[Congressional Record Volume 140, Number 109 (Tuesday, August 9, 1994)]
[House]
[Page H]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: August 9, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
                        WHITEWATER INVESTIGATION

  Mr. BURTON of Indiana. Mr. Speaker, first of all, I want to say 
tonight that there are three very courageous and patriotic people in 
this country who do not let political pressure dictate to them. Those 
three people are the three Federal judges who rose above partisan 
politics to appoint a new independent counsel to investigate Vincent 
Foster's death in the Whitewater investigation. And so tonight I would 
like to say, on behalf of the American people, to those three Federal 
judges who have been much maligned because of their choice, 
congratulations. I think you are very courageous people.
  I also tonight want to congratulate Kenneth Starr, who was appointed 
the new independent counsel this past Friday. Mr. Starr, I have never 
met Mr. Starr, but I have, over the weekend, read a little bit about 
his background and looked into his credentials. And he appears to me to 
be a man of impeccable integrity and a man that I believe will do a 
good job in investigating everything pertaining to Whitewater. So my 
congratulations go out to Mr. Starr as well.
  I would be remiss if I did not say that I am a little concerned about 
what some of my Democrat colleagues have said about Mr. Starr.
  Mr. Bennett, Robert Bennett, who is President Clinton's personal 
attorney, has been very busy over the weekend criticizing Mr. Starr for 
some of the things he said in the past and urging him to recuse himself 
from being the independent counsel. I find this very strange because if 
Mr. Clinton and Hillary Clinton and the people in the administration 
that have connections to Vince Foster and the Whitewater affair, if 
they have nothing to hide, they should not mind whoever is the 
independent counsel, because all they have to do is answer the 
questions pertaining to Whitewater and Vince Foster and everything 
else. If there is nothing to hide, what difference does it make who the 
independent counsel is? I think they are concerned because they are 
afraid he may ask some very, very difficult questions.
  Toward that end, I intend to send tonight to Mr. Starr, the new 
independent counsel, information that we have uncovered in our 
investigation, information that was not discussed during the Whitewater 
hearings or was not investigated or, if it was investigated by Mr. 
Fiske, it was not in his report. So we are going to send that 
information to Mr. Starr, along with a sworn deposition before a court 
reporter by the man who found Vince Foster's body, the confidential 
witness. That sworn statement contradicts much of the Fiske report 
concerning Vince Foster's death and the position of the body in the 
park, at Marcy Park. I am hopeful that Mr. Starr will review that along 
with his staff, along with the other issues that we are raising, and I 
am confident that he will do a thorough job of looking into it. If he 
feels like there is no need for further investigation of Mr. Foster's 
death and his connection to the Whitewater Development Corporation, 
then so be it. But at least now I am confident that we have somebody as 
independent counsel that will review all the facts, ask all the 
questions, and get to the bottom of it.

                              {time}  2040

  Tonight, Mr. Speaker, I would like to talk about another aspect of 
the Whitewater, Madison S&L, and other aspects of the entire 
investigation that should be looked into.
  One of the things that we have found, Mr. Speaker, and I think it has 
been discussed in some detail previously on the floor, is an attempt to 
cover up part of the investigation involving a lady named Jean Lewis, 
who was an investigator with the Resolution Trust Corporation in Kansas 
City. The Resolution Trust Corporation is the Federal agency that 
supervises the failed savings and loan institutions around this 
country.
  From 1991 to 1993, Jean Lewis investigated the failed Madison 
Guaranty Savings & Loan Association in Little Rock, AR. Mrs. Lewis made 
two different criminal referrals to the Justice Department involving 
Madison S&L, the Whitewater Development Corp., and Bill and Hillary 
Clinton, although neither referral directly accused the Clintons of 
violating the law.
  She said that the FBI and the Justice Department officials reviewed 
her findings and concurred or agreed with them, so it was not just this 
lady saying these things. The FBI investigated it, as did the Justice 
Department, and they concurred in what she said.
  Let us go into the first referral: September, 1992. She sent the 
first criminal referral to the U.S. Attorney in Little Rock, AR. 
President Bush was President. Charles Banks was the Republican U.S. 
attorney in Little Rock.
  The September referral stated that over $100,000 in Madison funds 
were illegally, illegally, funneled into the Whitewater Development 
Corp. to pay the company's bills. This is taxpayers' money. It ended up 
being taxpayers' money, because we had to foot the bill later.
  She identified at least a dozen companies that siphoned, siphoned 
Madison funds to Whitewater. The Clintons were identified as 
``potential beneficiaries'' of the check kiting scheme. Her memos 
stated that James McDougal's outside partners in Whitewater, including 
the Clintons, were ``intelligent individuals, the majority of them 
attorneys, who must have concluded,'' who must have concluded ``that 
McDougal was making the payments for their benefit.''
  She went on to say ``If you know that your mortgages are being paid, 
but you are not putting money into the venture, and you also know the 
venture is not cash flowing, wouldn't you question the source of the 
funds being used for your benefit?''
  Another quote: ``It was my belief,'' she said, ``that the losses to 
Madison from the Whitewater account alone could easily exceed 
$100,000.''
  U.S. Attorney General Banks took no action on the referral before he 
was replaced by the new U.S. Attorney who was appointed by President 
Clinton, and her name was Paula Casey. The second referral took place 
in September of 1993. Remember, the new attorney down there was a 
Clinton appointee.
  Mrs. Lewis' second criminal referral, filed a year later, charged 
that Madison Savings & Loan had illegally diverted $60,500 to Bill 
Clinton's 1984 campaign for Governor. Her referral charged that the 
campaign was an alleged participant in the illegal conspiracy.
  She charged that Bill Clinton's campaign knew of the $60,500 transfer 
of funds that was illegal from the Madison Savings & Loan. The referral 
also contained additional information on the relationship between 
Madison S&L and the Whitewater Development Corp.
  Now we go to October, 1993. Paula Casey, the U.S. Attorney in Little 
Rock, who was appointed by Bill Clinton, formally declined to 
investigate the first referral from a year earlier. Ms. Casey was 
appointed by Bill Clinton. She had worked on the Clinton campaign. Her 
husband was appointed to a State job by Governor Clinton. She decided 
not to investigate, because she was afraid, I believe, that it might 
implicate Mr. Clinton.
  After Jean Lewis' second criminal referral had been reported in the 
press, Paula Casey recused herself from the case. She backed away and 
said she couldn't handle it because she wanted somebody else to, 
because of her connection to Clinton, but only after it was in the 
paper.
  Justice Department officials in Washington then determined that an 
investigation had to be opened. Mr. Fiske took over the entire 
investigation in January of 1994.
  Now we go to 1993, in November. On November 10, 1993, Jean Lewis was 
removed from the Whitewater case, allegedly because of a personality 
conflict with the attorney in the case. In a letter typed that day, she 
said she was ordered off the case by ``the powers that be.''

  Now we go to February, 1994. On February 2, after both of her 
referrals were made public, Jean Lewis was visited by April Breslaw, an 
RTC attorney from Washington, DC.
  According to Mrs. Lewis, April Breslaw pressured her to change her 
conclusions about Madison S&L and Whitewater, and the contributions to 
Bill Clinton's campaign, and the $100,000 that she said was illegally 
used to pay expenses for the Whitewater Development Corp.
  Mrs. Lewis said that April Breslaw told her that ``people at the 
top'' would be happier if they had answers to the questions about 
Whitewater that would ``get them off the hook''.
  Mrs. Lewis said that two of the head people April Breslaw was talking 
about were, No. 1, RTC Deputy Chief Executive Officer Jack Ryan, and 
RTC general counsel Ellen Kulka.
  Jean Lewis recorded the meeting. This is very interesting. She 
recorded the meeting. Congressman Jim Leach, ranking Republican on the 
Committee on Banking, Finance and Urban Affairs, heard the tape and 
said it substantiated her account of the meeting.
  Both Kulka and Ryan work directly under Deputy Secretary Roger 
Altman, who was investigated last week by the Senate Committee on 
Banking, Finance and Urban Affairs and the House Committee on Banking, 
Finance and Urban Affairs. Roger Altman was the RTC's acting director 
and a close friend of President Clinton.
  That very same day, that very same day, Roger Altman had a secret 
meeting at the White House with White House Counsel Bernie Nussbaum, to 
discuss the Whitewater-Madison investigation.
  Jean Lewis refused to change her views or statements, and sought 
protection as a whistleblower under Federal law. I hope my colleagues 
get this.
  They sent April Breslaw down there at the behest of Deputy Chief 
Executive Officer Jack Ryan at the RTC and General Counsel Ellen Kulka 
at the RTC to try to get her to lay off of the investigation, even 
though she had already had two referrals sent to the Justice Department 
accusing the Clintons and others of possible wrongdoing dealing with 
the Whitewater Development Corp. and Madison Guaranty.
  Here are some questions that need to be answered during the 
Whitewater investigation. No. 1, why did Jean Lewis' first referral sit 
on Paula Casey's--President Clinton's appointment as the district 
attorney down there--why did it sit on her desk down there for over a 
year without any action taken on it?
  No. 2, why did Paula Casey refuse to open an investigation into 
Whitewater and S&L? Could it be because her husband was appointed to a 
job by Bill Clinton, or she was a campaign worker for Bill Clinton in 
1992?
  No. 3, why didn't Paula Casey recuse herself from the first referral? 
She had a very serious conflict of interest, but she didn't recuse 
herself until there was an article in the paper that put her on the hot 
seat, and then she did recuse herself from the second investigation.
  No. 4, why did Paula Casey recuse herself from the second referral 
only after it had been revealed in the press? I believe it was probably 
because of the pressure of the press.
  No. 5, are Paula Casey's actions on this case being investigated by 
the Justice Department's ethics office? I think there should be an 
ethnics investigation.
  No. 6, who sent April Breslaw to Kansas City to meet with Jean Lewis? 
We know that RTC Deputy Chief Executive Officer Jack Ryan and RTC 
General Counsel Ellen Kulka, according to this young lady, asked her to 
tell them to take it easy, to tell Mrs. Lewis to take it easy.
  No. 7, why would April Breslaw pressure Jean Lewis to change her 
statements on Whitewater and Madison S&L?
  No. 8, is April Breslaw being investigated by the Resolution Trust 
Corporation's Inspector General, as I believe she should be?
  Let me just say in closing, Mr. Speaker, there are many, many 
questions about the Whitewater-Madison Guaranty issue that need to be 
investigated very, very thoroughly. I am very confident now that we 
have an independent counsel, an independent counsel in Mr. Starr, who 
will get to the bottom of all of these things. I think the American 
people are going to be well served.
  It is time for all of the questions to be asked, it is time for all 
of the questions to be answered regarding Vince Foster's death, his 
connection to Whitewater, these apparently illegal contributions to the 
gubernatorial campaign of Bill Clinton, and the American people, I 
think, will only be happy, and I know that I and many Members of 
Congress will only be happy when these questions are asked and they are 
answered.
  Finally, let me just say to my Democrat colleagues, they should not 
be concerned, Mr. Bennett should not be concerned, about who the 
independent counsel is unless they do not want questions asked and they 
do not want to answer the questions.
  All Mr. Starr can do is investigate and ask questions and get 
answers, and if there is nothing to hide, they should fear nothing. The 
questions should be answered.
  Mr. LaROCCO. Mr. Speaker, will the gentleman yield?
  Mr. BURTON of Indiana. I am pleased to yield to the gentleman from 
Idaho.
  Mr. LaROCCO. Mr. Speaker, how many of the gentleman's colleagues 
voted for the independent counsel when it was here?
  Mr. BURTON of Indiana. I will be happy to answer that question.
  Mr. LaROCCO. How many?
  Mr. BURTON of Indiana. Many were very concerned because the Democrats 
on your side changed the law to allow not only Mr. Fiske to be special 
counsel, but independent counsel. Before that time, and the gentleman 
may recall this, before that time, there was a prohibition against 
anybody in government being appointed independent counsel.

                              {time}  2050

  But the Democrats on your side, apparently to try to keep a lid on 
Whitewater, decided to appoint Mr. Fiske, or asked that Mr. Fiske, the 
special counsel, also be appointed independent counsel and to change 
the law to that effect. And I and other people on my side of the aisle 
came down here into the well and debated very vigorously saying that 
would give the appearance of impropriety and the appearance of a 
coverup. Nevertheless, almost on a party line vote, your side voted to 
make Mr. Fiske, or allow Mr. Fiske to not only be the special counsel 
but the independent counsel. So that is why we voted against it.
  Mr. LaROCCO. So how many were there? I did not hear your answer. How 
many voted for it?
  Mr. BURTON of Indiana. I have no idea. I hope that none of us voted 
for it because I believe there was a deliberate attempt on the part of 
the Democrats to have the special counsel, Mr. Fiske, be the 
independent counsel, and the beauty of this thing is that the three-
judge panel decided to turn down Mr. Clinton's Attorney General Janet 
Reno's recommendation that Mr. Fiske be the independent counsel.
  God blessed those three judges because they have appointed a man who 
will I believe get to the bottom of it, will not be pressured by 
anybody, and is truly going to be an independent counsel. And many of 
us questioned because of Mr. Fiske's ties to Bernie Nussbaum and other 
things that he was truly independent.
  I will be happy to answer any other questions.
  Mr. LaROCCO. The gentleman did not answer my question, but basically 
the gentleman in the well said he was pleased with the appointment of 
Mr. Starr.
  Mr. BURTON of Indiana. Right.
  Mr. LaROCCO. But basically Mr. Starr would not have been appointed by 
the three-judge panel if the minority and the Republicans had gotten 
their way because they had not voted for the independent counsel. So we 
would not have had the independent counsel that the gentleman is so 
happy about if the Republicans had gotten their way. So really we have 
the independent counsel in Mr. Starr that you are so happy about 
because the Democrats voted for the independent counsel. Is that 
correct?
  Mr. BURTON of Indiana. If I might reclaim my time, let me just say 
that we were for the independent counsel statute.
  Mr. LaROCCO. But did not vote for it.
  Mr. BURTON of Indiana. We were for the independent counsel statute, 
but we were not for a convoluted, manipulated independent counsel 
statute that the Democrats tried to ram through this place and did ram 
through in order to make Mr. Fiske not only the special counsel but the 
independent counsel so you could keep a lid on the Whitewater 
investigation. And the thing that really blows the mind of Mr. Bennett, 
and Democrats are complaining all across this town right now, the thing 
that blows their mind is they passed an independent counsel statute 
that they thought would keep a lid on this thing and it was changed by 
the three-judge panel who picked somebody else, and they are upset 
about that.
  Mr. LaROCCO. If the gentleman would yield further to me, under the 
terms of the independent counsel resolution that was passed by the 
House of Representatives. That is how they came into play. If we had 
not passed the independent counsel resolution here, then Janet Reno 
would have had the authority that she always has to name an independent 
counsel or special prosecutor. But now because of the work that we did 
here in calling for an independent counsel, the three-judge panel was 
able to pick this qualified Republican that you are so happy about. 
Also Mr. Fiske had impeccable Republican credentials. Now Mr. Starr 
does as well.
  Mr. BURTON of Indiana. If I may reclaim my time, let me just say that 
I have heard the Democrats on every talk show in this country from the 
White House on down talking about Mr. Fiske's impeccable ``Republican 
credentials.'' And Janet Reno, the Democrat Attorney General, picked 
Mr. Fiske. Mr. Fiske was tied to Bernie Nussbaum. His law firm was tied 
to the Whitewater Development Corp., the Arkansas Development Financial 
Authority and everything else which we have laid out on this floor 
night in and night out for over a month. The bottom line is that you 
folks over there wanted to keep a lid on it. That is why the leadership 
insisted that the independent counsel statute be changed so that Mr. 
Fiske, appointed by Bill Clinton's Attorney General, could not only be 
special prosecutor but independent counsel. And what chagrins the 
Democrats from the White House and Bill Clinton's personal attorney all 
the way down is now you have got a guy in there who is really going to 
ask the hard questions and really get to the bottom of this thing. That 
is why I say God blessed that three-judge Federal panel because they 
were not intimidated by the Attorney General's recommendation or by 
pressure from the White House or anybody else. They picked a guy who 
has no connection, none whatsoever, to anybody in the administration or 
anybody in the previous investigation.
  Mr. LaROCCO. If the gentleman would yield one more time to me.
  What the gentleman should say is God blessed the Democrats that 
passed a bill that gave this three-judge panel the authority to now 
name somebody that you are in agreement with.
  Mr. BURTON of Indiana. Let me just give you a pat on the back, OK? 
Let me just say this. I think the pressure that was created by the 
people of this country, the media and everything else forced the three-
judge Federal panel being incorporated into the legislation on the 
special counsel. I think that is fine. I think that is great. I would 
like to pat the Democrats on the back for passing the independent 
counsel statute even though they tried to fix it so Mr. Fiske would be 
the independent counsel. So congratulations on doing that, but I do not 
think, and I am confident the American people do not think you got what 
you really wanted because now we have got an independent counsel that 
is really going to do a job.

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