WASHINGTON, Sept. 20 -- Independent counsel Robert Ray Wednesday cleared the president and the first lady of criminal wrongdoing in the 6-year investigation of Arkansas business dealings known as "Whitewater."
Ray's Whitewater report remains under seal with the three-judge panel that oversees independent counsel investigations. But Ray issued a statement after the report was filed Wednesday, repeatedly saying his office "determined that the evidence was insufficient to prove beyond a reasonable doubt" each of the major allegations in the investigation.
However, Ray also said he could not determine why there was an 18-month delay in finding the billing records of the Rose Law Firm in Little Rock.
And Ray contended that his office "experienced delay caused by the White House and others involving both the production of relevant evidence and the filing of legal claims that were ultimately rejected by the courts."
A statement released after the report by the White House did not address that issue, but instead marked his ultimate conclusions. "Robert Ray is now the latest investigator to complete an examination of the transactions related to the Whitewater Development Co. and conclude that there are no grounds for legal action," the statement said.
The Whitewater investigation officially began in January 1994 when Attorney General Janet Reno appointed special counsel Robert Fiske to investigate allegations involving the relationship between President Clinton and first lady Hillary Rodham Clinton on one hand, and business partners James McDougal and his former wife Susan on the other.
The probe concentrated on the activities of McDougal's Madison Guaranty Savings & Loan Association; Capital Management Services Inc., a firm that routed Small Business Administration loans, and the Whitewater Development Corp., a failed business venture started by the McDougals and Clintons.
Fiske was replaced by former federal Judge Kenneth Starr in August 1994 after Congress re-enacted the Independent Counsel Act. The three-judge panel rejected Reno's recommendation of Fiske, and instead selected Starr as the independent counsel. Starr resigned last year, and Ray was appointed to finish the investigation.
At the center of the Whitewater probe was whether Clinton borrowed money from Madison Guaranty, which eventually failed.
Ray said Wednesday that the "evidence regarding this alleged loan was insufficient to prove beyond a reasonable doubt that President Clinton borrowed moneycaused anyone to borrow money for his benefitor had any personal loan at any time from Madison Guaranty."
The independent counsel's office offered a check made out to "Bill Clinton," and a check made out to the savings and loan, as evidence in Susan McDougal's 1999 trial for contempt for refusing to testify about the alleged loan.
"Neither check reflected a signature or endorsement by Bill Clinton," Ray said, though both had been deposited and processed.
In other matters, Ray concluded that there was insufficient evidence to prove that Clinton, as Arkansas governor, knew of a $300,000 loan from CMS to Susan McDougal or lied about it under oath; or lied under oath about Madison Guaranty's hiring of the Rose Law Firm, which employed Hillary Rodham Clinton.
The independent counsel concluded that there was insufficient evidence to prove that Hillary Clinton lied about her work as an attorney for Madison Guaranty, or obstructed justice in the production of Rose Law Firm billing records.
The records turned up in the White House in 1996, 18 months after Hillary Clinton received a subpoena for them.
Ray said there was insufficient evidence to prove that Webster Hubbell, a Clinton friend forced to resign as associate attorney general in 1994 before pleading guilty to a felony, was hired after his resignation by Clinton supporters as a "quid pro quo" for his silence about the first couple.
Earlier, Ray had cleared the Clintons in the 1993 firing of the White House Travel Office staff and the White House acquisition of FBI file summaries on Republicans in late 1993 and early 1994.
Starr's investigation of the president's statements denying his sexual liaison with former White House intern Monica Lewinsky led to Clinton's impeachment in the House in late 1998. But the president was acquitted by the Senate in February 1999.
Ray is overseeing a grand jury in Washington that is investigating matters covered by the impeachment and trial in Congress. He has said he would consider whether Clinton should be indicted on the Lewinsky matter after the president leaves office.
