a federally insured savings and loan owned by McDougal and a government-backed small-business investment firm owned by Hale.

Specifically, Clinton denied that he had pressured Hale to make an improper $300,000 loan to Mrs. McDougal. The money, some of which passed through the Whitewater development’s bank account, was used for real estate investments proscribed by the loan program that provided the funds.

“I know I never pressured David Hale to make a loan,” Clinton declared with irritation after being asked about it many times.

In fact, while the president acknowledged having a passing acquaintance with Hale dating back to the 1970s, he said that he had never talked with his accuser about anything important.

“I don’t believe I’ve had any kind of a substantive conversation with him,” Clinton said. “I knew who he was, so if I saw him, I’d say: ‘Hello, how are you?’ ”

Clinton scoffed at the notion that he had met with McDougal and Hale at a land sales trailer in January 1986, as Hale has testified. It was at this alleged meeting that Hale says then-Gov. Clinton pressured him into loaning money to Mrs. McDougal.

Asked about Hale’s recollection that he was wearing jogging shorts at that meeting, the president noted with a snicker that the sales trailer--located about 12 miles away from the governor’s mansion--was too far away for him to reach by jogging.

McDougal has also denied that such a meeting took place and prosecutors have failed to present any corroborating testimony.

The president said that he did recall stopping by McDougal’s office at Madison Guaranty Savings & Loan in downtown Little Rock on occasion during his jogging outings.

Nevertheless, he said, he had no recollection of asking McDougal during one of those impromptu office visits to put his wife, Hillary Rodham Clinton, on a $2,000-a-month retainer as lawyer for the thrift. McDougal claims to remember the meeting because Clinton left a perspiration stain on a new leather office chair. But McDougal also now says that he--not Clinton--raised the question about retaining Mrs. Clinton.

Asked about his joint investment in Whitewater with the McDougals, the president insisted, as he has in the past, that he was nothing more than a “passive investor” who allowed McDougal to manage the property.

He vaguely recalled some of the financing details of the Whitewater venture, but he said that he was unaware of McDougal’s decision in 1986 to acquire a plot of land south of Little Rock in the name of Whitewater Development. This was one of the purchases made by the McDougals with the $300,000 loan from Hale and it is the most important piece of evidence presented to date that indirectly links the Clintons to alleged illegal behavior.

In his questioning of Clinton, and in references to documents, Jahn provided no significant evidence related to Whitewater that has not previously been made public.

Questioning of Clinton by the defense lasted only about 20 minutes. Jahn’s lengthy and sometimes contentious cross-examination clearly began to irritate the president. At one point, Clinton protested: “I am doing my best to tell you the truth and all you want me to do is speculate.”

But Jahn was not cowed by Clinton’s testy reply. A short time later, he said condescendingly that he was trying to ask questions the president could understand.

Virtually since the beginning of the republic, presidents have been called upon to give testimony in criminal trials. In the last two decades, Presidents Nixon, Carter, Ford and Reagan all have given testimony for trials, much as Clinton did.

Asked at the White House Thursday what he wants the public to learn from his testimony, the president said that it was not “a big deal.” He added: “All I want the American people to understand is that I was asked to testify because they thought I might have some evidence that was helpful and I was glad to testify.”

Transcripts of the testimony were made public Thursday but U.S. District Judge George Howard Jr. seemed inclined to grant a White House request to prevent the videotape from being shown publicly.

David E. Kendall, the president’s lawyer who delivered the videotape to Little Rock and sat in the courtroom while the videotape was played, has argued that distributing the tape would allow Clinton’s enemies to use it in negative television commercials.

The Clinton tape was played on the same day that a defense lawyer in another Whitewater-related case said he planned to subpoena the president.

In that case, Herby Branscum Jr. and Robert M. Hill are accused of illegally using money from their Perry County Bank to repay people who made contributions to retire a Clinton campaign debt in 1990.

After the contributions, Clinton reappointed Hill to the state Bank Board and named Branscum to the Arkansas Highway Commission. Dan Guthrie, Branscum’s attorney, said that Clinton is the only person who can rebut allegations that Branscum’s appointment was made in exchange for his contributions.