July 18, 1995 - Part 1
July 18, 1995 - Part 1
(09:55:53) White House officials worried that someone at the Department of Justice or the FBI might find Foster's own notes which establish that Vince Foster worried about the connection between the Clintons, Madison Guaranty and Whitewater Development Corporation, If this evidence was discovered, they worried it would trigger a Federal investigation. Sitting here today, I must say there was ample reason to worry. The Clintons have always claimed they suffered a loss on their Whitewater investment, that they were 50/50 partners with McDougal on the venture and that they bore substantial financial risk from the investment. Based on Vince Foster's own words, we 7 now have good reason to question these claims. The Clintons have maintained publicly that, although they sustained a significant loss on the venture, they reported a $1,000 gain from the investment so as to be absolutely ethical and above board in filing their 1992 tax returns. It wasn't ethics. It was their fear of an audit. Mr. Foster's own notes, which are part of the enormous stack of Whitewater documents that the White House has hidden until now, established that Mr. Foster knew the Clintons were caught in a trap. The Clintons' public statements that they had suffered a loss on Whitewater were at odds with everything he or any of the accountants knew about the venture. In 1993, in the months before he died, Mr. Foster had the impossible job of proving a tax loss for the Clintons without supporting documents while at the same time avoiding an IRS audit. No matter how good a lawyer Vincent Foster was, he couldn't prove something that wasn't true. The only thing he could rely upon was the figure of $1,000, which was the surn that McDougal paid the Clintons for their share of Whitewater in December 1992. Ultimately, Mr. Foster chose to claim a $1,000 gain so as to avoid an audit. What I'd like to do now is to take a look at a few documents. The documents I'm about to show you were taken from the Whitewater files in Vincent Foster's office. Again, these are only three pages out of at least 450 that were only recently produced for our review. I might suggest to you that the documents are going to show up on the television screen. The handwriting that you will see on these documents is that of Mr. Foster. If you would put up document number 234 and focus in on "sometimes relied on Clintons' return on evidence. Don't want to go back into that box." Here Foster is distressed over the options for reporting either a loss or a gain on the Clintons' Whitewater investment. We see his concern about the fact that the accountants sometimes relied on the Clintons' returns as evidence, and, as he put it, they "don't want to go back into that box." As a matter of public record, we also know that the Clintons have always claimed that Madison Guaranty and Whitewater Development were separate. If you could focus in on "was McDougal trying to circumvent bank losses, why HRC is getting loans from others." As we look further down on that page, which you have just focused on, this can only mean that Foster was raising the extremely serious questions we are still trying to answer. Again, his notes raise the following question: "Was McDougal trying to circumvent bank loss? Why HRC is getting loans from others." The questions that I think he was raising-were federally-insured S&L bank funds used to cover Whitewater losses and was Hillary Rodham Clinton borrowing money to help McDougal circumvent Madison losses? Now, if you would put up document number 236 and focus in on "more importantly would result in ail audit of proof of basis," and "can of worms you shouldn't open." Here Mr. Foster was trying to figure out how to avoid an IRS audit of the First Couple's tax returns. On this page of notes, he seems to finally determine that, when all is said and done, the options they have that coincide with their public statements "more importantly would result in an audit 8 of proof of basis." Which, he says, is a "can of worms you shouldn't open."