Once-secret memos question Clinton's honesty

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By Jerry Seper

A decade before Sen. Hillary Rodham Clinton admitted fudging the truth during the presidential campaign, federal prosecutors quietly assembled hundreds of pages of evidence suggesting she concealed information and misled a federal grand jury about her work for a failing Arkansas savings and loan at the heart of the Whitewater probe, according to once-secret documents that detail the internal debates over whether she should have faced criminal charges.

Ordinarily, such files containing grand jury evidence and prosecutors' deliberations are never made public. But the estate of Sam Dash, a lifelong Democrat who served as the ethics adviser to Whitewater Independent Counsel Kenneth W. Starr, donated his documents from the infamous 1990s investigation to the Library of Congress after his 2004 death, unwittingly injecting into the public domain much of the testimony and evidence gathered against Mrs. Clinton from former law partners, White House aides and other witnesses.

The documents, reviewed by The Washington Times, identify numerous instances in which prosecutors questioned Mrs. Clinton's honesty, an issue that continues to dog her on the campaign trail after she was forced to acknowledge earlier this year exaggerating a story about coming under sniper fire as first lady during a visit to Bosnia in 1996.

For instance, the papers say prosecutors thought Mrs. Clinton first concealed her legal representation of Madison Guaranty Savings and Loan Association — and the money she made doing it — during the 1992 presidential campaign when she and her husband, then-Arkansas Gov. Bill Clinton, came under fire in a questionable Arkansas real estate project known as Whitewater.

Beginning in March 1992 and continuing over the next several years, Mrs. Clinton steadfastly denied that she ever "earned a penny" in representing her Rose Law Firm clients, including the failing thrift's owners, James and Susan McDougal — the Clintons' partners in the Whitewater Development Corp. project.

But the newly discovered records, more than 1,100 pages in 30 separate documents, tell a different story.

A June 1998 draft indictment of Mrs. Clinton's Rose firm partner Webster L. Hubbell, who followed the Clintons to Washington in 1993 as associate attorney general, said Mrs. Clinton did legal work for Madison "continuously" from April 1985 to July 1986. It also said she represented the thrift before the Arkansas Securities Department for approval to issue preferred stock, helped Madison obtain a questionable broker-dealer license to sell the stock and was actively involved in a failed Madison project known as Castle Grande.