Arkansas Tornado Stirs Up New Whitewater Discovery

In a bizarre Whitewater discovery, a repair shop owner opened the trunk of a tornado-damaged car and found a cashier’s check for more than $20,000 payable to Bill Clinton from his former partner’s savings and loan, grand jury witnesses say.

The discovery this spring of the 1982 check and thousands of other documents missing for a decade has opened a new line of inquiry by prosecutors into whether Clinton testified accurately about his relationship with James B. and Susan McDougal and their failed Arkansas S&L;, the witnesses said.

Clinton swore under oath last year that he “never borrowed any money” from the McDougals’ failing Madison Guaranty Savings & Loan.

Witnesses say markings on the cashier’s check, which bears no Clinton endorsement, suggest that the source of the funds was McDougal’s S&L;, and that the proceeds may have been deposited in one of two Arkansas banks where the Clintons did business.

The president’s private lawyer scoffed at the discovery Wednesday.

“Documents found in the trunk of an old and long-abandoned used car may have the authenticity and credibility of a newly discovered and freshly written Elvis autobiography,” attorney David Kendall said.

Kendall suggested that the check may have been used for a 1982 repayment of a loan taken out by James McDougal at another of his banks for the Whitewater land development. “Neither the president nor Mrs. Clinton had signed for this loan,” he said.

Kendall’s statement, however, offered no explanation why a check for such a loan would have been made out to Clinton.

A spokeswoman for independent counsel Kenneth W. Starr declined to comment Wednesday.

The documents were found by a car repair shop operator in the trunk of a 1979 or 1980 Mercury Marquis--its paint peeled and windows blown out--that was damaged when tornadoes swept across Arkansas last March, according to the garage operator and the car’s owner.

The papers had been given a decade ago to a Madison Guaranty employee to be delivered to a warehouse for storage.

That employee, Henry Floyd, acknowledged in an interview that he was supposed to deliver the documents in 1988 but went first to have his car repaired. The documents never got delivered because Floyd didn’t retrieve the auto after a payment dispute.

Floyd said the car, which had 55,000 miles on it, had been bought for him by James McDougal’s mother and “I used to drive her around in it on weekends. I just didn’t think about the Madison documents.”

The car, documents inside, sat unnoticed in a storage yard until the tornado.

The garage owner, who would speak only on condition of anonymity, said, “There were cashier’s checks just lying there. I come to one that has Bill Clinton’s name on it; I saw McDougal’s name, Jim Guy Tucker’s name and I thought this might be something they [prosecutors] are looking for.”

Tucker, who succeeded Clinton as Arkansas governor, resigned last year after being convicted of fraud and conspiracy in the Whitewater case.

The garage operator said he talked to one of his relatives, who contacted the FBI.

The prosecutors asked “whether I was told to destroy evidence and I forgot to get rid of it or whether I was told to hide evidence for anyone,” Floyd said. “I told them nobody told me to do anything as far as hiding or destroying evidence.”