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WASHINGTON POST MAGAZINE | DECEMBER 13, 1998

HOW IT CAME TO THIS: THE SCANDAL IN 13 ACTS

BY DAVID FINKEL

It was one of President Clinton's greatest days: the signing of a peace accord between Israel and the Palestine Liberation Organization. Yitzhak Rabin was at the White House. So was Yasser Arafat. So were George Bush and Jimmy Carter. So were Cabinet members and most members of Congress. And so was Walter Kaye, a lifelong insurance man, property and casualty his specialty, who five years later would come before the Ken Starr grand jury to explain how his presence at the White House that day was, arguably, the most consequential of all.

"I'll tell you what happened," Walter Kaye would tell the grand jury. He was talking about the events leading up to September 13, 1993, when he was 70 years old, and recently retired, and rich, and living in New York, and feeling somewhat adrift. "I was going through a very, very difficult emotional period," he said. "I had suffered a heart attack, and they sold the business, and I was pushed out right away. A very emotional thing, you know. You start a business from scratch, and I don't want to brag, but we did have a very nice business. And I was in bad shape.


Photo Illustration by Michael Morgenstern
"And one day," he continued, ". . . I'm having breakfast at a hotel in New York, and this young woman comes up to me and says to me, 'Aren't you Walter Kaye?' I said, 'I'm Walter Kaye.'

"She said to me, 'You know, I'd like to talk to you.' I said, 'If you're looking for money, I've given it away for the whole year. I'm involved with a lot of charities.' "She said, 'No, I want to talk to you about becoming active in politics.' I said, 'I want to tell you, if there's anything I'm not interested in it's politics. Just leave me alone.'

"So she says, 'Can't you be polite and listen?' " So he was polite, he said, and he listened, and soon after that he found himself talking to another woman who came up from Washington to see him.

"I don't even really remember her name," he said, "Kathy something, and she starts to give me the reasons why I should become active in politics, or make a contribution, excuse me, to the Democratic National Committee.

". . . I said, 'Listen, I'm an excitement nut. I like excitement. You offer me some exciting times, I will give you a contribution.' And what do you think happens? She said, 'If you like excitement, Mrs. Clinton is speaking at the Mayflower Hotel . . . Why don't you come as our guest?' "So I go down to the Mayflower Hotel," he said, ". . . and as soon as I get there, I know, boy, they're really working on me. They put me in the first row for the lecture . . . And then at about 10:30 I go out to get a cup of coffee, and one of the people from the Democratic Party, a young lady, says, 'Mr. Kaye, we'd like to invite you to meet Mrs. Clinton' . . . And I said, 'No, I really don't—' She said, 'Don't be silly. You're here. Why don't you meet me back here at 11:30? We'll take you back to meet Mrs. Clinton.'

"So I go. And again, I'm telling you . . . I never saw this before. You know, the dogs sniffing out the place, the Secret Service all over the place . . . We went to a private suite at the Mayflower, and sure enough, she came in, and I'm very, very excited, you know, and we chatted for a minute, and I was really overwhelmed. I'm telling you the truth. And then when I walked into the luncheon, what do you think they do? They seat me at her table.

"I'm telling you," he said. "They should be in the insurance business . . .

"But I'll tell you what was really the clincher.

"On Saturday morning, I get a call from the White House . . . If you recall, this is a time they signed the peace treaty between Arafat, Rabin and the president . . . And they said, 'Mr. Kaye, we would like you to attend' . . . and I just can't believe it. I'm telling you, I get goosebumps as I tell you, although I've had such aggravation with this.

"I go down, and you walk on the grounds of the White House. The flags are flying. The Marine Corps band is playing. Helicopters all over.

"I happen to be a very, very patriotic guy. I feel the greatest thing to happen to me was I live in this country.

"I just love it."

"Okay," one of Starr's assistants said to Kaye after listening to all of this. "And did you eventually develop a personal relationship with the members of the First Family?"

"I sure did."

"And you said you've given a large amount of money to the Democratic National Committee . . . Approximately how much have you given?"

"Well, I never knew, but according to the papers I gave about $300,000."

"Okay. Now you're familiar with the internship program at the White House?"

"Not 100 percent, but I know they have a lot of these young interns working there."

"Okay. And have you recommended people for jobs as interns in the White House during the Clinton administration?"

"Yes."

"And about how many people have you recommended, if you know?"

"Off the top of my head, just two."

"And who are they?"

"Monica Lewinsky and my grandson."

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© Copyright 1998 The Washington Post Company

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