By Amy Argetsinger
Washington Post Staff Writer
Saturday, May 28, 2005
LOS ANGELES, May 27 -- A federal jury here on Friday found a former top campaign official for Sen. Hillary Rodham Clinton (D-N.Y.) not guilty of charges that he intentionally covered up the lavish costs of a 2000 celebrity fundraising gala.
David F. Rosen, Clinton's national finance director during her first Senate race, had faced up to 10 years in prison and a $500,000 fine had he been convicted on two charges of lying to the government when he understated the event's costs by nearly $800,000 in filings to the Federal Election Commission. Rosen asserted that the event's hosts had misled him about their true expenses.
Though Clinton was not charged in the matter, and prosecutors repeatedly said they did not believe she was involved, the case had been closely watched by critics of the former first lady, especially at a time of heated speculation about her possible aspirations for a 2008 presidential run.
Rosen, 38, a newlywed who said his Chicago consulting firm has lost all its clients since his indictment, expressed relief when the jury returned with an acquittal after six hours of deliberation.
"It was hard for me to hold back tears," he told the Associated Press. "It was the happiest moment, next to my marriage, in my life."
Testimony throughout the three-week trial cast a spotlight on the complicated yet mutually beneficially relationships between political campaigns and the wealthy celebrities who support them.
Rosen, who testified, said repeatedly that he had no idea how much the event cost. For all the dinners and receptions he had overseen in his career as a fundraiser, none was as elaborate as the banquet and concert held at a sprawling Brentwood estate on the eve of the Democratic National Convention. Performers included Stevie Wonder and Melissa Etheridge, guests included Brad Pitt and Jennifer Aniston, and toasts were delivered by Muhammad Ali and Whoopi Goldberg.
But although prosecutors contended that it was obvious to all involved that costs were spiraling out of control -- as a result of factors such as the construction of an elaborate stage, the production budget for an Emmy-winning producer, and guest gift packages that included CDs and personalized director's chairs -- Rosen said he simply took the word of the organizers on how much the event cost, which he said is the custom among fundraisers, and never pressed for details.
The event cost more than $1.1 million -- Rosen reported to the FEC that it cost $400,000 -- and netted only $91,000. Though the hosts of the event covered all those costs, such "in kind" donations matter because they weigh against the amount a candidate can legally spend in unrestricted funds on advocacy ads and other direct appeals to voters.
Rosen also said he assumed that the celebrities donated their time and talent to such events -- though, in fact, entertainers such as Cher charged the organizers thousands of dollars for their travel in private jets. And he said he thought the entrepreneur who hosted the event put him up for several days at the luxurious Beverly Hills Hotel out of friendship -- his explanation for why he unlawfully failed to report his expenses there.
Rosen, though, acknowledged that he knew from the start that the two men hosting the event did so at least in part to raise their own profile as they tried to launch an Internet start-up with comic-book legend Stan Lee.
In his testimony, Rosen placed most of the blame on those two men -- Peter Paul, who has since been convicted of defrauding investors, and Aaron Tonken, now in prison for defrauding charities -- for misleading him about the costs. Neither was called to testify.
Clinton's office on Friday released a statement from her attorney, David Kendall, praising the verdict: "We have said from the beginning that, when all the evidence is in, David would be vindicated. . . . Sen. Clinton is very happy for David and his family."
But officials with Judicial Watch, which has long been critical of the Clintons, pledged to pursue the Rosen case further. The group recently asked the Senate Select Committee on Ethics to investigate Clinton's role in the matter. "Obviously, the Justice Department made a political calculation and decided not to pursue the case against Rosen aggressively," Paul J. Orfanedes, the group's director of litigation, said in a statement.