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Reno 'Mad' at White House Over Tapes (Oct. 9)

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From The Post
Firm to Pay $8 Million Fine for Illegal Campaign Gifts (Oct. 9)

Story of a Foreign Donor's Deal with '92 Clinton Camp Outlined (Oct. 9)

Clinton Rejects Allegations Over Tapes (Oct. 9)

Teamsters Contributions to Clinton Effort Probed

By Susan Schmidt
Washington Post Staff Writer
Thursday, October 9, 1997; Page A01

The Senate committee investigating allegations of campaign fund-raising abuses turned its attention for the first time yesterday to the possibility that funds from the International Brotherhood of Teamsters were improperly directed into the Clinton-Gore reelection effort last year.

The panel's chairman, Sen. Fred D. Thompson (R-Tenn.), suggested early yesterday that President Clinton knew about an alleged conspiracy to swap Teamsters contributions in exchange for Democratic fund-raisers directing big donors to contribute to the reelection effort of Teamsters President Ron Carey. Thompson's comments came as the Senate Governmental Affairs Committee questioned former White House deputy chief of staff Harold Ickes on Democratic fund-raising during the 1996 campaign.

But late in the day, Thompson backed away from the accusation, saying he had "left the wrong impression" that Clinton attended a private meeting in 1996 with a consultant to the Teamsters just four days before the union decided to contribute $236,000 to state Democratic parties.

"If you have to eat crow, or maybe half a crow, it's better to eat it warm than cold," Thompson said after learning more about the June 17, 1996, White House luncheon.

Still, Justice Department and Senate investigators are examining ties between the Teamsters and the Democratic National Committee in an effort to determine whether they engaged in an illegal conspiracy to effectively swap contributions between the Clinton and Carey reelection campaigns.

The committee today is scheduled to question two witnesses about the relationship between the Teamsters and the DNC during last year's elections. Richard Sullivan, the former Democratic National Committee finance director, and Mark Thomann, a former Northern California fund-raiser, are to be asked about an effort to direct a $100,000 contribution from a would-be DNC donor to the Carey campaign.

Yesterday, the panel produced White House entry logs showing that two top Democratic Party officials and a Teamsters consultant attended a White House luncheon with President Clinton on June 17, 1996. Consultant Martin Davis has pleaded guilty in a money-laundering scheme designed to benefit Carey's reelection.

It was during this period, four days later in fact, that Teamsters money began flowing to state Democratic parties. On June 21, according to one source who has seen the document, Teamsters political director Bill Hamilton issued a rush authorization for a series of state contributions totaling $236,500. Three days later the checks were issued.

Terence R. McAuliffe, the former finance chairman of the Clinton-Gore campaign, and Laura Hartigan, the campaign's finance director, said yesterday through their attorneys that they did not discuss contributions to Carey at the White House event, which was attended by other party donors and fund-raisers.

It was the timing of the White House visit in relation to the contributions that drew Thompson's attention yesterday, and his implication that the Teamsters contribution had been discussed with the president in a "private" meeting. But after the White House noted that Clinton had attended only the lunch and that other donors unaffiliated with the Teamsters had been present, Thompson apologized.

Both McAuliffe and Hartigan have been questioned by federal prosecutors in New York and by Senate investigators about conversations with Davis and the sequence of events that unfolded in the summer of 1996 as the Carey campaign fought an uphill battle for funds against challenger James Hoffa and the Democrats scrambled for contributions to ensure they would win in November.

Davis's role in the alleged plot was detailed in a criminal information filed in September by U.S. Attorney Mary Jo White of the Southern District of New York, who charged that he discussed a money swap with two unnamed Democratic officials. As a result of allegations of a broad money-laundering scheme by Carey aides, a federal judge has thrown out the 1996 Teamsters election results, which Carey won by a slim margin.

Davis, a Washington-based consultant who also did work for the DNC, is cooperating with the federal probe along with two other Carey campaign aides who have pleaded guilty. His attorney said yesterday he could not discuss the White House lunch because it is part of the ongoing investigation.

Court documents offer only sketchy details of the discussions, and Democratic Party officials have offered varying accounts. The DNC has said none of its officials was involved in a money swap.

According to court documents, Davis, the part owner of the Washington based consulting firm, The November Group, learned in May or June 1996 about planned Teamsters donations to various Democratic campaigns and began trying to use the money as "a means to induce the DNC to raise money for the Carey campaign."

McAuliffe introduced Davis to his Clinton/Gore '96 finance aide, Hartigan, as a point person who could coordinate labor contributions, according to Senate documents.

In June 1996, Hartigan set up a lunch at the Palm restaurant in Washington where Davis proposed to her and Sullivan that the DNC find $100,000 in donations for Carey. In the same discussion, Davis talked about generating $1 million for the Democrats, according to documents in the hands of Senate investigators.

Hartigan's office sent Davis a memo on June 12, 1996, listing states where the Teamsters should direct funds.

Meanwhile, sometime in July the Democrats began trying to find a home for a $100,000 donation from Judith Vasquez, a Filipina businesswoman who wanted to give to the DNC but was ineligible.

Documents show that DNC officials first tried to direct the donation to Carey's campaign. But it was determined she could not give to the union because she was an employer. The money ended up with Vote Now '96, a nonprofit South Florida voter registration group closely tied to the DNC.

A memo allegedly written by Sullivan that is now in the hands of Senate investigators offers a cryptic comment: "Vote '96 underwriting Teamsters."

Thomann's lawyer Robert Freibert said he was instructed by Sullivan about how to handle the Vasquez contribution. Sullivan's lawyer Robert Bauer said that Sullivan did not participate in a plan to swap contributions but believed it was legal and desirable to help the Carey campaign.

Thomann also got a call from Teamsters lawyer Nathaniel Charny, who was charged with ensuring that Carey contributions complied with the law. Charny "kind of pressured him," Freibert said, to find a way for Vasquez to give to Carey, perhaps through the name of her husband. Charny's lawyer did not return phone calls. Thomann eventually told Sullivan that "he was recusing; he wanted nothing more to do with the Vasquez money. He wanted out because he was uncomfortable with it," his attorney said.

Ickes, a key figure in the Senate committee's investigation of campaign fund-raising improprieties, testified for about seven hours yesterday about his role as the White House's "point man" in coordinating political and fund-raising activities with the DNC and the Clinton-Gore reelection committee.

Occasionally combative when a few Republican committee members challenged him, Ickes strongly defended Democratic fund-raising practices, denied that any laws were broken, and frequently replied to hostile questions with thrusts against the GOP's fund-raising operation.

"Boy, you're tremendous," Sen. Pete V. Domenici (R-N.M.) said in grudging admiration.

Staff writers Edward Walsh in Washington and Sharon Walsh in New York contributed to this report.

© Copyright 1997 The Washington Post Company

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