Thread by @nimkef

22 Mar 2002

The Real Whitewater Shocker

The independent counsel's report concedes there was no Clinton scandal, but details another one -- the role the first Bush administration played.

web.archive.org/web/2012061915…

While the aim of the report was clearly to defend the integrity of the investigation that produced it, tucked away toward the end is information that points to an opposite conclusion.

Starr & Ray investigation critics have long held the Whitewater probe was partisan from the start, born in dirty tricks and manipulation that began with the first Bush administration. Now the OIC itself is presenting facts that substantiate those claims.

https://twitter.com/nimkef/status/1417969730862911490?s=20

Late summer of 1992 a referral file from the Resolution Trust Corp. came before USA Charles A. Banks and local FBI officials in Little Rock, Ark. It was a potential case of check kiting against Jim McDougal, Susan McDougal and Lisa Aunspaugh.

It also mentioned Bill and Hillary Clinton as possible witnesses in the case. And as all the players in the drama realized, that made all the difference in the world.

Political appointees at the highest level of the first Bush admin actually intervened in the normal process of the investigation, not to slow it down but to speed it up — and with the pretty obvious intention of getting the matter before the public prior to Election Day, 1992.

From the start, Banks, a former Republican candidate for Congress whom Pres GHW Bush had recently nominated to the federal bench, had misgivings about the quality of the potential case, and he was suspicious about its timing.

There is no evidence, as even the OIC report concedes, that Banks treated the matter in anything but a proper manner.

People at the highest levels of the Bush admin found out about the Whitewater referral and started a series of actions intended to speed up the handling of it.

17 Sept 1992
Edie Holiday, secretary to the Cabinet in the Bush WH, contacted AG William Barr & asked if he “would be aware of a pending matter in Justice (she may have said it was a criminal referral) about a presidential candidate or a family member of a presidential candidate”

At around the same time then-White House counsel C. Boyden Gray also apparently took action. He inquired about the status of the referral with the head of the Resolution Trust Corp. (RTC), the agency from which the referral to the U.S. attorney originated.

Washington is replete with rules prohibiting or discouraging contact that might create the appearance of a conflict of interest. And most cover inappropriate contact between the political side of the executive branch and the law enforcement side of the executive branch.

During a later phase in the Whitewater investigation, the general counsel at the Treasury gave WH lawyers a heads up about a possible upcoming indictment of Jim McDougal & possibly Bill Clinton, which was being reported in an internal RTC newsletter called the “early bird report”

That incident was enough to get several White House officials hauled before a federal grand jury and led to the eventual resignations of White House counsel Bernie Nussbaum and Deputy Treasury Secretary Roger Altman.

“It doesn’t pass the smell test,” says one legal source close to the former president. “How did anybody at the White House even know about it? It suggests to us clearly that they were using the Justice Department and an investigation to influence the election.”

How did Edie Holiday find out about the referral? Or C. Boyden Gray? Why did they try to intervene as they did? What other officials were involved? On all of these questions the report is silent.

What is clear is that Barr went on to get in touch with Ira Raphaelson, the Justice Department’s special counsel for financial institution fraud, and asked him to find out whether such a referral existed. When Raphaelson didn’t uncover one at first, Barr asked him to try again.

Though Barr had no apparent reason to believe the budding case against the McDougals was being handled inappropriately, he instructed his subordinates at the DoJ & FBI to begin a series of contacts w/ officials in Little Rock to make sure the case was being handled appropriately

Barr, the report explains, told a subordinate that “he did not want action on it artificially sped up or slowed down — it was to be dealt with on its merits and in the normal course.”

In the succeeding pages, statements such as these are coupled with actions that clearly belie them. Everything in this case should be handled like every other case, Washington seemed to be telling the U.S. attorney in Little Rock.

But after reading the OIC’s recounting, it is virtually impossible to conclude that Barr and his colleagues at Justice were concerned with anything except the possibility that the potential case might not be moving as quickly as it could.

7 Oct 1992
Banks informed his superiors in DC that based on his review of the referral he was not inclined to open an investigation or move toward issuing indictments. DoJ & FBI officials then ordering him to commence an investigation and report back to them on Oct 16

Banks had little doubt about the origins of the sudden urgency to move ahead with the case. “All of a sudden, we had this FBI pressure that something had to be done by Oct 16th,” he later told the OIC. But Banks & other law enforcement officials in Little Rock held their ground.

DoJ apparently realized that it wouldn’t do to order local officials to fast-track the case, but they nudged them as much as they could. It reflects well on Banks that he didn’t let his superiors convince him that they knew better than he did.

He believed he was being angled into issuing subpoenas in the case before the November election, and later testified that he would have resigned before doing so.

There are many passages in the OIC report that beg the question of whether more questions would have been asked if the independent counsel were interested in scrutinizing the behavior of former Bush administration officials rather than people tied to the Clinton administration.

Why did the independent counsel choose to investigate possible foot-dragging by USA Banks (who is vindicated in the report), when Banks had no reason to help Clinton & ignore possible pressure employed by AG Barr, when Barr had a vested interest in seeing Clinton lose in Nov?

After Banks refused to pursue the Whitewater investigation, and after Clinton’s election, departing Bush DoJ officials lost their urgency about the case. Whitewater ultimately came into full bloom when Clinton requested a special prosecutor to look into it in 1994.

Another tantalizing tidbit in the report is the central role that FBI director Robert Mueller, then AAG for the criminal division, played in Barr’s fishing expedition.

It’s not clear that Mueller was doing anything more than overseeing the execution of decisions made by others or overseeing meetings of DoJ and FBI officials in DC. But he was clearly in the center of the drama and in the position to see almost everything that was going on.