Union Calendar No. 461

104th Congress, 2nd Session – – – – – – – – – – House Report 104–849

INVESTIGATION OF THE WHITE HOUSE

TRAVEL OFFICE FIRINGS AND RELATED

MATTERS

FIFTEENTH REPORT

BY THE

COMMITTEE ON GOVERNMENT

REFORM AND OVERSIGHT

together with

MINORITY AND ADDITIONAL VIEWS

SEPTEMBER 26, 1996.—Committed to the Committee of the Whole House

on the State of the Union and ordered to be printed
INVESTIGATION OF THE WHITE HOUSE TRAVEL OFFICE FIRINGS AND RELATED MATTERS
U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

1

27–214 CC 1996

Union Calendar No. 461

104th Congress, 2nd Session – – – – – – – – – – House Report 104–849

INVESTIGATION OF THE WHITE HOUSE

TRAVEL OFFICE FIRINGS AND RELATED

MATTERS

FIFTEENTH REPORT

BY THE

COMMITTEE ON GOVERNMENT

REFORM AND OVERSIGHT

together with

MINORITY AND ADDITIONAL VIEWS

SEPTEMBER 26, 1996.—Committed to the Committee of the Whole House

on the State of the Union and ordered to be printed
ii

COMMITTEE ON GOVERNMENT REFORM AND OVERSIGHT

WILLIAM F. CLINGER, JR., Pennsylvania, Chairman

BENJAMIN A. GILMAN, New York

DAN BURTON, Indiana

J. DENNIS HASTERT, Illinois

CONSTANCE A. MORELLA, Maryland

CHRISTOPHER SHAYS, Connecticut

STEVEN SCHIFF, New Mexico

ILEANA ROS-LEHTINEN, Florida

WILLIAM H. ZELIFF, JR., New Hampshire

JOHN M. MCHUGH, New York

STEPHEN HORN, California

JOHN L. MICA, Florida

PETER BLUTE, Massachusetts

THOMAS M. DAVIS, Virginia

DAVID M. MCINTOSH, Indiana

RANDY TATE, Washington

DICK CHRYSLER, Michigan

GIL GUTKNECHT, Minnesota

MARK E. SOUDER, Indiana

WILLIAM J. MARTINI, New Jersey

JOE SCARBOROUGH, Florida

JOHN B. SHADEGG, Arizona

MICHAEL PATRICK FLANAGAN, Illinois

CHARLES F. BASS, New Hampshire

STEVEN C. LATOURETTE, Ohio

MARSHALL ‘‘MARK’’ SANFORD, South

Carolina

ROBERT L. EHRLICH, JR., Maryland

SCOTT L. KLUG, Wisconsin

CARDISS COLLINS, Illinois

HENRY A. WAXMAN, California

TOM LANTOS, California

ROBERT E. WISE, JR., West Virginia

MAJOR R. OWENS, New York

EDOLPHUS TOWNS, New York

JOHN M. SPRATT, JR., South Carolina

LOUISE MCINTOSH SLAUGHTER, New

York

PAUL E. KANJORSKI, Pennsylvania

GARY A. CONDIT, California

COLLIN C. PETERSON, Minnesota

KAREN L. THURMAN, Florida

CAROLYN B. MALONEY, New York

THOMAS M. BARRETT, Wisconsin

BARBARA-ROSE COLLINS, Michigan

ELEANOR HOLMES NORTON, District of

Columbia

JAMES P. MORAN, Virginia

GENE GREEN, Texas

CARRIE P. MEEK, Florida

CHAKA FATTAH, Pennsylvania

BILL BREWSTER, Oklahoma

TIM HOLDEN, Pennsylvania

ELIJAH CUMMINGS, Maryland

———

BERNARD SANDERS, Vermont

(Independent)

JAMES L. CLARKE, Staff Director

KEVIN M. SABO, General Counsel

JUDITH MCCOY, Chief Clerk

BARBARA OLSON, Chief Investigative Counsel

BARBARA COMSTOCK, Special Counsel

JOE LOUGHRAN, Investigator/Professional Staff Member

ROBERT SHEA, Professional Staff Member

KRISTI REMINGTON, Investigator

LAURIE TAYLOR, Investigator

BUD MYERS, Minority Staff Director
(iii)

LETTER OF TRANSMITTAL

HOUSE OF REPRESENTATIVES,

Washington, DC, September 26, 1996.

Hon. NEWT GINGRICH,

Speaker of the House of Representatives,

Washington, DC.

DEAR MR. SPEAKER: By direction of the Committee on Government Reform and Oversight, I submit herewith the committee’s fifteenth report to the 104th Congress.

WILLIAM F. CLINGER, Jr., Chairman.

(V)

C O N T E N T S

Page

Introduction .............................................................................................................. 1

I. Summary overview ........................................................................................ 2

A. The White House stonewalled all investigations into the White

House Travel Office firings and related matters ................................ 3

B. The full cooperation pledged by the President was a hollow promise ............................................................................................................ 8

C. President Clinton’s staff engaged in an unprecedented misuse of

executive power and executive privilege .............................................. 9

D. The consequences of the White House’s cover-up have been dramatic to the Travel Office employees, the Foster family, and administration officials in personal, as well as in institutional terms .. 10

II. Committee findings and recommendations ................................................. 11

III. Actions in May 1993 which led to the White House Travel Office firings 28

A. The career Travel Office employees are fired, accused by the White

House of wrongdoing and political cronies are put in charge of

the Travel Office .................................................................................... 28

B. The Travel Office firings were a result of pressure by Harry

Thomason and Mrs. Clinton which accelerated in the week before

the firings ............................................................................................... 29

IV. The Travel Office firings were part of a campaign payback scheme

that was in place long before May 1993 ................................................... 52

A. Harry Thomason sought the travel business from the early days

of the transition, told Mrs. Clinton he could provide the service

and President Clinton and Mrs. Clinton provided the access to

do so. Harry Thomason maligned the Travel Office employees,

as well as Travel Office contractor UltrAir in order to move them

out of that office. Thomason’s travel business interests posed an

inherent conflict with his involvement in Travel Office decisions

or any solicitation of business in this area .......................................... 52

1. Harry Thomason’s ownership interest in aviation companies

presented inherent conflicts of interest in his seeking Travel

Office business ................................................................................ 52

2. TRM, Thomason’s company, provided service to the Clinton/

Gore campaign and sought to capitalize on their association

with the new administration ......................................................... 53

3. A January 29, 1993 memorandum from Darnell Martens to

Harry Thomason catalogs the ambitious Washington agenda

for TRM: pursuing Travel Office business and obtaining ‘‘official status’’ at the White House .................................................... 55

a. Seeking ‘‘Washington opportunities’’ ...................................... 55

b. Obtaining ‘‘some form of official status’’ ................................. 55

c. Seeking the Travel Office business ......................................... 57

4. Putting Martens in touch with the White House to obtain

Travel Office business .................................................................... 57

5. Drafting a memorandum covering his conversation with Dale

which shows he was seeking the Travel Office business ............ 58

6. Laying out the strategy to get the Travel Office business in

a March 5, 1993 memorandum: dig up dirt on the current

employees and replace them with campaign cronies ................... 58

B. Catherine Cornelius pursued her interest in taking over the Travel

Office from the very first days of the transition and into the early

days of the administration, proposing herself as co-director of the

office ........................................................................................................ 61

C. Darnell Martens gives the nod to his campaign benefactor Penny

Sample of Air Advantage ...................................................................... 63
Page

VI

D. Arkansas travel agency World Wide Travel provided services during the campaign, obtained the DNC contract in November 1992,

and sought White House Travel Office business ................................. 64

E. Conclusion ............................................................................................... 65

V. Harry Thomason pursued opportunities in Government contracts

through his relationship with the President which would have resulted in a financial benefit to him and his company ............................. 66

VI. Employment status of selected advisors to the President .......................... 69

A. Special Government employee defined ................................................. 69

B. An individual may undertake certain activities that qualify for

a special Government employee status without formal appointment ........................................................................................................ 70

C. Treatment of SGES in the executive branch ....................................... 71

1. Michael S. Berman’s activities at the Clinton White House ........ 72

2. Activities of Harry Thomason and Darnell Martens .................... 74

a. The Justice Department found that there is no evidence

that Martens or Thomason had any formal status as a

Government employee or special Government employee ..... 76

b. The Justice Department found that there is not sufficient

evidence that either Thomason or Martens was a de facto

Government employee or special Government employee or

that they sought to avoid the formalities of Government

office in an effort to skirt the conflict of interest laws ......... 77

c. The Justice Department found that insufficient evidence

exists that Thomason performed a Federal function or

acted under the supervision of a Federal employee ............. 77

d. The Justice Department found that both men participated

in some manner in the inquiry concerning the Travel Office—at minimum providing information relevant to the

decisionmakers. It is not at all clear, however, that such

participation would qualify as ‘‘substantial’’ under the statute ............................................................................................. 78

e. The Justice Department found that Thomason and Martens

clearly had no decisionmaking role ........................................ 78

f. The Justice Department found that even if we could establish that they had some employment status, we would

have difficulty establishing that the employment was connected with the Travel Office ................................................. 79

3. Activities of Penny Sample ............................................................. 81

4. Conclusion ........................................................................................ 82

VII. Lack of competitive bidding .......................................................................... 83

A. Background ............................................................................................. 83

B. Competitive bidding in the Clinton White House ............................... 84

C. KPMG Peat Marwick contract .............................................................. 85

D. World Wide Travel ................................................................................. 87

E. Air Advantage ......................................................................................... 88

F. American Express ................................................................................... 89

VIII. The White House initiated a full-scale campaign of misinformation in

the aftermath of the Travel Office firings and put in place a coverup from which it could not extricate itself ............................................... 90

A. President Clinton led the misinformation campaign from the first

days of the Travelgate debacle ............................................................. 90

B. The initial press offensive against the Travel Office employees

mischaracterized the Peat Marwick review and the FBI’s role in

order to cover-up the real reasons for the firings ............................... 91

C. Neither the Congress, the press nor the public bought the White

House story ............................................................................................ 93

D. The last best hope for a cover-up? A man from hope, Mack

McLarty .................................................................................................. 95

1. David Gergen assumes damage control patrol .............................. 95

2. White House Management Review: Truth or obfuscation? .......... 96

3. The Management Review excluded information which was exculpatory to Travel Office employees and derogatory to President Clinton and his cronies .......................................................... 97

4. The Management Review minimized the role of Mrs. Clinton .... 99

IX. The White House’s failure to admit Thomason’s baseless ‘‘kickback’’

allegations were false and led to a fruitless IRS investigation .............. 102

A. Introduction ............................................................................................ 102
Page

VII

B. UltrAir ..................................................................................................... 103

C. The UltrAir matter was not handled under the same standards

as other potential tax violations ........................................................... 104

D. Securing the records .............................................................................. 106

E. KPMG Peat Marwick: Both sides now ................................................. 107

F. Bill Kennedy and the IRS ...................................................................... 107

G. Kickback allegations disproved by the White House .......................... 107

H. Internal Revenue Code 6103 ................................................................. 108

X. Vincent Foster became increasingly disturbed by the problems generated by Travelgate—as did numerous high ranking White House

officials ........................................................................................................ 109

A. Despite Foster’s initial efforts during the management review, he

was unsuccessful in concealing ‘‘the clients’’ role in the Travel

Office firings ........................................................................................... 109

B. The Management Review’s inclusion of Bill Kennedy’s reference

to the involvement of ‘‘the highest levels’’ of the White House

in the firings raised problems for both President Clinton and Mrs.

Clinton .................................................................................................... 110

C. Foster was troubled by the prospect of numerous congressional

and criminal investigations into the Travel Office firings ................. 112

D. Foster was in the middle of problems related to Harry Thomason,

which were starting to gather steam ................................................... 115

E. Foster strongly argued for private attorneys to assist the White

House in handling the coming investigations but Nussbaum

rebuffed him. Foster discussed the issues with outside attorneys

and friends ............................................................................................. 120

XI. Foster’s death generated another layer of a cover-up over a coverup ................................................................................................................. 121

A. Foster’s death shattered a White House just recovering from an

abysmal first 6 months of administration ........................................... 121

B. At the time of Foster’s death on July 20, 1993, his office contained

damaging evidence about the Travelgate matter and related

events. Individuals with a reason to hide or cover-up documents

were at or around Foster’s office prior to the office being sealed ...... 122

C. White House Counsel Bernard Nussbaum obstructed numerous

investigations into the Travel Office and the death of Vince Foster,

by withholding the Vince Foster Travel Office notebook ................... 125

D. Neil Eggleston withheld the Foster Travel Office file from relevant

investigations even after it was belatedly disclosed to him by Bernard Nussbaum ...................................................................................... 130

E. Craig Livingstone provided testimony about his activities on the

morning after Foster’s death which is inconsistent with law enforcement officials and new White House documents which were

withheld under a claim of executive privilege until August 1996 ..... 131

F. Evidence of Mrs. Clinton’s involvement in the response to the

finding of Foster’s ‘‘suicide’’ note. Her direction not to tell the

President about the note, on July 26, 1993, was withheld from

investigators ........................................................................................... 134

XII. The White House has stonewalled all previous investigations and engaged in an unprecedented damage control operation run out of the

White House Counsel’s Office ................................................................... 138

A. Hearings were requested in 1993 on this matter ................................ 138

B. White House history of stonewalling .................................................... 138

1. GAO investigation ........................................................................... 139

2. OPR investigation ............................................................................ 149

XIII. Stonewalling this committee’s investigation ............................................... 154

A. History of seeking Travelgate documents from the White House ...... 154

1. Chairman Clinger’s efforts to investigate while in the minority . 154

2. Committee efforts in the 104th Congress ...................................... 155

B. White House protection efforts were particularly keyed to withholding documents potentially damaging and shielding key players ....... 160

1. Harry Thomason role ...................................................................... 160

2. Notes of interview with Mrs. Clinton—missing ............................ 161

3. Missing memo in Kennedy’s office which was reviewed by FBI

agents .............................................................................................. 161

4. Missing Mack McLarty memo ........................................................ 162

C. White House response on matters related to Mrs. Clinton ................ 162

D. Pattern of obstruction ............................................................................ 165
Page

VIII

1. Delays in document production ...................................................... 165

2. Reluctant witness ............................................................................ 166

E. Committee moved to depositions under oath ....................................... 167

1. ‘‘I don’t recall . . .’’ ......................................................................... 167

2. Who couldn’t ‘‘recall’’ ....................................................................... 167

XIV. The stonewall begins to crack ....................................................................... 171

A. Watkins memo begins to explain the true story .................................. 171

1. Pressure from First Lady and Mack McLarty .............................. 172

2. Pressure from Harry Thomason ..................................................... 174

3. Secret Service incident .................................................................... 175

B. White House made ineffective claims of ‘‘executive privilege’’ over

discussions about ‘‘Watkins memo’’ ...................................................... 176

C. Congress holds White House accountable ............................................ 176

XV. President Clinton has abused executive power and executive privilege

and misused the counsel’s office in order to effectuate a cover-up

of the Travel Office matter ........................................................................ 176

A. The long road to getting White House documents—from foot dragging to executive privilege .................................................................... 176

B. The President engaged in an unprecedented use of executive privilege in the course of the committee’s depositions ............................... 178

C. Executive privilege claims are being asserted for political security

not national security .............................................................................. 178

1. Conversations with Mrs. Clinton = executive privilege? .............. 179

2. Executive privilege for debriefings with outside attorneys? ........ 179

3. Executive privilege over White House briefing papers created

for Congress? ................................................................................... 179

4. Executive privilege over information regarding Vincent Foster? 179

D. The misuse of the counsel’s office began under the tenure of Bernard Nussbaum as President Clinton’s first White House counsel ... 180

E. President Clinton’s second counsel, Lloyd Cutler, sustained the

pattern of obstruction set by Nussbaum .............................................. 181

F. President Clinton’s special counsel begins her ‘‘task list’’ of oversight of all congressional as well as independent counsel investigations ........................................................................................................ 181

G. President Clinton pushes the boundaries of his claims of executive

privilege against producing relevant documents to Congress ............ 184

H. The President has insisted that all of his counsel’s maintain an

obstructionist position with Congress .................................................. 185

APPENDIX

Supporting documentation for the record .............................................................. 187

VIEWS

Minority views of Hon. Cardiss Collins, Hon. Henry A. Waxman, Hon. Tom

Lantos, Hon. Robert E. Wise, Jr., Hon. Major R. Owens, Hon. Edolphus

Towns, Hon. John M. Spratt, Jr., Hon. Louise McIntosh Slaughter, Hon.

Paul E. Kanjorski, Hon. Karen L. Thurman, Hon. Carolyn B. Maloney,

Hon. Thomas M. Barrett, Hon. Barbara-Rose Collins, Hon. Eleanor Holmes

Norton, Hon. James P. Moran, Hon. Gene Green, Hon. Carrie P. Meek,

Hon. Chaka Fattah, Hon. Tim Holden, and Hon. Elijah Cummings ............... 858

Additional views of Hon. Paul E. Kanjorski .......................................................... 887
1Transcript of remarks by President Clinton, May 21, 1993.

Union Calendar No. 461

104TH CONGRESS REPORT " ! HOUSE OF REPRESENTATIVES 2nd Session 104–849

INVESTIGATION OF THE WHITE HOUSE TRAVEL OFFICE

FIRINGS AND RELATED MATTERS

SEPTEMBER 26, 1996.—Committed to the Committee of the Whole House on the

State of the Union and ordered to be printed

Mr. CLINGER, from the Committee on Government Reform and

Oversight, submitted the following

FIFTEENTH REPORT

together with

MINORITY AND ADDITIONAL VIEWS

On September 18, 1996, the Committee on Government Reform

and Oversight approved and adopted a report entitled ‘‘Investigation of the White House Travel Office Firings and Related Matters.’’ The chairman was directed to transmit a copy to the Speaker

of the House.

INTRODUCTION

In order to establish a baseline for examining the facts compiled

by the committee, it is useful to begin with the statements uttered

by the President early on in his administration. It is also useful to

measure the statements against his deeds. This will provide the

public with a proper measure for determining the success of this

President in resolving issues in his own backyard—in particular

this issue known as ‘‘Travelgate.’’ As President Clinton stated himself when this matter first come to light, ‘‘Look at the facts, evaluate the facts, and draw your own conclusions.’’ 1

‘‘It will be a great story [firing the Travel Office employees]—Bill

Clinton cleaning up the White House.’’
2

—Harry Thomason, May 1993 in a conversation with

White House aide Jennifer O’Connor.

‘‘May 12, p.m.—Thomason comes back in DW’s [office]—says he

bumped into Hillary and she’s ready to fire them all that day.

—David Watkins notes of May 31, 1993 discussing contacts on the Travel Office.

‘‘Harry says his people can run things better; save money, etc. And

besides we need those people out—we need our people in—We

need the slots— . . . Is the real story to be told?’’

—David Watkins notes of a conversation with the First

Lady on May 14, 1993.

‘‘If we do any kind of report & fail to address these q[uestion]s,

press jumps on you wanting to know answers; while if you give

answers that aren’t fully honest (e.g., nothing re HRC) you risk

hugely compounding the problem by getting caught in halftruths. You run risk of turning this into a ‘coverup’.’’

—Todd Stern, co-author of the White House Management Review of the Travel Office firings.

‘‘Defend management decision, thereby defend HRC role whatever

it is, was in fact or might have been misperceived to be.’’

—Vincent Foster, July 1993.

‘‘Bernie, are you hiding something?’’

—Former Deputy Attorney General Philip Heymann in

a conversation with Bernard Nussbaum following Nussbaum’s refusal to allow law enforcement authorities to review Foster’s documents, July 1993.

I. SUMMARY OVERVIEW

Travelgate is a story about the failure of the Clinton White

House to live up to the ethical standards expected of the highest

office in the land. The wrongdoing of this administration lies not

in the firings of the seven Travel Office employees. They served at

the pleasure of the President. If the President chose to fire them

to reward political cronies, that was his prerogative. And he must

reap the consequences.

Rather, the wrongdoing occurred after the firings. It resulted

from a desire to hide the truth about who actually fired them and

why.

The committee spent 31⁄2 years investigating not just who fired

them and why, but the wrongdoing that followed. The resulting

mosaic pieced together from the facts uncovered reveals the answers the White House refused to disclose. In the end, the actions

of the Clinton administration following the firings may have a lasting and damaging impact on the Office of the Presidency.

The committee has found that the motive for the firings was political cronyism: the President sought to reward his friend, Harry

Thomason, with the spoils of the White House travel business. A

pretext for the firings was created, and the trigger was pulled.

When the public reacted to the firing with outrage, the roles of

the President, First Lady and Thomason were minimized as the

White House staff engaged in a colossal damage-control effort.

First, it had to portray the victims of the firings as the wrongdoers. This was achieved by White House officials unleashing the

full powers of the Federal Government against the seven former
3

2The former Associate Attorney General for the Clinton administration convicted of tax evasion and mail fraud for stealing money from clients of the Rose Law Firm which included the

Federal Government. 3The former White House administrator who resigned in May 1994 after using a Presidential

helicopter to play golf. The cost of the flight was estimated at more than $13,000. 4The former business partners and good friends of Bill and Hillary Clinton. James McDougal

was convicted in June 1996 on 18 counts of bank fraud and conspiracy. His ex-wife Susan

McDougal was convicted in June 1996 on 4 counts of bank fraud and conspiracy. 5The former Clinton Agriculture Secretary who resigned December 31, 1994, due to potential

conflicts of interest relating to his relationship with the poultry industry (specifically Tyson

Foods). The appointment of an Independent Counsel in October 1994, spurred Espy’s resignation. 6 Currently the White House Deputy Chief of Staff. Ickes was the lawyer for LIUNA (Laborers’

International Union of North America), a union investigated by the Justice Department for alleged mob activity. 7Deputy White House Counsel, close advisor to President Clinton and unindicted co-conspirator in Independent Counsel Starr’s prosecution of Arkansas bankers, Hill and Branscum.

Lindsey was alleged to have distributed funds from Arkansas Banks for Clinton gubernatorial

campaign. 8The controversial first Clinton White House Counsel who presided over numerous administration debacles, including Travelgate, and resigned in March 1994 following the issuance of numerous Whitewater subpoenas to the White House. 9 Close friend and advisor to Mrs. Clinton. Thomases was allegedly involved in advising Bernard Nussbaum that Mrs. Clinton was concerned about law enforcement officials having ‘‘unfettered access’’ to Foster’s office following his death.

workers. The extraordinary might of the Federal Bureau of Investigation, the Internal Revenue Service and the Department of Justice—not to mention the prestige of the White House itself—all

were brought to bear. These actions constitute a gross abuse of the

rights of seven American citizens and their families.

Second, an enormous and elaborate cover-up operation, housed in

the White House Counsel’s Office, sought to prevent numerous investigations from discovering not only the roles of who fired the

workers and why, but also their efforts to persecute the victims. In

the process, the administration may have severely damaged the

credibility and prestige of the White House: it obstructed and frustrated all investigations; it turned the Office of the White House

Counsel into a political damage-control operation; it made frivolous

claims of executive privilege; it abused its powers to smear innocent citizens; and most important, it failed to level with the American people.

As a result, it is the committee’s view that the White House

stands in contempt of its own constitutional responsibilities to

faithfully uphold and execute the Constitution and laws of the Nation. Never before has a President and his staff done so much to

cover up improper actions and hinder the public’s right to learn the

truth. The following chapters reveal the facts that tell this story.

A. THE WHITE HOUSE STONEWALLED ALL INVESTIGATIONS INTO THE

WHITE HOUSE TRAVEL OFFICE FIRINGS AND RELATED MATTERS

Three and a half years ago, the friends of Webb Hubbell,2 David

Watkins,3 Jim and Susan McDougal,4 Mike Espy,5 Harold Ickes,6

Bruce Lindsey,7 Bernard Nussbaum,8 Susan Thomases,9 Jim Guy
4

10The former Governor of Arkansas who resigned after his conviction for obtaining illegal

loans from David Hale. His prison term was suspended pending his good behavior while on probation. 11The ex-bar bouncer who was brought to the White House to direct the Office of Personnel

Security after serving on the Clinton/Gore campaign as senior consultant on ‘‘counter events operations’’ including the ‘‘deployment’’ of ‘‘Chicken George.’’ Livingstone reportedly hurled racial

epithets at a senior aide to Representative Floyd Flake earlier this year and in 1993 threatened

to ‘‘punch in’’ the face of a female neighbor. Mr. Livingstone resigned in the wake of the FBI

files matter while appearing before this committee on June 26, 1996. 12Former associate counsel who was and is a partner in Mrs. Clinton’s former law firm. Mr.

Kennedy was Craig Livingstone’s boss and distinguished himself by failing to obtain passes for

White House officials in a timely fashion and neglecting to report his ‘‘nanny tax’’ problem when

he joined the White House staff. Mr. Kennedy resigned in November 1994. 13 Resigned from the Clinton/Gore ’96 Campaign amidst reports that he had a year-long relationship with a Virginia call girl in his official office/suite at the Jefferson Hotel. Reported to

have told $200-an-hour prostitute Sherry Rowlands that a paranoid Mrs. Clinton ordered the

FBI files of Republicans for review by the Clinton White House. Mr. Morris claims he was only

talking about ‘‘polling data’’ which indicated the American people thought Mrs. Clinton was behind the FBI files matter. 14 Bill Clinton 1992 campaign statement. 15 Handwritten notes of Deputy Staff Secretary Todd Stern, May 27, 1993, CGEPR 682–683. 16 ‘‘Whitewater Potential Questions’’ prepared by White House Counsel’s office, DF 781532.

Tucker,10 Craig Livingstone,11 Bill Kennedy,12 and Dick Morris13

came to Washington vowing to provide the ‘‘most ethical’’ administration in the history of the Republic.14 One of their first targets

in allegedly ‘‘cleaning up’’ Washington was the small, tucked-away

White House Travel Office, where then-Director Billy Dale had

served for over 30 years through eight Presidents and had voted for

the new President, William Jefferson Clinton. Before long, Bill

Clinton, who campaigned on the mantra, ‘‘I feel your pain,’’ caused

a great deal of pain in the lives of seven career Government employees as well as countless others caught up in the events known

as ‘‘Travelgate.’’

Because the White House has gone to great lengths to prevent

this committee from investigating the Travelgate matter, the committee must ask: Why have so many on the Government payroll at

the White House worked so hard for so long to keep the real story

about the Travel Office firings and related events from the American people? Why, to use the words of a senior White House official,

did the President ‘‘run the risk of turning this into a cover-up?’’ 15

Why did the President ultimately resort to the most frivolous claim

of executive privilege rivaling even the Nixon administration in his

determined efforts to delay this investigation and push it into the

political season? Why did the White House hide the fact of President Clinton’s knowledge of the firings before they occurred?

The Committee on Government Reform and Oversight has discovered endless cover-ups hidden within cover-ups. One of President Clinton’s lawyers offered a prophetic rationale as to why the

White House continues to keep matters under wraps. In typed

notes over which President Clinton claimed executive privilege, a

White House Counsel tellingly quoted William Safire:

No politician is stupid enough to hide something when

he has nothing to hide.16

The evasiveness with which President Clinton’s lawyers have

dealt with congressional investigators for more than 3 years presented the committee with the following dilemma: If there really is

nothing there, why are the President’s lawyers working so hard to

hide something?
5

17 Committee deposition of Craig Livingstone, March 22, 1996 p. 115.

We learned that the lives of seven innocent long-time career Government employees were shattered, their reputations smeared, to

make way for the ambitions and arrogance of the President’s

friends and family. We learned that the FBI and IRS became involved in this matter because of Harry Thomason’s false allegations

that Travel Office Director Billy Dale received illegal ‘‘kickbacks’’

from a charter airline company. The White House knew very quickly that the alleged source of the kickback charges denied ever making them. But upon learning this fact, the White House did nothing

to correct the public record it had created through misinformation.

In fact, long after President Clinton’s White House staff knew

the allegations were false, they continued in their efforts to make

a case against the beleaguered and increasingly impoverished Billy

Dale. The Department of Justice (‘‘DOJ’’) case, U.S. v. Billy Ray

Dale, was sorely lacking in evidence. It was compromised by missing records that had not been secured by the Clinton White House

or the Justice Department.

It was obvious, even to Justice Department prosecutors, that

they had no witnesses who could provide any derogatory information about Billy Dale. Finally, they were left only with the dubious

claim that the notoriously frugal Mr. Dale lived a ‘‘lavish lifestyle.’’

The prosecution revealed to the jury the ‘‘scandalous’’ evidence that

Mrs. Dale went to a hairdresser and purchased large quantities of

groceries for the Lake Anne vacation home the two-career Dales

saved many years to build and enjoy. Predictably, Dale was acquitted in less than 2 hours by a jury of his peers.

Unfortunately, Mr. Dale’s speedy acquittal did not put an end to

his 3-year ordeal. The IRS pursued Dale, threatening income tax

audits. The IRS also was busy in Smyrna, TN auditing the company that did business with Mr. Dale at the Travel Office, UltrAir.

Only recently was Mr. Dale given a clean bill of health by the

Internal Revenue Service after 3 years of intense scrutiny. UltrAir

had no tax liability and an owner of UltrAir received a $5,000 refund before the IRS gave up its search for any shred of evidence

to justify its harassment of this small struggling business.

We learned that the individual responsible for ‘‘securing’’ the

Travel Office on the day of the firings and maintaining the records

was none other than the now famous ex-bouncer and political operative, Craig Livingstone, former Director of the White House Security Office.17 Mr. Livingstone was the same individual seen by Secret Service Agent Bruce Abbott removing boxes of documents from

the White House the morning after Vince Foster’s death in July

1993.

The much-heralded White House Management Review (hereinafter ‘‘WHMR’’) proved to be nothing more than a whitewash overseen by then-Chief of Staff and childhood friend of Bill Clinton,

Mack McLarty, the very person who had authorized the Travel Office firings. In the course of the committee investigation, evidence

of a vast cover-up of President Clinton’s knowledge and dealings

with his close friend Harry Thomason as well as his staff’s deliberate minimization of Hillary Clinton’s role emerged and still continues to unfold.
6

18President Clinton’s personal defense lawyer, Robert Bennett, who handles the Paula Jones

case, also represents ‘‘Friend of Bill’’ Harry Thomason in both criminal and civil matters. Deputy

Chief of Staff Harold Ickes is another of the colorful clients responsible for monopolizing Bennett’s legal dance card. 19 Undated memorandum by David Watkins entitled ‘‘Response to Internal White House Travel Office Management Review,’’ (otherwise known as the ‘‘Watkins soul-cleansing memo’’), White

House document production Bates Stamp No. CGE 012286–012294. (Hereinafter document numbers preceded by ‘‘CGE’’, ‘‘CGEPR’’, or ‘‘DF’’ indicate White House documents.) 20White House Management Review interview notes of Bruce Lindsey, June 9, 1993, CGEPR

331–334. 21White House debriefing of David Gergen’s attorney Andy Krulwich, by Miriam Nemetz, July

13, 1995. The debriefing pertained to David Gergen’s deposition before the Senate Whitewater

Committee on July 12, 1995, DF 781220–781224. 22 ‘‘Vincent Foster, Jr., Deputy White House Counsel to the President—Victim; 7/20/93,’’ by

Special Agent Scott M. Salter, 7/29/93–8/9/93. The report was made to the Deputy Attorney General who requested the FBI to enter the captioned investigation and to ‘‘focus FBI efforts on

the turning over of a note found in the office of Vincent W. Foster.’’

We learned that access does indeed have its privileges. For the

seven fired White House Travel Office employees, this meant they

had to be moved out of the picture to make way for President Clinton’s Hollywood connection, Harry Thomason. The committee obtained evidence that President Clinton personally gave the nod for

Harry Thomason to come to the White House to work on the

‘‘Image Project’’—not Political Director Rahm Emanuel as has been

represented by the White House. We learned that having powerful

friends and the same lawyer as President Clinton can make for

timid prosecutors.18

We learned that a long-hidden memo by a key figure in the Travel Office affair, David Watkins, disclosed that Hillary Clinton,

based upon information provided by Harry Thomason, pressured

senior White House aides for the firings.19 Despite President Clinton’s misleading press accounts that he knew little about the

firings, we learned Bill Clinton actually was briefed on the firings

2 days before they occurred.20 And then-Assistant to President

Clinton for Management and Administration, David Watkins reluctantly became the designated fall guy for the firings in order to

protect the higher-ups who had directed his actions.

We learned of the long-hidden notebook kept by Vincent Foster

had been in the office of White House Counsel Bernard Nussbaum

following Mr. Foster’s death. The notebook chronicled Mr. Foster’s

anguish over Hillary Clinton’s role in the firings, Harry

Thomason’s potential criminal liability, and whether the White

House scandal containment strategy could be maintained to stop at

the level of David Watkins.

We learned that Mrs. Clinton directed President Clinton’s Chief

of Staff, Mack McLarty not to tell President Clinton about the torn

up ‘‘suicide’’ note found in Vincent Foster’s briefcase on July 26th,

6 days after his death. Mrs. Clinton instructed the President’s senior aides to wait until a ‘‘coherent position’’ was developed before

informing the President.21 The note was essentially an outline of

a defense of the Travel Office firings. When it took more than a day

to turn the note over to the proper law enforcement authorities,

both the Attorney General and Deputy Attorney General were so

concerned that the Deputy Attorney General immediately initiated

an FBI investigation into the delay in turning over the note.22 In

the investigation of the delay, no one mentioned Mrs. Clinton’s in-
7

23 Id. 24Letter to Hillary Rodham Clinton from David Watkins, May 3, 1994, CGE 39294. 25Letter from White House Counsel Jack Quinn to Chairman Clinger, June 10, 1996. But see, conflicting testimony by Special Counsel to the President, Jane Sherburne in her committee deposition of July 23, 1996, p. 32. (Although Quinn, in his letter suggests that the White House

knew of its possession of the Billy Dale FBI background file-referring to it as a ‘‘personnel file,’’

Sherburne, in sworn testimony, stated unequivocally that she did not know of the existence of

the file in February of this year.) 26 IRS Agent Bruce Brown’s memorandum of his discussion with DOJ Prosecutor Stuart Goldberg, August 16, 1993.

volvement in reviewing the note or recommending a delay in turning it over.23

We learned of the existence of a letter long withheld from all investigators which David Watkins wrote to ‘‘Hillary.’’ In that letter,

Watkins lamented that the GAO revealed conversations that Watkins had with Mrs. Clinton. Mr. Watkins assured Mrs. Clinton that

he knew who his ‘‘client’’ was and regretted revealing that Mrs.

Clinton told him she wanted ‘‘those people out’’ and ‘‘our people

in.’’ 24

After a long battle to obtain responsive subpoenaed documents,

White House Counsel to the President Jack Quinn finally turned

over documents one of which led us to discover that hundreds of

FBI files of Reagan and Bush officials, including that of former

Travel Office Director Billy Dale, were wrongfully requisitioned

from the FBI in 1993 and 1994 by two political operatives, Craig

Livingstone and his sidekick Anthony Marceca, who had specialized in opposition research for the Democratic Party.

We now know that the individual placed by President Clinton in

charge of the FBI files was the very same individual whom the

White House had put in charge of securing the Travel Office

records on the day of the firings—the now infamous security officer, Craig Livingstone.

We learned that the White House Counsel’s office withheld Billy

Dale’s FBI background file for months misrepresenting it to the

committee as a personnel file, effectively keeping the lid on the

Filegate scandal.25

The fact that Craig Livingstone held the fate of Billy Dale and

his colleagues in his hands, however, came as no surprise to Mr.

Dale. He and his family were subjected to inexcusable, unending

indignities by the Clinton White House, hounded by the servile

Justice Department and the IRS. Mr. Dale was denied the opportunity to defend himself by a Department of Justice prosecutor who

opposed Dale’s defense motion to present facts detailing the missing Travel Office records. We know that the prosecutor himself told

IRS investigators that records were missing, most likely removed

by Presidential cousin Catherine Cornelius, who had designs on

running the Travel Office.26 Why didn’t the Justice Department’s

prosecutor feel he had the same disclosure responsibilities to Mr.

Dale as to other Government investigative units? This question

never was answered.

Fortunately, Mr. Dale was acquitted despite the actions of the

White House and the Justice Department. His colleagues were totally exonerated of any wrongdoing. Nevertheless, to this day,

President Clinton continues to malign Mr. Dale and continues to

exhibit an unusually thin-skinned response to press inquiries about

this matter. In January of this year, White House Press Secretary
8

27White House press briefing, January 30, 1996. (Q: ‘‘Would the President . . . sign . . . such

a measure, were it to pass?’’ McCurry: ‘‘Yes, he would sign it.’’) 28 In an August 1, 1996, press conference, Clinton addressed questions regarding his prior commitment to sign a bill, which would reimburse Billy Dale for $500,000 in legal fees Dale

incurred in his defense. Clinton angrily declared, ‘‘I never gave my word on that.’’ Referring to

White House aides who have been asked to give testimony to this and other investigations, he

snapped, ‘‘There are a lot of people who were never charged with anything, much less offering

to plead guilty to anything . . . Are we going to pay their legal expenses, too?’’ 29 January, 12, 1996, press briefing. (President Clinton, in answer to questions about Republican assertions that the White House has not been cooperative with probes into the Travel Office and Whitewater affairs, stated: ‘‘We’re in the cooperation business. That’s what we want

to do.’’ In a July 13, 1993 letter to Jack Brooks, President Clinton stated, ‘‘The Attorney General

is in the process of reviewing any matters relating to the Travel Office and you can be assured

that the Attorney General will have the Administration’s full cooperation in investigating those

matters which the Department wishes to review.’’

Mike McCurry gave his assurances that President Clinton would

sign a bill to reimburse Billy Dale’s legal expenses.27 However, the

President recently, and angrily, reneged on that promise.28

Although the committee has been far more successful in uncovering new information to explain these events than has any previous

investigation, the disappearance of relevant documents, the selective amnesia among dozens of relevant witnesses and the sustained

obstruction orchestrated by President Clinton’s stable of White

House lawyers, have kept the full story from being told. This continues to be the standard operating procedure of the Clinton White

House to this day.

B. THE FULL COOPERATION PLEDGED BY THE PRESIDENT WAS A

HOLLOW PROMISE 29

The President’s promise to cooperate fully with investigations

into the Travel Office and related matters never was honored. Requested records never were appropriately provided to the Justice

Department or any other investigative body over the course of numerous inquiries—including criminal investigations and the investigation by this committee.

Five separate investigations examined various aspects of the

Travel Office firings. What all five previous investigations had in

common was the White House’s success in denying production of

relevant documents to each of them. Such sustained obstruction

over so long a period of time only could persist if directed from the

very ‘‘highest levels.’’ The buck stops at the President.

While this committee has been far more successful in obtaining

relevant records than any other previous investigation, its painstaking efforts have met with obstruction from President Clinton’s

staff at every turn. As a result, in some areas the committee’s investigation is still inconclusive. Since the firings and especially

since the 1994 elections, the White House Counsel’s office hired a

team of lawyers for a major damage control operation which we

have concluded focused on withholding from the committee documents related to Harry Thomason, Mrs. Clinton and President

Clinton.

In January 1995, Congressman Clinger became the chairman of

the new House Committee on Government Reform and Oversight

and announced that a thorough investigation into the growing

Travel Office scandal would be undertaken. Three hearings had

been held and subpoenas were issued when documents suddenly

materialized inside the White House that previously had been sub-
9

poenaed by other bodies and requested by the committee. On

March 9, 1996, the U.S. House of Representatives by voice vote

adopted House Resolution 369 which authorized committee staff to

take depositions pursuant to a subpoena in the White House Travel

Office matter.

The committee has deposed 72 witnesses, informally interviewed

23 witnesses, obtained 58,734 documents from the White House

and approximately 45,000 documents from the Justice Department,

Treasury Department and other agencies.

The committee was determined to ensure that the Clinton administration did not succeed in its attempt to derail this Travel Office investigation, as it had with every preceding investigation. Unfortunately, the committee found that issuance of subpoenas was

not sufficient to ensure the production of all relevant records. It became necessary for the committee to take the rare action, holding

White House Counsel John M. Quinn in contempt of Congress on

May 9, 1996 by the committee. It was only after scheduling a May

30, 1996, House floor vote on the Resolution that the White House

turned over 1,000 pages over which it initially had asserted were

‘‘subject to’’ executive privilege.

However, the White House continued to withhold 2,000 pages of

documents. President Clinton asserted a blanket claim of executive

privilege, stalling for time throughout the summer of 1996. The

White House Counsel’s Office/Chief of Staff’s Sherburne ‘‘team’’ finally provided the committee with access to the 2,000 pages of

overly-redacted documents only when a second threat of a House

floor vote on contempt of Congress was made. Only at that point

did President Clinton finally relinquish the outstanding subpoenaed documents to the committee on August 15, 1996. A date calculated to attract the least attention from the media as it was the

same evening that Senator Dole accepted the Republican nomination for President.

Had the committee failed to pursue its right to obtain this information, its investigation would have been severely undermined and

we never would have learned the key facts surrounding the termination of the seven Travel Office employees. We likely never would

have uncovered the Clinton White House’s receipt of hundreds of

FBI background files or evidence of the vast White House cover-up

of Travelgate and Filegate.

C. PRESIDENT CLINTON’S STAFF ENGAGED IN AN UNPRECEDENTED

MISUSE OF EXECUTIVE POWER AND EXECUTIVE PRIVILEGE

From the start, the White House Travel Office matter has reflected a disturbing pattern of misuse of executive power and resistance by the White House to any type of public accountability for

highly questionable activities. Ironically, while President Clinton

preaches individual responsibility, he assembled a team of taxpayer-funded White House attorneys to evade accountability and

avoid responsibility for his actions and those of his staff and advisors. President Clinton created his own personal legal defense

team, the likes of which the Office of the President has never before seen.

We have learned through documents most reluctantly produced

to the committee that President Clinton’s White House Counsel
10

routinely engaged in the practice of debriefing witnesses’ attorneys

after giving sworn testimony. The witnesses, mostly current and

former White House staff, included those being deposed by this and

other committees as well as those testifying before criminal grand

juries. This practice is unprecedented for any White House undergoing an investigation, and may result in the waiver of the attorney-client privilege in matters currently being investigated by the

Independent Counsel.

In addition, other documents contained in the 2,000 were provided to the committee only after a threat of a congressional criminal contempt vote. These detailed scripts were created by White

House Counsel for use by minority members of the committee to

thwart this investigation. Such meticulous executive branch

scripting for congressional hearings is something even the Nixon

White House did not dare to undertake. The information from

these debriefings and scripts demonstrates that the White House

was privy to information which was inconsistent with public statements made by Clinton officials and even President Clinton and

Mrs. Clinton.

It became clear that President Clinton ultimately had resorted to

a blanket claim of executive privilege over these and other documents which clearly were not covered by any logical reading of the

law of the privilege, in a last-ditch effort to forestall the committee’s review of relevant documents.

D. THE CONSEQUENCES OF THE WHITE HOUSE’S COVER-UP HAVE BEEN

DRAMATIC TO THE TRAVEL OFFICE EMPLOYEES, THE FOSTER FAMILY, AND ADMINISTRATION OFFICIALS IN PERSONAL, AS WELL AS IN

INSTITUTIONAL TERMS

Undeniably, the Travel Office fiasco and the resulting cover-up

have had sad and even tragic consequences. They caused irreparable damage to the lives and reputations of seven innocent Travel Office employees, led to numerous thwarted and even obstructed

investigations, and it seems clear contributed to the depression and

death of one of the central figures in the firings, former Deputy

Counsel to the President, Vincent Foster.

The White House’s reasons for obscuring facts, covering up the

initial events and covering up the cover-ups, often were petty or

otherwise reflected the vanity of a new administration refusing to

admit its mistakes in the matter, or acknowledge inappropriate interference in other areas. In some cases, it was an administration

seeking favors for friends that, if implemented, at the very least,

would have crossed ethical lines. It is clear that once the ‘‘official’’

story was made public, any movement toward the truth brought

the threat of damaging legal and political ramifications that the

Clinton White House could not afford to risk.

The extensive documentary record constructed over the past year

has dismantled the White House cover story. The committee sought

records of meetings, phone logs, Secret Service logs and White

House residence records that were the only way to fill in the missing memories of countless witnesses. While the recollections of witnesses frequently have been implausibly flawed, the documentary

record often tells a very different and far more complete story.
11

30 Notes of White House Associate Counsel Natalie Williams of conversation with Harry

Thomason attorney, Amy Sabrin, undated (but most likely from January 1996 timeframe), DF

780464–465. The President exerted a claim of executive privilege over these notes on May 30,

1996 and they were not provided to the committee until August 15, 1996.

Finally, it is the President himself who ultimately must be held

accountable for this persistent pattern of White House misinformation and misuse of executive power and executive privilege. Given

the alarming turnover of key White House operatives over the past

31⁄2 years, only the President himself could have sustained such a

pattern of misbehavior. Why has President Clinton tried to keep

the true story from being told? A recurring question arises whether

the President is above the law—whether the First Lady is above

the law.

The discrepancies, vagaries and omissions between the ‘‘official’’

White House account of these matters and the factual record now

properly falls within the scope of the criminal investigation by

Independent Counsel Kenneth Starr, now known as ‘‘Travelgate.’’

II. COMMITTEE FINDINGS AND RECOMMENDATIONS

COMMITTEE FINDINGS

PLANS TO FIRE THE WHITE HOUSE TRAVEL OFFICE EMPLOYEES AND

REPLACE THEM WITH CAMPAIGN PERSONNEL WERE IN PLACE FROM

THE EARLIEST DAYS OF THE CLINTON ADMINISTRATION

• Efforts to dislodge the longstanding White House Travel Office employees began shortly after the 1992 election and continued throughout the Clinton transition. Presidential cousin

Catherine Cornelius, who had worked on travel arrangements

for the campaign, teamed up with Arkansas-based travel company World Wide Travel to advocate ‘‘out-sourcing’’ the travel

operations at the White House.

• White House Administrator David Watkins met with

Cornelius and World Wide representatives several times prior

to January 20, 1993, and Cornelius submitted several memos

during this timeframe. Meanwhile, World Wide Travel secured

the Democratic National Committee business, an account it

still holds today.

• Harry Thomason, whose air charter consulting company

Thomason, Richland and Martens, Inc. (TRM) provided services to the Clinton/Gore campaign, spoke with Mrs. Clinton

during the transition and pressed his view that the long-time

career employees ‘‘should be replaced because they were disloyal.’’ 30 Thomason also told President Clinton about allegations of wrongdoing in the Travel Office in March 1993.

HARRY THOMASON WHO HAD A FINANCIAL STAKE IN THE TRAVEL

BUSINESS, INSTIGATED THE FIRING OF THE TRAVEL OFFICE EMPLOYEES. MR. THOMASON HAD PERSONAL AND FINANCIAL STAKES IN ENSURING THAT THE FORMER TRAVEL OFFICE EMPLOYEES WERE FIRED

WHICH MADE IT CLEARLY INAPPROPRIATE FOR HIM TO HAVE ANY INVOLVEMENT IN THIS MATTER

• Harry Thomason was the first person to pass along rumors

about the Travel Office employees to Mrs. Clinton and Presi-
12

31See depositions of First Lady’s Chief of Staff Maggie Williams, July 29, 1996, and Press Secretary Lisa Caputo, May 14, 1996, and responses to interrogatories from the First Lady of

March 21, 1996. 32David Watkins handwritten notes dated April 16, 1993, CGE 29184. 33 Committee deposition of Todd Stern, May 29, 1996, pp. 38–39. [Note: all committee deposition citations reflect the page(s) of the original deposition transcripts.]

dent Clinton. (While Mrs. Clinton has suggested that Vincent

Foster may have told her first about the rumors, Foster’s own

notes indicate that he did not know about the rumors until

May 12, 1993, when Watkins and Harry Thomason first approached him. Mrs. Clinton only raised this issue with Foster

the following day.) Neither Mrs. Clinton nor anyone in Mrs.

Clinton’s office could identify any alternative source of the rumors.31

• The suggestion by President and Mrs. Clinton that there

were ‘‘rumors everywhere’’ and Harry Thomason’s sworn testimony about ‘‘a buzz in the air’’ of wrongdoing in the Travel Office are not consistent with the more than 70 depositions conducted by the committee and dozens of informal interviews.

Virtually no one—except those in direct contact with Harry

Thomason—heard rumors. The White House Management Review authors confirmed that they discovered no other source of

the rumors and their notes make clear that Thomason was the

source of the rumors. Both the General Accounting Office review and the DOJ Office of Professional Responsibility (‘‘OPR’’)

review concluded that Harry Thomason passed on the rumors

to Mrs. Clinton.

• Harry Thomason and Darnell Martens made efforts to investigate the Travel Office employees in the spring of 1993.

Martens had Penny Sample of Air Advantage make calls to

UltrAir, the company that had the Travel Office business, and

Martens sought out a former UltrAir employee for information.

Documents related to these efforts are missing. A March 5,

1993, memo indicated that Darnell Martens was to receive a

package from Miami Air and would have a ‘‘complete summary

with substantive information’’ for Thomason. These documents

never were produced to the committee.

• Harry Thomason contacted David Watkins on April 16, 1993,

and passed on rumors of wrongdoing about the Travel Office.

According to Watkins’ contemporaneous notes, Harry

Thomason related the allegations of 5% kickbacks in this conversation.32 Watkins then relayed this information to Catherine Cornelius and asked her to investigate the office.

PRESIDENT CLINTON APPROVED HARRY THOMASON’S ‘‘IMAGE PROJECT’’ AT THE WHITE HOUSE, GIVING THOMASON AN ‘‘OFFICIAL STATUS.’’

THIS FACILITATED HARRY THOMASON’S EFFORTS TO OBTAIN LUCRA- TIVE GOVERNMENT CONTRACTS

• President Clinton, Mack McLarty, George Stephanopoulos,

and Mandy Grunwald ‘‘all approved’’ the ‘‘White House

Project’’—Harry Thomason’s image project at the White

House.33 Contrary to White House representations that Rahm

Emanuel was responsible for bringing Harry Thomason to the

White House, Mack McLarty, with President Clinton’s ap-
13

34 Jennifer O’Connor’s handwritten notes dated August 18, 1993, identify the memo, CGE

37586; committee deposition of Jennifer O’Connor, March 29, 1996, p. 45. 35The White House later inappropriately withheld from GAO investigators the page of the

White House Project memo which discusses this issue on the grounds that it was a ‘‘political’’

issue. 36See committee deposition of John Podesta, June 5, 1996, p. 23. Podesta was then-Staff Secretary at the White House, testified that he did not see the February 11, 1993, memo go into

President Clinton’s office but he did see it coming out of his office. Harry Thomason stayed at

the residence on February 16 and 17, 1993. Thomason recalls bowling with President Clinton

on this occasion—and beating the President—and he is listed in White House residence records

but he does not recall whether he passed on the February 11 memo (CGE 2223) on which the

President wrote a February 17, 1993, note. Committee deposition of Harry Thomason, May 17,

1993, p. 122.

proval, authorized Thomason’s work at the White House.

Emanuel would not have had the authority to bring anyone

into the White House in such a fashion. There was a McLarty

memo, now missing, that was circulated to senior staff about

Thomason’s role.34

• Thomason’s White House Project went beyond simple

‘‘image’’ issues and he was involved in meetings on how to obtain more money for staffing purposes throughout the White

House. The possibility of using excess Presidential inaugural

funds for extra staff also was being explored by the White

House.35

HARRY THOMASON ABUSED HIS OFFICIAL STATUS AND WHITE HOUSE

ACCESS AT A TIME WHEN HE HAD A FINANCIAL STAKE IN THE TRAV- EL BUSINESS. HARRY THOMASON’S ACTIVITIES AT THE WHITE HOUSE

MAKE HIM A SPECIAL GOVERNMENT EMPLOYEE TO WHICH THE CON- FLICT OF INTEREST LAWS APPLY

• Darnell Martens, Harry Thomason’s partner in his air charter consulting company, TRM, wrote a January 29, 1993 memo

to Thomason outlining how they should pursue ‘‘Washington

opportunities’’ in the early days of the Clinton administration.

These opportunities included seeking White House travel business as well as a quarter-of-a-million dollar GSA contract to

survey all non-military Government aircraft. Documents provided to this committee and only subsequently provided to the

Justice Department, clearly establish that TRM was seeking

both Travel Office business and the GSA contract.

• Darnell Martens, with the assistance of his partner Harry

Thomason, contacted Billy Dale in February 1993 seeking the

Travel Office business. Martens’ post-May 19, 1993, explanations that he was seeking the business on behalf of others,

contradicts his own documents of March 5, 1993, in which he

advocates that ‘‘the Administration . . . disband the . . . system in favor of the functions being outsourced to TRM/Air Advantage.’’ Furthermore, TRM would have stood to benefit from

potential commissions as well as business goodwill even if only

seeking the contracts for others.

• On or around February 16–17, 1993, Harry Thomason gave

President Clinton a February 11, 1993, memo drafted by

Martens soliciting the GSA contract to audit non-military aircraft. At this time, Thomason was working at the White House

and staying as a guest in the White House residence.36 At or

around this same time, Harry Thomason first told President

Clinton of rumors of wrongdoing in the Travel Office and in-
14

37February 17, 1993, buck slip from John Podesta to Mack McLarty, Mark Gearan and David

Watkins marked for ‘‘ACTION’’ attached to a February 11, 1993, memo from Darnell Martens

to Harry Thomason, CGE 02296.

formed President Clinton he would speak with the appropriate

office at the White House about this. President Clinton, fully

aware of Thomason’s business interests in this area, took no

action to discourage Thomason’s involvement.

• President Clinton reviewed the TRM proposal for the GSA

contract and set in motion efforts to assist TRM in obtaining

Government business by sending a note to Mack McLarty reading: ‘‘Mack/These guys are sharp/shd discuss/w/Panetta/Lader.’’

On February 17, 1993, Staff Secretary John Podesta passed

along this memo from the President to McLarty, David Watkins and Mark Gearan for ‘‘ACTION.’’ 37

• Mr. Thomason, who then was working on the White House

‘‘image’’ project for the purpose of obtaining good press stories

for President Clinton, told David Watkins, Jennifer O’Connor

and others that firing the Travel Office employees would be a

‘‘good press story.’’ Thus, creating a good news story to bolster

President Clinton’s image was an objective of the Travel Office

firings. This was all done in the course of Thomason’s duties

in the image project for which even White House Counsel Beth

Nolan opined that he was a special Government employee.

• Mr. Thomason was involved in numerous meetings concerning the Travel Office. Thomason’s advice on restaffing a new

Travel Office was both offered to Mrs. Clinton and relayed to

David Watkins and Catherine Cornelius. Ms. Cornelius was instructed to meet with Thomason about the Travel Office.

Thomason tasked Darnell Martens about having Penny Sample

come to Washington and the White House to work in the Travel Office. While an SGE for purposes of the imaging project,

Thomason independently became an SGE for purposes of the

Travel Office by virtue of his integral involvement in these

matters.

THE WHITE HOUSE COMMUNICATIONS OFFICE, IN CONJUNCTION WITH

THE WHITE HOUSE COUNSEL’S OFFICE, PUBLICLY ACCUSED THE

TRAVEL OFFICE EMPLOYEES OF CRIMINAL CONDUCT AND MISUSED

AND MANIPULATED THE FBI TO FURTHER THEIR POLITICAL AGENDA

• George Stephanopoulos and Dee Dee Myers relayed wrong

information to the press about reasons for the firings and the

involvement of the FBI. On May 21, 1993, the FBI again was

misused and abused when Stephanopoulos and Myers summoned the FBI Communications Director to in effect come to

the White House and take dictation for the FBI press release

that the White House wished for, and insisted that the FBI release.

• After the Travel Office firings were announced and met with

great controversy with the press, the White House immediately

initiated a disinformation campaign. The White House tried to

contain the responsibility for the firings at the level of David

Watkins even though his actions undeniably were precipitated

by pressures from above.
15

• The White House announced the Travel Office firings and

claimed they resulted from a Peat Marwick review that had

yet to be completed. Peat Marwick representatives then were

pressured by the communications office to brief the press and

to rush to produce a review corroborating the White House allegations.

PRESIDENT CLINTON INAPPROPRIATELY ALLOWED HIS COUSIN CATH- ERINE CORNELIUS TO REMAIN IN A POSITION WHERE SHE HAD A

CLEAR CONFLICT OF INTEREST. CORNELIUS PURSUED AN INVESTIGA- TION OF EMPLOYEES OF AN OFFICE IN WHICH SHE COVETED THE

TOP JOB AND FOR WHICH SHE PLANNED A REORGANIZATION

• Once at the White House working for David Watkins, Catherine Cornelius continued her efforts to take over the Travel

Office, among other things writing a January 26, 1993, memo

and a February 15, 1993, memo co-authored with Clarissa

Cerda, designating herself and Cerda as future co-directors of

the office.

MRS. CLINTON, ACTING ON HARRY THOMASON’S BASELESS ALLEGA- TIONS OF WRONGDOING AGAINST THE TRAVEL OFFICE EMPLOYEES, ASSERTED PRESSURE ON SENIOR WHITE HOUSE STAFF TO FIRE THE

TRAVEL OFFICE EMPLOYEES

• When Harry Thomason arrived at the White House during

the week of May 10, 1993, he was anxious to learn what had

transpired since he passed on rumors about the Travel Office

to David Watkins. Watkins had not yet acted upon Thomason’s

allegations, so Thomason spoke with Mrs. Clinton about these

matters. Mrs. Clinton in turn pressured Mack McLarty, Vince

Foster and David Watkins to fire the employees. Thomason

also met with Catherine Cornelius to exchange information.

Thomason told Jennifer O’Connor about the kickback allegations and told her that the Travel Office employees had been

‘‘ripping us off for years.’’

• Harry Thomason had numerous contacts with President

Clinton and Mrs. Clinton throughout the first half of May

1993, including: calls to the residence private line on May 5

and May 6; phone messages both to and from Mrs. Clinton

throughout the week of May 10–14; meetings with President

Clinton on the mornings of May 12 and May 13; and a lengthy

dinner in the White House residence on the evening of May 13,

1993. Thomason provided incomplete testimony to the committee about the nature of these contacts and exhibited selective

memory loss in recounting these meetings.

• Once Mrs. Clinton’s wishes were relayed to Watkins on May

12, Watkins turned to Foster to determine a course of action.

Foster tasked Associate Counsel Bill Kennedy to find a solution. Kennedy called the FBI and informed them that the

‘‘highest levels’’ of the White House were interested in this

matter.

• On May 14, 1993, Mrs. Clinton, following a lengthy dinner

with Harry Thomason the evening before, relayed to David

Watkins that ‘‘Harry’’ had a ‘‘plan’’ for the Travel Office and

that ‘‘we need to get those people out’’ and ‘‘our people in.’’
16

38OPR Report, tab B: May 13, 1993, FBI e-mail from Richard Wade to Thomas Kubic, subject:

White House Travel Office, DOJ document #AZ 000603.

Harry Thomason continued to press for the firings throughout

the day.

• On May 16, 1993, in a previously undisclosed meeting between Mrs. Clinton and Mack McLarty, Mrs. Clinton pressured

McLarty to fire the Travel Office employees.

• On May 17, 1993, McLarty met with Watkins and told him

the Travel Office was on Mrs. Clinton’s radar screen. Watkins,

responding to pressure from McLarty, Foster and Mrs. Clinton,

decided to fire the employees because he thought there ‘‘would

be hell to pay’’ if he did not accede to the First Family’s wishes. McLarty approved the decision and the May 17 memo on

the firing was ‘‘cc’d’’ to ‘‘Hillary Rodham Clinton’’ and faxed to

President Clinton in California.

• Even though it was cited as the basis for the firings, the

Peat Marwick review was not completed until May 21, 1993,

2 days following the firings.

BILL KENNEDY ABUSED THE FBI BY REPEATEDLY INVOKING THE

‘‘HIGHEST LEVELS’’ OF THE WHITE HOUSE IN MEETINGS WITH THE FBI

• Bill Kennedy sought to and in fact did abuse and compromise the FBI by invoking the ‘‘highest levels’’ of the White

House in order to involve FBI headquarters officials rather

than a field agent as would have been the normal procedure.

Mr. Kennedy provided inaccurate and incomplete testimony to

this committee and numerous other investigative bodies regarding his statements to the FBI.

• White House officials hoped to fire the employees on May 13

and drafted talking points on May 13, 1993, discussing the

Travel Office firings and claiming an FBI investigation was underway. The FBI, however, could not move that quickly and

did not believe it had sufficient predication to launch a criminal fraud audit.

• The alleged ‘‘predication’’ for the FBI investigation was the

‘‘kickback allegation’’ relayed to the FBI by Catherine

Cornelius.38 Cornelius obtained this information from Harry

Thomason who subsequently had repeated it to numerous

other White House staffers.

• FBI headquarters never should have been contacted directly

on this matter. Such allegations normally would have been

handled by a field agent or even the local police.

WHITE HOUSE OFFICIALS COVERED-UP THE REAL REASONS FOR THE

FIRING OF THE WHITE HOUSE TRAVEL OFFICE EMPLOYEES. THE

FIRINGS WERE NOT BASED ON THE PEAT MARWICK REVIEW, BUT

RATHER WERE DECIDED BEFORE PEAT MARWICK EXAMINERS EVER

SET FOOT IN THE WHITE HOUSE

• At the very latest, the decision to fire the Travel Office employees was made by May 12, 1993, a full day before the FBI

was called to the White House and 2 days before the Peat

Marwick review team came to the White House. On May 12,

Harry Thomason told David Watkins that he had talked with
17

39 Committee deposition of Daniel Russell, March 27, 1996, p. 59. 40 CGE 000967.

Mrs. Clinton and she was ‘‘ready to fire them all that day.’’ On

May 10, Thomason had circulated the memo by Martens outlining allegations of wrongdoing in the Travel Office. The decision to fire was made first; the White House rationale was

sought later.

THE WHITE HOUSE MISREPRESENTED THE PEAT MARWICK REVIEW. IT

WAS NEITHER AN AUDIT NOR INDEPENDENT AND WAS DIRECTED BY

A WHITE HOUSE WHICH DID NOT WANT AN AUDIT TO BE CONDUCTED

• The Peat Marwick employee who was called in to conduct a

supposed ‘‘audit’’ already had volunteered his services to the

Vice President’s National Performance Review in a May 10,

1993, meeting with Jennifer O’Connor. The Peat Marwick

work, as explained in its own engagement letter and subsequent draft and formal reports was a review conducted in

keeping with and limited by the White House’s needs. It was

neither ‘‘independent’’ nor an audit as represented by the

White House.

• Contrary to representations made by both the White House

and Peat Marwick, the Travel Office records were auditable according to Dan Russell, the Peat Marwick auditor who worked

on the review.39 An audit would have taken longer and the

White House did not want to take the extra time. The White

House dictated how the Peat Marwick review would be conducted and focused its attentions on particular issues including

a ‘‘kickbacks.’’

• Peat Marwick found no basis for the ‘‘kickbacks’’ allegations

in its review. The findings of the Peat Marwick review have

been seriously misrepresented by the White House.

• On July 8, 1993—6 days after the Management Review was

published—Vince Foster has notes indicating that Peat

Marwick auditors contacted the White House. His notes state:

[auditors] ‘‘strongly disagree[d] with [the] review conclusion’’ of

the Management Review.40

THE FBI ALLOWED THE WHITE HOUSE TO CONTROL ITS INVESTIGATION

• Once the FBI was brought to the White House on May 13,

1993, despite its desire to be involved in the investigation, it

ceded control of the investigation to the White House. The

White House told the FBI that Peat Marwick auditors would

be brought in first and that the FBI could not observe the

audit despite its request to do so.

• From May 13, 1993, when the FBI first was contacted

through May 19, 1993, the FBI exerted no control over the investigation. The White House ignored the FBI’s request not to

fire the employees on May 19, 1993, and the White House

failed to honor its commitment to maintain control over the

Travel Office records.
18

THE FBI MISHANDLED THE TRAVEL OFFICE INVESTIGATION FROM THE

BEGINNING, ALLOWING THE WHITE HOUSE TO CONTROL THE INVESTIGATION AND DID NOT ADEQUATELY SECURE TRAVEL OFFICE

RECORDS IN A TIMELY FASHION

• There was no integrity in maintaining the Travel Office

records in the White House due to a total abdication of responsibility by anyone in the White House Counsel’s office, the Office of Administration, and the Staff Secretary’s office. The

Staff Secretary, John Podesta, was contacted by Records Management officials who were concerned about the loss of Travel

Office records on the day after the firings. No one from Mr.

Podesta’s office responded.

• Craig Livingstone, the Director of Personnel Security, was

the individual put in charge of securing the office and the

records and files in the Travel Office on May 19, 1993. In light

of what we now know about Craig Livingstone’s gathering of

hundreds of FBI files on former Republican administration officials, his background as an ex-bouncer and his grand ambitions at the White House, the integrity of the Travel Office

records is all the more suspect.

• Vincent Foster, Bill Kennedy, David Watkins and others

were aware that Catherine Cornelius was removing records

from the Travel Office and taking them home over a monthlong period. No immediate efforts were made to ensure that all

records secreted out of the office by Cornelius were returned.

• The FBI failed to secure any records in the Travel Office

until almost a month after the firings. David Bowie, the Washington Metropolitan Field Office supervisor in charge of the investigation, negligently failed to exert control over the records

in a timely fashion and generally remained unaware of the ongoing controversy.

• Whether due to White House withholding of documents or by

its own design, the Justice Department cavalierly responded to

the potential for missing records. Furthermore, the Department was grossly negligent in failing to gain any control over

Travel Office documents or prevent the destruction of documents which could ultimately have determined whether or not

allegations made against former Travel Office Director Billy

Dale were true.

• Despite the fact that lead Justice Department prosecutor

Stuart Goldberg acknowledged to IRS officials that Travel Office records were missing, Justice Department officials vigorously opposed efforts by Billy Dale to seek White House documents pertaining to this subject.

THE WHITE HOUSE ENGAGED IN A CONSPIRACY OF SILENCE OF THE

TRUE STORY BEHIND THE FIRINGS FROM THE VERY FIRST DAYS. IT

DID SO FOR DAMAGE CONTROL PURPOSES

• President Clinton denied knowing anything about the Travel

Office firings even though he had been briefed on the matter

2 days before the firings. This was known to at least Bruce

Lindsey and Jeff Eller. Such statements by the President had

to have sent a chilling message to all those individuals who
19

41 ‘‘A Stealthy, Evasive Confession,’’ the New York Times, July 11, 1993.

were aware of President Clinton’s prior knowledge of the

firings, in effect creating a conspiracy of silence. The fact that

President Clinton was briefed prior to the firings was not disclosed publicly until this investigation.

PRESIDENT CLINTON ESTABLISHED A COVER-UP SITUATION WHEN HE

INAPPROPRIATELY PLACED THE PERSON WHO HAD APPROVED THE

FIRINGS—MACK MCLARTY—IN CHARGE OF THE MANAGEMENT REVIEW AND MCLARTY WITHHELD INFORMATION IN THE COURSE OF

THE INVESTIGATION. IT IS INAPPROPRIATE FOR THE WHITE HOUSE

TO INVESTIGATE ITSELF IN MATTERS OF CONFLICTS

• It was inappropriate for Mack McLarty, the individual who

both pushed Watkins to fire the Travel Office employees and

approved the firings pursuant to ‘‘pressure’’ from Mrs. Clinton,

to oversee the subsequent White House Management Review

announced on May 25, 1993, in the wake of a firestorm of

media criticism and the embarrassing upbraiding of the White

House by Attorney General Reno about the misuse of the FBI.

• McLarty represented that Podesta and Stern were chosen to

conduct the review because neither had been involved in any

of the relevant events. But Staff Secretary Podesta was aware

of the efforts by Thomason to obtain Government business

through his contacts with the President and also had been informed that the records in the Travel Office were not being appropriately secured. Further, two McLarty aides were provided

to assist Podesta.

• The White House set up a sham investigation in which a key

person involved in the firings was to be briefed on, oversee and

steer the investigation of alleged wrongdoing for which he was

in large part responsible.

• In the initial meetings with Podesta and Stern, McLarty did

not disclose his full role in the firings, and he withheld the fact

that the May 17 memo was cc’d to Mrs. Clinton and that he

had a May 16 meeting with Mrs. Clinton. While Podesta and

Stern learned of the May 17 memo in the course of their review, they never were informed by McLarty of the May 16

meeting in which McLarty was pressured by Mrs. Clinton to

take action in the Travel Office matter. It should come as no

surprise that Podesta and Stern were ineffective in investigating their own bosses.

THE INTERNAL WHITE HOUSE MANAGEMENT REVIEW WAS A CATALOG

OF ‘‘MISTAKES AND DECEPTION’’ 41 WHICH OMITTED INCRIMINATING

INFORMATION ABOUT THE PRESIDENT, MRS. CLINTON AND HARRY

THOMASON. THE WHITE HOUSE CHOSE TO COVER-UP INCRIMINATING

INFORMATION FOR POLITICAL EXPEDIENCY

• When the White House conducted the Management Review,

the President was at an abysmally low 36 percent approval

rating, his budget and health plans were on the ropes, and numerous debacles in the first 6 months had the White House

reeling.
20

42WHMR interview of Ross Fischer of Miami Air, June 17, 1993. CGEPR 237–239.

• The White House Management Review covered up President

Clinton’s prior knowledge of the Travel Office firings beginning

at least 2 days before they occurred. • The White House Management Review covered up the fact

that it was President Clinton who approved of Harry

Thomason’s working at the White House. Thomason was designated on his pass as a ‘‘White House staffer,’’ not as a volunteer. And Thomason was to report to President Clinton.

• The White House Management Review covered up President

Clinton’s efforts to assist Harry Thomason in obtaining Government contracts for TRM. Even though a specific section in

the report discussed ‘‘appearances of impropriety’’ by Harry

Thomason and Darnell Martens, it ignored this most blatant

abuse of White House access which directly involved President

Clinton.

• The White House Management Review minimized Mrs. Clinton’s role in the Travel Office firings and omitted the testimony

of witnesses indicating a larger role by Mrs. Clinton. It also

failed to note that senior White House aides initially had withheld information about Mrs. Clinton’s involvement in the

firings.

• The White House Management Review omitted conversations Harry Thomason had with Mrs. Clinton about the Travel

Office and failed to note that Thomason refused to cooperate

with the review after an initial interview.

• The White House Management Review concealed the fact

that the alleged source of Harry Thomason’s rumor—the President of Miami Air—denied that Billy Dale or anyone in the

Travel Office ever solicited kickbacks.42 As a result, the IRS

continued a 21⁄2 year fruitless investigation in which UltrAir prevailed with a $5,000 refund from the agency.

• The White House Management Review largely ignored the

fact that Peat Marwick, World Wide Travel and Penny Sample

of Air Advantage were brought into the White House with no

competitive bidding. White House ethics officials had reviewed

these matters and expressed such concerns. The concerns were

not contained in the final report.

• The White House Management Review, contrary to representations made to the press on July 2, 1993, by McLarty, Gearan

and Podesta, attempted to conduct its own investigation of the

seven employees. However, when they came up empty-handed,

they abandoned these efforts and failed to disclose the exculpatory information they had discovered which would have been

of benefit to the reputations of the Travel Office employees.

• In the aftermath of the Travel Office firings and in the

course of the White House Management Review, Patsy

Thomasson sought to intimidate and coerce false representations from Catherine Cornelius and Clarissa Cerda regarding

whether or not David Watkins had read their February 15,

1993, memo on the takeover of the Travel Office. Chief of Staff

McLarty inappropriately ignored this gross violation of standards of conduct by Ms. Thomasson when he was informed of
21

it. Further, Thomasson even resorted to pulling Cornelius’ and

Cerda’s mess privileges when they did not comply with her request that they misrepresent Watkins’ knowledge.

THE WHITE HOUSE MANAGEMENT REVIEW REPRIMANDED PEOPLE WHO

WERE ONLY FOLLOWING THE ORDERS OF THE REAL INSTIGATORS

• Despite Mr. Nussbaum’s request to McLarty that both he

and Foster be reprimanded if Kennedy were reprimanded,

McLarty refused to issue those reprimands because they would

have been too close to the ‘‘highest levels.’’

• It was apparently politically unthinkable for President Clinton to hold those actually responsible for the firings publicly

accountable. This set in motion a cover-up that grew more convoluted with each subsequent investigation. With the intersection of the investigations into the death of Vincent Foster, the

tangled Travelgate web became harder to re-weave to accommodate subsequent revelations.

• Rather than reprimanding the lower-level players (Bill Kennedy, David Watkins, Jeff Eller and Catherine Cornelius), the

appropriate action would have been for the President to acknowledge his role in bringing Harry Thomason to the White

House and providing him the opportunity to inappropriately

seek Government business.

• The White House Management Review, the possibility of

congressional hearings and the pending criminal investigation

by Public Integrity were of great concern to Vincent Foster.

But a concerted effort was launched by McLarty to downplay

his concerns in investigations with GAO, OPR and the FBI.

THE WHITE HOUSE’S OBSTRUCTION OF THE REVIEW OF VINCE FOS- TER’S DOCUMENTS WAS DUE IN PART TO CONCERNS ABOUT

TRAVELGATE DOCUMENTS IN FOSTER’S CUSTODY

• Independent Counsel Fiske properly concluded that the

Travel Office firings were a significant factor in Mr. Foster’s

depression in the weeks preceding his death. His colleagues,

most notably Bernard Nussbaum, ignored the potential ramifications of the problems faced by Harry Thomason’s actions

and President Clinton and Mrs. Clinton’s involvement in the

Travel Office matter and dismissed Foster’s attempts to have

these matters handled by outside counsel as would have been

appropriate.

• White House Counsel Bernard Nussbaum conducted a sham

review of the documents in Foster’s office following Foster’s

death. Mr. Nussbaum did not adequately or accurately describe

to law enforcement officials relevant documents in Foster’s office, including the Vince Foster Travel Office file. Despite

Nussbaum’s claims to the contrary, no one present in Foster’s

office during the July 22, 1993, search recalls seeing the Vince

Foster Travel Office file or hearing of any document described

as such by Nussbaum.

• Mr. Nussbaum withheld information concerning the existence of, and concealed the critical Vince Foster Travel Office

notebook from GAO, Public Integrity and FBI investigators for

almost a year following Foster’s death and only informed the
22

43Foster’s sister, Sheila Anthony told OPR investigators that in July 1993, Foster had told

her he was considering resigning. Mrs. Foster told the Independent Counsel that the note was

probably written on or about July 11, 1993: ‘‘On that day, she had encouraged him to write

down everything that was disturbing him. . . . Later that day, Foster told his wife that he had

written the opening argument for his defense.’’ Report of the Independent Counsel, June 30,

1994, p. 14.

White House of its existence after he disclosed it to a Grand

Jury in May 1994.

• Following Vincent Foster’s death, high-ranking White House

officials quietly killed efforts by TRM to obtain the GSA contract, concealed all documents pertaining to these efforts from

the ongoing General Accounting Office investigation, and longdelayed their production of documents to the Justice Department’s Public Integrity unit investigating possible criminal

conflicts of interest by Harry Thomason and Darnell Martens

while they were at the White House.

MRS. CLINTON INSTRUCTED WHITE HOUSE STAFF ON THE HANDLING

OF FOSTER DOCUMENTS AND THE FOSTER NOTE FOUND ON JULY 26,

1993, AND SENIOR WHITE HOUSE STAFF COVERED UP THIS INFORMATION AND KEPT IT FROM INVESTIGATORS

• Mrs. Clinton personally was involved in the discussions regarding the White House’s handling of documents in Vince

Foster’s office following his death. Mrs. Clinton made known

her views that investigators should be denied ‘‘unfettered access’’ to Foster’s office prior to the search of the office on July

22, 1993.

• The White House withheld evidence subsequently discovered

among the 2,000 pages over which President Clinton invoked

executive privilege, that senior White House aide Bill Burton

spoke with Mrs. Clinton on the evening of Foster’s death (July

20, 1993).

• Mrs. Clinton directed that Mack McLarty and others not inform the President about the discovery of the Foster ‘‘suicide’’

note on July 26, 1993. This note essentially defended Foster’s

and the White House’s actions in the Travel Office firings and

Mrs. Clinton suggested that executive privilege research be

done regarding the note.

• The White House’s delay in turning over the Foster note was

due to senior staffers’ deference to Mrs. Clinton’s wishes.

Statements by Mack McLarty and David Gergen that the note

was not immediately turned over because of the need to notify

Mrs. Foster and the President are not consistent with the evidence. No one called Mrs. Foster the evening the note was discovered and President Clinton was not told about the note’s existence until after Mrs. Clinton met with Bernard Nussbaum

and Steve Neuwirth. Mr. Nussbaum and Mr. Neuwirth had

been tasked with studying the executive privilege issue at 2:30

p.m. Susan Thomases and Bob Barnett also were in the residence that afternoon at approximately 3 p.m.

• The Foster note most likely was not a ‘‘suicide’’ note but

rather a note in preparation for resigning or in the event that

Foster was asked to resign or take the fall for the problems

generated by the firings and related matters.43
23

44 In particular, the January 29, 1993 (EZ 037684), and March 12, 1993 (CGE 00224), memos

demonstrated a clear interest in obtaining the Travel Office business as well as numerous other

‘‘Washington opportunities.’’ 45FBI e-mail from Gregory D. Meacham, to Tom Kubic, dated September 26, 1994, ‘‘Regarding

your inquiry . . . I . . . was advised by SA Pam Bombardi, that DOJ Trial Attorney Stuart

Goldberg had stated that he wanted to do the indictment before the elections, probably on October 4, 1994.’’ Bates Stamp No. FBI–00000242.

THE JUSTICE DEPARTMENT DEFERRED TO THE WHITE HOUSE DURING

ITS INVESTIGATIONS OF THE WHITE HOUSE TRAVEL OFFICE AND

HARRY THOMASON AND IGNORED THE OBSTRUCTIVE BEHAVIOR EXHIBITED BY THE COUNSEL’S OFFICE

• The Justice Department vigorously pursued criminal allegations from the White House about Billy Dale while minimally

investigating allegations of conflicts by Presidential friend

Harry Thomason. Prosecutor Stuart Goldberg told an FBI

agent that DOJ intended to indict Dale before the 1994 elections.

• Prosecutor Goldberg also told an IRS agent that there were

missing documents in this case and that Public Integrity believed they might be in Catherine Cornelius’ possession. Yet

when Dale raised the issue of missing documents as a defense

at his own trial, the Justice Department opposed this request

and the Judge ruled in the Government’s favor.

• Even after the White House stonewalled the Justice Department on its requests for Harry Thomason documents and engaged in obstructive behavior that necessitated the issuance of

a September 13, 1994, subpoena to the White House, the Justice Department showed little interest in further investigating.

In fact the Department failed to obtain critical documents from

Thomason himself until this committee threatened a subpoena

to obtain them and did in fact obtain documents particularly

relevant to a conflicts investigation.44

• In stark contrast to the stated intent of indicting Billy Dale

before the 1994 elections,45 the Justice Department declined

prosecution of Harry Thomason and Darnell Martens citing, in

part, concerns that it might be viewed as a ‘‘political prosecution.’’

• In startling contrast to its chronic stonewalling on all matters related to Harry Thomason or Vincent Foster, the White

House not only cooperated fully with the investigation of Billy

Dale but conducted its own investigation into wrongdoing and

provided any incriminating information it could find to both

the Public Integrity Section and the GAO.

• The FBI ignored the fact that the White House interviewed

many witnesses (in the course of the White House Management Review) before the FBI interviewed them in the weeks

following the Travel Office firings. In direct contrast to the

Justice Department’s strong opposition to this committee interviewing witnesses involved with the Travel Office matter, the

Justice Department registered no protests against this and

took no action to ensure that the FBI was allowed to interview

witnesses before the White House did. David Bowie once again
24

46 Committee interview of David Bowie. 47Testimony of Nancy Kingsbury before the House Committee on Government Reform and

Oversight, October 24, 1995.

was woefully negligent and entirely unaware of the fact that

the White House was conducting a Management Review.46

• The Justice Department deferred to the White House by allowing the White House: to initially control the investigation of

the Travel Office and call all the shots; to maintain custody

and control over the Travel Office documents for almost a

month after the firings; and to delay for almost a year the production of documents relevant to the DOJ investigation of

Harry Thomason. At every turn, the Justice Department was

overly accommodating of a controlling White House.

• In the course of the committee’s investigation, the Justice

Department put a former Clinton campaign staffer in charge

of handling documents produced to the committee. Following

Billy Dale’s November 1995 acquittal, his 1994 plea negotiations were leaked to the press. This information inappropriately was used by the White House and President Clinton to

malign Billy Dale long after President Clinton publicly wished

Dale well and hoped Dale could put the matter behind him.

WHITE HOUSE OFFICIALS ENGAGED IN A PATTERN OF DELAY, DECEIT

AND OBSTRUCTION OVER THE COURSE OF 3 YEARS OF INVESTIGA- TIONS INTO THE TRAVEL OFFICE AND MATTERS RELATED TO VIN- CENT FOSTER’S DEATH

• The GAO’s investigation was delayed for months by document production delays. Ultimately GAO did not receive all

documents relevant to its inquiry including: the Vince Foster

Travel Office file, the White House Management Review interview notes, documents related to the TRM efforts to obtain

GSA contracts and the Watkins ‘‘soul cleansing’’ memo. A GAO

representative noted that the level of cooperation that it received from the White House was not conducive to properly

conducting GAO’s work.47

• The ‘‘Watkins memo’’ was responsive to numerous document

requests and was inappropriately withheld by David Watkins,

Matthew Moore and Patsy Thomasson. All three had hard copies and/or computer copies of the memo and were made aware

of the various document requests and subpoenas to which it

would have been responsive.

• In responding to a Public Integrity request for documents regarding Harry Thomason, Matthew Moore wrote an April 4,

1994 memo to Neil Eggleston stating: ‘‘I know of no documents

in my possession, or ever in my possession, responsive to the

request.’’ This was false. The Watkins memo clearly was responsive to this request. At or around this time, Moore removed the Watkins memo from his computer and provided a

disk copy to Watkins as he left the White House. However,

Moore maintained his own copy of the disk which included several previous drafts of the memo.

• The White House withheld documents from the Justice Department’s Office of Professional Responsibility including the

Vince Foster Travel Office file, the White House Management
25

48Memo by Beth Nolan, Associate White House Counsel handling ethics issues, CGE 43349.

Review interview notes and the Watkins ‘‘soul cleansing

memo.’’ OPR Counsel Michael Shaheen found the White

House’s lack of cooperation ‘‘unprecedented’’ in his 20 year

Government career.

• White House stonewalling forced the Public Integrity Section

at the Justice Department to acknowledge it had no confidence

that the White House had faithfully produced all documents

‘‘relating to the Thomason allegations.’’ While Section Chief

Lee Radek noted that the ‘‘integrity of our review is entirely

dependent upon securing all relevant documents,’’ he did not

obtain all relevant documents: notably the complete Vince Foster Travel Office notebook and the Watkins ‘‘soul cleansing’’

memo, as well as more than 120 items over which the White

House claimed executive privilege. The Justice Department

quietly acceded to this inappropriate invocation of privilege.

One of the key items that it did not receive was a White House

Counsel’s Office memo demonstrating that the Counsel’s office

did believe there was a case to be made that Harry Thomason

was a special Government employee.48

• Bernard Nussbaum obstructed the FBI investigation into the

discovery of the Foster note as well as numerous other investigations, including congressional investigations, by failing to

timely inform anyone in law enforcement, the White House, or

Congress about the Vince Foster Travel Office notebook that he

had secreted in Nussbaum’s office by July 22, 1993.

• An FBI investigation was ordered on July 28, 1993 by Philip

Heymann, the day after the note was turned over to the Park

Police after the 30-hour delay in informing law enforcement

authorities. Heymann instructed David Margolis to be ‘‘very

aggressive’’ in the investigation.

• Nussbaum failed to inform those tasked with overseeing document production to both the Justice Department and the

GAO that he was secreting a relevant document in his office.

Nevertheless, once he informed Neil Eggleston in May 1994,

Eggleston also failed to turn over the documents to the Public

Integrity Section in a timely and responsive manner.

• Neil Eggleston and Cliff Sloan, at Nussbaum’s direction, delayed the production of documents relating to the criminal investigation of Harry Thomason and Darnell Martens to the

Public Integrity section and ultimately denied all such documents to GAO.

DAVID WATKINS’ ‘‘SOUL CLEANSING’’ MEMO ACCOUNT OF THE TRAVEL

OFFICE IS SUBSTANTIALLY CORROBORATED BY NUMEROUS RECORDS

AND WITNESS TESTIMONY

• Watkins’ contemporaneous account of Travel Office events

told by Watkins in his ‘‘soul cleansing’’ memo is corroborated

by the records of meetings, phone calls, contacts and documents that demonstrate the involvement and pressures to act

from Mrs. Clinton, Mack McLarty and Harry Thomason.

• The President’s invocation of executive privilege over discussions about the Watkins memo held between and among White
26

House Counsel, Maggie Williams, Ann Lewis, and Mrs. Clinton

is an extraordinary misuse of the privilege in light of the ongoing criminal investigation of these matters.

• The Watkins memo and the documentary evidence contradict

sworn testimony by Mrs. Clinton that the claims in her April

1994 GAO responses that she had ‘‘no role’’ in the firings of the

Travel Office employees were accurate.

PRESIDENT CLINTON HAS ENGAGED IN AN UNPRECEDENTED MISUSE

OF THE EXECUTIVE POWER, ABUSE OF EXECUTIVE PRIVILEGE AND

OBSTRUCTION OF NUMEROUS INVESTIGATIONS INTO THE TRAVEL OF- FICE

• The White House Counsel’s office coordinated and controlled

to the greatest extent possible, all investigations into this matter. It engaged in pre-interviews, debriefings and regular efforts to coordinate with outside attorneys for the individuals

involved in investigations. This conduct is unsuitable for the

White House Counsel’s office and is unprecedented.

• Attorneys of numerous current and former White House officials and others may have waived their clients’ attorney-client

privilege by debriefing White House attorneys about their clients’ depositions and in some cases providing information to

the White House that was withheld from Congress.

• The White House Counsel’s office hired a team of lawyers to

mount a massive damage control operation which focused on

minimizing public awareness of the roles of President Clinton

and Mrs. Clinton in the firings and their contacts with Harry

Thomason. This team reported directly to Deputy Chiefs of

Staff Harold Ickes and Evelyn Liebermann, among the closest

of confidantes with the First Family, instead of the White

House Counsel.

• White House efforts to obstruct all investigations of this matter were part of a larger pattern exhibited by the Counsel’s office which continues to this day to shadow the investigations

of this and other congressional committees as well as the Independent Counsel. A task list prepared by Special Counsel Jane

Sherburne demonstrates that the White House even tracked

convicted felon and former Associate Attorney General Webster

Hubbell’s cooperation with the Independent Counsel.

• The pattern of behavior of the White House Counsel’s office,

including unprecedented misuse of executive privilege, was designed deliberately to obstruct all investigations and thereby

avoid full disclosure of the facts surrounding the Travel Office

firings and matters related to Vincent Foster.

• The collective memory loss of dozens of employees is unconvincing and disturbing. Throughout the course of the committee’s depositions, the phrases ‘‘I don’t recall,’’ ‘‘I don’t know’’

and ‘‘I can’t remember’’ were uttered thousands of times and

regarding the most basic and memorable information.

• Those closest to the President and First Lady appear to suffer the most significant memory losses about key events involving the First Family. The White House Counsel’s office and

those who conducted the Management Review—and were most

intimately familiar with the factual record in this case—also
27

are affected with seeming memory disorders. And while many

of the key events in this investigation occurred 3 years ago,

memory losses of key individuals were consistently poor whether the events occurred years or weeks ago.

• Covering up the true story behind the Travel Office matter

led to the White House’s obstruction of numerous investigations. This obstruction was conducted, overseen and encouraged by those at the ‘‘highest levels’’ of the White House,

compounded by the death of Vincent Foster which then caused

a further cover-up on top of the Travelgate cover-up.

COMMITTEE RECOMMENDATIONS

1. The ‘‘Special Government Employee’’ (SGE) provisions of the

U.S. Code should be reformed to prevent its requirements to be ignored. Clear standards should be identified under which agencies,

including the Executive Office of the President, should analyze the

activities of volunteers to determine if they meet the definition of

SGE. Agencies should be required to perform this analysis for each

volunteer and maintain appropriate records. Congress should conduct rigorous oversight of the activities of advisors and volunteers

throughout Government.

2. The Executive Office of the President should establish financial and internal review controls consistent with the requirements

of the Chief Financial Officers Act and the Inspectors General Act.

These requirements should include the development of annual, audited financial statements of all business activities and the establishment of an internal review system. Such systems could be crafted to protect the constitutionally protected responsibilities of the

President. Some of these provisions are included in H.R. 3452,

while other provisions require further study by Congress.

3. The Presidential Records Act and the Federal Records Act

should be amended to provide for jurisdiction of Federal courts to

ensure that Government records are not unlawfully destroyed, but

are managed and preserved as required by law. A recent court decision in Armstrong v. Bush, 924 F.2d 282 (D.C. Cir. 1991) held that

judicial review was available to enforce the provisions of the Federal Records Act, but not the Presidential Records Act. The Department of Justice has interpreted that ruling to be so broad that it

would preclude the courts from enjoining the wholesale destruction

of records that the Presidential Records Act clearly requires be preserved.

4. The Office of the Counsel to the President should return to its

traditional mission of providing traditional legal counsel to the

President and his immediate staff. Not more than a couple of decades ago, the White House Counsel’s office consisted of just a few

highly qualified jurists. The congressional appropriation committees, when funding the White House, should oversee the size and

mission of the Counsel’s office. The Counsel’s office should be required to disclose the number of attorneys working in the Counsel’s

office, each attorney’s job description, and the supervision of each

attorney. If necessary, limitations should be placed on Executive

Office appropriations designed to limit the scope of responsibilities

performed by the White House Counsel’s office.
28

49There were only five employees present on May 19, 1993, when the firings of all seven occurred. The individuals present that day included Director Billy Dale, John Dreylinger, Barney

Brasseux, Ralph Maughan and Robert Van Eimeren. Two of them were out of the country: John

McSweeney was on vacation in Ireland and Deputy Director Gary Wright was on an advance

trip in Seoul, South Korea. 50 Committee deposition of Darnell Martens, April 11, 1996, pp. 148–150. 51 Committee deposition of Harry Thomason, May 17, 1996, pp. 126–128.

5. Congress should consider the feasibility of prohibiting the EOP

from procuring goods and services through its own procurement operations and requiring the EOP, where possible, to procure using

existing contracts of other agencies, such as the General Services

Administration’s Federal Supply Schedules. Where current contracts do not satisfy the specific requirements of the EOP, the EOP

should select another agency for its purchasing needs.

Further, Congress should consider requiring the EOP to submit

to Congress a report detailing each noncompetitive procurement

and the justification for the use of such procedure.

6. Only individuals of the highest quality and ethics should be

employed by and volunteer services to the Government. The committee is frustrated that such obvious recommendations must be

made at this time in our country’s history. Individuals with their

own financial interest as their paramount goal, with little respect

for the constitutional responsibilities of the U.S. Congress, and

with loyalties to anyone other than the American people should not

seek or obtain employment in the public sector.

III. ACTIONS IN MAY 1993 WHICH LED TO THE WHITE HOUSE

TRAVEL OFFICE FIRINGS

A. THE CAREER TRAVEL OFFICE EMPLOYEES ARE FIRED, ACCUSED BY

THE WHITE HOUSE OF WRONGDOING AND POLITICAL CRONIES ARE

PUT IN CHARGE OF THE TRAVEL OFFICE

At approximately 10 a.m., on May 19, 1993, all seven members

of the White House Travel Office staff were fired.49 They were ordered to vacate the White House compound within 2 hours. Returning to the Travel Office by 10:30 a.m., the fired Travel Office employees found their desks already occupied by the President’s cousin, Catherine Cornelius and employees of World Wide Travel, the

Arkansas travel agency which arranged for press charters during

the Clinton Presidential campaign. A week before any determination had been made by the FBI or Peat Marwick, World Wide Travel was summoned to Washington by Cornelius.

Presidential friend, Clinton/Gore campaign operative and Hollywood producer, Harry Thomason, began working at the White

House in early 1993, allegedly on the ‘‘staging’’ of White House

events. Mr. Thomason’s company, TRM, had brokered charters during the campaign, and he shortly thereafter got in touch with his

partner, Darnell Martens, to collaborate on future business. Mr.

Thomason requested that Martens ask Penny Sample, another

Clinton/Gore campaign veteran, to come to the White House to assist in the Travel Office.50 Ms. Sample owned an airline charter

brokerage company called Air Advantage which arranged charters

for the Clinton/Gore campaign. Mr. Thomason claims he doesn’t

know how Martens came to be asked for this assistance,51 but in
29

52 Committee deposition of Catherine Cornelius, April 30, 1996, p. 104; Martens deposition,

pp. 172–173. 53 Committee interview of Larry Herman, August 29, 1995. 54 CGE 39295. 55 CGE 39296. 56 CGE 39297.

sworn testimony both Martens and Catherine Cornelius confirm

that Thomason did make such a request.52

By early afternoon on May 19, the Travel Office employees heard

then-White House Press Secretary Dee Dee Myers inappropriately

announce at a press briefing that they were the subject of an FBI

criminal investigation. Ms. Myers also falsely reported that an

audit had found ‘‘gross mismanagement.’’ An official audit of the

Travel Office never was performed, and nowhere in the report of

the management review did Peat Marwick refer to ‘‘gross mismanagement’’ in the White House Travel Office prior to May 19,

1993.53

The Travel Office employees had been given no indication at the

time of their dismissals that they were under investigation. They

had cooperated fully with a review conducted by Peat Marwick in

the days preceding the firings, which they were falsely told was

part of the National Performance Review. After the completion of

their out-processing, the Travel Office employees, shadowed by

White House Security Officer Craig Livingstone, were driven out of

the White House compound in a windowless panel van with no passenger seats. What the fired Travel Office employees did not know

was that their nightmare had just begun.

B. THE TRAVEL OFFICE FIRINGS WERE A RESULT OF PRESSURE BY

HARRY THOMASON AND MRS. CLINTON WHICH ACCELERATED IN THE

WEEK BEFORE THE FIRINGS

May 10, 1993, Monday

The events precipitating the Travel Office firings erupted more

than a week before in a May 10, 1993 meeting. At that time, Harry

Thomason’s baseless kickback allegations were coupled with Catherine Cornelius’ open ambition to run the Travel Office. Mr.

Thomason had already pressed his allegations on David Watkins,

Mrs. Clinton and President Clinton.

Mr. Watkins told Cornelius that she should speak with

Thomason about the Travel Office and she e-mailed White House

colleagues, Clarissa Cerda and Mike Lufrano:

I have a meeting with Harry Thomason at 10 a.m. this

morning . . . to discuss the future of this office . . . could

be over very soon.54

Lufrano e-mailed back with the warning:

remember . . . everything you send on e-mail is stored

forever in the archives. Careful! 55

Following her meeting with Thomason, Cornelius e-mailed

Clarissa Cerda: ‘‘I need to start thinking about how you officially

bring in someone to help . . . Does the White House engage in a

memorandum of understanding to assist in crisis situation . . .

please let me know.’’ 56
30

57 CGE 8391. 58 Harry Thomason phone logs, May 10, 1993, Thomason document production, Bates Stamp

No. 00000105. 59 Id. 60 Committee deposition of Bobbie Faye Ferguson, April 12, 1996, p. 63. 61 Id.; Thomason deposition, p. 128. 62 Committee deposition of Harry Thomason, May 17, 1996, pp. 107–108. 63 Committee deposition of Bonnie Berry, May 21, 1996, pp. 30–32. 64 Harry Thomason telephone logs for May 11, 1993, Thomason document production, Bates

Stamp No. 00000106. 65 Id. 66McLarty calendar, CGE 26860.

On May 10, 1993, Matt Moore, another assistant to David Watkins wrote a memo to Watkins’ deputy, Patsy Thomasson, stating

in part: ‘‘Billy Dale informs me that there is no written agreement

in place to cover travel . . . no contracts in place.’’ Moore’s handwritten notes on the document mentioned Charlie Caudle, the

owner of UltrAir and Express One who soon would be under investigation by the IRS.57

The same day, Thomason had a message on his calendar to ‘‘call

Hillary . . . she wants to talk to you tonight.’’ 58 Mr. Thomason

also had messages to call David Watkins, Mack McLarty for a

meeting the next day, and Susan Thomases at home.59 At 1 o’clock,

Thomason received a memo he requested from his TRM partner,

Darnell Martens, outlining allegations of wrongdoing concerning

the Travel Office.60 He provided the memo to Catherine Cornelius,

Vincent Foster, and Bill Kennedy at the White House that week.61

In describing when and why he had the Martens memo faxed to

the White House, Thomason testified:

Answer. To the best of my knowledge it was after some

conversations about the Travel Office had been discussed.

There were some conversations about the Travel Office,

and some of the White House personnel, and I am not exactly sure who wanted to know does Mr. Martens have

anything on this and at that time I requested that—I told

somebody to call Mr. Martens’ office and request that it be

sent.

Question. Do you know who was making those requests

at the White House?

Answer. To the best of my recollection it was David Watkins or somebody in his office.62

Mr. Thomason enjoyed a very busy White House schedule for an

avowed ‘‘non-employee.’’ He was utilizing a White House office, had

the benefit of a White House pass, had a full-time assistant who

helped schedule his numerous meetings with White House staff. It

was fitting that on May 11, 1993, David Watkins approved a work

order to put phones and a computer hookup in ‘‘Harry Thomason’s

office.’’ 63

May 11, 1993, Tuesday

The next morning, May 11, Mrs. Clinton called Harry Thomason

at 10 a.m. and left a message for him to call her.64 He also received

a message to call Craig Livingstone: ‘‘come over while Susan is

here.’’ Mr. Thomason also had a meeting with Mack McLarty

scheduled on this afternoon.65 (McLarty had the same time scheduled for a meeting with Thomason on his calendar.) 66 Mr.
31

67Thomason deposition, p. 179. 68 Committee deposition of Thomas F. McLarty, July 12, 1996, pp. 23–24, 66–67. 69 CGE 2931, 2933. 70 In the White House Management Review, GAO interviews and in public statements, the

White House gave the impression that Rahm Emanuel was responsible for bringing Harry

Thomason to the White House. Rahm Emanuel’s interview with the White House Management

Review indicated that he told them that the President, Mack McLarty, George Stephanopoulos

and Mandy Grunwald ‘‘all approved’’ the project, yet the review omitted Rahm Emanuel not

being the sole actor in bringing Thomason to the White House. CGEPR 236. 71 Harry Thomason phone logs, documents provided by Harry Thomason, Bates Stamp No.

00000106. 72White House Management Review (‘‘WHMR’’), authored by John Podesta and Todd Stern,

July 2, 1993, p. 7. 73White House Management Review interview of Steve Davison, June 5, 1993, CGEPR 185. 74 Id. 75Foster Travel Office notebook, CGE 899a. 76Thomason deposition, p. 156.

Thomason does recall a meeting in which he provided McLarty

with a copy of the White House ‘‘image’’ project report during this

week.67

Mr. McLarty had no recollection of any meetings with Thomason

on the White House Project but stated that he believed the President Clinton and Mrs. Clinton asked Thomason to come to the

White House for the staging of events.68 Mr. Thomason was given

his pass on March 23, 1993.69 The request for his pass did in fact

show him reporting to President Clinton, contrary to White House

reports that Rahm Emanuel, Assistant to the President and Director of Special Projects, was responsible for Thomason’s tour of duty

at the White House.70 Mr. Thomason also had a 3 p.m. meeting

scheduled with Susan Thomases following the meeting with

McLarty and a message to call her at her home that evening.71

On May 11, 1993, Cornelius, while on a trip to Chicago with

President Clinton, was paged by the Travel Office and given a message to call a Time magazine reporter who was seeking information

on whether or not Cornelius was the President’s cousin.72 Steve

Davison of World Wide Travel informed White House investigators

that in this timeframe, ‘‘HT [Harry Thomason], JC [James

Carville], GS [George Stephanopoulos], and HRC [Hillary Rodham

Clinton] furious and ready to throw them out that day.’’ 73

The Management Review reported that in response to the call

from Time, ‘‘Cornelius spoke with Deputy Communications Director

Jeff Eller, with whom she had a personal relationship. She told

Eller that she believed a Travel Office employee leaked this information to the press.’’ 74

May 12, 1993, Wednesday

On May 12, 1993, Watkins called Foster to set up a meeting with

him. Mr. Watkins mentioned that Mrs. Clinton was interested in

the matter which they were to discuss.75 Mr. Thomason testified

that the meeting was for President Clinton to sign some commemorative inaugural books for campaign workers. He claimed that the

Travel Office was never mentioned.76

Mr. Martens arrived at the White House that morning for a 9:30

a.m. meeting with OMB’s Jack Kelly. Mr. Martens set this meeting

to discuss the logistics of obtaining a GSA Government contract for

his and Thomason’s company, Thomason, Richland & Martens
32

77 CGE 18296, 18298. 78Foster Travel Office notebook, CGE 899a. 79Foster Travel Office notebook, CGE 899a. Mr. Berman was at the White House working on determining how they could utilize an excess of $10 million in leftover Presidential inaugural

funds for White House activities. 80Foster Travel Office notebook, CGE 000923. 81 Cornelius deposition, pp. 114–115. 82 Id. 83 Cornelius deposition, p. 85. 84See infra section V. 85Fax to Harry Thomason at the White House from Darnell Martens, May 13, 1993, discussing ‘‘30 day billing cycle’’ and ‘‘aircraft being reviewed for Sunday . . . ’’ (Documents provided

by Harry Thomason.)

(TRM). Also that day, Martens received a White House pass. Mr.

Martens was to report to Harry Thomason and David Watkins.77

Following his meeting with President Clinton, Thomason met

with Foster about personal issues concerning President Clinton’s

family.78 Michael Berman also attended the meeting.79 At the end

of their conversation, Thomason mentioned that he ‘‘may have

learned of some graft’’ in the Travel Office and promised to let Foster know when he learned more.80

Mr. Thomason next met with Cornelius to exchange information

on the Travel Office and then discussed their suspicions with Watkins. Ms. Cornelius showed Thomason her ‘‘file’’ and told him that

cash seemed to be missing. Mr. Thomason told Cornelius on this

date that Mrs. Clinton would be unhappy with what he believed

was going on in the Travel Office. He made it clear to Mrs. Clinton

that he was going to share his concerns with her.81 Ms. Cornelius

said Thomason repeated references to Mrs. Clinton during the

course of the week.82 The two later moved the meeting to Watkins’

office.

Mr. Martens arrived after his OMB meeting and he joined in the

meeting which had grown to include Cornelius, Thomason, Watkins

and Patsy Thomasson.83 Mr. Martens previously had been gathering information about the Travel Office and had contacted Billy

Dale about obtaining the travel business.84

During his visit to the White House, Martens was asked by

Thomason if the charter company, Air Advantage, would be able to

handle a trip for the White House the following Sunday. This clearly indicated that the plan for the Travel Office firings was in place.

(A fax sent the next day by Martens detailing how he could provide

planes for Sunday also confirms the plan was in place.85 Mr.

Martens explained in his deposition:

Answer. Harry had asked me at some point in time on

the afternoon of May 12th when I was at the White House

whether Air Advantage would be able to handle a trip for

the White House on Sunday, that coming Sunday.

Question. Which would have been May 14th?

Answer. No, this is Friday——

Question. May 16th, I am sorry.

Answer. It might be the 16th or 17th, somewhere in

there. And so I said I will track her down and ask her. He

goes okay, just make sure they can do a 30 day billing,

that they can bill like a normal 30 day invoice. I said okay.

Question. So this is actually asking you to check with

Penny Sample to see if 30 day billing is okay, not TRM?
33

86Martens deposition, pp. 157–9. 87Thomason deposition, p. 213. 88WHMR interview notes of Jennifer O’Connor, June 11, 1993, CGEPR 383–390. 89WHMR interview notes of Jennifer O’Connor, June 11, 1993, CGEPR 383–390. 90May 31, 1993 notes of David Watkins, Watkins document production, PM 000169. 91 Cornelius deposition, p. 79; Watkins memorandum to Mack McLarty, May 17, 1993, CGE

17753–17754; Foster Travel Office notebook, CGE 000903.

Answer. Yes. For Air Advantage.

Question. Harry made that request?

Answer. Yes.86

In Thomason’s own deposition, he attempted to explain that

Martens’ request for assistance originated:

in connection with somebody at the White House saying

if we do this we don’t want to miss a beat and we have

to have somebody in place to temporarily take over and

could you recommend somebody, and I said the people that

worked on the campaign are obviously the people. I don’t

know what 30-day billing cycle means. I just know that

there was somebody from the White House [who] passed,

evidently, along this information after I had called in, and

this was the answer.87

Mr. Thomason next attended a meeting with Jennifer O’Connor

to discuss the 25 percent White House staff cut, and other personnel matters. During the meeting, Thomason informed O’Connor

that the Travel Office employees ‘‘were ripping us off’’ and that firing them would be a ‘‘great press story . . . Bill Clinton cleaning

up House.’’ 88 Ms. O’Connor recounted that she and Thomason had

to leave the meeting to tend to a ‘‘crisis’’ in Watkins’ office.89 Mr.

Watkins’ contemporaneous notes show that Thomason returned to

Watkins’ office that afternoon. Mr. Thomason told Watkins he

‘‘bumped into’’ Mrs. Clinton in the hall, and she was ready ‘‘to fire

them all that day.’’ 90

At this point, Watkins, who earlier had contacted Foster for assistance, went to meet with him along with Thomason and

Cornelius. The accounts of the meeting by Cornelius and Watkins,

as well as Foster’s notes all recount Thomason discussing the kickback issue.91 Mr. Thomason was evasive on this point in his deposition:

Answer. Well, I remember Mr. Foster asking what are

the rumors; and I remember just saying, okay, here is

what all we have heard.

Question. Was there any discussion that you recall concerning kickbacks or bribery allegations in that meeting?

Answer. Again, I can’t be specific. That was sort of the

buzz that was in the air. Now, was it kickbacks or was it

taking gifts; I mean, I don’t know. You know, I just remember there was something that—and that is about the

general term of taking something, you know; and I don’t

know if they were kickbacks or what, but yes was the buzz

in the air.

At another point in his deposition:

Question. Do you recall ever relaying that information to

anyone in the White House that there were kickbacks, or
34

92Thomason deposition, pp. 136–137, 188. 93 Cornelius deposition, p. 79. 94 Id., p. 88. 95WHMR interview notes of Bruce Lindsey, CGEPR 331. 96WHMR interview notes of Jennifer O’Connor, CGE 385. 97OPR Report, p. 9. 98Foster Travel Office notebook, CGE 923. 99 Cornelius deposition, p. 94. 100 Cornelius deposition, pp. 93–94. 101 Cornelius deposition, p. 96.

5 percent kickbacks, or kickbacks, or allegations of bribery?

Answer. Well, I don’t remember 5 percent kickbacks, but

there was always—in all of those meetings there was always sort of a buzz in the room that had to do with, well,

there were kickbacks, there was this, there was that, and

did I start them? I don’t know, but I don’t think so. Did

I hear them? Yes. Did I repeat them? I don’t recall.

Question. Do you know who you heard them from?

Answer. I don’t, because it would always be a group of

people in a room, and there was just the buzz about what

somebody had heard and, you know, or discovered or something.

Question. And were these at the White House, these

meetings or people in the room?

Answer. Right, I mean, you know, the—there were a

couple of those kind of meetings.92

From the accounts of others present in this and other meetings,

Thomason was the ‘‘buzz.’’ Ms. Cornelius testified that Thomason

told her about the kickbacks 93 and in fact, further testified that

she could not recall ‘‘anyone else discussing [kickbacks].’’ 94 Testimony of Bruce Lindsey in the White House Management Review

recounted that ‘‘Sometime in Feb-March-April HT [Harry

Thomason] said to me that travel office—demanding kickbacks

. . .’’ 95 Mr. Thomason’s kickback allegations also surfaced in Jennifer O’Connor’s testimony to the White House Management Review. She stated that while having lunch with David Watkins on

May 12, 1993, Watkins told her ‘‘this is confidential,’’ that

Thomason had dealings with travel companies and that the Travel

Office was soliciting kickbacks.96

The OPR report noted that Thomason related a conversation suggesting that a friend of his ‘‘had seen what he considered possible

evidence of a kickback involving the Travel Office.’’ 97 This account

is further supported by an entry in Foster’s Travel Office notebook

where he writes, ‘‘HT related vague story of 3d party request for

kickback/5 percent—vague.’’ 98 Mr. Thomason was passing on information in which he had his own financial interest.

The Watkins/Cornelius/Thomason/Foster meeting adjourned and

they reconvened later with White House Associate Counsel Bill

Kennedy joining the group.99 Ms. Cornelius returned from a quick

trip to her house where she was keeping documents she had covertly removed from the Travel Office at David Watkins’ request.100

Mr. Kennedy then was tasked with crafting a response to this matter.101 In the meeting they discussed who could do an audit. They
35

102OPR interview of Catherine Cornelius, September 2, 1993, p. 3, she quotes Patsy

Thomasson saying in response to Kennedy’s idea to bring in the FBI, ‘‘Well, Billy Kennedy, I

certainly would like that, because that would keep the GAO out.’’ 103 Committee deposition of Bill Kennedy, April 9, 1996, p. 133. 104 Committee interview of Robert Van Eimeren, July 26, 1995. 105 Notes of David Watkins, May 31, 1993, Watkins document production, Bates Stamp No.

PM 000169. 106 Notes of Lorraine Voles, undated (approximately May 1993), CGE 009110. 107Ms. Thomases was a reference for Catherine Cornelius on her resume. Ms. Thomases

worked on advance throughout the campaign and Cornelius worked on travel. Ms. Thomases

certainly was not one known for being shy with her views on how to run the White House or

on her authority to speak for Mrs. Clinton. 108Secret Service WAVES records (for entrances and exits) for Susan Thomases, May 7, 1993. 109OPR Report, p. 15.

sought an alternative to a GAO audit because previous investigations by GAO had been unfavorable to the White House.102

At approximately 5:30 p.m. Kennedy contacted James Bourke,

Chief of the FBI’s Special Inquiry Unit (SPIN). Even though two

FBI agents were permanently assigned to the White House, Kennedy never asked them for ‘‘guidance’’—his stated reason for contacting the FBI. By this time, Thomason, Foster and Watkins were

well aware of Mrs. Clinton’s interest in this matter and discussed

it freely. Mr. Kennedy, however, made the implausible claim in his

committee deposition that he had no idea of Mrs. Clinton’s interest

at that time.103

On this day, Cornelius, while planning the takeover of the Travel

Office, called World Wide Travel to alert them to the opening for

the new business. World Wide immediately sent an agent, Steve

Davison, to Washington, DC in response to the call. In this timeframe, the Travel Office employees recall Catherine Cornelius’ frequent absences from the Travel Office to attend meetings elsewhere. One employee recalled an occasion in the first weeks of May

where Cornelius informed them that she had a meeting with

Thomason and Mrs. Clinton.104

Throughout May 12 and May 13, Watkins received ‘‘periodic reports from Vince Foster that [the] First Lady had inquired about

[the] Travel Office and why wasn’t action being taken—report was

that they should be fired immediately and out of here by the end

of the day.’’ 105 On the 12th, McLarty called Susan Thomases with

whom Harry Thomason had conversations during the week. Lorraine Voles, deputy Press Secretary, reported that in this timeframe that Eller advised her about the Travel Office allegations.

Ms. Voles’ notes indicate that she had heard that Susan Thomases

‘‘went to Mac . . . Hillary wants these people fired . . . Mac

wouldn’t do it . . . DW [David Watkins] didn’t want to do it.’’ 106

Susan Thomases,107 was at the White House the week before on

Friday, May 7, 1993, from 2:30 to 7:47 p.m.108

May 13, 1993, Thursday

On May 13, 1993, Kennedy summoned the FBI to the White

House after a flurry of early morning calls from the White House

to the FBI. Mr. Kennedy told FBI Unit Chief James Bourke that

‘‘he was getting some pressure and he needed a call back in the

next 15 minutes or he may have to go to another agency, such as

the IRS.’’ 109 Mr. Kennedy claims that his sense of urgency was
36

110 Contrast this statement with other testimony, such as Vince Foster’s, that documents of

‘‘kickbacks’’ or some other financial allegations, simply could not all be destroyed. Furthermore,

the idea that anyone at the White House was concerned with documents being destroyed in the

Travel Office is inconsistent with the fact that there was no control asserted over the office at

any time during the weeks before or after the firings. Neither Kennedy nor anyone else in the

White House Counsel’s Office ever made any attempts to secure the documents in the Travel

Office. 111OPR Report, p. 20. 112 Committee deposition of William Kennedy, April 9, 1996, p. 91. 113OPR Report, p. 17. Agent Howard Apple was the acting chief of the Violent Crimes and

Major Offenders section. Agent Pat Foran was the Unit Chief of the Operational Intelligence

Unit, Criminal Intelligence Section, ‘‘CID’’. 114DOJ, OPR interview of Howard B. Apple, Unit Chief of the Interstate Theft Crimes Unit,

Criminal Investigative Division, August 11, 1993. 115OPR Report, p. 20. 116OPR Report, p. 18. 117See DOJ, OPR interviews of: Unit Chief Howard Apple, August 11, 1993; Patrick Foran,

Unit Chief of the Operational Intelligence Unit, Criminal Intelligence Section, August 16, 1993;

Richard Wade, Unit Chief of the Governmental Fraud Unit, Criminal Investigative Division, August 11, 1993; Thomas Carl, Supervisory Special Agent in the Government Fraud Unit, Criminal

Investigation Division, August 1993. 118General Accounting Office interview of Howard Apple, October 15, 1993. (Emphasis added.) 119OPR Report, p. 20. 120OPR Report, pp. 21–22.

based on the fear that documents would be destroyed, but no other

testimony corroborates his claim.’’ 110

Indeed, it is more likely that his sense of urgency was a response

to that which Watkins and Foster were responding—pressure from

Thomason and Mrs. Clinton. This is further supported by evidence

that Kennedy alerted the FBI that those at ‘‘the highest level’’ in

the White House wanted prompt action on a matter allegedly involving financial wrongdoing.111 Mr. Kennedy made the dubious

explanation that by highest levels, he must have been referring to

Foster and Watkins.112 It is unlikely that the highest levels referred to individuals that Kennedy did not report to and in fact,

were on an equal footing with him.

At this time, the FBI was beleaguered by an embattled Director

and was operating under a reduced budget imposed by President

Clinton. When the White House called, the FBI immediately dispatched two Headquarters agents, Pat Foran and Howard Apple,

despite their protests that it would be more appropriate to assign

a field agent.113 Mr. Kennedy was adamant that FBI Headquarters

personnel with a ‘‘national perspective’’ be involved.114 The two

agents arrived at the White House Counsel’s Office for an 11 a.m.

meeting, which lasted approximately 30 minutes.115

Agent Apple reported that Kennedy told Agent Bourke that he

would contact the IRS if the FBI did not respond.116 Mr. Kennedy

repeated the statement at this meeting, that the inquiry was directed from the highest levels. Although Kennedy denies making

any reference to the ‘‘highest level,’’ four FBI agents testified under

oath that the did.117 Agent Apple testified that when he questioned

Kennedy’s reference, Kennedy responded, ‘‘Let’s just say the highest level.’’ 118 Agent Foran testified that he interpreted Mr. Kennedy’s reference to the ‘‘highest levels’’ to mean President Clinton

or Vice President Gore.119

Mr. Kennedy also told the FBI agents that ‘‘a company which

had done work for President Clinton during the campaign was interested in obtaining a contract for the services provided by the

Travel Office,’’ but had not been allowed to bid on the business.120

During this discussion, Kennedy gave Agent Foran an ‘‘untitled
37

121 Id. 122OPR Report, p. 22. 123OPR Report, p. 25. 124See Hubbell telephone log of 11:30 phone call from Kennedy to Hubbell. 125Martens deposition, p. 187; Bobbie Faye Ferguson production, BFF 1013. 126 Richard Wade was Unit Chief of the Governmental Fraud Unit, Criminal Investigative Division; Thomas Carl was Supervisory Special Agent in the Government Fraud Unit, Criminal

Investigation Division. 127OPR Report, p. 27. 128OPR Report, pp. 29–31. 129OPR Report, p. 31. 130OPR Report, p. 31.

document to read that he retrieved from a folder in his desk.’’ 121

The agents testified that ‘‘the document repeated the suspicions regarding the Travel Office that Kennedy had described to Foran and

Apple orally.’’ 122

Although Agents Foran and Apple were not allowed to keep the

document, both agents described it as a far lengthier document

than the Martens memo and dissimilar in format from the Martens

memo. This memo has never been produced to the committee and

the White House continues to claim it does not exist.

The FBI agents ultimately told Kennedy that they were not the

appropriate unit to handle this matter and returned to FBI Headquarters to determine who should assist. The agents testified that

they clearly had the sense that Kennedy was under considerable

pressure to resolve this matter.123 Mr. Kennedy telephoned his

good friend, Webster Hubbell, almost immediately after the agents

left his office.124 At this time, Hubbell was the No. 3 person at the

Justice Department and, effectively, running the Department.

By 12:20 p.m. on May 13th, Martens responded to a request from

Thomason at the White House. Mr. Martens faxed information to

Thomason that ‘‘aircraft are being reviewed for Sunday, if needed

. . . Penny [Sample, of Air Advantage] and I can be at White

House to assist ‘C’ [Cornelius] as needed to begin operations.’’ 125

A second set of FBI agents was sent to the White House to meet

with Kennedy the afternoon of May 13; Tom Carl and Rick

Wade.126 Mr. Kennedy repeated his message that this was an ‘‘urgent matter’’ which had interest from ‘‘high levels.’’ These agents

similarly reported that Kennedy was ‘‘very tense and frustrated

throughout the meeting.’’ 127 Mr. Kennedy repeated the various allegations about the Travel Office employees, including Thomason’s

allegations of kickbacks and bribery. When it appeared that Kennedy was not making any progress with the second set of FBI

agents, he asked if it would assist them if they spoke with someone

who had more direct evidence. Mr. Kennedy left and returned with

Catherine Cornelius, President Clinton’s third cousin and current

Office of Administration Assistant. The agents were left alone with

Cornelius to discuss her ‘‘allegations.’’ 128

Ms. Cornelius reported to the agents that she had copied and removed documents from the Travel Office in the course of her investigation.129 She also relayed the information she received from

Harry Thomason about solicitations of kickbacks from Miami Air.

In addition, she gave her version of the alleged ‘‘lavish’’ lifestyles

of the Travel Office employees. When Kennedy and Foster rejoined

the meeting, they were told that the agents were ‘‘keying in’’ on the

bribery allegation.130
38

131OPR Report, pp. 34, 36. 132OPR Report, p. 30. 133 ‘‘Report of OPR’s Review of the Conduct of the FBI in Connection with its contacts with

the White House in the Travel Office Matter,’’ to JoAnn Harris, Acting Deputy Attorney General, from Michael E. Shaheen, Jr. Counsel to the Office of Professional Responsibility, March

18, 1994, p. 33, footnote 37. 134 Handwritten notes of David Watkins, May 14, 1993, ‘‘White House Travel,’’ CGE 007989–

7991. 135OPR Report, p. 33. 136 Agent Kubic also was the supervisor for Agents Wade and Carl. 137OPR Report, p. 33, fn. 37. 138OPR Report, p. 36, fn. 41. 139OPR Report, p. 37. 140 Vince Foster Travel Office notebook, CGE 1050.

The FBI accepted Cornelius’ recitation of these otherwise unsubstantiated allegations as sufficient predication to launch a criminal

investigation, with a particular focus on ‘‘kickbacks’’ for jurisdictional purposes.131 No one questioned whether Cornelius had any

conflicts of interest concerning her investigation of the Travel Office employees. Neither her relationship to President Clinton nor

her widely known desire to take over the Travel Office as its Director were revealed to the FBI.132 An FBI headquarters supervisor

later testified that he was ‘‘surprised’’ that an interview of

Cornelius had occurred since witness interviews were supposed to

be handled by a case agent, not an FBI headquarters supervisor.133

Even as the FBI informed the White House it had sufficient

predication to launch an investigation on May 13, the White House

Counsel’s Office shifted gears. Messrs. Foster and Kennedy informed the FBI agents that the White House intended to conduct

an outside audit and would allow the FBI to proceed with an investigation at a later point if it determined that one were warranted.

Mr. Watkins’ contemporaneous notes suggest a reason for this

dramatic shift in strategy:

What will reaction by press be if we do S&L/bank type

audit and no improper findings. . . . What are negative

political consequences if no criminal violations? 134

The FBI telephoned the White House Counsel’s office several

times that afternoon to insist that for the sake of the investigation,

FBI agents should be present in the Travel Office during the audit.

Mr. Foster offered to check with ‘‘higher authority’’ to see whether

the FBI should participate and promised to call back with an answer at 6:30 p.m.135

FBI White Collar Crime Unit Chief Tom Kubic 136 testified about

the issue of whether FBI should be present at the audit. He said

that he thought ‘‘that decision ought to be made not by FBIHQ, but

by the agent conducting the investigation in consultation with the

prosecutor.’’ 137 In a strange turn of events, the FBI acquiesced

when Foster called Agent Wade and informed him that ‘‘the White

House did not want FBI agents to accompany the auditors.’’ 138

Agent Wade initially tried to convince Foster that FBI involvement in the audit would prevent the auditors from possibly being

witnesses in a criminal matter. Mr. Foster remained firm that he

did not want agents present during the audit.139 According to Foster’s notes, he consulted with Hubbell about the FBI being present.

He wrote, ‘‘WH [Hubbell] & I, he agrees . . . discussion w/ Wade

. . .’’ 140 A commitment was made to the agents that the docu-
39

141 Committee deposition of William Kennedy, April 9, 1996. pp. 98–99. 142Foster Travel Office notebook, CGE 000971. (In these same notes Foster describes the First

Lady’s demeanor in this meeting—‘‘general impatience’’ . . . ‘‘general frustration.’’) 143Foster Travel Office notebook, CGE 000971. 144See Foster Travel Office notebook. 145Foster Travel Office notebook, CGE 001003. 146McLarty deposition, p. 33. 147McLarty deposition, pp. 30–31; OPR interview of P. Thomasson, September 22, 1993, p.

2. 148OPR interview of P. Thomasson, p. 2. 149O’Connor deposition, p. 63.

ments would be properly secured. Mr. Kennedy had no recollection

of any identifiable actions by anyone in the White House to ensure

that records were properly secured.141

The only ‘‘higher ups’’ with whom Foster met on May 13 concerning this matter were President Clinton’s Chief of Staff, Mack

McLarty and twice with Mrs. Clinton. Based upon the fact that

McLarty is not a lawyer, he would have little knowledge about FBI

concerns regarding the preservation evidence and the likelihood

that the auditors might become witnesses at a trial. On May 13,

Mrs. Clinton raised the topic of the Travel Office, asking Foster,

‘‘Are you on top of it?’’ 142 Mr. Foster assured her that Kennedy was

addressing the matter but that he had ‘‘just heard about it yesterday.’’ 143

Mr. Foster recorded in his notebook that in his second meeting

with Mrs. Clinton, she appeared less than satisfied with the timeliness of decisionmaking.144 Mr. Foster particularly was concerned

about who, other than Mrs. Clinton, may have known about this

second meeting or overheard the conversation. He writes:

Q—anyone else present . . . don’t recall . . . when SS

[Secret Service] in hall and door open I go in . . . sometimes other persons present, sometimes not.145

This meeting occurred after Kennedy’s meetings with the FBI that

day.

Mrs. Clinton also called McLarty on May 13 requesting to meet,

specifically to talk about the Travel Office. Mrs. Clinton arrived at

his office at approximately 3 p.m. McLarty testified that,

[Mrs. Clinton] had heard that there might be serious

problems, deep concerns, in the Travel Office, about management and conduct. . . . I responded that I was aware

of those possibilities and with that she said, well, good,

you are aware of it. I think this is a serious matter, we

should look into it.146

Following this meeting, McLarty met with Watkins, Foster, and

Patsy Thomasson about the Travel Office at approximately 4

p.m.147 Prior to the start of this meeting, Foster told Patsy

Thomasson that his ‘‘clients,’’ a reference to the President and Mrs.

Clinton, were very concerned about the Travel Office.148 At this

meeting, they decided to call in an outside company to audit the

Travel Office.

Later that evening, Watkins and Patsy Thomasson contacted

Larry Herman of KPMG/Peat Marwick (Peat Marwick).149 Mr. Herman had already volunteered his services for NPR and had been

scheduled to conduct some NPR work the following day. Mr. Wat-
40

150O’Connor deposition, p. 63. 151 It was revealed that Eller had a close, personal relationship with Catherine Cornelius during this period. 152 Committee deposition of Jeff Eller, April 18, 1996, pp. 15–16. Outside of these two meetings, Eller could recall virtually nothing of substance and stated, ‘‘I don’t recall,’’ ‘‘I don’t know’’

or ‘‘I have no recollection,’’ almost 700 times in the course of his deposition in response to questions about his involvement in and knowledge of the firings. 153May 13, 1993, talking points on the Travel Office by Jeff Eller, CGE 7933. (Although Eller

could not recall doing the talking points or discussing them with anyone, Patsy Thomasson,

John Podesta, Todd Stern and others identified them as ‘‘Jeff Eller’s Talking Points.’’) 154White House residence logs. 155GAO questions submitted to Mrs. Clinton, April 6, 1994. 156 Id. 157Mrs. Clinton’s answers to Government Reform and Oversight Committee’s interrogatories,

March 21, 1996.

kins’ assistant, Jennifer O’Connor, later contacted Herman to brief

him with background information on the Travel Office work.150

Director of Media Affairs Jeff Eller 151 had at least two meetings

with Thomason, in which Eller advised quick firings to get ahead

of the press story.152 Mr. Thomason had two messages from Eller

on this date, May 13, marked ‘‘very important.’’ Mr. Eller was

working on ‘‘May 13 talking points,’’ which assumed the Travel Office firings were to occur on that day and that the FBI was investigating.153

That evening of May 13, 1993, Foster called to update Mrs. Clinton on the day’s activities. The call came in during a 3-hour dinner

Mrs. Clinton had with Harry Thomason in the residence.154 Despite the flurry of events on this day, as well as the keen and urgent interest expressed by both Mrs. Clinton and Thomason

throughout this dinner, neither has any specific recollection of any

discussions about the Travel Office during that dinner.

GAO investigators asked Mrs. Clinton in March 1994, if she participated in ‘‘any other discussions with White House staff or Mr.

Thomason concerning the White House Travel Office matter during

the period leading up to the removal of the Travel Office employees

on May 19, 1993? If so, when and how would you describe those

discussions.’’ 155 Mrs. Clinton decided to limit her April 6, 1994, response with the oft-repeated mantra:

She has no specific recollection of any particular conversation with Mr. Thomason on this issue at that time.156

Two years later Mrs. Clinton responded under oath to the committee’s March 1996 interrogatories:

I believe I became aware from Vincent Foster or Harry

Thomason of concerns about financial mismanagement in

the White House Travel Office. . . . I cannot recall specific conversations with him regarding the White House

Travel Office or its personnel, but as indicated above, it is

possible that at some point in May 1993, he may have

mentioned to me issues of possible financial mismanagement in the Travel Office. I do not recall what, if anything,

I may have said to him on this topic.157

The evidence points to Harry Thomason as the first person to

pass on rumors of wrongdoing in the Travel Office to Mrs. Clinton.

It is impossible that Foster could have been the person who first

told Mrs. Clinton about the Travel Office matter unless he was

lying to his notebook when he said he first heard about it on May
41

158 Notes of David Watkins, May 31, 1993, Watkins document production, PM 000169. 159Thomason deposition, p. 228; handwritten notes of Associate White House Counsel Natalie

Williams, DF 780464. 160Livingstone deposition, March 22, 1996, pp. 27–28. 161OPR Report, p. 10, fn. 10. (Mr. Kennedy pinpointed the date of his receipt of these rumors

at February 1993.) 162See committee depositions of John Podesta, June 5, 1996 and Todd Stern, May 31, 1996. 163Watkins memorandum, CGE 012287.

12. It is clear that Mrs. Clinton knew about the Travel Office at

the time she first approached Foster and that she was not responding to information he was relaying to her. Moreover, David Watkins’ notes state that on May 12, 1993, Mrs. Clinton told Thomason

she wanted them all fired that day.158 Mr. Thomason confirmed

through his attorney to the White House Counsel’s office that he

told Watkins that Mrs. Clinton shared his views that the Travel

Office employees should be replaced.159

The only other source of rumors that the committee has come

across in over a year of investigation was Craig Livingstone. Mr.

Livingstone testified that he heard of rumors in the spring of 1993

from a source he could not identify. He passed those rumors on to

Kennedy, who thanked him.160 Mr. Kennedy testified that he considered Livingstone’s rumors to be the ‘‘worst kind of third party

hearsay’’ and that he took no action and made no response to the

rumors.161

Recently Mrs. Clinton denied even knowing who Livingstone was

in 1993. Mr. Kennedy denied ever talking with Mrs. Clinton about

these matters. This leaves Harry Thomason as the only possible

source of these allegations against the Travel Office employees.

Neither John Podesta nor Todd Stern could uncover any other

sources of the rumors in their White House investigation.162 The

same is true of all the other investigations.

It is doubtful that either Livingstone or Kennedy could have informed Mrs. Clinton of all the rumors she reported hearing. It is

most likely that by at least May 12, Thomason had ample opportunity and informed Mrs. Clinton of his allegations against the

Travel Office employees. David Watkins’ ‘‘soul cleansing’’ memorandum provides further confirmation:

[T]he First Lady took interest in having the Travel Office situation resolved quickly, following Harry Thomason’s

bringing it to her attention. Thomason briefed the First

Lady on his suspicion that the Travel Office was improperly funnelling business to a single charter company, and

told her that the functions of that office could be easily replaced and reallocated.

Once this made it onto the First Lady’s agenda, Vince

Foster became involved, and he and Harry Thomason regularly informed me of her attention to the Travel Office

situation—as well as her insistence that the situation be

resolved immediately by replacing the Travel Office staff.

Foster regularly informed me that the First Lady was

concerned and desired action—the action desired was the

firing of the Travel Office.163
42

164 CGE 006965–006980. Mr. Herman, partner in charge of the review for Peat Marwick, confirmed ‘‘we were never asked to perform an audit.’’ Response to committee interrogatories, June

19, 1996. 165 Committee deposition of Patsy Thomasson, April 22, 1996, pp. 98, 101. Mr. Watkins was

out of town at the time attending his daughter’s graduation. 166OPR Report, p. 44. 167 CGE 006965. 168 CGE 006980. 169For example, in the White House Management Review it stated that Peat Marwick was

unable to conduct a formal audit because financial records were too disorganized and irregular.

WHMR, p. 10. 170 Russell deposition, p. 59. 171McLarty deposition, p. 35. Other evidence shows that Eller had been meeting with Harry

Thomason and Cornelius throughout this week.

May 14, 1993, Friday

On May 14, 1993, the White House brought in what it heralded

as an ‘‘independent’’ auditor. In fact, the individual brought in to

head the White House Travel Office review was neither independent nor an auditor. The White House engaged the management

consulting division, not the public accounting division of Peat

Marwick, to conduct its ‘‘Management Review’’ of the Travel Office.

Peat Marwick’s engagement letter, draft report and final report all

state that Peat Marwick was not asked to and indeed did not conduct the work necessary for an ‘‘audit, examination or review’’ in

accordance with established accounting standards.164 Although the

Management Review team was directed to look for kickbacks, it

found no such evidence.

Throughout the day, Patsy Thomasson kept Watkins and Kennedy apprised of developments.165 Mr. Kennedy called FBI Agent

Carl during the course of the Peat Marwick review to advise him

of the progress.166

The White House directed Peat Marwick’s efforts in the Travel

Office review. In its draft report, Peat Marwick stated, ‘‘The procedures we performed were limited in nature and extent to those

which the Office of the Counsel determined best fit its needs.’’ 167

In contrast, the final report, states that the Office of Management

and Administration limited the review procedures.168 The distinction is telling, given the fact that the White House Counsel’s Office

would determine whether or not the FBI proceeded with a criminal

investigation. Obviously, the White House did not want the White

House Counsel’s role in directing Peat Marwick’s efforts to be revealed in its final report.

Over the course of the last 3 years the White House has maintained that the Travel Office records were not auditable. The testimony of Dan Russell, a Peat Marwick accountant, contradicts

this.169 He testified that the White House Travel Office records

were indeed auditable and that an audit of the records could have

been performed within several weeks.170

In a morning meeting in McLarty’s office, Eller argued vigorously

that the employees should be fired that day.171 Mr. Eller later explained to the GAO that he made this argument only under the assumption that the decision to fire the employees had already been

made by Watkins and Patsy Thomasson.

At approximately 6:30 or 7 p.m. on May 14, Foster asked Watkins to speak with Mrs. Clinton about the Travel Office. Mrs. Clinton had inquired about the Travel Office with Foster earlier in the
43

172OPR Report, p. 45. 173Watkins memorandum, CGE 012287. 174 Id. Watkins also reported that ‘‘Harry Thomason indicated that he could put a more efficient structure in place in an hour’s time to handle all the tasks of the Travel Office.’’ CGE

012292. 175 Responses to questions for the First Lady from the Committee on Government Reform and

Oversight of the House of Representatives, March 21, 1996, p. 11. 176 April 6, 1994 response to GAO interrogatories by Mrs. Clinton. 177Mrs. Clinton’s responses to committee interrogatories, p. 3. 178Watkins’ testimony in committee hearing, January 17, 1996; see also Watkins ‘‘soul cleansing’’ memo, CGE 012287. 179Mrs. Clinton’s answers to interrogatories, pp. 12–13.

day.172 Even though Watkins was in Memphis, TN, trying to celebrate his daughter’s graduation, Foster insisted that:

it was important that [he] speak directly with the First

Lady that day. [Watkins] called her that evening and she

conveyed to [him] in clear terms her desire for swift and

clear action to resolve the situation.173

During this conversation, Watkins recorded that Mrs. Clinton:

mentioned that Thomason had explained how the Travel

Office could be run after removing the current staff—that

plan included bringing in World Wide Travel and Penny

Sample to handle the basic travel functions, the actual actions taken post dismissal—and in light of that she

thought immediate action was in order.174

Foster was present during the conversation.175

In contrast, Mrs. Clinton’s recall of this conversation was first

provided in responses to GAO inquiries on April 6, 1994, in which

she responded:

Mrs. Clinton does not recall this conversation with the

same level of detail as Mr. Watkins. She recalls that on

Friday, May 14, she had a very short telephone call with

Mr. Watkins. Mr. Watkins stated that Mr. Foster had

mentioned that Mrs. Clinton was interested in knowing

what was going on with the Travel Office. Mrs. Clinton

knew that Mr. Watkins was out of town. Mr. Watkins conveyed to her that even though he was not in Washington,

his office was taking appropriate action.176

Mrs. Clinton also told the GAO that she ‘‘did not know the origin

of the decision to remove the White House Travel Office employees’’

and that she had ‘‘no role in the decision to terminate the employees.’’ 177 These statements are inconsistent with Watkins’ sworn

statements. He testified that ‘‘Foster regularly informed me that

the First Lady was concerned and desired action—the action desired was the firing of the Travel Office staff.’’ 178

Almost 2 years later, Mrs. Clinton took an oath that her original

answers were accurate. However, she provided additional information which indeed does show a role:

I may have expressed the view that appropriate action

should be taken if the circumstances warranted it. . . . I

expressed my concern . . . that if there were fiscal mismanagement in the Travel Office or in any part of the

White House, it should be addressed promptly.179
44

180Thomason message logs, Thomason document production, Bates Stamp No. 00000112. 181FBI 302 interview of David Watkins, August 10, 1993. 182 It is a common practice to release information on Fridays to minimize news coverage. 183 Committee deposition of Brian Foucart, May 3, 1996, pp. 30–32. 184OPR Report, p. 46. 185White House typed memo ‘‘For Peter,’’ undated [but is from May 1993], CGE 008268. 186OPR Report, p. 46. 187Foster Travel Office notebook, CGE 000909. 188WHMR interview notes of Steve Davison, June 5, 1993, CGEPR 185–198. 189Thomasson deposition, pp. 123–124.

On this day, Harry Thomason was asking about the Travel Office

developments throughout the day. He had a message from

Cornelius that ‘‘the audit started in the travel office.’’ 180 Late that

evening, Patsy Thomasson interrupted the Watkins’ family graduation celebration again to ‘‘urge him’’ to call Harry Thomason who

was staying at the Jefferson Hotel. Mr. Watkins reached Harry

Thomason at midnight and told him the Peat Marwick report

would not be released before Monday.181 It appears that Harry

Thomason and Eller had been pressing since the previous day for

the firings to take place before 5 p.m. on May 14, 1993, which was

a Friday.182

May 15–16, 1993, Saturday-Sunday

Throughout the weekend, the Peat Marwick review continued.

Despite numerous conversations with FBI Headquarters, no one at

the White House ever informed the agents that Peat Marwick was

not performing an ‘‘audit.’’

Moreover, the White House did not inform the FBI that it was

conducting its own investigation. Patsy Thomasson enlisted Jennifer O’Connor and Brian Foucart under the pretense of an NPR

review to interview Billy Dale and report back to her.183 Ms.

Thomasson requested they provide a memo of the results.184 Ms.

Thomasson also tried to enlist one of her assistants, Peter Siegel,

to go on a trip scheduled for the following Monday to shadow the

Travel Office employees and record an ‘‘hour-by-hour’’ accounting of

what they did. This mission was to be carried out ‘‘unobtrusively.’’ 185

On May 15, Kennedy contacted FBI Agent Carl at home to receive an private briefing from Peat Marwick. Agent Carl arrived at

the White House at 5 p.m. with the Washington Metropolitan Field

Office Supervisor assigned to the matter, David Bowie.186 Again,

Kennedy assured the FBI agents that the Travel Office records

were secure.

Also on May 15, McLarty telephoned Foster to tell him that he

was going to New York with Mrs. Clinton that evening and wanted

Foster to ‘‘give highlights, status’’ to him before the trip.187 Steve

Davison of World Wide Travel reported, ‘‘We’d heard that Mack

couldn’t get a hotel room, that HRC was pissed at Travel staff,’’ as

a possible reason for the firings.188

On Sunday, May 16, 1993, Patsy Thomasson continued her own

investigative work by calling in several computer people to remove

the hard drives on all the computers in the Travel Office. Again,

the FBI was not informed of these activities.189

A World Wide Travel employee Fan Dozier talked with Harry

Thomason on this day and recounted that Thomason remarked:
45

190WHMR interview notes of Fan Dozier, June 8, 1993, CGEPR 204–211. 191 Id. 192McLarty deposition, pp. 37–38. 193 ‘‘Chronology of Travel Office Firings (as of 5.25.93)’’ with handwritten notations by Chief

of Staff Mack McLarty, CGEPR 0563–0564. 194McLarty deposition, pp. 40–42. 195Foster Travel Office notebook, CGE 911, 1039. 196Watkins memorandum, CGE 012287. 197Watkins ‘‘soul cleansing memo,’’ CGE 012287. 198 Early White House productions of this memorandum to the committee contained copies of

this memorandum with Mrs. Clinton’s names crossed out and unable to be read. No explanation

has been given for why her name had been crossed out on these copies. 199White House Management Review interview notes of Bruce Lindsey, June 9, 1993, CGEPR

331–334. President Clinton’s ill-fated trip to California ended with a $200 haircut on the runway

of the Los Angeles airport. 200The fact that the President knew of the firings prior to their occurrence on May 19 had

always been denied by the White House prior to this investigation. The committee uncovered

notes that detailed the briefing of President Clinton on this matter. For example, on July 2,

1993, during a press briefing on the release of the White House Management Review, Mack

McLarty was asked:

Question. Was the President aware that the Travel Office was being dismissed before it was

dismissed?

Mr. MCLARTY. He was interviewed, Mr. Podesta interviewed him. He was not aware of the

other——

Question. Neither one?

Mr. MCLARTY. I don’t believe he was, not to my knowledge. And I think in terms of perhaps

his being aware of some of this perhaps he was ill served in that regard.

‘‘you mean you’re not up there working [in the Travel Office]?’’ 190

Mr. Thomason added that ‘‘the First Lady would be very upset’’ to

hear that World Wide Travel was not already in place.191

Later that evening, McLarty was in the White House residence

for a dinner with President Clinton and Mrs. Clinton and several

cabinet members.192 Mrs. Clinton spoke with McLarty in private

about the progress of the Travel Office investigation. McLarty later

added a notation to one of the numerous chronologies subsequently

created by the White House Counsel’s office that on this date, there

was ‘‘HRC pressure.’’ 193 Although McLarty previously did not acknowledge this meeting, he testified before this committee that

Mrs. Clinton did pressure him to act at this time.194

Mr. Foster arrived at the White House for a late night meeting

with President Clinton at approximately 9 p.m. The meeting lasted

approximately 2 hours, until 11 p.m. On Foster’s calendar detailing

his activities on May 16 for Travel Office matters, the only notation

he wrote was ‘‘?’’ 195

May 17, 1993, Monday

Mr. Watkins had an early morning meeting with McLarty. Mr.

McLarty informed him that this matter was on Mrs. Clinton’s

‘‘radar screen.’’ 196 Mr. Watkins recorded that there ‘‘would be hell

to pay if . . . we failed to take swift and decisive action in conformity with the First Lady’s wishes.’’ 197

Mr. Watkins drafted a memo to McLarty later this same day covering the planned Travel Office firings. Mr. Watkins copied this

memo to Mrs. Clinton.198 The memo was faxed to Eller who was

traveling with President Clinton in California.199 Mr. Eller discussed the memorandum with Presidential confidante Bruce

Lindsey. In turn, Lindsey discussed the memorandum with President Clinton in California.200 That morning, Lindsey placed a
46

201Phone logs of William Kennedy, CGE 23023. Neither Kennedy nor Lindsey have any recollection of this telephone call. See committee deposition of Bruce Lindsey, July 29, 1996, p. 50;

see also Kennedy deposition (April 9, 1996), pp. 130–131. 202WHMR, p. 11. 203Foucart deposition, p. 42. 204Mr. Foucart arrived at the White House after serving as the budget and finance person

at the DNC. 205Mr. Thomason had undated notes of a meeting that he testified was with Craig Livingstone

to discuss Livingstone’s interest in securing the Director’s job in the White House Military Office. Thomason did not recall when this meeting occurred. On May 18, 1993, Livingstone put

Anthony Marceca on an access list to the White House. CGE 47618. 206 Cornelius deposition, pp. 116–117. 207 Committee deposition of Gary Aldrich, July 18, 1996, p. 49.

phone call to Kennedy from Air Force One and left a message for

Kennedy to call him.201

Mr. Dale went to see Watkins later this day to inquire about retiring. Mr. Watkins advised Dale that he did not want to discuss

it at this time and scheduled a meeting for Wednesday morning,

May 19, at 10 a.m. with all the employees.202

May 18, 1993, Tuesday

The FBI called the White House to see what was happening to

the ‘‘audit’’ only to be put off for the day. Throughout the day,

Cornelius was finalizing plans with World Wide Travel staff to effectuate the takeover of the Travel Office operations. A new director of the Travel Office was selected by David Watkins: the reticent

Brian Foucart.203 Mr. Foucart recalled little of any events while at

the White House. He testified that he could not recall what his title

was or exactly when he began working there.204

Harry Thomason also had a meeting with Craig Livingstone on

this day although the purpose is unknown.205 Ms. Cornelius enlisted Thomason’s help as she had in the previous week to determine how the Travel Office could be run.206

At the end of the day, Kennedy put his arms around the shoulders of FBI agents assigned to the White House, Dennis

Sculimbrene and Gary Aldrich and said,

You guys are really going to thank me in the morning. . . . I can’t talk about it right now, but I kept you out

of something and you are going to be very grateful in the

morning that you were kept out of this.207

The only event that occurred the next day was the firing of the

seven White House Travel Office employees and the announcement

that they were under investigation by the FBI. We now know that

Kennedy exhibited an uncanny foresight into future events. However, Kennedy’s statement reveals a level of prescience that being

a part of the firing of the seven Travel Office employees was not

something anyone wanted to acknowledge.

May 19, 1993, Wednesday

While the FBI awaited the completion of what it had been falsely

told was going to be an audit, the White House suddenly decided

to fire the Travel Office employees on Wednesday, May 19, 1993.

The firings were announced in a press briefing and the President’s

press office proceeded, contrary to official policy, to announce that

there was an ongoing FBI investigation.
47

208WHMR, p. 11. 209OPR Report, p. 49. 210 Urgent memo of May 19, 1993 from Jack Keeney to Janet Reno, Philip Heymann and Webster Hubbell. While Attorney General Reno, Deputy Attorney General Heymann and Associate

Attorney General Hubbell all deny reading this memo until the following week, an assistant to

Heymann, Cynthia Monaco states that she personally handed the memo to Heymann on the day

it was written or possibly as late as the next day and that she watched him read it according

to her informal interview with the committee. Nevertheless, the oblivious response from the Justice Department to the highly unorthodox developments of this investigation in the earliest days

seemed to set a pattern. 211 Herman interview. 212 Id. 213Staff interview of Ross Fischer in fall 1995. This information was notably absent from any

public accounts or in the White House Management Review which was released on July 2, 1993

absent this exculpatory information. 214Martens deposition, p. 173.

Early that morning, Watkins provided White House Press Secretary Dee Dee Myers with talking points which included the mention that the White House asked the FBI to investigate.208 When

Kennedy called Agents Carl and Wade to tell them about the impending firings, Agent Wade warned ‘‘that the termination could

pose problems for the investigation.’’ 209 The White House ignored

the FBI’s concerns and neither the FBI nor the Justice Department

ever publicly voiced any further objections.

When word of the firings reached the Justice Department, its

Criminal Division Acting Chief, Jack Keeney, drafted an ‘‘Urgent

Memo’’ on May 19, 1993. In that memorandum, he noted that the

FBI had become involved due to the ‘‘kickbacks’’ allegation.210

Peat Marwick’s report was not available when the White House

announced the firings on May 19. In fact, it was not yet written.

Consequently, Peat Marwick’s primary author, partner Larry Herman, was ushered into a meeting with George Stephanopoulos, Dee

Dee Myers, Vince Foster, Bill Kennedy, Ricki Seidman and Harry

Thomason. He was immediately greeted with the question, ‘‘Where

the hell is the report?’’ 211 Mr. Herman testified that Harry

Thomason pressed him with questions about whether they had uncovered anything about ‘‘kickbacks.’’ 212

During this timeframe, Thomason spoke to Ross Fischer of

Miami Air and discovered that Fischer never made any allegations

of kickbacks.213 Harry Thomason quickly learned that his allegations were turning to dust.

Meanwhile, Thomason contacted his partner Darnell Martens

and asked for his assistance in contacting Penny Sample of Air Advantage to come to Washington to help in the Travel Office. She

arrived the next day.214 Mr. Thomason again was vague about his

participation to summon Penny Sample. He testified:

Question. There was a time before the firings when

Darnell Martens placed a telephone call to Penny Sample.

It was in May of 1993. Did you have any involvement or

offer any advice concerning the telephone call that was

placed to Penny Sample to come to the White House?

Answer. I don’t know. I don’t know. I mean, at one point

I remember somebody in the White House said: Who could

do this if we decided to make a change in this department?

But so, I don’t remember anything else about it actually.

Question. Do you know who recommended Mr. Martens

call Ms. Sample to come to the White House prior to the
48

215Thomason deposition, pp. 17–18. 216See OPR Report, p. 62. 217FBI press response, May 20, 1993, OPR Report, p. 57; see supra note 64. 218OPR Report, p. 57, fn. 65. 219 Cornelius deposition, p. 143; committee deposition of Clarissa Cerda, April 16, 1996, pp.

124–125. Ms. Cornelius testified in detail to the actions taken by Patsy Thomasson against her

in her attempt to ‘‘save David’s job.’’ Not only was Cornelius asked to resign from her job at

the White House, but her mess privileges were taken away by Thomasson when she refused

to do so. Ms. Cornelius testified that she would not leave the White House unless President

Clinton asked her to do so. Ms. Cornelius’ attorney authored a letter to Deputy Chief of Staff

Bill Burton requesting a substantial raise for Ms. Cornelius above the pay rate of the job. In

this letter, it is noted that Cornelius had ‘‘admirably chosen to remain silent’’ as a ‘‘complete

team player’’ throughout this whole Travel Office ordeal. Letter from Stephen Braga to Charles

William Burton, August 6, 1993, CGE 029028–30. 220 ‘‘Chronology of Travel Office Firings (as of 5.25.93)’’, CGE 563–564.

firing of the White House Travel Office employees on May

19th?

Answer. I don’t. Mr. Martens was at the White House in

a meeting with several people later, and I’m not sure what

the date was or anything, and it came out of that conversation. But exactly who, I couldn’t tell you.215

May 20, 1993, Thursday

The firings were met with near universal skepticism in the press

once it was revealed that President Clinton’s cousin and Harry

Thomason were in the wings to take over the operations of the

White House Travel Office. The press soon began to learn just how

instrumental they had been in generating the firings.

The announcement of the FBI investigation was a particular

problem because to this point, the FBI had allowed the White

House to totally control the alleged investigation. The White House

had already made a premature announcement of the investigation

and now the FBI press office was busy catching up with the White

House ‘‘press responses.’’ The FBI had to deal with White House

press responses that continued to support the White House’s indications that there would be an FBI investigation.216

The FBI press response did concede that the FBI planned to

await the ‘‘final report of the auditors’’ in order to ‘‘analyze their

findings and conduct appropriate investigation.’’ 217 At this point,

the FBI did not have the report and had not learned there was not

going to be an ‘‘audit’’ upon which to base an investigation. FBI

Media Affairs Director John Collingwood testified that he sent copies of his ‘‘press responses’’ to the White House throughout this

week.218

The press also learned on this date that Cornelius and Clarissa

Cerda prepared a February 15, 1993 memorandum for Watkins

which positioned them as co-directors of the Travel Office. When

this broke in the press, Patsy Thomasson instructed Cornelius and

Cerda to deny that Watkins ever read the memo, a claim which

both believed was false.219 A White House created chronology disclosed that Gene Gibbons of Reuters and Wolf Blitzer of CNN informed Stephanopoulos that they had obtained this memorandum.

They agreed to hold their stories until Watkins, Myers and

Stephanopoulos met with the reporters’ bureau chiefs the following

morning.220

Once Eller’s personal relationship with Cornelius became public,

he told interviewers that he threw away all his documents and al-
49

221 Cornelius deposition, p. 142; committee deposition of Jeffrey Eller, April 18, 1996, p. 129;

committee deposition of George Stephanopoulos, May 15, 1996, p. 33. 222OPR interview of Supervisory Special Agent Thomas Carl, August 1993, p. 10. 223Foster Travel Office notebook, CGE 917. 224OPR Report, p. 62.

legedly ‘‘removed himself’’ from the issue. However, Cornelius testified that Eller was engaged in a heated discussion with

Stephanopoulos about this matter about this time—an altercation

neither can now recall.221

With the pressure growing for a Peat Marwick report that

matched the advance hype, Larry Herman called in front office reinforcements from Peat Marwick. Mr. Kennedy informed the FBI,

which had made several requests for the report, that the ‘‘auditors’’

were working on the report but that ‘‘changes were being made to

the draft and that [the FBI] would get a copy as soon as it was

available.’’ 222

May 21, 1993, Friday

The FBI still had not received what they thought would be an

‘‘audit’’ report from the White House. Ms. Myers and

Stephanopoulos met with various White House personnel to try to

put a story together to quell the growing press fury. Mr. Foster recorded in his notes of this date that at some point Stephanopoulos

was told of HT’s [Harry Thomason’s] memo and that

Stephanopoulos ‘‘gets upset’’ because he had already told the press

that Thomason had no financial interest at stake.223

Ann Devroy and Ruth Marcus of the Washington Post contacted

Stephanopoulos about the ‘‘Martens memo’’ they had obtained. This

memorandum detailed Martens’ efforts to obtain Travel Office business as well as his call to Dale in February 1993, about obtaining

Travel Office business.

The story about the Cornelius/Cerda memorandum to take over

the Travel Office was reported that morning by CNN and

Stephanopoulos quickly dismissed it as the work of yet another

‘‘low-level staffer’’ in the Clinton White House. He claimed that the

memorandum had nothing to do with the firings. The Martens

memorandum’s release made it imperative that the ‘‘management

decision’’ to fire the employees not only be backed up by Peat

Marwick but also by the FBI.

Delays in the final Peat Marwick review and the FBI formal announcement of an investigation had become a problem. The White

House called John Collingwood at the FBI to come to a White

House press strategy meeting. Once there, Stephanopoulos asked

him to revise his FBI press response.224 He did so upon his return

to the FBI and faxed it to the White House. Mr. Stephanopoulos

used the revised response in his 4 p.m. press conference.

The White House finally released the long-awaited Peat Marwick

review at this press conference. The FBI did not receive the Peat

Marwick review until later that evening at Headquarters. The assigned FBI field office did not receive the report until the following

week. Nevertheless, before anyone at the FBI reviewed the Peat

Marwick report, the FBI ‘‘investigation’’ had been confirmed.

In a previously undisclosed phone conversation between White

House Counsel Bernie Nussbaum and Deputy Attorney General
50

225WHMR interview notes of Bernard Nussbaum, June 8, 1993, CGEPR 380–382. 226 Id. 227 CGE 7763. 228May 21, 1993 memo to John Podesta from Lee Johnson, CGE 007763. This memo was not

provided to the Justice Department in the course of the investigation into Billy Dale. It was

finally provided to the defendant in the course of his trial after it became public. This was

among a number of documents that the White House was seriously deficient in providing the

Justice Department which continued to receive records from the White House throughout the

trial. 229Sculimbrene Public Integrity interview, August 16, 1995. None of the Justice Department

prosecution team for the Dale case questioned Agent Sculimbrene about these documents even

though he made his knowledge of the situation abundantly clear to his superiors at the FBI.

After Agent Sculimbrene was asked to testify in the Billy Dale trial, he was treated as an outcast by his superiors at the FBI. Agent Sculimbrene testified that he was drug tested for the

first time in his career and then ultimately removed from the White House so that he would

not cause the Clinton administration to be ‘‘uncomfortable.’’ After months of working without

any assignments at a desk in the field office, Agent Sculimbrene finally resigned from the FBI.

FBI general counsel Howard Shapiro attacked Agent Sculimbrene’s integrity and honesty in testimony before the committee. Testimony before the committee, August 1, 1996. 230 Handwritten notes of Todd Stern, May 27, 1993, CGEPR 0679. 231Ferguson deposition, p. 81. 232 Committee deposition of Clarissa Cerda, April 16, 1996, pp. 124–125. 233Secret Service logs, CGE 9287.

Phil Heymann on the morning of Friday, May 21, Nussbaum asked

Heymann if the White House could say that the FBI had signed

off on an investigation.225 Mr. Nussbaum later claimed that

Stephanopoulos pressed him to take action.226 Mr. Nussbaum also

said FBI Deputy Director Floyd Clarke happened to be in

Heymann’s office when Heymann gave the go ahead to announce

the investigation.

White House Deputy Director of Records Management Lee Johnson sent a memorandum to Staff Secretary John Podesta on this

date expressing serious concerns about the records in the Travel

Office and the lack of control over these records.227 Podesta’s office

was responsible for records management at the White House.228

Mr. Johnson repeatedly contacted Steven Neuwirth in the White

House Counsel’s office about this matter and received no response.

FBI Agent Sculimbrene also raised concerns about the lack of control over the documents. He stated that he had seen people throwing out records and documents from the Travel Office and was

shocked that there was absolutely no FBI presence or control over

the investigation at this point.229 Mr. Podesta’s Deputy Todd Stern

later noted that: ‘‘document handling . . . terrible . . . no documents secured . . . but FBI may not want this—prejudice case . . .

who drove it and who knew.’’ 230

That evening, Cornelius and Cerda had dinner at the Jefferson

Hotel with Thomason and his White House assistant Bobbie Faye

Ferguson. Ms. Cerda told Ferguson that she and Cornelius had

been told to say that Watkins did not read their February 15

memorandum.231 Ms. Cerda did not think this was true and believed she was being asked to lie.232

May 22, 1993, Saturday

The White House staff was reeling from a grueling press week

on both the Christophe haircut and the Travel Office firings. President Clinton’s staff gathered at the White House throughout the

weekend to ‘‘war room’’ the press strategy. Mr. Thomason appeared

at the White House over this weekend.233
51

234OPR Report, p. 68, fn. 76. 235 Numerous copies of Mr. Safire’s column were produced by the White House. 236WHMR interview notes of Bruce Lindsey, CGEPR 331–334. 237OPR Report, pp. 68–69.

May 24–25, 1993, Monday-Tuesday

On May 24 and 25, 1993, an increasingly skeptical press continued to question White House cronyism and misuse of the FBI. The

Attorney General was asked by a Washington Post reporter on May

24, if she was aware of the White House contacts with the FBI.

General Reno denied any such knowledge in spite of the fact that

an Urgent Memo about the matter was provided to her on May

19.234

The press learned that Collingwood had been at the White House

on Friday, May 21, and continued to raise questions about President Clinton’s staff exerting pressure on the FBI. New York Times

columnist William Safire accused the White House of ‘‘politicizing’’

the FBI during an appearance on ‘‘Meet the Press’’ on May 23 and

again in his New York Times column on May 24.235

On May 25, President Clinton was questioned during a photo

session about Mr. Safire’s allegations. President Clinton responded

that:

whenever you’ve asked me a question, I’ve told you all

I know about it. All I knew was there was a plan to cut

the size of the office, save tax dollars, save the press

money.

President Clinton’s lack of knowledge is in conflict with Bruce

Lindsey’s testimony that he briefed President Clinton on the matter prior to the firings. When Lindsey briefed him, President Clinton asked, ‘‘What’s it about?’’ 236

General Reno took the White House to task for directly contacting the FBI without going through the Justice Department and expressed her consternation with these events to President Clinton’s

Counsel Bernard Nussbaum.237

The White House announced that a ‘‘White House Management

Review’’ would be immediately undertaken to be presided over by

then-Chief of Staff Mack McLarty. Mr. McLarty was put in charge

of the internal investigation even though he clearly had a role in

the firings. The incongruity of putting the person who authorized

the firings in charge of this investigation ensured from the beginning that the full story would not be told.

May 27, 1993, Thursday

White House Management Review co-author Todd Stern memorialized his concerns in his handwritten notes:

problem is that if we do any kind of report and fail to

address these Qs [questions], press jumps on you wanting

to know answers; while if you give answers that aren’t

fully honest (e.g. nothing re HRC) you risk hugely

compounding the problem by getting caught in half-truths.

You run the risk of turning this into a ‘cover-up’. . . . We
52

238 Handwritten notes by Todd Stern, May 27, 1993, CGEPR 0682–683.

need to think seriously about whether or not it won’t be

better to come clean . . .238

Unfortunately, Mr. Stern’s musings were never heeded—coming

clean was not on the White House agenda.

IV. THE TRAVEL OFFICE FIRINGS WERE PART OF A CAMPAIGN

PAYBACK SCHEME THAT WAS IN PLACE LONG BEFORE MAY 1993

A. HARRY THOMASON SOUGHT THE TRAVEL BUSINESS FROM THE

EARLY DAYS OF THE TRANSITION, TOLD MRS. CLINTON HE COULD

PROVIDE THE SERVICE AND PRESIDENT CLINTON AND MRS. CLINTON

PROVIDED THE ACCESS TO DO SO. HARRY THOMASON MALIGNED THE

TRAVEL OFFICE EMPLOYEES, AS WELL AS TRAVEL OFFICE CONTRACTOR ULTRAIR IN ORDER TO MOVE THEM OUT OF THAT OFFICE.

THOMASON’S TRAVEL BUSINESS INTERESTS POSED AN INHERENT

CONFLICT WITH HIS INVOLVEMENT IN TRAVEL OFFICE DECISIONS OR

ANY SOLICITATION OF BUSINESS IN THIS AREA

The origins of the Travelgate story began long before the May 19,

1993, firings and long before the Clintons crossed the White House

threshold in January 1993. Harry Thomason, famous Hollywood

producer and a long-time close friend of the Clintons, became an

indispensable member of the 1992 campaign entourage. He and his

wife provided much needed assistance: from their own personal aircraft in the early days of the campaign and help with Hollywood

fund-raising, to scripting and staging of the 1992 Democrat convention complete with a Thomason produced video, ‘‘The Man from

Hope.’’

1. Harry Thomason’s ownership interest in aviation companies presented inherent conflicts of interest in his seeking Travel Office

business

Mr. Thomason possessed an ownership interest in several aviation oriented companies. He had a 33 percent ownership interest

in Thomason, Richland & Martens, Inc., (TRM), an aviation consulting company based in Cincinnati, OH. TRM’s cash flow depended heavily on moneys derived from the Clinton/Gore campaign

from the fall of 1991 through the election in November 1992. This

reliance continued throughout the Clinton/Gore transition.

Mr. Thomason’s two partners had a 33 percent ownership in

TRM. Darnell Martens was brought into TRM and served as the

president of the company. Martens testified how the company

began financially:

Question. And so there were the two financial backers?

Answer. Yes.

Question. Did they in fact put up equal money——

Answer. No.

Question. Can you just explain what happened with

that?

Answer. Each were to put up $50,000. Harry put in 25

initially, Dan [Richland] did not. Maybe a year and a half
53

239Martens deposition, p. 36. 240Martens deposition, p. 10. 241Martens deposition, p. 16. The Thomason Aircraft Corp. was a ‘‘corporate aircraft maintenance facility at Van Nuys Airport,’’ California. This company had a ‘‘piston maintenance operation, a turbine maintenance operation and then a parts department.’’ Aircraft sales was added

to the company’s activities the following year. Id., pp. 12–14. 242 Id., pp. 14, 38, 45, 48.

later, Dan put up 25,000. He subsequently put in his other

25,000. And Harry has yet to put in his final 25,000.

Question. Were you a financial backer of the company?

Answer. Only from the aspect of bringing the Executive

Jet contract with me as part of the original deal.

Question. And you served as president?

Answer. Correct.239

Mr. Thomason met Darnell Martens in 1989 when he bought a

plane from Executive Jet while Martens was employed there.240

Mr. Martens, who claims his real life ambition was to work in the

television industry, kept in touch with Thomason over the next several years. Mr. Martens testified that in 1991, Thomason encouraged him to present a business plan for the company that ultimately became TRM. TRM was incorporated in November 1991,

shortly after Bill Clinton announced he was running for President.

Mr. Martens additionally took on a role with a second Harry

Thomason-owned aviation company, the Thomason Aircraft Corp.,

as acting president. The Thomason Aircraft Corp., marketed aircraft parts and some aircraft sales.241 This company became a client of TRM and Martens worked between the two companies in

Ohio and California. At one point, Thomason Aircraft supplied an

eight-seater plane to TRM.

Martens’ income was covered under an arrangement he made

with Executive Jet to provide his salary for approximately 1 year.

In May 1993, his 1 year contract was ending and the additional

commissions he obtained for his service to the Clinton/Gore campaign were drying up. The access that Harry Thomason could provide was an attractive solution for the cash strapped start up company. Mr. Martens testified that after the inauguration he wanted

to have enough money so that he could spend a few months doing

research and ‘‘get back to his business plan’’ providing financial advisory service for companies that owned aircraft and developing

‘‘benchmark products.’’ 242

2. TRM, Thomason’s company, provided service to the Clinton/Gore

campaign and sought to capitalize on their association with the

new administration

In December 1991, Thomason told Martens that he had a friend,

Bill Clinton, who was running for President. In his deposition,

Martens explained:

I kind of rolled my eyes and said: Okay, so what?

And he goes: Well, it is Bill Clinton.

I had never heard of Bill Clinton. In fact, when he said

it, right then was the first time I had ever heard the

name.

So I said: Yes, so?
54

243Martens deposition, pp. 20–21. 244GAO deposition of Penny Sample, September 1, 1993, pp. 21–22. 245 Judith Michaelson, Putting ‘House’ and Past in Order, Old Nemeses Delta Burke and

Thomason’s Combined Forces, Los Angeles Times, January 4, 1995. 246 Handwritten notes of President Clinton’s Associate Counsel Natalie Williams detailing a

conversation with one of Harry Thomason’s attorneys, Amy Sabrin, DF 780464. Although President Clinton claimed executive privilege over all of Ms. Williams’ handwritten notes, the committee received production on August 15, 1996.

He goes: Well, the thing is that they have been getting

into chartering airplanes and just ad hoc, you know, if

somebody needs to go somewhere. And we are real concerned about primarily the safety issues, who are they

using, how much are they paying, are they properly insured, some of those issues. You know, there has been

some discussion around with some of the advisors that

maybe somebody should take a look at what they are doing

so that they don’t actually have something bad happen,

you know, use an operator they shouldn’t or whatever.

He said: It seems to me maybe you would want to go

down and see if there was an opportunity for you to do

some consulting for them.

I said: Sure, that will be fine.243

Mr. Martens attended a Los Angeles fund-raiser with Thomason,

shook Bill Clinton’s hand, and then met with David Buxbaum of

the Clinton/Gore campaign and obtained the campaign charter

business. Mr. Buxbaum was in charge of budget matters and reported directly to Watkins who was then Clinton/Gore campaign

manager. Mr. Martens was not aware of any competitive bidding

done to obtain the business.

Initially, TRM provided all the planes for the fledgling campaign.

As Clinton successes mounted in the primary season and the entourage grew, Martens utilized a New Mexico charter company, Air

Advantage, to serve as a charter broker. Air Advantage paid an

agreed upon percentage to Martens through TRM. Although

Martens testified that he did billing and consulting work with Air

Advantage, Air Advantage owner Penny Sample claimed she really

didn’t know what Martens did or for what they were paying

him.244

When Bill Clinton won the Presidency in November 1992, the

TRM partners and their associates set their sights on ‘‘Washington

opportunities.’’ Linda Bloodworth-Thomason ridiculed the idea of

her husband trying to get the Travel Office business as the equivalent of taking over someone’s lemonade stand when the whole

Travel Office debacle blew up in May 1993, after the firings:

given our salaries, setting our sights on the White House

travel office would be the financial equivalent of us taking

over someone’s lemonade stand.245

However, Thomason and Martens did in fact seek a quarter of

a million dollar Government contract as well as the potential $10

million annual cash flow. It is now apparent, that even before the

start of the Clinton administration, Harry Thomason spoke with

Mrs. Clinton about replacing Travel Office employees because they

were ‘‘disloyal’’ and discussed the fact that he (TRM) could do the

same work he had performed for the campaign.246
55

247DOJ document production, EZ 037684. 248 Confidential fax cover sheet (CGE 2228) with memo offering assistance with the Travel Office, May 13, 1993, Bates Stamp No. BFF 1031; memorandum from Martens to Bruce Lindsey,

April 12, 1993, regarding proposal to perform financial audit of non-military Federal aircraft,

CGE 2229. 249Thomason deposition, p. 110. 250 Confidential memorandum to Thomason from Martens, January 29, 1993 regarding ‘‘TRM

Action Items’’, DOJ production, Bates Stamp No. EZ 037684. 251 ‘‘Remarks at a Meeting with Cabinet Members,’’ 29 Wkly Comp. Pres. Documents, p. 67. 252See GAO interview of Craig Livingstone, March 10, 1994. Craig Livingstone testified to

GAO investigators that this request was ‘‘unheard of.’’ Livingstone went to the Office of Administration to find out why he had been given an access form from President Clinton requesting

a pass for Harry Thomason. According to Livingstone, Watkins refused to provide any explanation and only told him that it needed to be done.

But see Thomason deposition, p. 75. Thomason stated in sworn testimony that after arriving

at the White House for several days and having to wait at the gate for someone to grant him

entrance through the gate, Livingstone approached him one day and said: ‘‘[W]hy are we doing

this? You know, it causes a waste of time, you a waste of time. Why don’t we get you a temporary pass so that we just won’t have to make the call everyday.’’ 253 CGE 2933. 254 CGE 18296.

3. A January 29, 1993 memorandum from Darnell Martens to

Harry Thomason catalogs the ambitious Washington agenda for

TRM: pursuing Travel Office business and obtaining ‘‘official

status’’ at the White House

a. Seeking ‘‘Washington opportunities’’

In a memorandum never before provided to investigators until

the committee threatened to subpoena Harry Thomason, the multiple Thomason-Martens enterprises were revealed. In the January

29, 1993 memorandum from Martens to Thomason, Marten detailed numerous ‘‘Washington opportunities’’ that could be pursued

by ‘‘capitaliz[ing] on the ‘Thomason’ name recognition.’’ 247

Mr. Martens first suggested changing the TRM firm name to

‘‘Harry Thomason & Associates’’ as they moved forward with their

‘‘opportunities.’’ Mr. Martens made up his own letterhead and proceeded to use this new name when faxing requests for meetings at

the White House.248 Mr. Thomason testified, however, that this

was done without his approval and claimed to have put an immediate halt to the name change. Nevertheless, this same heading appears on later TRM correspondence to the White House.249

b. Obtaining ‘‘some form of official status’’

Second, Martens’ memo recommended obtaining ‘‘some form of official status as advisors to the White House for general aviation

policy matters.’’ The memorandum proposed achieving this goal

through special consulting projects such as developing a ‘‘computerized safety and operational database’’ or reviewing ‘‘all non-military

Government aircraft to determine financial and operational appropriateness.’’ 250 President Clinton greatly facilitated this effort after

a February 10, 1993, cabinet meeting when he announced he was

‘‘ordering an inventory of the airplane fleet.’’ 251

Messrs. Martens and Thomason did in fact obtain the ‘‘official

status’’ of White House passholders. Harry Thomason obtained his

pass on March 23, 1993, and Darnell Martens obtained his pass on

May 12, 1993.252 Mr. Thomason was listed as reporting directly to

President Clinton.253 Mr. Martens reported to Harry Thomason

and Watkins.254
56

255Mrs. Clinton’s answers to interrogatories, p. 9. 256WHMR interview notes of Rahm Emanuel, June 14, 1993, CGE 0236. In his committee

deposition, Emanuel could not recall this fact. However, Todd Stern, who took notes at

Emanuel’s interview, confirmed that his notes did reflect that the President, Mack McLarty,

Mandy Grunwald and George Stephanopoulos approved the ‘‘White House Project’’ that Harry

Thomason was working on. See Stern deposition, pp. 38–39. 257GAO interview of Thomas F. ‘‘Mack’’ McLarty, March 21, 1994. 258McLarty deposition, p. 23. 259The White House Management Review, p. 6. 260McLarty deposition, pp. 23–24. 261McLarty does not appear to have turned over his copy of ‘‘The White House Project’’ to

John Podesta and Todd Stern in the course of the Management Review. Stern recalls receiving

the document from Rahm Emanuel. Podesta does not recall from whom they received the document.

Harry Thomason was enlisted to come to the White House when

the White House fell upon hard times with the press and President

Clinton’s polling figures headed south. Mr. Thomason was officially

brought in to assist in better ‘‘staging’’ of events for the President.

Mrs. Clinton acknowledged discussing these ‘‘staging’’ efforts with

Harry Thomason.255

Rahm Emanuel told White House Management Review investigators that McLarty, Stephanopoulos, Mandy Grunwald and President Clinton were consulted about bringing in Harry Thomason for

staging advice and they all signed off on the project. Mr. Emanuel

confirmed in sworn testimony before this committee that McLarty

approved bringing in Harry Thomason.256

In stark contrast, McLarty claimed he had no role in bringing

Harry Thomason to the White House in numerous public statements as well as the White House Management Review.257 Furthermore, McLarty testified to this committee that he ‘‘thought the

President and First Lady had asked him [Harry Thomason] to

come to the White House.’’ 258 Other Clinton administration staff

consistently maintained that Emanuel was responsible for Harry

Thomason coming to the White House. The White House Management Review is vague on the subject:

At the end of April, Thomason returned to Washington.

He had been asked to consult on the staging of Presidential events and was provided with an access pass of the

kind issued to staff, allowing him open passage throughout

the White House complex.259

It is unlikely that Emanuel’s position gave him the authority to

bring someone to work at the White House, provide an East Wing

office, computer, phone hook up, White House pass and direct senior staff to meet with such an individual for a ‘‘project.’’ Such a

task clearly would be within the scope of the Chief of Staff, particularly when it involved the Clintons’ close friend and supporter,

Harry Thomason.

Mr. McLarty denies his role in bringing in Harry Thomason and

furthermore, states he never met with Thomason while he was at

the White House.260 Mr. Thomason directly contradicts this account. He testified to this committee that in the May 12, 1993

meeting reflected on his calendar, he gave McLarty a copy of ‘‘The

White House Project.’’ 261

Mr. McLarty’s testimony that he believed President Clinton and

Mrs. Clinton asked Harry Thomason to come to the White House

for the ‘‘staging’’ efforts, would explain why Thomason’s White
57

262 Jennifer O’Connor recounted such a memo in handwritten notes, CGE 37586; see also

Cornelius deposition, p. 76. Cornelius testified that O’Connor told her of such a memo. The committee specifically sought this memorandum from the White House to no avail. 263 In the course of the White House Project, Harry Thomason had meetings with dozens of

White House staffers as is reflected in an agenda provided by both the White House and Harry

Thomason. Most of Thomason’s meetings were conducted on April 30 and May 1, 1993. 264 CGE 2296–2297. 265Thomason was an overnight guest in the White House residence on February 16 and 17,

1993 and forwarded the February 11, 1993 memo (CGE 2297) to the President. 266See Darnell Martens memorandum, dated January 29, 1993, DOJ production, Bates Stamp

No. EZ 037684.

House pass had him reporting directly to the President. Moreover,

there is evidence that McLarty sent a memorandum to certain staff

explaining Thomason’s designated role at the White House prior to

Thomason’s scheduled interviews with department heads. This

memorandum has not surfaced in the course of the committee’s

document requests to the White House.262 Again, the White House

Chief of Staff would be the logical person to send out such a memo

so that staff would understand why they were being asked to take

time out of their schedules to meet with Harry Thomason.263

c. Seeking the Travel Office business

Mr. Martens clearly envisioned seeking the Travel Office business according to his January 29 memo to Harry Thomason:

Determine who controls the scheduling of the White

House Press Corps aircraft. This can be done by TRM

much as the campaign aircraft were handled.

There is no documentary evidence that Thomason ever objected to

any of these activities. In fact, Thomason personally forwarded a

proposal memorandum for a GSA contract to President Clinton,

which was one of the items on the January 29 memorandum list.264

Mr. Martens January 29 memo also recommended that he and

Thomason ‘‘travel to Washington within the next 30 to 45 days to

meet with either DOT [Department of Transportation] or White

House transportation advisors’’ regarding these items. Within the

month, while an overnight guest at the White House, Harry

Thomason passed on his ideas personally to President Clinton.265

Martens even fancied that he and his Hollywood partner could provide ‘‘selection assistance’’ regarding President Clinton’s choice for

a new FAA Administrator.266

4. Putting Martens in touch with the White House to obtain Travel

Office business

Mr. Thomason used his access to the White House to put

Martens in touch with Myers and learn how to solicit the Travel

Office business. Ms. Myers in turn put Martens in touch with Billy

Dale. When Martens attempted to seek Travel Office business from

the former Travel Office Director, Billy Dale, he was rebuffed.

Then, perhaps, was the point at which Mr. Dale’s fate was sealed.

He made the mistake of not giving business to President Clinton’s

friend even though to do so would have disrupted a longstanding

arrangement preferred by the customers of the Travel Office—the

White House press corps.
58

267Martens deposition, p. 52. 268Martens memo, WHMR, exhibit ‘‘G’’. 269 Id. 270 Committee interview of Billy R. Dale, November 27, 1995. 271 Committee interview of Robert Van Eimeren, July 26, 1995. 272Martens memo, WHMR, exhibit ‘‘G’’.

5. Drafting a memorandum covering his conversation with Dale

which shows he was seeking the Travel Office business

Mr. Martens recounted his impressions of this conversation with

Dale in a memorandum that was disclosed to the press just days

after the firings. Mr. Martens testified that he wrote the memorandum contemporaneous with his conversation with Dale in early

February 1993.267 The Martens memorandum clearly states that

TRM was seeking business from the Travel Office:

Dee Dee Myers stated to both Harry Thomason (personally) and Darnell Martens (by phone) that the White

House was not tied to any particular charter operator and

that based on that assumption, she saw no reason why

Thomason, Richland & Martens, Inc. (TRM) should not be

able to compete for the White House Press Corps charter

business.268

Mr. Martens goes on to detail his conversation with Dale in which

he was told that ‘‘there was no possible combination of price/service

under which TRM could earn the White House business.269

Mr. Dale acknowledged that he interpreted Martens’ overtures as

a bid for TRM to get the Travel Office business and that he simply

didn’t need a ‘‘middle man.’’ 270 What Martens was soliciting was

to take over Dale’s job. Robert Van Eimeren overheard the conversation and concurred with Dale’s account.271

A reading of the Martens memorandum further leads to the conclusion that TRM was seeking the Travel Office business. Again,

Martens wrote, ‘‘Martens informed Dale that TRM purchases a

much higher volume of charter hours than the White House does

and that the buying power could be combined with the White

House business to lower the cost from particular vendors to the

Press Corps.’’

Mr. Martens’ memorandum continues for close to two pages to

outline his opinion that the Travel Office is a Republican operation:

‘‘Airline of Americas [UltrAir—the then current charter company]

is a Republican-operated charter airline.’’

Mr. Martens seemed to view the White House Travel Office business as a political plum that now belonged to Clinton supporters:

Once again, a company which made its choice and has

represented that it did not support the Clinton presidential initiative continues to benefit from its special relationship with Billy R. Dale and the White House Travel

Services Department.272

6. Laying out the strategy to get the Travel Office business in a

March 5, 1993 memorandum: dig up dirt on the current employees and replace them with campaign cronies

Even more significant was another version of this ‘‘Martens

memo’’ that never saw the light of day prior to this investigation.
59

273Memorandum from Darnell Martens to Harry Thomason, March 5, 1993. 274See depositions of Martens and Thomason. 275Martens deposition, p. 74.

Even the criminal investigation team in the Public Integrity Section of the Justice Department failed to obtain this document until

brought to their attention by the committee. Like its predecessor,

this March 5, 1993, memorandum further supports that TRM was

seeking business in the Travel Office. Mr. Martens subsequently

tried to explain it away by suggesting that it was merely a ‘‘memo

to myself.’’ Mr. Thomason finally turned over this document under

threat of a subpoena in December 1995.

The March 5 memorandum from Martens to Thomason discussed

Martens’ efforts to gather incriminating information on the Travel

Office employees while promoting TRM’s plan to take over the

Travel Office. In this version, Martens outlines the ‘‘solution’’ for

the Travel Office:

the Administration should disband the antiquated

Transportation Department system in favor of the functions being outsourced to TRM/Air Advantage.273

Air Advantage was the same charter company used by TRM during

the campaign. This is precisely what the events of May 1993, were

designed to achieve. Similar to the May 13, 1993, fax discussed

above that was sent to the White House, Thomason and Martens

clearly envisioned ‘‘Penny [Penny Sample of Air Advantage] and I

[Martens]’’ working at the White House.

Perhaps no other document so clearly lays out the agenda behind

the maligning of the Travel Office employees—dirty them up, move

them out and move in TRM and Air Advantage. The explanation

is all laid out in this long-withheld document. The cover memo to

this March 5 ‘‘solution’’ memo indicates that Martens took the following actions to investigate the Travel Office employees:

• ‘‘contacted the DOT regarding the AOA [Airline of the Americas/UltrAir] campaign violations’’

• ‘‘we are contacting a party Treasurer to determine if AOA’s

owners made substantial Republican contributions’’

• ‘‘we are to receive a package from Miami Air today with additional information on their experience with the White House

. . . ’’

• ‘‘we are trying to obtain an on-the-record conversation with

the ex-AOA employee.’’

Mr. Martens noted in his cover memo that he felt like ‘‘Mike Wallace on 60 minutes.’’ He informed Thomason that he would be sending additional information.

Of course, Martens and Thomason have said that this memo, like

the others meant nothing.274 Mr. Martens testified that this was

just a memo ‘‘to myself.’’ 275 They attempted to explain it away as

just a big misunderstanding by people who write fabricated memos

to themselves that inadvertently fall into the wrong hands. In spite

of this, Thomason did pass this information on to others at the

White House including, but not limited to, Watkins, Foster, Kennedy, Cornelius, Patsy Thomasson, and O’Connor over the next few

months.
60

276The phone number called at the Washington Post was 334–7463. Thomason phone records,

Thomason document production, Bates Stamp No. 876. 277This factual evidence is consistent with Watkins ‘‘soul cleansing’’ memo in which he states

that ‘‘Management and Administration had no part in bringing Thomason into the White House

. . . Contact with this Office on the subject consisted only of the First Lady’s Office calling to

insist on immediate access for Thomason.’’ CGE 12291–12292. 278 CGE 2933. 279WHMR interview notes of Jennifer O’Connor, June 11, 1993, CGEPR 0384.

Notably, Harry Thomason made numerous phone calls to Mrs.

Clinton’s press office, to Lindsey’s office, and to the Washington

Post on March 5, 1993.276 In the following days, the calls to Mrs.

Clinton’s office continued. Thomason’s phone logs identify numerous contacts with Mrs. Clinton and her office throughout the week

of May 10 through May 14, 1993. He called the private residence

phone on both May 5 and May 6, 1993, and had a lengthy dinner

in the residence on May 13, 1993.

The paperwork for Thomason’s White House pass was completed

on March 10, faxed to Mrs. Clinton’s press office on March 23,

1993, stamped ‘‘RUSH ASAP.’’ 277 Mr. Thomason obtained a Temporary White House Office pass, not a Temporary White House volunteer pass as would have been appropriate had he been a volunteer.278 Since Harry Thomason’s White House Project did not begin

until the end of April, why the ‘‘RUSH ASAP’’ to get his pass in

March if not for tending to Travel Office affairs?

The January 29 and March 5 Martens memoranda are consistent

with the information Thomason passed on to White House officials.

In order to get rid of the Travel Office employees, however, the

‘‘good story’’ that Thomason was hoping for needed a better plotline. Simple patronage and steering contracts to rich friends never

makes for a good story.

‘‘These guys are crooks,’’ Harry Thomason roared through the

White House. ‘‘They are ripping us off’’ he declared according to

White House employee Jennifer O’Connor.279 With these words, the

lives of seven men changed forever.

Mr. Thomason worked with Cornelius and Watkins on his vision

of the new Travel Office. The May 13, 1993 fax to the White House

clearly shows that the plan was set in action on May 12, 1993. This

was the same date that Martens was at the White House, obtained

his White House pass, assigned to report to Harry Thomason. On

this same day, Cornelius called upon World Wide Travel Agency to

send staff to Washington. By the time Watkins was assigned this

agenda item, the outcome of the Travel Office had already been decided by higher ups. He only had to determine the means; the ends

were set. Mr. Watkins only executed the directives from above.

White House officials preposterously claimed that Thomason’s efforts in obtaining Travel Office business and Government contracts

for TRM were unrelated. They clearly were contemporaneous and

overlapping as part of a larger effort to benefit from ‘‘Washington

opportunities’’ for TRM. Mr. Thomason sought to take full advantage of the access that Thomason enjoyed with President Clinton

and Mrs. Clinton.

Mr. Thomason’s business interests, ‘‘advice’’ and ‘‘staging’’ all

complemented each other. The good story of the Travel Office

clean-up was just another ‘‘image project’’ to get better press for

President Clinton and business for TRM. In order to accelerate his
61

280See memorandum from Lee Radek to Stuart Goldberg, January 11, 1996, ‘‘Subject:’’ Recommendation to Decline: Harry Thomason and Darnell Martens. AX 500000–500023. 281 CGE 7918. 282Ms. Yates worked as a financial consultant at Baird, Kurtz, and Dobson, the financial consulting firm for the Clinton-Gore Campaign. 283Memorandum from Cornelius to Watkins and Yates, December 31, 1992, Watkins document production, Bates Stamp No. JML 2551. 284 Id. 285Memorandum from Cornelius to Watkins, January 26, 1993, Watkins document production,

Bates Stamp No. JML 2558.

plans, Thomason and Martens made what turned out to be totally

baseless allegations against the Travel Office employees and

UltrAir. Even the Justice Department found no basis for kickbacks

or bribery allegations.

In contrast, the Justice Department did dismiss the criminal

charges against Thomason and Martens after a tortured reading of

the documents.280 Moreover, it took considerable gullibility to buy

into the ‘‘we lied to our memos’’ theory Martens presented concerning his memos. Given that DOJ’s Public Integrity Division never

sought these documents until after this committee obtained them,

the actions of Harry Thomason and Darnell Martens deserve additional scrutiny by the Independent Counsel. The committee has

compiled a far more extensive record of documentation that addresses a wider array of issues pertaining to Harry Thomason and

Darnell Martens.

B. CATHERINE CORNELIUS PURSUED HER INTEREST IN TAKING OVER

THE TRAVEL OFFICE FROM THE VERY FIRST DAYS OF THE TRANSITION AND INTO THE EARLY DAYS OF THE ADMINISTRATION, PROPOSING HERSELF AS CO-DIRECTOR OF THE OFFICE

The firings were long a glimmer in the eye of Catherine

Cornelius, who wanted to run the Travel Office herself. Ms.

Cornelius had a relationship with Eller, who also pushed for the

firings as early as December 1992 when he told reporters there

may be changes in the office. During the campaign, Cornelius handled travel matters along with World Wide Travel and wanted to

continue that role when she joined the White House.

During the transition, Cornelius met with Betta Carney and

Steve Davison of World Wide Travel and made suggestions to Watkins for reorganizing the Travel Office. On December 2, 1992, Betta

Carney wrote a letter to Cornelius expressing interest in the White

House Travel Office business.281

In late December, Cornelius began to prepare several memos detailing her plan to take over the Travel Office. On December 31,

1992, she sent a memorandum to Watkins and Barbara Yates 282

outlining the functions of the White House Travel Office. Cornelius

claimed in her memo that the Clinton-Gore administration ‘‘has a

unique and unprecedented opportunity to establish a comprehensive Travel Management Program for the White House.’’ 283 In her

summary conclusions, Cornelius outlines the advantages to her

plan which include the elimination of five staff positions from the

payroll, replacing those positions with those of an ‘‘out sourced

agency.’’ 284

A follow-up memo to Watkins expands on the existing structure

of the office.285 On the first day of the new administration, people
62

286Testimony of John McSweeney before the Committee on Government Reform and Oversight, January 24, 1996. 287See WHMR, exhibit F. 288Watkins contemporaneous notes of April 16, 1993, CGE 29184. These notes also reflect a

discussion with Thomason about the Secret Service. A Secret Service agent named Bob Coy is

reflected in the notes as well as some references to agents talking to Bob Woodward and a reference to someone named ‘‘George Stewart.’’ The committee has learned that George Stewart

is a private investigator from the Little Rock, AR area. It was reported that he was contracted

by the White House early in the administration to do undisclosed investigative work. 289 Handwritten notes of David Watkins, CGE 029184. 290WHMR, p. 6. 291Public Integrity 302 interview of Cornelius, September 19, 1994; Cornelius deposition, p.

70.292Ms. Cornelius was a 24-year-old, recent college graduate working in her first job. 293 Cornelius deposition, p. 70. 294Public Integrity 302 interview of Catherine Cornelius, June 9, 1993.

began calling the Travel Office asking for Cornelius, ‘‘the new head

of the White House Travel Office.’’ 286 Catherine Cornelius herself

says she was open about her ambition to run the Travel Office.

Ms. Cornelius took the job at the White House with Watkins

with the promise of a better position with a better salary. Ms.

Cornelius hoped that position to be the co-director of the Travel Office. Her desire to be the co-director had been made clear to Watkins in her February 15, 1993 memo designating herself in that position.287 It was particularly inappropriate for Cornelius to pursue

an investigation of an office in which she hoped to assume the position of director. Yet that is exactly what happened. Despite her apparent conflict of interest, Kennedy put her in front of the FBI

agents to describe a basis for a criminal investigation of the Travel

Office employees.

After several months in Watkins’ office, Cornelius was moved

over to the Travel Office in early April 1993. She was officially

tasked to handle the staff travel for White House employees including Health Care Task Force travel arrangements.

On April 16, 1993, Harry Thomason called Watkins to discuss a

number of items including the Travel Office.288 Mr. Watkins’ notes

of this conversation refer to the Travel Office and ‘‘charter press

. . . be taking kick-backs . . . ask for 5% kickbacks.’’ 289 The White

House Management Review remarked that Thomason phoned Watkins in April to pass on ‘‘allegations about corruption in the Travel

Office.’’ 290

Mr. Watkins’ notes of April 16, 1993, also reference a conversation Thomason had with Bruce Lindsey. Mr. Thomason’s phone

records show a call from Thomason’s Hollywood studio to Lindsey

the day before.

Two days later, Watkins called Cornelius into his office to tell

that there may be some wrongdoing in the Travel Office. Cornelius

told DOJ Public Integrity investigators in 1993, and the committee

in 1996, that Watkins read from a notebook as he described the allegations against the Travel Office employees: ‘‘Those guy are a

bunch of crooks. They have been on the take for years.’’ 291

Ms. Cornelius had not observed any wrongdoing at this point,

however, once the thought was planted in her mind, she started to

watch over the Travel Office employees with a new perspective.292

Mr. Watkins told her to keep her ‘‘eyes and ears open.’’ 293

Ms. Cornelius began copying receipts and records from the Travel Office and removing documents to review. One evening in April,

she carried documents to Watkins office for his review.294 In the
63

295The White House Records Management employees became very concerned after the firings

when they learned there was no control over the documents, and that Cornelius had asked for

boxes. Lee Johnson, the Deputy Director of Records Management, wrote a memo to Staff Secretary John Podesta on May 21, 1993 expressing concern over the handling of White House

Travel Office records. CGE 7763. 296Mr. Dale’s lake home held a mortgage of less than $100,000. Mr. Dale had lived in his

home in Maryland for over 30 years and his mortgage was paid. 297This evidence is derived from their testimony as well as Foster’s Travel Office notebook. 298See supra discussion of May 10–May 27, 1993. 299David Lauter and John M. Broder, Clinton Friend Defends Role in Travel Flap, Los Angeles Times, May 23, 1993.

process of copying and removing documents, Cornelius jammed a

check in the copier which was later found by one of the Travel Office employees. Cornelius also took documents home with her, a

fact known by Watkins and later by Kennedy and Foster. No one

raised any concerns about her removal of these Presidential

records.295

In the course of her time in the Travel Office, Cornelius reported

to Watkins that she thought the Travel Office employees lived beyond their means. Cornelius offered examples of this high-lifestyle

to include vacation time in Europe, ownership of a race horse and

Billy Dale’s lake home in Virginia.296

When Harry Thomason arrived in Washington on May 10, 1993,

Cornelius met with him and the two swapped stories about what

they thought would merit ‘‘a good story’’ about the Travel Office

employees. Mr. Thomason told Cornelius of his allegations that the

employees were seeking ‘‘kickbacks’’ from Miami Air. The committee now has evidence that Thomason repeated these allegations to

Mrs. Clinton, Foster, Kennedy, Lindsey, Patsy Thomasson and numerous others at the White House.297

By May 12, 1993, Thomason and Martens planned to bring

Penny Sample of Air Advantage into the White House and the

firings were on the way. The recommendations set forth in the

TRM memos and in Catherine Cornelius’ memos came to fruition

throughout the rest of the month.298

C. DARNELL MARTENS GIVES THE NOD TO HIS CAMPAIGN BENEFACTOR

PENNY SAMPLE OF AIR ADVANTAGE

Air Advantage, whose president was Penny Sample, served as

the Clinton-Gore campaign’s charter broker. Mr. Martens knew her

through the billing and consulting work that he did with Air Advantage during the campaign. Mr. Martens testified that after the

election he wanted to assist or refer Air Advantage and other campaign charter carriers in obtaining White House press charter business. Even Martens recognized the goodwill, if not financial benefits, that would flow from his help to provide these companies with

White House access.

In a May 23, 1993, Los Angeles Times article, Harry Thomason

claimed that ‘‘Darnell Martens had contacted White House Travel

Office Director Dale in February to find out how nine airline charter companies that supplied planes for the Clinton campaign could

bid for the White House business.’’ 299

Mr. Martens enlisted Sample’s assistance to provide information

on the background of the White House Travel Office and the charter airline they used. Ms. Sample began gathering information for

Martens’ memorandum. She called Airline of the Americas and re-
64

300Martens deposition, p. 73. 301 Id., p. 68. 302Martens deposition, p. 73. 303 ‘‘Travel agency in loop; Helped Clinton before election,’’ by Frank J. Murray, the Washington Times, May 21, 1993. 304 ‘‘Clinton Camp Credits Agency for Governor’s Primary Wins,’’ by Fran Golden, Travel

Weekly, September 10, 1992. 305White House press conference, May 20, 1993.

ported back to Martens the number of airplanes and where they

were located.300 She provided background information on the White

House Travel Office’s contractual arrangements with Pan Am and

Airline of the Americas for press travel charters.301 Mr. Martens

testified that Penny Sample ‘‘knows a lot about everybody.’’ He

added ‘‘that’s her job.’’ 302 In return for her undercover work,

Martens called Sample to come to the White House to take over the

charter business after the firings.

D. ARKANSAS TRAVEL AGENCY WORLD WIDE TRAVEL PROVIDED SERVICES DURING THE CAMPAIGN, OBTAINED THE DNC CONTRACT IN NOVEMBER 1992, AND SOUGHT WHITE HOUSE TRAVEL OFFICE BUSINESS

World Wide Travel played a critical role in the 1992 Clinton

Presidential campaign. In particular, the Washington Times reported that Watkins credited World Wide with:

setting up cash management practices that obtained advance payments from traveling journalists. This freed campaign money for advertising in such key states as Michigan and Illinois.

Mr. Watkins stated that World Wide’s billing arrangement with the

Clinton campaign, ‘‘allowed us to win key primaries, to have money

that otherwise would be tied up in accounts receivable to put in advertising.’’ 303 Travel Weekly explained that:

This was achieved by requiring them to pay by credit

card whereby the agency issues ghost American Express

cards to those travelers who, for whatever reason, do not

carry plastic. Representatives of the press and the Secret

Service also were required to sign a manifest each time

they boarded a plane chartered by the campaign. The

agency billed immediately and collected payment within 48

hours. . . . Because of the quick turn around, the Clinton

campaign was then able to spend the freed-up funds on advertising efforts in key primary states, such as Michigan

and Illinois.304

Ironically, World Wide’s aggressive billing led the White House

press corps to challenge Stephanopoulos’ May 20, 1993, contention

that World Wide would save the press corps money:

George, speaking of sloppy record-keeping, I don’t know

anyone on the campaign plane who ever got a detailed accounting of the charges. I think most of us just got a

charge on our American Express bill saying, ‘signature on

file,’ and had to then call up and hound World Wide Travel

to get some sort of detailed bill. I mean, did you look into

their accounting procedures at all before you selected them

as an interim travel agency? 305
65

306WHMR interview of Steve Davison, CGEPR 174. 307 Id. 308 Id. Mr. Davison had worked with Watkins and Cornelius during the campaign and thought

Watkins had placed her in the Travel Office ‘‘because he wanted to get rid of her.’’ He told investigators that Cornelius ‘‘portrayed herself as bosom buddy of BC [Bill Clinton],’’ but that she

‘‘didn’t have a clue’’ as to running a travel operation. WHMR interview notes of Steve Davison,

June 5, 1996, CGE 0174–0203. 309 CGEPR 200. 310See GAO Report on the White House Travel Office Operations, May 2, 1994. 311David Watkins GAO interview, December 9, 1993.

Ms. Cornelius called World Wide Travel to come to Washington

on May 12, 1993, asking them to be prepared to come to the White

House at any time. On May 19, 1993, after being fired by Watkins,

the Travel Office employees returned to their office to find at their

desks World Wide Travel agents.

World Wide soon realized that Cornelius had not arranged the

‘‘emergency contract’’ authorizing them to be in the White House.

Nor was the bad press following the firings doing anything for its

reputation. After 2 days in the White House, on Friday, May 19,

Steve Davison told Watkins that World Wide was leaving.306 They

finally agreed to remain through the day and leave the following

Monday when American Express was brought in to assume the duties of the fired Travel Office employees.

When the ‘‘plan began to unravel,’’ Watkins, Thomasson, and

Foucart begged World Wide Travel to stay. Special Assistant to the

President Patsy Thomasson told World Wide ‘‘we’ll give you anything you want.’’ 307 World Wide Travel later told White House investigators that ‘‘what I needed was the seven people.’’ 308 However,

the fired Travel Office employees were carted out of the White

House in a windowless van. The White House press offensive to

discredit them was well underway.

Mr. Davison explained to investigators that ‘‘no one gave any

forethought as to what would happen when the seven [Travel Office employees] left.’’ World Wide Travel said that ‘‘we felt betrayed

beyond belief.’’ 309 World Wide Travel left the White House within

2 days of their arrival.

E. CONCLUSION

Harry Thomason, assisted by Mrs. Clinton was at the center of

events leading to the firings of the Travel Office employees. Early

on in the administration, Thomason had told Mrs. Clinton and the

President about the alleged problems, and by May his rumors of

wrongdoing had spread.

The White House consistently maintained that the firings of the

Travel Office employees were due to mismanagement evidenced by

a Peat Marwick audit. There was no audit. The firings were initiated long before Peat Marwick was called, and before anyone in the

Clinton administration met the Travel Office employees. Furthermore, as the GAO report noted, if there was mismanagement in the

Travel Office, it was the responsibility of David Watkins and Patsy

Thomasson to handle.310 GAO found serious management deficiencies in the way Watkins and Thomasson managed the Travel

Office, and in the course of their GAO interviews, it became apparent that they had little working knowledge of basic Government

management regulations.311
66

312Memo from Darnell Martens to Harry Thomason, January 29, 1993, Re: TRM Action

Memo. 313Martens deposition, pp. 87–88.

The firings were discussed in December 1992, a full month before

the new administration took office. Mr. Eller told the press in December 1992, that there might be changes in the Travel Office. The

firings were decided upon in order to advance the personal agendas

of Presidential friends and family, long before any wrongdoing or

mismanagement was alleged. It is clear from the volume of documents and testimony that the committee has obtained that the decision to fire the employees was made first—in order to push the

interests of Clinton friends and family—and the rationale came

later.

V. HARRY THOMASON PURSUED OPPORTUNITIES IN GOVERNMENT

CONTRACTS THROUGH HIS RELATIONSHIP WITH THE PRESIDENT

WHICH WOULD HAVE RESULTED IN A FINANCIAL BENEFIT TO HIM

AND HIS COMPANY

While Harry Thomason was spreading rumors of wrongdoing in

the Travel Office, he and Martens were seeking other Government

business, including a quarter of a million dollar Government contract. The January 29, 1993, memo discussed above was a laundry

list of ‘‘Washington opportunities’’ for TRM.312 One of the ‘‘opportunities’’ Martens sought for his and Thomason’s company was a consulting project to review ‘‘the operational and fiscal soundness of all

federal non-military aircraft.’’

On February 10, 1993, Martens was surprised to hear President

Clinton discuss the idea on television because he had not yet had

a chance to formally put something together on the topic:

Question. Okay. In the memo, you talk about the fact

that the President had stated in a Cabinet meeting that

his staff had informed him that there were savings to be

had in the review of government aircraft.

Answer. Yes.

Question. Did you actually see that on CNN?

Answer. Yeah. I was in a hotel room getting dressed in

the morning and saw it.

Question. Did Harry give you any information or did you

receive any information that the President was going to

bring up basically your project in a Cabinet meeting?

Answer. No, because it’s—I was amazed. In fact, I was

stunned. That’s why I put it in here. Because it’s opposite—I hadn’t put it in a memo yet, and to my knowledge

Harry hadn’t been back to see him so—because that was

the purpose of putting this memo together, so Harry would

understand what I was talking about, and then he said he

would mention it to him if he had a chance.313

Mr. Martens put together the February 11, 1993, memo. While

Thomason has portrayed this as something Martens was pushing,

it was Thomason who had the access to brief the President. In the

February 11 memo, Martens said, ‘‘Put me in front of the right per-
67

314 Confidential memo to Harry Thomason from Darnell Martens, Re: White House Inventory

of the Federal Aircraft Fleet, CGE 2223. 315Podesta deposition, p. 54. 316Podesta deposition, p. 54. 317Thomason deposition, pp. 118, 122. 318Darnell Martens sends Bruce Lindsey a cover note on April 6, 1993 forwarding his February 11, 1993 memo describing it as a memo ‘‘which was presented and discussed with the

President in mid-February.’’ CGE 002227. 319 Intercompany memorandum from Darnell Martens, president to Harry Thomason, chairman, Re: Federal Aircraft Management Information System (FAMIS), on TRM, Inc. stationery,

March 12, 1993, CGE 002224. 320Lindsey deposition, p. 30.

son at the White House and I will prove the value of both the

project and Thomason’s capabilities.’’ 314

Mr. Martens explained:

We’ve demonstrated our capabilities to the President by

coordinating all aircraft activities for the Clinton For

President Committee, the Clinton/Gore ’92 Committee and

the Clinton/Gore Transition Team. . . . Harry, I can state

without qualification that TRM is uniquely qualified to

conduct this study.

Again, Martens viewed these contracts, as he had the Travel Office

business, as a reward for good service to the Clinton-Gore campaign. There are no written documents from Thomason disabusing

him of that notion and certainly Thomason’s actions on behalf of

TRM kept Martens encouraged.

The February 11 memo was forwarded to McLarty, Gearan and

Watkins, with a note indicating that the President had reviewed

the material and forwarded it to them for ‘‘Action.’’ Written on the

memo was a note for McLarty from the President: ‘‘Mack—These

guys are sharp—shd [should] discuss w/Panetta/Lader.’’ Staff Secretary Podesta could provide no information as to what ‘‘Action’’

the President intended be taken on this memo.

Mr. Podesta first became aware of the memo when it showed up

in the President’s ‘‘out box.’’ 315 As Staff Secretary, Podesta was responsible for the daily flow of paperwork in and out of President

Clinton’s office. Mr. Podesta had never seen the February 11 memo

go into the President’s office but he did see it coming out.316 Mr.

Thomason spent the night in the White House residence on February 16, 1993, and even bowled that evening with the President.

While Thomason distinctly remembers beating the President at

bowling that evening, he has ‘‘no recollection’’ of giving the President the February 11, memo soliciting the GSA contract for his

company TRM.317 Since Martens later refers to this in an April

memo and mentions that Thomason discussed it with the President, it is clear Thomason did give the President the memo.318

On March 12, 1993, Martens sent Thomason another memo

about the proposed Federal aircraft study and refers to a discussion

Thomason had with the President about the February 11, 1993

memo: ‘‘Based on your discussion with President Clinton of my 2/

11/93 memo, I began the process of obtaining specific information.’’ 319 This memo provides an overview of the proposed project.

By April 1993, Thomason had put Martens in touch with Bruce

Lindsey who took care of aviation matters in the White House,320

although his official position at that time was head of Presidential

personnel. On April 6, 1993 Martens faxed Lindsey his February
68

321 CGE 002227. 322 Id., p. 39. 323Memorandum for Leon Panetta from Roy Neel, August 25, 1993. CGE 017597.

11 memo, detailing a ‘‘follow-up memo to Harry’s meeting with the

President.’’ The memo discussed the cooperation of ICAP [Interagency Committee on Aviation Policy] and a work summary estimating a 1-year timeframe for the project and the estimated costs.

The cover letter again noted TRM’s ‘‘loyalty to the Administration.’’ 321

The following day Martens met with Lindsey to discuss the

project. He sent Lindsey a follow-up memo on April 12, 1993 ‘‘recommending that the Office of the President initiate an operational

and financial audit of all non-military Federal aircraft.’’ He wanted

to do this by working with ICAP and GSA participation, but it was

clear that the project was to be White House based. Martens recommended an Executive order to get the project moving.

By April 26, 1993, Martens sent a note to Lindsey to see if any

action had been taken and reminded Lindsey that Thomason would

be in the White House that coming Friday and Saturday. He wanted to see if Thomason could follow up with Lindsey at that time.

Martens sent Lindsey another summary of the proposed audit on

April 29, 1993.

Lindsey claims that throughout this time, he had no idea that

TRM had any connection with Thomason.322 This is not credible

given that the meetings were initiated by Thomason and that some

of the memos sent to Lindsey had a letterhead which read, ‘‘Harry

Thomason & Associates.’’

Clearly, as with the Travel Office business TRM sought,

Thomason and Martens were capitalizing on Thomason’s access to

the White House. The GSA/ICAP contract was being designed so

that Martens could officially work at the White House, thus explaining why he was issued a pass on May 12, 1993, upon arriving

at the White House. While at the White House, Martens would also

be able to provide assistance as needed in the new Travel Office.

Mr. Thomason had already begun work on various projects at the

White House. These included projects such as how to use excess

Presidential inaugural funds for paying extra White House staff,

and the staff cuts issue in addition to his ‘‘staging’’ duties at the

White House.

Mr. Thomason had a financial interest in White House business.

Despite his protestations that he was too rich to care about any of

this business, he was maximizing his connections to keep his fledgling aircraft business and Martens afloat. It is significant that Podesta was aware of Thomason’s efforts from the first day he was

tasked with the Management Review. Despite the fact that the review addressed ‘‘conflicts’’ and ‘‘appearances of impropriety,’’ the

White House totally ignored Mr. Thomason’s conflicts.

Furthermore, this project was not eliminated once the Travel Office firings occurred. It was not until sometime in August 1993,

that then-Deputy Chief of Staff Roy Neel wrote current Chief of

Staff and then-OMB Chief Leon Panetta a memo saying that no action should be taken on the project.323 By this time, the Justice Department’s criminal investigation on Harry Thomason’s possible

conflicts of interest was underway and no doubt, a second conflict
69

324The category of a ‘‘special Government employee’’ was established by P.L. 97–849 (1962),

to facilitate recruiting persons with specialized knowledge and skills to serve Government without applying the full range of conflict of interest laws that apply to regular Government employees. See, S. Rept. No. 2213, 87th Cong., 2d Sess. (1962), reprinted at 1962 U.S. Code Cong. &

Ad. News 3852–3853. 325 18 U.S.C. 202(a). 326White House ethics counsel came to this conclusion when reviewing the activities of Harry

Thomason. See CGE 43349. 327 As will be discussed later, these sections restrict regular Government employees from representing anyone except the Government before a court or Government agency in a particular

matter in which the United States is a party. However, this only applies in relation to a covered

matter involving a specific party or parties in which the Government employees at anytime have

participated personally and substantially for the Government, or which is pending in the department or agency in which the special Government employees are serving. The restriction on representation on any pending matter does not apply to special Government employees who have

served in a department or agency for not more than 60 days of the last 365 consecutive days.

had to be put to bed. Was Foster aware about this second looming

conflict?

VI. EMPLOYMENT STATUS OF SELECTED ADVISORS TO THE

PRESIDENT

One of the Federal personnel regulations to which every White

House is expected to comply is the ‘‘Special Government Employee

laws.’’ 324 The committee’s investigation has revealed a general lack

of attention that all executive branch agencies in the Clinton administration paid to the status of their advisors and volunteers.

This is especially true of a White House which President Clinton

pledged would be the most ethical ever.

A. SPECIAL GOVERNMENT EMPLOYEE DEFINED

The United States Code defines a special Government employee

(SGE) as a person who is ‘‘. . . retained, designated, appointed, or

employed to perform, with or without compensation, for not to exceed 130 days during any period of 365 consecutive days. . . .’’ 325

If the period of employment exceeds 130 days during any period of

365 consecutive days, that individual should be considered a regular Government employee, with or without compensation.

The law is clear that a person who performs work as a Federal

employee cannot evade the conflicts laws simply by avoiding formal

appointment to office.326 Thus, a consultant or advisor who is not

a regular Government employee may be a special Government employee for purposes of the conflicts of interest laws.

While regular and special Government employees are treated the

same under the conflict-of-interest requirements of Title 18 U.S.

Code Sections 204, 207, 208, and 209, they are treated differently

in the conflict-of-interest provisions included in Sections 203 and

205.327 Section 216 of Title 18 sets out the criminal penalties for

willful and non-willful violations of 18 U.S.C. Sections 203, 204,

205, 207, 208, or 209. Section 216 also provides the Attorney General with the option to bring a civil action for damages or seek an

injunction against a person who engages in conduct constituting offenses under the conflict-of-interest provisions.

Section 211 of Title 18 prohibits any SGE from improper use of

title or position. This prohibits the use of a SGE’s influence in return for money or any thing of value. Government employees also

must comply with the Standards of Conduct regulations for all executive branch employees including regulation of gifts, disclosure of
70

328 ‘‘Conflict of Interest-Status of an Informal Presidential Advisor as a ‘Special Government

Employee’ ’’, 1977 OLC Lexis 9; 1 Op. O.L.C. 20, February 24, 1977. See also, OGE Op. 82x22. 329 5 U.S.C. Sections 2104, 2105. 330See Bayless Manning, Federal Conflict of Interest Law, pp. 29–30 (1964).

non-public information, use of official property for unofficial purposes, and outside activity that conflicts with Government duties.

B. AN INDIVIDUAL MAY UNDERTAKE CERTAIN ACTIVITIES THAT QUALIFY FOR A SPECIAL GOVERNMENT EMPLOYEE STATUS WITHOUT FORMAL APPOINTMENT

The Justice Department’s Office of Legal Counsel issued an opinion concerning the status of advisors to the President and whether

their act of providing advice to the President qualifies them as a

SGE is found in an opinion of the Justice Department’s Office of

Legal Counsel.328 The Office of Legal Counsel found that although

‘‘the term ‘employee’ is not defined in the conflict-of-interest laws,

it was no doubt intended to contemplate an employer-employee relationship as that term is understood in other areas of the law.’’

Beyond the definition of SGE, discussed above, Title 5 of the

United States Code identifies several criteria to determine whether

a person is an ‘‘officer’’ or ‘‘employee’’ of the United States.329 As

a matter of first principles, an individual obviously is an officer or

employee if ‘‘properly appointed.’’ The first SGE requirement, however, only requires that the individual be ‘‘retained, designated, appointed, or employed.’’ There are two other criteria whereby an individual may become an officer or employee, when that individual

has not been formally appointed. If the person:

—is engaged in the performance of a Federal function under

authority of law; and

—is subject to the supervision of a Federal officer or employee.

The Office of Legal Counsel, and supporting materials prepared

by the Office of Government Ethics, stress that any determinations

of an individual as a SGE must be performed on a case-by-case

basis. A leading commentator on the subject, cited in the OLC opinion, is Professor Bayless Manning. He suggests several questions to

be posed if the individual does not have a formal designation. He

writes:

Is the person’s advice solicited frequently? Is it sought

by one official, who may be a personal friend, or impersonally by a number of persons in a government agency that

needs expert counsel? Do meetings take place during office

hours? Are they conducted in the government office, and

does, perhaps, the adviser maintain a desk or working materials in government facilities?330

It may be helpful to provide a few examples of when individuals

are or are not considered SGEs based on the assistance they provide to the Federal Government.

Example 1: A question has arisen as to whether Mr. A

should be regarded as an SGE for purposes of the Federal conflict-of-interest laws. Generally, Mr. A advises the President almost daily, principally on an informal basis. This essentially
71

331See 1977 (Counsel-Inf. Op.) 1 Op.O.L.C. 20. 332See United States v. Mississippi Valley Generating Co., 364 U.S. 520, 552 (1961). 333See 18 U.S.C. Sec. 201 nt., for a reprint of this memorandum.

personal relationship would not in itself result in Mr. A’s being

a SGE.

Example 2: Mr. A, from the example above, departs from his

usual role of an informal adviser to the President in connection

with his recent work on a current social issue. Mr. A has called

and chaired a number of meetings that were attended by employees of various agencies, in relation to this work, and he has

assumed considerable responsibility for coordinating the administration’s activities in that particular area. Mr. A clearly

is engaging in a governmental function when he performs

these duties, and he presumably is working under the direction

or supervision of the President. For this reason, Mr. A should

be designated an SGE for purposes of this work.331

Example 3: An expert in policy analysis was used as a consultant by staff of the Office of Management and Budget. Although he took no oath of office, had no tenure and received

no salary, he is still an SGE due to the nature of his relationship with individual members of the OMB staff.332

Example 4: The First Lady of the United States is not an

SGE however frequently she might advise the President or

make policy recommendations.

C. TREATMENT OF SGES IN THE EXECUTIVE BRANCH

Once a person is deemed to be an SGE, he is subject to the criminal conflict of interest provisions included in Title 18 of the United

States Code and must file periodic financial disclosure forms as

well.

The term ‘‘special Government employee,’’ as defined in Section

202(a), is used in sections 203, 205, 207, 208, and 209 of Title 18.

A January 28, 1963, memorandum from the Attorney General highlighted the similarities and differences among conflict-of-interest

statute applications to regular and special Government employees

under these statutes.333 Special and regular Government employees are treated similarly in sections 207 and 208 of Title 18 of the

U.S. Code.

Section 205 prohibits a Federal employee from personally representing another before a Federal agency, with or without compensation. Specifically, Section 205 prohibits a Federal employee

from acting as ‘‘agent or attorney’’ for anyone before any Federal

agency in connection with any particular matter in which the United States is a party or has a direct and substantial interest.

Section 207(a) restricts employees after leaving Government

service from representing anyone other than the Government in

connection with a particular matter:

(1) in which the Government is a party or has an interest,

(2) in which he or she participated personally and substantially, and
72

334 In section 207, the term ‘‘participated’’ means an action taken as an officer or employee

through decision, approval, disapproval, recommendation, rending of advice, investigation, or

other action. 335 At the request of an agency, the Director of the Office of Government Ethics may waive

this prohibition if the Director determines that imposing it would create an undue hardship in

obtaining qualified personnel and granting the waiver would not create the potential for gaining

undue influence or unfair advantage.

(3) which involved a specific party or specific parties at the

time of the participation.334

Section 207(c) places a 1 year restriction on senior level officers

and employees from representing anyone other than the United

States before his or her former department or agency after terminating Federal employment. This restriction does not apply to

SGEs who serve less than 60 days in a 1-year period before terminating their employment.335

Section 207(d) applied the 1-year restriction discussed in 207(c)

to ‘‘very senior’’ personnel, i.e., the Vice President, officials at Executive Schedule levels I and II, and certain persons on Presidential

and Vice Presidential staffs. Unlike those covered by subsection (c),

officials covered by subsection (d) also may not undertake any representation before any Executive Schedule levels I through V person in any executive branch department or agency.

Section 207(f) restricts any person subject to restrictions in subsections (c), (d), or (e), from representing a foreign entity before any

department or agency or aiding or advising a foreign entity with

the intent to influence a Federal Government decision within 1

year after terminating employment.

Section 208 permanently restricts both special and regular Government employees, unless exempted, from participating personally

and substantially in a governmental capacity in which they, their

spouses, minor children, general partners, organization in which

they serve as a director, trustee, general partner or employee, or

any person or organization with whom they are negotiating or have

an arrangement concerning prospective employment, have a financial interest. A person may act in a governmental capacity through

such things as decision, approval, disapproval, recommendation,

rendering advice, investigation, or otherwise, in a judicial or other

proceeding application for request for ruling or other determination, contract, claim, controversy, charge or accusation.

Exceptions may be granted in a number of circumstances. For example, an officer or employee may avoid this restriction if he or she

first advises the appointing official of the nature and circumstances

of the proceeding or other governmental action, and makes full disclosure of the financial interest and receives in advance a written

determination by the appointing official that the interest is not so

substantial as to affect the integrity of the services of the officer

or employee.

1. Michael S. Berman’s activities at the Clinton White House

In many ways, the experience of Michael S. Berman is representative of the manner in which the Clinton administration views its

obligations under Federal personnel laws. According to his deposition before the committee, Mr. Berman was adjudicated to be a

special Government employee by the Department of Justice when
73

336Deposition of Michael Berman, p. 11. 337 Id., p. 17. 338 Id., pp. 17–18. 339 Id., p. 55.

he volunteered to assist in the Senate confirmation of Webster

Hubbell.

Mr. Berman testified that the ‘‘appropriate ethics office’’ at the

Department of Justice determined that to perform these duties, Mr.

Berman would have to be classified as an SGE and comply with all

of the conflicts of interest laws when it came to representing his

clients before the Justice Department. Mr. Berman complied,336

and while he did not file a financial disclosure statement, he did

understand that:

There was a requirement that I could not do any business at the Department during the period of time, and I

didn’t do any.337

This attention to Federal law by the Clinton administration

ended when Mr. Berman left the Department of Justice and became a volunteer at the White House. Again, according to his testimony before this committee:

Question. Was there any prohibition placed on you doing

work at the White House while you were at the Department of Justice?

Answer. No.

Question. Similarly, was there any prohibition placed on

your company generally at the White House?

Answer. No.

Question. During the period that you had the—were on

the access list, did you fill out any disclosure forms or

similar forms?

Answer. No.

Question. And was there any prohibition on you doing

other activities at the White House while you were on the

access list?

Answer. No.338

While Berman was at the White House to assist in the Supreme

Court nomination of Ruth Bader Ginsberg and advise on the Senate confirmation of Webster Hubbell, he also provided advice to numerous Clinton senior staff. It appears that he was performing

many of the same duties at the White House as he had performed

at the Department of Justice. This includes attending meetings, offering advise on management practices, drafting memos, issuing reports, etc. Naturally, he still was functioning as a special Government employee. The committee found no evidence that the Clinton

White House, unlike the Department of Justice, ever bothered to

inquire or evaluate his status.

During Mr. Berman’s deposition, he was asked:

Question. Did anyone at the White House ever discuss

with you special government employee issues or status of

special government employees at the White House?

Answer. No.339
74

340Mr. Berman testified that Bruce Lindsey handled issues relating to the airline industry

for President Clinton. 341 Id., pp. 85–86. 342For more information on the activities of Harry Thomason while at the White House, see

memorandum to Lee J. Radek, Chief, Public Integrity Section, Criminal Division, U.S. Department of Justice from Stuart M. Goldberg, Senior Litigation Counsel and Raymond N. Hulser,

Trial Attorney, Public Integrity Section, Criminal Division, Recommendations to Decline: Harry

Thomason and Darnell Martens, January 11, 1996. See also, memorandum from Beth Nolan,

Associate Counsel to the President, to Cliff Sloan, July 14, 1993.

This lack of attention to statutory requirements is very troubling

when repeated instances of such ethical lapses are uncovered. This

issue is of particular importance because Mr. Berman admits to

representing outside clients during his work at the White House.

Mr. Berman testified to his numerous telephone calls to Bruce

Lindsey concerning certain airline industry clients that he was representing.340 He testified:

Answer. The White House has a role in deciding, along

with DOT—I represent United Airlines—as to whether or

not United Airlines will fly from Chicago to Heathrow, or

American Airlines will fly from Chicago to Heathrow. And

if there were a series of calls—some of them may well have

been social, but my guess is that—and I don’t know specifically, but there were some cases in ’95, and Bruce

[Lindsey] is one of the people in the White House that one

contacts if you are interested in aviation issues. That was

part of his portfolio.

Question. So this call would have been made in your capacity as part of the Duberstein Group?

Answer. Yes.341

Such representation of a private interest while also an employee

of the Federal Government appears to collide with the restriction

contained in Section 205, discussed above, which prohibits a Federal employee from acting as ‘‘agent or attorney’’ for anyone before

any Federal agency in connection with any particular matter in

which the United States is a party or has a direct and substantial

interest. Obviously, if Berman was a special Government employee

while in the White House, a review of his activities in relation to

all of the conflicts of interest and standards of conduct regulations

needs to be undertaken.

2. Activities of Harry Thomason and Darnell Martens

Harry Thomason is a Hollywood television producer and personal

friend of the President and First Lady. He was involved in a variety of aspects of the Clinton/Gore campaign from the primary season through the November 3, 1992 election.342 After raising large

amounts of money for the Clinton campaign, Mr. Thomason flew in

from California to assist Mr. Clinton in the pivotal New Hampshire

primary and produced the ‘‘Man from Hope’’ video for the 1992

Democratic Convention, among other things. Mozark Productions,

the Hollywood production company owned by Harry Thomason and

his wife, Linda Bloodworth-Thomason, became known as the 1992

Clinton campaign’s ‘‘second campaign headquarters’’ as a result of

all the activities undertaken there on candidate Clinton’s behalf.

The Los Angeles Times reported,
75

343 ‘‘Designing Presidential Politics; Television: Behind the Scenes [With the BloodworthThomason’s],’’ by Diane Haithman, Los Angeles Times, July 25, 1992.

The Thomason’s production company, Mozark, has become known as the ‘‘second campaign headquarters’’ for

Clinton—and has become Hollywood’s own little slice of

Arkansas. Clinton’s brother, Roger, 35, who works as a

$500-a-week production assistant on ‘‘Designing Women’’

and ‘‘Hearts Afire’’, and that each day the ‘‘Clinton Clipper,’’ a collection of the day’s articles and headlines on the

campaign, appears on the office fax machine.343

Mr. Martens was an executive with Executive Jet in Cincinnati,

OH when he first met Thomason in the late 1980s. In November

1991, they incorporated Thomason, Richland & Martens, Inc.

(TRM), an aviation consulting firm in Cincinnati. Mr. Thomason

and Mr. Martens each were one-third partners in TRM along with

Dan Richland, the Thomasons’ Hollywood agent.

In January 1992, Mr. Thomason introduced Mr. Martens to thenGovernor and Mrs. Clinton at a campaign fundraiser luncheon in

Los Angeles. He also suggested that Mr. Martens go to Little Rock

to see if he could assist the Clinton campaign there. Mr. Martens

did so and, for the duration of the 1992 campaign, Martens assisted

in the chartering of aircraft for the campaign. Martens reviewed

charter contracts and rates, determined whether they were proper,

checked certifications and so forth.

While TRM never had a formal contract with the Clinton campaign, Martens charged a brokerage commission or a consulting fee

for TRM’s work, depending on the size of the charter. For corporate

aircraft, Martens worked through Executive Jet. After interviewing

several brokers for larger airplanes, he selected Air Advantage of

Albuquerque. Through Air Advantage, he came to know, and work

with, Penny Sample, Air Advantage’s president. Ms. Sample’s activities are discussed below.

In March 1993, Thomason was asked to come to the White House

and provide guidance on ways to better use the White House for

public relations events and improve the President’s image. An itinerary for a series of meetings at the White House was developed

and Thomason was provided a White House pass.

At the White House, Thomason was given access to a telephone

and computer, as well as office space in the East Wing. He was

even listed in a White House phone directory. Mr. Thomason received no compensation from the Government for his work at the

White House. He was appointed to no Government position, had no

title and took no oath of office.

As was discussed in detail in the overview chapter, Mr.

Thomason and his business partner Darnell Martens clearly were

central players in events that led to the firings in the Travel Office.

In fact, the chronology clearly evidences Mr. Thomason’s involvement in nearly every aspect of the management of the White House

during the early months of the Clinton administration.

As early as February 1993, Mr. Thomason approached senior

Clinton administration officials to discuss possibilities for his company to bid on lucrative aviation contracts with the Federal Government. Messrs. Thomason and Martens were seeking a several
76

344Memorandum from Stuart M. Goldberg, Senior Litigation Counsel and Raymond N.

Hulser, Trial Attorney, Public Integrity Section, Criminal Division, to Lee J. Radek, Chief, Public Integrity Section, Criminal Division, January 11, 1996. 345 Justice Department memorandum, p. 22.

hundred thousand dollar sole source Government contract to perform a review of all civilian Government aircraft. They worked

with Bruce Lindsey and communicated with the President about

these activities in the spring of 1993.

While working at the White House, Thomason told President

Clinton about alleged problems at the White House Travel Office.

Mr. Thomason subsequently spread Travel Office rumors to various

staffers about alleged ‘‘kickbacks’’ solicited by Travel Office personnel. Mr. Thomason was involved in efforts to implement the socalled 25 percent personnel cuts at the White House. He authored

‘‘The White House Project,’’ and worked on management problems

in the Correspondence Office. His duties clearly went beyond the

scope of the imaging project.

The White House Travel Office Management Review, the General

Accounting Office review and the Department of Justice each concluded that Messrs. Thomason and Martens should not be considered special Government employees for the purposes of his dealing

with the Travel Office matter and, as a result, were not required

to abide by conflict-of-interest statutes. However, each of these reports relied upon the limited fact pattern found in the White House

Management Review.

The committee’s investigation uncovered numerous documents

which directly support the conclusion that Mr. Thomason fulfilled

the requirements of an SGE. Moreover, Thomason appeared to be

pursuing his personal financial business each day while he was at

the White House in violation of the conflict of interest statutes.

Throughout the 3 years of investigation, we have seen the elaborate steps taken by White House counsel to hide pieces of this material from other legitimate investigative bodies.

On January 11, 1996, the Department of Justice determined that

neither Harry Thomason nor Darnell Martens were subject to the

provisions of 18 U.S.C. Sections 208 or 208 and, therefore, should

not be prosecuted.344 Due to the narrow interpretation the Justice

Department reads into the SGE statute, we believe its analysis was

flawed for several reasons. After reviewing the law, which the committee also believes that it should be reviewed during the next

Congress. The Justice Department’s conclusions will be addressed

individually here.

a. The Justice Department found that there is no evidence

that Martens or Thomason had any formal status as a

Government employee or special Government employee 345

The Department points out that neither was appointed to a position, took an oath of office or received a title, that the personnel

office did not keep a file on them, they did not seek a regular appointment, receive compensation, or hold themselves out to be a

Government employee. It comes as no surprise that the Clinton

White House did not require its volunteer workers to take an oath

or otherwise review applicable statutes regarding the activities of

Government volunteers. One thing that the American people have
77

346 364 U.S. p. 552. 347 Id. 348 Id. 349 Id., p. 23. Footnote 36.

learned over the last several years is that this White House was

hardly vigilant when it came to such details.

Harry Thomason was asked, however, to assist in the White

House by the President of the United States and regularly worked

with numerous senior administration officials. He was given a

White House pass and the paperwork submitted for his pass indicates he was to ‘‘report’’ to President Clinton. The frequent number

of telephone calls and meetings with the President or Mrs. Clinton

clearly demonstrates their supervisory nature. Finally, the receipt

of compensation is not a requirement to become a Government employee.346 Beth Nolan’s review of this section pointed out that a

person cannot avoid being designated an SGE merely because there

has not been a formal appointment.

b. The Justice Department found that there is not sufficient

evidence that either Thomason or Martens was a de facto

Government employee or special Government employee or

that they sought to avoid the formalities of Government

office in an effort to skirt the conflict of interest laws 347

Contrary to the Justice Department’s findings, it would be difficult to imagine a more clear example of a de facto Government

employee than Harry Thomason. He was asked by President Clinton to come into the White House to assist in developing a successful management structure at the White House, certainly a Government task. He received a ‘‘hard pass’’ for easy entry into the White

House, which were hard to get for even regular White House employees. He had a telephone, desk, and office in the White House.

Harry Thomason was even listed in the White House telephone directory.

Furthermore, an ‘‘intentional’’ effort to skirt the conflict of interest laws would be informative when determining whether someone

meets the definition of Government employee, but it would not be

determinative. What is required, as discussed above, is an employer-employee relationship characterized by typical criteria.

c. The Justice Department found that insufficient evidence exists that Thomason performed a Federal function or

acted under the supervision of a Federal employee 348

The Department’s memo included a shocking footnote:

Thomason might also argue that his imaging project,

which focused on communicating President Clinton’s message more effectively, was political campaign work,

rather than federal government work. In fact, the proposal that Thomason prepared suggested the use of inaugural funds for its implementation, rather than government funds.349 (Emphasis Added).

It is startling that the Department of Justice would argue that a

private individual may have been performing campaign work out of

the White House, using Federal Government resources such as
78

350 Id., p. 24. 351 Id.

computer equipment, telephones, etc., and then disregard the implications of that admission.

The committee disagrees with the Department’s suggestion, however, that the work of Thomason and Martens was campaign related, rather than governmental. Mr. Thomason’s ‘‘imaging project’’

was similar to the type of work performed by press secretaries

throughout the Clinton administration. In fact, a good portion of

the current White House Counsel’s Office devotes its resources toward improving the ‘‘image’’ of the President.

Beyond the imaging project, however, Thomason additionally

helped to reshape the entire management structure at the Clinton

White House. The chronology provided in this report clearly demonstrates his involvement in numerous management issues, many

far beyond the scope of Presidential imaging.

Given that broad range of job duties, it stands to reason that Mr.

Thomason would make recommendations on the efficiency and effectiveness of White House offices and that his changes would immediately be implemented. What is not allowed, however, is that

he would base his recommendations in pursuit of his own financial

interests.

d. The Justice Department found that both men participated

in some manner in the inquiry concerning the Travel Office—at minimum providing information relevant to the

decisionmakers. It is not at all clear, however, that such

participation would qualify as ‘‘substantial’’ under the

statute 350

Given the lack of cooperation the Clinton White House provided

to and was accepted by the Justice Department, one can quickly

see how its analysis would conclude that the activities of Thomason

and Martens were minimal. Facts uncovered by the committee,

however, suggest just the opposite.

A review of the chronology of events, provided earlier in this report, suggests that Harry Thomason in particular was involved in

White House activities nearly every day, including numerous telephone calls to Government officials and private meetings with the

President, Mrs. Clinton, and the Chief of Staff. Copies of official

correspondence were routinely sent to Thomason as though he was

a regular member of the White House staff, and meetings were

scheduled to include Thomason at the White House. In the days

leading up to the firing of the Travel Office workers, Thomason

spent nearly all of his time in meetings or telephone calls discussing the operations of the Travel Office.

e. The Justice Department found that Thomason and Martens

clearly had no decisionmaking role 351

Once again, the Department makes a conclusion which ignores

the realities of Government service. Neither Thomason nor

Martens were required to ‘‘sign’’ documents attesting to their decisionmaking role. But, given the fact that at least Thomason was introduced to the White House staff as a close friend and advisor to
79

352 Id. 353 Nolan memorandum, p. 6, CGE 43265.

the President, who occasionally spent the night at the White

House, their influence was surely felt. That influence should not,

by itself, suggest that Thomason or Martens were Government employees, but in an analysis of the facts, it would be inappropriate

and not very realistic to conclude that Thomason or Martens lacked

a decisionmaking role.

The committee also questions whether holding a decisionmaking

role is a vital step to being considered a Government employee.

Thousands of Government employees are hired to advise more senior officials on what decisions to make. Their services are sought

for the quality and type of advice they provide, not the decisions

they make.

f. The Justice Department found that even if we could establish that they had some employment status, we would

have difficulty establishing that the employment was connected with the Travel Office 352

The Department echoes a view discussed in an analysis by the

White House which suggests that an individual can be deemed a

Government employee for some circumstances but not for others. In

effect, according to this analysis, an individual can wear two hats.

One moment, they can meet with a senior Government official to

advise them on what steps that official should take to make the

President ‘‘look better’’ in public functions. The next moment they

advise that same Government official on how the Government

should buy services offered by the advisor. The committee rejects

that conclusion.

When an individual gains special status by accepting a Government official’s request for help, they should not try to use that

privilege for profit. The committee refuses to accept the conclusion

that the Congress, when drafting the Government employment

statutes, meant to allow individuals to profit from the Government

at a time when they held special authorities provided by the Government. The committee agrees that Congress should revisit the

Government employment statutes to ensure that agencies abide by

their obligations to determine when volunteers become Government

employees. But the committee does not believe that current law

should be read to allow volunteers to become profiteers.

In a revealing inter-office memorandum, White House Associate

Counsel Beth Nolan opined:

When viewed as a whole, the facts revealed in the

[White House Travel Office Management] Report could

support a conclusion that Mr. Thomason was an uncompensated consultant with the status of a special government employee, by virtue of his assignment to consult on

the staging of presidential events . . . the matter is not

free from doubt, and we should proceed to analyze Mr.

Thomason’s conduct as if he were a government employee.353

Although this document was kept from the committee for years

under claims of executive privilege, even Nolan’s limited review of
80

354 Id., p. 11.

the few facts she had, determined that Harry Thomason likely was

a special Government employee. However, Nolan went on to repeat

the Department of Justice’s reasoning that even if Thomason was

an SGE for the purposes of the imaging project, such a status

should be compartmentalized and should not have an impact on his

other activities. Specifically, she stated,

Harry Thomason may have been a special government

employee with respect to the assignment he was given to

consult on staging presidential events, but this did not

convert him into a special government employee for other

matters, including the Travel Office.354

Not only did Nolan only rely on the facts provided in the White

House Travel Office Management Review, but she did not discuss

how, if Thomason was a special Government employee, his activities could be compartmentalized so as to allow him to represent his

personal business interests when he was not wearing his SGE hat.

Nothing in the legislative history suggests that Congress meant to

allow a President to bring his campaign staff into the White House

as part time SGEs, introduce them to influential contracting officers throughout the Government, allow them to gain inside advantages on other Government contracts, and then bid on Government

business simply by taking off their SGE hat. The theory that an

SGE could change his status as easily as walking into another

room is bad public policy and not found in any legitimate reading

of the statute.

In the final analysis, the committee believes that when viewed

in light of the totality of activities taken on by Thomason, he

should be viewed as a special Government employee. Previous analysis of this matter was fatally flawed, however, due to the lack of

cooperation by members of the White House staff who intentionally

withheld information from Government officials seeking to investigate the White House activities of Harry Thomason and Darnell

Martens. Because Martens acted more as an assistant to

Thomason, without the same trappings of approval by the White

House, the committee is not prepared to conclude that he meets the

definition of SGE. That does not suggest, however, that the committee condones his efforts to use the special access afforded

Thomason to profit at the public’s expense.

As suggested, the committee’s investigation was further frustrated by a convenient lack of memory regarding the circumstances

of Thomason’s activities at the White House. Individuals who could

otherwise remember precise details about some of their activities

throughout 1993 made inconsistent or even conflicting statements

about their relations with Thomason. Once again, we have seen a

friend of the President’s ‘‘air brushed’’ out of internal reports and

statements since the early days of the Clinton administration. Even

further, Harry Thomason refused to cooperate with the General Accounting Office and refused to be interviewed a second time for the

White House Travel Office Management Review. Without the force

of a subpoena, Thomason very likely would have refused to cooper-
81

355General Accounting Office Report, pp. 67–68.

ate with this committee as well. Further inquiry should determine

whether this lack of cooperation was criminal.

3. Activities of Penny Sample

What is less disputed is that Penny Sample, president of Air Advantage, was a special Government employee for the purposes of

assisting in White House Travel Office operations following the

May 19, 1993 firings. On May 20, 1993, after the Travel Office

workers had been terminated, Sample was brought into the White

House Travel Office as a volunteer worker. In her interview with

the General Accounting Office, she stated that she had:

. . . made charter arrangements for the Clinton campaign. She reported that she was contacted on May 17 or

18 by Mr. Martens, with whom she had worked during the

campaign, to inquire about her availability to work in the

White House Travel Office. She was asked to call Ms.

Cornelius, who inquired if she would be available to provide temporary assistance in the procurement of aircraft

charters for the White House press corps without compensation. She agreed to do so but said that she could only

do so for a short period of time.355

Ms. Sample did not leave that post until June 2, 1993 following

revelations that she had received a commission from the first airline charter that she had booked for a White House Travel Office

trip to New Hampshire on May 22, 1993. Air Advantage forwarded

the $52,000 to Midwest Air.

It is clear from the circumstances surrounding Sample’s arrival

at the White House that she should have been considered an SGE.

Again, due to the lax management standards at the White House,

no one analyzed this volunteer’s employment standards and responsibilities. She was, however, given an affirmative work assignment at the White House. She reported to a permanent Government employee (David Watkins); performed a single task, was provided access to all materials necessary to perform her work, and

made financial decisions which obligated the Federal Government.

White House attorney Beth Nolan also believed Penny Sample

was an SGE:

. . . it seems clear that PS was asked to serve as a volunteer in the White House to perform a federal job, and

as such probably was a special government employee.

As discussed above, Section 208 of Title 18 restricts Government

employees from participating personally and substantially in a governmental capacity in which he or she has a financial interest. A

person may act in a governmental capacity through such things as

decision, approval, disapproval, recommendation, rendering advice,

investigation, or otherwise, in a judicial or other proceeding, application for request for ruling or other determination, contract, claim,

controversy, charge, accusation.

Penalties for violating section 208 of Title 18 appear in 18 U.S.C.

Sec. 216. Section 216 establishes different criminal penalties for

non-willfully and willfully engaging in conduct constituting offenses
82

356See, 18 U.S.C. Sec. 3559, which indicates that the offense of non-willful engagement is classified as a Class A misdemeanor because the term of imprisonment is 1 year or less, and 18

U.S.C. Sec. 3571, which indicates that the fine for an individual convicted of that offense is not

more than $100,000. 357See, 18 U.S.C. Sec. 3559, which indicates that the offense of willful engagement appears

to be classified as a Class E felony, and 18 U.S.C. Sec. 3571, which indicates that the fine for

an individual convicted of such an offense is not more than $250,000. 358 At the time this committee is drafting this report, White House political advisor Dick Morris resigned his position with the Clinton re-election campaign. This resignation comes on the

heels of reports that Mr. Morris shared sensitive Government information with an outside individual, allegedly a call girl. The White House defended themselves by arguing that Mr. Morris

was not a Government employee and did not hold a security classification. That defense misses

the point. News accounts suggest that Mr. Morris was involved in not only campaign decisions,

but public policy decisions concerning actions of the Presidency as well. Advising the President

on whether the administration should support or oppose numerous pieces of legislation and public policy proposals clearly is a Government function. Given his broad responsibilities, the Clinton White House should have determined whether Mr. Morris met the requirements to be a special Government employee and should have conducted a security background investigation.

under the conflict of interest provisions. Non-willful engagement is

punishable by imprisonment for not more than 1 year or a fine in

an amount set forth in Title 18, or both.356 Willful engagement is

punishable by imprisonment of not more than 5 years or a fine in

an amount set forth in Title 18, or both.357

White House attorney Beth Nolan’s notes also are revealing at

this point:

P.S. is the president of a charter broker, Air Advantage.

She arranged for Air Advantage to forward a fee to Midwest Express to cover official White House expenses. Even

though there seems to have been no financial advantage to Air Advantage in this transaction, its forwarding of a $52,000 fee probably had a financial effect on Air Advantage. Section 208 requires neither that

the financial effect be positive, nor that the financial effect

be substantial (there is no de minimis exception). (Emphasis Added)

The fact pattern discussed in this chapter and the introductory

overview support this committee’s conclusion that Penny Sample

was a special Government employee subject to the conflict-of-interest provisions of Title 18. The committee further agrees with the

analysis of Clinton White House attorney Beth Nolan, above, when

she concludes that Sample and Air Advantage violated Section 208

of U.S.C. Title 18.

4. Conclusion

What is also clear as a result of the committee’s investigation is

that President Bill Clinton willingly opened the doors of the White

House to friends and supporters and allowed those individuals to,

in effect, take whatever booty they could find. Documents provided

under threat of subpoena by Thomason and Martens provide shocking evidence that close friends of the President planned to raid the

public treasury long before Bill Clinton was sworn into office.358

The committee condemns the greedy, self-serving activities of

those who obviously believed ‘‘access had its privileges’’ and used

their special access to the White House to promote their own financial gain. A Washington Post article provides interesting insight

into Thomason’s belief that one’s support of a successful Presidential candidate entitles one to realize personal private gain from

subsequent voluntary public service:
83

359 ‘‘Travel Office Flap Cited as Evidence of Need for White House Staff Changes,’’ Ann

Devroy, Washington Post, May 27, 1993. 360 Albert Gore, Jr., Vice President of the United States; Creating a Government that Works

Better and Costs Less; Report 1994; September 14, 1994. 361 108 Stat. 3243. 362 Executive Order No. 12931, 59 Fed. Reg. 52,387 (1994).

I do find it surprising that a person who was as instrumental as I was in the Clinton campaign cannot pick up

a phone in the White House and ask for information for

people . . . If President Bush was in office, I would do the

same thing if I had this access.359

Both Thomason and Martens could have gained considerable financial advantage had they succeeded in their overall efforts to review

the entire Federal civilian aircraft fleet under the auspices of the

Interagency Committee on Aviation Policy (ICAP). Taking effective

control of the White House Travel Office was simply a first step in

their plans to capitalize on Thomason’s name recognition in Washington, DC during the Clinton administration.

VII. LACK OF COMPETITIVE BIDDING

A. BACKGROUND

Purchases by the Federal Government from the private sector

provide opportunities for the expansion of participating businesses

and the creation of new service-oriented companies. Procurement

expenditures generate secondary and related consumer spending.

Thousands of Federal activities are involved in acquiring products

and services that affect the Nation’s economy. The economic impact

resulting from the award of a major contract can greatly benefit a

city or region, while the loss of a Government contract can cause

financial hardship.

The growth of Federal procurement during the past decades resulted in a proliferation of complex and overlapping Federal regulations that often hindered an agency’s ability to purchase the best

goods and services at the lowest cost. Potential vendors complained

of the frustrating labyrinth of Federal specifications that controlled

the production of goods. This committee, working with the Clinton

administration, took significant steps to reform these bureaucratic

procedures.

On September 7, 1993, Vice President Albert Gore’s National

Performance Review issued a report entitled Creating a Government that Works Better and Costs Less.360 This report included 20

specific recommendations on procurement reform. The Clinton administration proposed a legislative package designed to restructure

and reduce impediments to the Federal Government’s acquisition

practices. Following extensive hearings by this committee, President Clinton signed into law P.L. 103–355 on October 13, 1994.361

That same day, President Clinton issued Executive Order 12931,

entitled Federal Procurement Reform, which requires executive

branch agencies to make their own administrative procurement

procedures more effective and innovative ‘‘over and above those required by statute.’’ 362

Federal acquisition laws were further revised, under the leadership of Chairman Clinger and this committee and the Clinton ad-
84

363The National Defense Authorization Act for Fiscal Year 1996, Pub. L. 104–106. For information on the legislative history of the National Defense Authorization Act for Fiscal Year 1996,

see H.R. Rept. No. 450, 104th Cong., 2d Sess. (1996). 364 41 U.S.C. s. 253. Subsection (c) states that a competitive bid is not required when there

is ‘‘an unusual and compelling urgency.’’ 365The Competition in Contracting Act of 1984 can be found in Title VII of division B of the

Deficit Reduction Act of 1984 (Pub. L. 98–369; 98 Stat. 1175).

ministration, as part of the 1996 Defense Authorization Act.363 Division D of that act, referred to as the Federal Acquisition Reform

Act of 1996, concerns changes to the procurement requirements for

armed services and civilian agency acquisitions. The general effect

of Subdivision D is to eliminate or simplify certain contracting procedures. For example, one provision raises the dollar thresholds for

contracts that use other than competitive procedures and are approved by high-level agency officials. Another provision limits the

competitive range to the largest number permitting an efficient

competition. The committee believes that these provisions will

streamline Government contracting and cut out unnecessary requirements.

Notwithstanding these recent reforms, the preferred method for

Federal procurement has traditionally been full and open competition, where all potential suppliers and vendors are given an equal

opportunity to compete for Government contracts.364 In the past,

agencies used streamlined small purchase procedures only for purchases of $25,000 or less. The Federal Acquisition Streamlining Act

raised this minimum to $100,000. The Federal Government publicizes its intention to buy property by posting solicitations in public places, announcements in the Department of Commerce publication Commerce Business Daily, and by sending invitations for bid

to business firms on applicable mailing lists.

Whenever possible, agency contracting officers are required to

promote full and open competition in soliciting offers and awarding

Government contracts. Procurement actions may involve sealed

bids, negotiated proposals, sole source acquisition, or multiple

award schedules.

This committee’s position is that any effort to reform the Federal

Government’s procurement process should begin with a firm commitment to encourage the use of competition in the Federal marketplace. In order to require Federal agencies to increase their use

of competition in Federal procurement actions, Congress enacted

the Competition in Contracting Act of 1984.365 This legislation required Federal agencies to open their bidding process to all qualified firms wishing to compete for the Government’s business and

by eliminated advertising restrictions and non-competitive bidding

procedures.

B. COMPETITIVE BIDDING IN THE CLINTON WHITE HOUSE

Despite the support for competition in the Federal marketplace

by both the Congress and the administration, the Clinton White

House apparently believed that full and open competition should

apply only to other agencies, while it awarded lucrative contracts

to friends and political supporters of the President. The White

House contends that the Travel Office’s failure to conduct competitive bidding for press charters played a part in its decision to fire

the Travel Office workers. However, it was the Clinton administra-
85

366White House Chief of Staff Mack McLarty and Office of Management and Budget Director

Leon Panetta, White House Travel Office Management Review, July 2, 1993, p. 5. 367White House Chief of Staff Mack McLarty and Office of Management and Budget Director

Leon Panetta, White House Travel Office Management Review, July 2, 1993, p. 6. 368General Accounting Office, White House Travel Office Operations: Travel Office Operations,

Report No. GGD–94–132, May 1994 p. 27.

tion, itself, that failed to utilize competitive bidding in the award

of lucrative Government contracts. The White House directed procurement funds toward friends and supporters of the President.

For example, on June 24, 1993, 1 month after the Travel Office

firings, the White House refused to utilize a competitive bidding

procedure to purchase a $25 million telephone system contract for

the White House. Clinton aide Patsy Thomasson was involved in

this and other non-competitive awards. In each case, she conveniently claimed that ‘‘urgent and compelling’’ circumstances existed

to obviate any obligation to bid the contract competitively.

According to the White House Management Review, ‘‘[Harry]

Thomason was concerned that the White House charter business

was not competitively bid and that the Travel Office might also be

engaged in wrongdoing.’’ 366 Others professed concerns about problems in the Travel Office. The White House Travel Office Management Review states that:

On May 1, at the White House Correspondents Association Dinner, Thomason heard George Condon, President of

the Correspondents Association, address the growing expense to the press of traveling on Presidential trips, a particular problem for smaller news agencies. Harry

Thomason viewed the no-bid practices of the Travel Office

as part of the problem.367

That view was further echoed in the General Accounting Office Report:

To ensure that the Travel Office receives the best value

for the funds it spends, goods and services generally

should be procured through a competitive process.368

Clinton administration actions leading up to and following the

Travel Office firings belie these professed concerns regarding competitive bidding, however. From the hiring of KPMG Peat Marwick

through the recruitment of World Wide Travel, Air Advantage, and

possibly, American Express, the Clinton administration avoided legitimate competitive bidding of Travel Office contracts altogether.

C. KPMG PEAT MARWICK CONTRACT

When it was decided that an outside firm should review the

Travel Office, David Watkins, Assistant to the President for Management and Administration called KPMG partner Larry Herman.

Mr. Herman, who had addressed staff members of the National

Performance Review on the issue of reinventing Government, was

recommended to Watkins by Jennifer O’Connor, a member of the

White House staff. Mr. Herman’s firm was hired over the phone on

the evening of May 13, 1993. Mr. Herman was asked to be at the

White House early the following morning. No competitive bid was
86

369General Accounting Office, White House: Travel Office Operations, Report No. GGD–94–

132, p. 57. Clinton aide David Watkins reported to Chief of Staff McLarty on May 17, 1993 that

the Travel Office staff had been told the audit was part of the Vice President’s National Performance Review effort. The committee was informed that the KPMG partner responsible for

the review was on leave and worked on a voluntary basis for the National Performance Review.

Representatives of the Vice President later informed the committee that while reforming the

Travel Office was consistent with the goals of the National Performance Review, the review was

not conducted under the auspices of the NPR. 370 A bill referred to the House of Representatives by this committee, H.R. 3452, 104th Cong.,

2d Sess. (1996), the Presidential and Executive Office Accountability Act, introduced by Congressman John Mica, would provide, inter alia, an internal Inspector General for the Executive

Office of the President. Surprisingly, the White House has expressed its opposition to this measure. 371Michael E. Shaheen, Jr., Office of Professional Responsibility of the U.S. Department of

Justice, Report of the Office of Professional Responsibility’s Review of the Conduct of the FBI in

Connection with its Contacts with the White House in the Travel Office Matter, pp. 28–29. 372White House memorandum from Patsy Thomasson to Dale Helms, Delegation of Authority

Relative to Peat Marwick Contract, August 9, 1993, CGE 2514–2518.

solicited to conduct this review of the White House Travel Office.369

Mr. Watkins later said that KPMG Peat Marwick was sought because the White House had no internal audit capability.370 Deputy

White House Counsel Vincent Foster, while in the presence of FBI

agents, initially recommended that an audit be conducted on the

Travel Office. Because the FBI had no authority to conduct an

audit without the predicate of an investigation, the FBI suggested

that Foster ‘‘get OMB or GAO to do the audit.’’ 371 The committee

found no evidence to suggest that the White House staff investigated the suitability of an audit conducted by the General Accounting Office or the Office of Management and Budget.

The White House Travel Office Management Review, while criticizing the procurement practices of the fired Travel Office staff, did

not even discuss the fact that KPMG Peat Marwick was brought

into the White House without a competitive bid. The gap in the report regarding the circumstances under which KPMG was hired is

problematic. White House documents indicate that the authors of

the White House Travel Office Management Review were aware

that a problem existed with the non-competitive bid for KPMG.

These documents indicate there were numerous discussions between White House Counsel and the Chief of Staff McLarty about

how to get around (i.e., justify) this problem.

In the end, Peat Marwick arrived at the White House without a

contract for the work it was about to undertake. Mr. Herman drafted a preliminary work contract on May 19, 1993, 5 days after the

review was initiated. While this contract was signed the week of

May 17, 1993, the final KPMG contract was not sent out by the

White House until 3 months later, on August 17, 1993. To justify

why normal procurement procedures were not followed, the White

House argued:

Normal procurement procedures were not an option due

to a perception of potential financial mismanagement. Due

to this perception, the need for financial review became urgent and compelling, with time of the essence.372

The committee does not support this conclusion. The White House

should have searched for other means to conduct an internal review of the White House Travel Office. The arguments raised in defense of the decision to hire an outside auditor bring force to the

case for legislation approved by this committee that would provide

the President with his own, hand picked auditor.
87

373General Accounting Office, White House: Travel Office Operations, Report No. GGD–94–

132, pp. 66–67. 374 Barney Gomez and Bob Homan of the General Accounting Office; interview with Betta

Carney and Steve Davison of Worldwide Travel; Little Rock, AR; September 7, 1993; p. 48.

D. WORLD WIDE TRAVEL

World Wide Travel Service, Inc., was selected by White House

staff to provide commercial travel services in lieu of those formally

provided by the long-term employees of the White House Travel Office. World Wide had performed similar services for the Clinton

Presidential Campaign in 1992. According to the General Accounting Office report:

Ms. Betta Carney, President of World Wide, told us that

on May 11 she was telephoned by Ms. Cornelius, who reported that the White House Travel Office staff would possibly be dismissed in the near future, due to allegations of

wrongdoing; Ms. Cornelius asked that this information be

kept secret. The next day, Ms. Cornelius, who told us she

called at the direction of Mr. Watkins, asked if World Wide

could start at the White House Travel Office for an interim

period until a competition could be held. A representative

of World Wide arrived in Washington on May 14 and remained on call throughout the weekend, but was not

called. According to Mr. Stephen Davison, World Wide’s

Director of Customer Service, on May 18, he and a World

Wide travel agent met with Ms. Cornelius, who reported

that the Travel Office matter was not resolved. However,

that evening Ms. Cornelius called to ask that the World

Wide officials meet her the next morning (May 19) in Mr.

Watkins’ office. At the meeting the next morning, Mr. Watkins informed the World Wide representatives that the

Travel Office employees had been fired and were vacating

the premises.373

Representatives of World Wide were in the offices of the White

House Travel Office before the career White House employees had

returned from the 10 a.m. meeting at which Watkins fired them on

May 19, 1993.

Also in the General Accounting Office interview, Betta Carney

said that when Catherine Cornelius called her on May 12, 1993, to

come to the White House, Carney asked:

[I]s this legal, could we do this, and on site, without a

formal contract? And she said something about emergency

procurement of some type that the White House lawyers

had talked about it, and that there was a possibility that

it would be okay and that we should be ready to send

someone up there at a moment’s notice.374

In questions posed by reporters at a White House press conference, Betta Carney was referred to as:

. . . the closest associate with David Watkins here, . . .

[and] sort of carried the campaign in its early days when

they didn’t have any money and agreed to bill them on a

delayed basis as their contributions came in. And Watkins
88

375George Stephanopoulos; White House press briefing; Washington, DC; May 21, 1993, p. 8. 376 At the time that World Wide Travel was chosen by the White House, both Catherine

Cornelius and David Watkins were on staff at the White House. 377White House Chief of Staff Mack McLarty and Office of Management and Budget Director

Leon Panetta, White House Travel Office Management Review, July 7, 1993, p. 20. 378General Accounting Office, White House: Travel Office Operations, Report No. GGD-94–132,

p. 45.

has been quoted as saying that that enabled them to free

up money to use for advertising in the Michigan and Illinois primaries at a time when they might not otherwise

have been able to do so. That sounds like it treads dangerously close to corporate contributions and FEC violations.375

George Stephanopoulos did not comment on this allegation, but he

confirmed that individuals at World Wide Travel made donations

to the Clinton campaign.

Notwithstanding evidence to the contrary, the White House tried

to argue that the selection of World Wide Travel was not based on

its prior personal or business relationship with members of the

campaign staff, now members of the White House staff.376 There

is no evidence that the White House had any other reason to

choose World Wide Travel, an Arkansas based travel service, over

other, nationally known travel firms.

The conclusion of the White House Travel Office Management

Review simply states that, ‘‘hiring World Wide Travel on a no-bid

basis—even as an interim, stop-gap measure—created the appearance of favoritism toward a local friend of the campaign.’’ 377 All

evidence points to the fact that the appointment of World Wide

Travel was, in fact, favoritism toward a friend of the Clinton campaign. There is evidence, however, that this was intended not as

an ‘‘interim, stop-gap measure,’’ but as a permanent, financial arrangement.

E. AIR ADVANTAGE

Penny Sample, president of Air Advantage, provided airline charters for the Clinton campaign and was assisted by Thomason, Richland & Martens (TRM), an aviation consulting business. Mr.

Martens contacted Penny Sample on May 17, 1993, and asked if

she would be willing ‘‘to provide temporary assistance in the procurement of aircraft charters for the White House press corps without compensation.’’ 378 Sample agreed to provide this service as a

volunteer. Within 2 weeks, Sample left the White House Travel Office after it was disclosed that she received a commission on the

first charter trip she arranged for the White House, a press trip to

New Hampshire on June 22, 1993.

This financial arrangement was mentioned in both the General

Accounting Office report and White House Travel Office Management Review, but neither discussed at any length to the lack of

competition afforded when the contract was signed. The GAO Report stated:

With the removal of the Travel Office employees, several

organizations were approached to provide White House

travel services. World Wide Travel Services, Inc. And Air

Advantage had both been involved in campaign travel . . .
89

379 Id., p. 45. 380White House Chief of Staff Mack McLarty and Office of Management and Budget Director

Leon Panetta, White House Travel Office Management Review, July 7, 1993, p. 20.

Air Advantage was brought in on May 18 or 19 to provide

temporary help in procuring aircraft charters for the White

House press corps.379

The White House Management Review stated:

Bringing in Penny Sample of Air Advantage, to handle

press charters on a no-bid, volunteer basis furthered the

appearance that the White House was trying to help its

friends. This implies no improper conduct on Sample’s

part, but again created an appearance of favoritism.380

Favoritism was a major factor in the selection of a White House

contractor. Unfortunately, this fact was ignored in each of the

major Travel Office reviews.

F. AMERICAN EXPRESS

On May 21, 1993, at 4:10 p.m., then White House Communications Director George Stephanopoulos announced that World Wide

Travel would be departing the White House Travel Office effective

immediately, as a result of White House concerns with appearances

of favoritism in its hiring practices. Mr. Stephanopoulos then announced that American Express would replace World Wide Travel

in the Travel Office beginning Monday, May 24, 1993. Once again,

no competitive bid preceded this announcement of a major change

in the Travel Office. The White House engaged in a formal competitive bid for this business on Sunday, May 23, 1993, 2 days after

Stephanopoulos’ announcement that American Express had been

awarded the contract.

The timing of Stephanopoulos’ announcement seems curious,

when competitive bidding had yet to occur. The committee did

learn, in the course of its investigation, that Patsy Thomasson met

behind closed doors with representatives of American Express

hours before Stephanopoulos’ May 21, 1993 announcement. In fact,

Patsy Thomasson requested that she have the FBI guard the doors

for her closed-door meeting with American Express. When told that

was not appropriate given the FBI’s role in the Travel Office matter, Ms. Thomasson had Secret Service agents guard the door. Ms.

Thomasson also discussed the travel contracts over the phone with

American Express, until she was told to stop contacting them.

There was no indication that Patsy Thomasson met with either of

American Express’ two competitors for the Travel Office business.

American Express’ selection subsequently was credited to its excellent bid presentation and for including resumes of those who would

work in the Travel Office in its packet.

The committee is concerned that this preparation very likely followed Ms. Thomasson’s own ‘‘heads-up’’ of American Express.
90

381White House press conference, May 19, 1993. 382WHMR interview of Bruce Lindsey, CGEPR 331–334. 383Phone logs of David Watkins. 384 Committee deposition of Mack McLarty, July 12, 1996, p. 23. 385 Committee deposition of Jennifer O’Connor, March 29, 1996, pp. 37–38. 386May 19, 1993 White House press conference.

VIII. THE WHITE HOUSE INITIATED A FULL-SCALE CAMPAIGN OF

MISINFORMATION IN THE AFTERMATH OF THE TRAVEL OFFICE

FIRINGS AND PUT IN PLACE A COVER-UP FROM WHICH IT COULD

NOT EXTRICATE ITSELF

A. PRESIDENT CLINTON LED THE MISINFORMATION CAMPAIGN FROM

THE FIRST DAYS OF THE TRAVELGATE DEBACLE

Immediately after the firing of the White House Travel Office

(WHTO) employees on May 19, 1993, the press asked whether the

President had approved of that decision:

Question. Who made this decision to fire them?

Ms. MYERS: David Watkins supervised the review. David

Watkins runs the Office of Administration. It was his decision.

Question. And had the acquiescence of the President?

Ms. MYERS: Absolutely.381

Bruce Lindsey briefed President Clinton about the Travel Office

firings 2 days before they occurred.382 David Watkins called Air

Force One on May 18th to inform the President of the firings.383

As Ms. Myers noted, the President approved the firings. We now

know that the President also approved bringing in Harry

Thomason for the ‘‘image’’ project 384 which included staging good

press events—one of which was supposed to be the firing of the

Travel Office employees—‘‘Bill Clinton cleaning house,’’ as Harry

Thomason explained.385

On the afternoon of May 19th, the President was already

distancing himself from his Press Secretary’s statement regarding

his role in the White House Travel Office matter:

Question. Mr. President, can we ask you if you feel you

were fair in summarily dismissing some employees of the

government of long-standing without a hearing, and leaving the impression perhaps that they may have committed

criminal acts?

The PRESIDENT: I don’t know. I’ll have to refer to the

Chief of Staff about that.

Question. We’re speaking about the Travel Office, sir.

The PRESIDENT: I know. All I know about it is that I was

told that the people who were in charge of administering

in the White House found serious problems there and

thought there was no alternative. I’ll have to refer to them

for any other questions. That is literally all I know about

it. I know nothing else about it.386

On May 25th, the day the White House announced it was placing

five of the former White House Travel Office employees on ‘‘extended administrative leave’’ and initiating an internal investigation, the President again was asked about the firings:
91

387May 25, 1993 White House press conference. 388May 26, 1993, White House press conference. 389 CBS This Morning (CBS television broadcast, May 27, 1993). 390 ‘‘A Stealthy, Evasive Confession,’’ the New York Times, July 11, 1993, Section 4. 391The Washington Post, ‘‘Travel Office’’ (Cont’d), May 28, 1993, p. A20. 392May 19, 1993, White House press conference. (Statement of Dee Dee Myers).

Question. Mr. President, are you upset by this whole

Travel Office mess? And who is responsible for it, sir?

The PRESIDENT: Well, ultimately, anything that happens

in the White House is the responsibility of the President.

And whenever you’ve asked me a question, I’ve told you all

I know about it. All I knew was there was a plan to cut

the size of the office, save tax dollars, save the press

money.387

The next day, May 26th, while responding again to media questions about the Travel Office firings, President Clinton explained:

. . . the press complained to me repeatedly about being

gauged (sic) by the White House Travel Office. I kept hearing everywhere.388

During the CBS This Morning, town hall meeting on the morning

of May 27th, President Clinton said:

We found out that there were seven people working in

the Travel Office, primarily to book travel for the press,

and that the press was complaining that the cost was too

high. So, there were all these recommendations made to

change it. But nothing was done until an accounting firm

came in and reviewed the operations and found serious

management questions in terms of unaccounted funds and

things like that. So then the person in charge of that made

the decision to replace them.389

Of course this statement was false, as the New York Times pointed

out, writing:

. . . why even after the public had learned how Clinton

friends engineered the travel office flushout, did the staff

feed President Clinton the discredited line that the firings

were simply economy measures? 390

‘‘Let’s not obscure what happened,’’ the President said in the

days following the firings.391 Yet this is the course set by the President himself from the first day of the firings.

B. THE INITIAL PRESS OFFENSIVE AGAINST THE TRAVEL OFFICE EMPLOYEES MISCHARACTERIZED THE PEAT MARWICK REVIEW AND THE

FBI’S ROLE IN ORDER TO COVER-UP THE REAL REASONS FOR THE

FIRINGS

The first series of Clinton administration deceptions occurred in

the days immediately following the firings. White House statements on May 19, 1993, indicated the firings followed an audit performed pursuant to Vice President Gore’s National Performance

Review, which uncovered ‘‘abysmal mismanagement’’ and ‘‘shoddy

accounting practices.’’ 392 Spokesperson Dee Dee Myers added that

the FBI was investigating possible criminal violations by the fired
92

393KPMG Peat Marwick Draft Report, CGE 006966, (although it was dated May 17, 1993,

it was not actually drafted before May 19 or 20, 1993). 394KPMG Peat Marwick Draft Report, CGE 006966, (although this was dated May 17, 1993,

it was not actually drafted before May 19 or 20, 1993). 395 Committee deposition of Dan Russell, March 27, 1996, p. 59. 396Foucart deposition, May 3, 1996, pp. 42–43. Foucart took notes of David Watkins’ speech

to the employees as he fired them: ‘‘What we are going to do is surgical rather than prolonged.’’ 397Letter to Nancy Kingsbury (GAO) from Todd Campbell in the Vice President’s office, December 1993, CGE 2554. 398 Committee interview of Larry Herman, August 29, 1995; see also GAO interview of Larry

Herman, August 31, 1993, p. 11. 399 Committee interview of Larry Herman, August 29, 1995.

employees. In fact, an audit of the Travel Office never was undertaken, let alone completed.

Peat Marwick’s engagement letter, draft and final report all

specify that its work did not constitute an audit. Peat Marwick told

the White House that:

such procedures do not constitute an audit, examination,

or review in accordance with Standards established by the

American Institute of Certified Public Accountants and,

therefore, we do not express an opinion or any other form

of assurance on the information presented in our report.393

Peat Marwick further explained to the White House that:

The procedures we performed were limited in nature

and extent to those which the Office of the Counsel determined best fit its needs.394

The White House also informed the press that the Travel Office

records were ‘‘in shambles’’ and not auditable. However, a Peat

Marwick C.P.A., Dan Russell, testified before this committee that

the pre-firing Travel Office records were auditable and that they

simply would have needed more than the 3 days allowed by the

White House for their review to perform such an audit.395

The Travel Office employees themselves first heard the allegations of criminal wrongdoing on television while packing their personal belongings before leaving the White House. When firing them

earlier that day, David Watkins made no mention of any criminal

investigation but instead represented the firings as part of a reorganization effort.396

The Vice President’s office quickly distanced the firings from anything having to do with the National Performance Review by repudiating the White House press secretary’s assertions that the Peat

Marwick review was part of the National Performance Review.397

Meanwhile, Larry Herman, Peat Marwick’s partner in charge of

the review, was confounded by the fact that the White House would

base the Travel Office firings on an as-yet-unfinished report. Mr.

Herman never told anyone at the White House his review would

justify the firing of all of the employees, particularly those that had

nothing to do with the financial aspects of the office.398

The White House Press shop pressured Herman to provide selective off-the-record press briefings on May 19.399 Harry Thomason

and Jeff Eller were also present in the press room that day when

‘‘kickback’’ allegations were circulated to the press. By that time,
93

400 Committee deposition of Harry Thomason, May 17, 1996, p. 223. (Thomason claims he inadvertently ended up in the press briefing room at the precise time of the briefing on the Travel

Office firings because he was taking a tour of the White House.) 401White House press conference, May 20, 1993. 402See supra at Sections IV, V and VI. 403 Vince Foster Travel Office notebook, CGE 000917. 404 Vince Foster Travel Office notebook, CGE 000917. 405OPR Report, p. 58. 406OPR Report, p. 68. 407OPR Report. 408OPR Report, pp. 68–69.

Herman informed White House officials that he had found absolutely no basis for the kickback allegations.400

George Stephanopoulos stated in a May 20 press conference that

Harry Thomason had ‘‘no financial interest’’ in White House travel

matters,401 a patently false statement in light of Thomason’s various White House business solicitations on behalf of TRM.402 Mr.

Foster later wrote of a meeting on May 21 in which they discussed

Thomason’s financial interests. Mr. Foster’s notes indicate that

Stephanopoulos became ‘‘upset’’ when he was shown an ‘‘HT

memo,’’ presumably reflecting that Thomason had a financial interest in the matter.403 Mr. Foster also noted that while

Stephanopoulos said there was no financial interest, ‘‘DD/M [Dee

Dee Myers] & Eller [Jeff Eller] and I disagree.’’ 404

The initial response by White House officials when faced with a

press hostile to the firings was to hide the truth. They withheld the

full scope and extent of Harry Thomason’s favor-seeking at the

White House, misrepresented the Peat Marwick review and repeatedly maligned the seven fired Travel Office employees. When that

did not work and the press raised issues of cronyism and patronage, on May 21, the White House press office summoned the FBI

spokesperson to the White House to edit the FBI’s press statements

in an effort to bolster the White House’s story.405 When news of

this additional effort to politicize the FBI was learned the following

Monday, May 24, the Attorney General contacted White House

Counsel Nussbaum and expressed concern about the direct contact

by the White House with the FBI.406

The press highlighted the fact that at the very time the FBI

spokesman was attending a White House press strategy meeting on

the Travel Office, embattled FBI Director William Sessions was

meeting with Webb Hubbell and Janet Reno about whether he

would keep his job.407 When Attorney General Reno learned of the

direct contact that the FBI had with the White House in both initiating the investigation and revising the FBI press statements, she

expressed her concerns. Ms. Reno told Nussbaum that the FBI

should not have the appearance of being used for political purposes.408

C. NEITHER THE CONGRESS, THE PRESS NOR THE PUBLIC BOUGHT THE

WHITE HOUSE STORY

The Travel Office firings were met by intense press skepticism.

From the first days, when the roles of Harry Thomason and Catherine Cornelius became apparent, this was a clear-cut case of cronyism. The New York Times editorial page wrote on May 26, 1993,

‘‘By design or incompetence or a blend of the two, the White House
94

409 ‘‘Myopia at the White House: The FBI Abused,’’ the New York Times, May 26, 1993, p.

A20. 410 ‘‘The Missing Voice,’’ the Washington Post, May 26, 1993, p. A18. 411 ‘‘The Moi? Defense,’’ Meg Greenfield, Newsweek, June 7, 1993, p. 72. 412 ‘‘The White House and the FBI,’’ the Baltimore Sun, May 26, 1993, p. 18A. 413 ‘‘Clinton tries to shake Travelgate,’’ the Chicago Tribune, May 26, 1993, p. 12. 414 ‘‘The Man Who Has Clinton’s Ear,’’ Michael Kinsley, Time, September 2, 1996.

has used a highly vulnerable FBI for unworthy political purposes.’’ 409

The Washington Post editorial page wrote on the same day: ‘‘It

looks as if the FBI logo was being used by the White House as a

political shield.’’ 410 Washington Post editorial page editor Meg

Greenfield wrote on June 7, 1993:

They should see no business, hear no business and

speak no business and, above all, do no business. Harry

Thomason and Linda Bloodworth Thomason, the First

Family friends involved in all the fuss last week, indignantly pointed out that they were much too well off to

have even been interested in the money to be gained from

a travel-office deal . . . But the familiar ‘‘moi?’’ defense (a

decent person like me couldn’t possibly do a gross thing

like that) is irrelevant to the conflict-of-interest issue.

Where a prospective conflict exists such people must keep

out of it.411

The Baltimore Sun editorial page opined, ‘‘Some Republicans

have called for a congressional review. Democratic senators ought

to join them. This is an important matter. It should be above partisan point-making.’’ 412

What became known as ‘‘Travelgate’’ was soon being compared to

Watergate: ‘‘It was no exaggeration when the Senate minority leader on Tuesday compared the Clinton administration’s use of the

FBI last week in the flap over the White House Travel Office to

Richard Nixon’s attempt to pervert the agency to political purposes

during Watergate. It is an outrage,’’ noted the Chicago Tribune editorial page on May 26, 1993.413

In the face of such severe criticism, acknowledging the full extent

of Harry Thomason’s activities and the President’s role in promoting Thomason’s business interests would cause additional political

vulnerability. With Mrs. Clinton’s health care bill being touted as

the centerpiece of the Clinton agenda, acknowledging her role in

the Travel Office would detract from one of the administration’s

highest priorities at that time.

The inability to tell the truth about the Travel Office firings

must be viewed in the context of the poll-driven, image conscious

Clinton White House of 1993. The President’s popularity polls

reached a devastating low of 36 percent following the May 19, 1993

Travel Office firings.414 The firings had the misfortune of coincid- ing with the May 18 $200 haircut aboard Air Force One on the Los

Angeles International Airport tarmac.

June 1993 brought hard-fought budget battles in which the

President’s tax raising budget narrowly passed the Senate by one

vote. The headlines at the time were brutal: ‘‘Another failed Presidency?’’ ‘‘What Went Wrong?’’ ‘‘The Incredible Shrinking President.’’ The hemorrhaging had to be stopped and the President
95

415WHMR interview notes of Bruce Lindsey, June 9, 1993, CGEPR 0331. 416 Id. 417 ‘‘The Missing Voice,’’ the Washington Post, May 26, 1993, p. A18. 418 Committee interview of David Gergen, September 13, 1995, p. 7.

called upon confidante and then Chief of Staff, Mack McLarty, the

very same person who approved the firings.

D. THE LAST BEST HOPE FOR A COVER-UP? A MAN FROM HOPE, MACK

MCLARTY

The President undermined his own commitment to ‘‘get to the

bottom’’ of the Travel Office matter in announcing the Management

Review when he incongruously put the person who had fired the

employees in charge of the review. Then-Chief of Staff McLarty

presided over a review in which the conclusions were as pre-determined as the decision to fire the Travel Office employees.

Mr. McLarty did not fail the President. Mr. McLarty participated

in the cover-up of the President’s involvement in bringing Harry

Thomason to the White House for the image project. Mr. McLarty

also concealed how the President inappropriately assisted

Thomason with getting business for his company, Thomason, Richland & Martens. Finally, McLarty covered up the fact that the

President knew about the firings before they occurred.

While aboard Air Force One, on May 17, 1993, Jeff Eller approached senior Presidential aide Bruce Lindsey and informed him

of the Travel Office and Lindsey asked, ‘‘if involved w/HT’s [Harry

Thomason’s] concern?’’ 415 Mr. Eller briefed Lindsey on the pending

firings, Lindsey in turn briefed President Clinton a full 2 days before the firings occurred.416

But Thomason’s ‘‘staged’’ productions clearly received disastrous

reviews. It was time for an image make-over.

1. David Gergen assumes damage control patrol

The President was reportedly furious with his staff when

Thomason’s idea of a good story—firing the Travel Office employees—went south. There was talk of a staff shake-up. Newspaper

stories at the time were strikingly critical of the abuse of the FBI

in these events. The Washington Post had taken the President to

task:

But it was wrong to smear them in public as wrongdoers

in advance of any finding that they have done wrong. If

they were fired for unconfessed political reasons, that was

wrong, too. And the apparent muscling of the FBI to put

a stronger gloss on the case (even as its director fights and

is beholden to the White House to keep his job) was wrongest of all.417

In late May 1993, the President turned to the another image

maker, David Gergen. It is noteworthy that on May 28th when

David Gergen was brought to the White House to meet with the

President about his new position,418 Harry Thomason and Linda

Bloodworth-Thomason were in the residence that evening for dinner with Mrs. Clinton. Gergen was ushered up to the residence by

Roy Neel at approximately 10 p.m. where Gergen met with Mrs.

Clinton and the President. Mr. Gergen told the committee ‘‘I have
96

419Gergen interview, p. 21. 420Gergen interview, p. 10. 421See committee depositions of John Podesta and Todd Stern. 422See supra Sections V and VI. 423 In addition, Podesta was contacted by the Office of Records Management on the day following the firings to inform him of the grave concern about loss of records in the Travel Office. 424Podesta deposition, p. 54. 425 Id. 426White House residence logs of February 16–17, 1993. 427 Harry Thomason deposition, pp. 118, 122. 428Podesta deposition, p. 54.

to tell you, I do not know Mr. Thomason. If he walked in the door

now, I wouldn’t know him.’’ 419 White House residence logs show

the Thomasons arriving for dinner at 8:30 p.m. and David Gergen

and the Thomasons leaving the residence together at 1 a.m.

One of Gergen’s first tasks was to placate the press in the midst

of the biggest press debacle to that date: the Travel Office firings.

Mr. Gergen testified he also was involved in quelling rumors that

Mrs. Clinton and Susan Thomases were behind the firings. Mr.

Gergen told the press that this charge was false; however, he said

he could not recall the source of his information.420

2. White House Management Review: Truth or Obfuscation?

At about the same time Gergen was brought in, McLarty tasked

Presidential aides John Podesta and Todd Stern to conduct the

White House Management Review. Mr. Podesta and Stern regularly reported back their findings to McLarty throughout the review process. Mr. McLarty, the supervisor of the review, does not

appear to have informed Podesta and Stern of his conversations

with Mrs. Clinton until information from other sources surfaced

about her role.421

The White House told the public that John Podesta was put in

charge of these matters because he had no involvement in the

events examined. But in fact McLarty, in selecting Podesta to head

up the matter, selected a person who was knowledgeable about

Thomason’s efforts to obtain Government contracts as well as the

President’s efforts to help Thomason.422 Mr. Podesta forwarded the

Harry Thomason/Darnell Martens ‘‘these guys are sharp’’ memo to

McLarty and others.423

Mr. Podesta became aware of the February 11, 1993 memo that

Darnell Martens had forwarded to Harry Thomason when it

showed up in President Clinton’s ‘‘out box’’ on February 17.424 As

Staff Secretary, Podesta was responsible for the daily flow of paperwork in and out of the President’s office. Although Podesta had

never seen the February 11, 1993 memo go into the President’s office, he did see it coming out.425

On February 16, 1993, Thomason was at the White House, spent

the night at the White House and even bowled with the President

that evening.426 Although Thomason distinctly remembers beating

the President at bowling that evening, he has ‘‘no recollection’’ of

giving the President the February 11, 1993 memo soliciting the

GSA contract for his company, TRM.427 Podesta found the memo

in the President’s out box the very next day.428

Yet the Management Review, which distinctly addressed the issues of ‘‘personal interests’’ and ‘‘the appearance of favoritism,’’ totally ignored Thomason’s efforts in getting Government contracts
97

429See, Podesta deposition, May 29, 1996; Stern deposition, June 5, 1996. 430 Nolan deposition, p. 35. 431Memorandum for John Podesta and Todd Stern from Beth Nolan, July 1993, subject: Questions from Travel Office Report re Harry Thomason, CGE 43235–43246. 432WHMR interview of Ross Fischer, CGEPR 237–239. 433OPR Report, pp. 31–32. 434WHMR interview of Ross Fischer, CGEPR 237–239. 435 CGEPR 0530–537, memo to Todd Stern from Dwight Holton, dated June 22, 1993, re: Complete list of checks, and checking plan. 436 CGE 029652, memo from Mary Beck to John Podesta, re: Official Personnel folders.

and President Clinton’s assistance in Thomason’s efforts. While

earlier drafts of the Management Review included these matters

and the authors thoroughly reviewed the issues involved, they were

excluded from the final report. In committee depositions, neither

Podesta nor Stern could credibly explain how Harry Thomason’s solicitation of aviation contracts had nothing to do with ‘‘the appearance of favoritism.’’ 429

3. The Management Review excluded information which was exculpatory to Travel Office employees and derogatory to President

Clinton and his cronies

Clearly the omitted facts regarding Thomason’s efforts to obtain

Government business were relevant in learning the true picture behind the firings. Mr. Podesta had even asked Beth Nolan, the

White House ethics counsel, to review the issue of whether or not

Harry Thomason was a special Government employee and whether

or not issues of conflict of interest pertained to Thomason.430 But

when Ms. Nolan came back with a preliminary conclusion that

Thomason might in fact be a special Government employee and

might have conflicts, the information was excluded from the final

report.431

In striking contrast, while the Management Review excluded information that could have had negative public and possibly legal

impact on Harry Thomason, its authors spent a large portion of the

report condemning the Travel Office employees and their operations. The authors excluded the most significant finding regarding

allegations against the employees: that the ‘‘kickbacks’’ allegation

made by Thomason had no basis in fact.432

The kickback allegation provided the predicate for FBI involvement in the Travel Office matter.433 In the course of the review,

Podesta contacted Ross Fischer of Miami Air, who denied he ever

made the allegation.434 In fact, it appears the Management Review

authors recognized this problem. Their own notes allude to concerns about FBI jurisdiction absent the kickbacks issue.435 A kickbacks discussion was deemed irrelevant, despite the authors’

awareness of exculpatory information.

A pattern developed throughout the course of the review: information unflattering to the Travel Office employees was included in

the report, exculpatory information was not. In the case of Harry

Thomason, little unflattering information was included. This is especially true where such information might involve the President.

In seeking derogatory information on the Travel Office employees, Podesta reviewed their personnel files.436 Mary Beck, the Director of Personnel in the Office of Administration, said this was

the only instance during her tenure in the White House in which
98

437 Committee deposition of Mary Beck, p. 27. 438 July 15, 1993 memo to Irene McGowan from Mary Beck, CGE 22205. 439See Podesta deposition. 440 Committee deposition of John Podesta, June 5, 1996, p. 120. 441DF781538–542. This memo was among those initially withheld by the President under a

claim of executive privilege on May 30, 1996 and not released to the committee until August

15, 1996. 442Podesta deposition, p. 98. In contrast, there are brief notes of Podesta’s interview with the

First Lady, CGEPR 0129. 443See, Podesta deposition, p. 99.

such an unusual request was made of her office.437 The files circulated around the White House for several weeks before Ms. Beck

made an urgent call for them to be returned.438 Although asked repeatedly, Podesta could provide no ‘‘official need’’ for the files.439

Soon after the firings Thomason retained attorney Bob Bennett

and Thomason thereafter did not cooperate with Podesta’s review.

For example, Thomason refused to do a follow-up interview and Podesta became aware that Thomason was not pleased with the direction of his report.440 Mr. Thomason’s actions were successful; his

stonewalling of Podesta worked. Mr. Podesta gave up on pursuing

further information about Thomason.

By omitting the efforts of Thomason’s company, TRM, to get

business contracts from the Government, the report considerably

diminished the full picture of Thomason’s abuse of Presidential access. The report thereby made no reference to the President’s complicity in that abuse. An internal White House memo, over which

the President initially claimed privilege, asked:

Doesn’t ICAP [the GSA efforts] show how deeply

Thomason and his personal interests had infiltrated the

White House? Is the reason this was not included to avoid

mentioning the involvement of the President in promoting

the financial interests of his friends? 441

The committee believes the answers to these two questions are

‘‘yes.’’

The fact that TRM and Harry Thomason indeed had sought contracts clearly undermines his claim that he was not seeking the

Travel Office business. The Martens memo, which had been made

public, clearly showed that TRM was seeking the Travel Office

business; however, it was implausibly dismissed by Martens as not

meaning precisely what it said. Had the report included information about Thomason’s other Government interests, this information would have been more damaging.

In contrast to every other interview conducted during the White

House Management Review, there were reportedly no notes taken

of the ‘‘interview’’ that Podesta conducted with the President.442

Mr. Podesta recalls nothing of the interview with the President,

whether he discussed the President’s knowledge of the firings, or

whether he asked about the President’s complicity in Thomason’s

activities. The only answer Podesta offered was that everything

that the President told him was in the report.443

The review also omitted various documents and comments that

undermined the official White House story. White House talking

points of May 13, 1993, authored by Jeff Eller, demonstrated that

there were plans to fire the employees a full day before Peat
99

444 CGE 7933, May 13 talking points. 445 Id. 446 Committee deposition of Brian Foucart, May 3, 1996, pp. 64–69. (Watkins asked Foucart

to speak with Cornelius a second time, in August 1993, to get her to resign. Foucart refused

the request.) 447 Cerda deposition, pp. 123–125. 448 Cornelius deposition, p. 143. 449WHMR interview of Catherine Cornelius, CGEPR 0161; WHMR interview notes of Clarissa

Cerda, CGEPR 0117. (The memo which Cornelius and Cerda co-wrote outlined how the two

could more efficiently run the Travel Office without the assistance of the present employees.) 450Watkins memorandum to McLarty, May 17, 1993, CGE 17753–54. 451Podesta deposition, p. 37; Stern deposition, p. 100. 452See depositions of Podesta and Stern. 453WHMR notes, June 8, 1993, CGEPR 0208.

Marwick came to the White House.444 This was left out of the report. These talking points claimed that the FBI was going to perform an audit, thus showing the real purpose of requesting FBI involvement.445

Another story omitted from the final draft of the Management

Review was David Watkins’ and Patsy Thomasson’s intimidation of

Catherine Cornelius. Mr. Watkins enlisted the help of his assistant, Brian Foucart, to convince Cornelius to resign.446 Patsy

Thomasson attempted to go through Cornelius’ friend and roommate, Clarissa Cerda, to secure Cornelius’ resignation.447 Ms.

Cerda, however, did not cooperate. Patsy Thomasson contacted

Cornelius directly regarding Cornelius’ memo on Travel Office reorganization.448 Ms. Thomasson wanted it to appear as though Watkins never relied on Cornelius’ memo on Travel Office reorganization. She wanted Cornelius to conceal any knowledge she had regarding whether Watkins read the memo.449

4. The Management Review minimized the role of Mrs. Clinton

The White House Management Review, while successful in its attempt to cover up the President’s actions regarding Harry

Thomason and to conceal documents which demonstrated a predetermined course of action, was not successful in fully concealing

Mrs. Clinton’s role. Mr. Podesta learned of Mrs. Clinton’s involvement and interest in the matter when he discovered the May 17,

1993 memo to McLarty from Watkins regarding the firings. The

memo includes a notation that it was sent to Mrs. Clinton.450

Neither Podesta nor his assistant, Stern, could recall when they

first learned of this May 17 memo or who provided it to them.451

However, it does not appear that Mack McLarty initially made this

or other information that he had obtained regarding the Travel Office firings available to Podesta for his Management Review.452

Mr. Stern recalled that he first learned definitively of Mrs. Clinton’s role on June 8, 1993 when he interviewed World Wide Travel

employee, Fan Dozier. Ms. Dozier told Stern about a conversation

she had with Harry Thomason on May 16, 1993. Stern’s notes recount what Dozier told Stern about her conversation with Harry

Thomason.

HT [Harry Thomason] said ‘‘You mean you’re not up

there working?’’ HT said he’d call HRC [Hillary Rodham

Clinton] and she would be very upset to hear they [the

seven Travel Office employees] were still there . . . this

was probably Sunday 5/16.453
100

454Stern deposition, pp. 32–33. 455 Handwritten notes of Todd Stern, May 27, 1993, CGEPR 0683. 456 CGE 032978. 457OPR interview of Patsy Thomasson, September 22, 1993. 458WHMR interview of Foster, CGEPR 0248. 459WHMR Management interview of Foster, June 3, 1993, CGEPR 0257. 460WHMR interview of Foster, June 3, 1993, CGEPR 0249. 461WHMR interview of David Watkins, June 2, 1993, CGEPR 487–508. 462Podesta deposition, p. 81; WHMR interview of Foster, June 30, 1993, CGEPR 0258. (Harry

Thomason also failed to disclose his conversations with the First Lady in his interview with the

White House Management Review on May 27, 1993. Thomason refused to cooperate in any additional interviews with Podesta and Stern.)

Mr. Stern believes he heard vague rumblings about Mrs. Clinton’s role prior to this date, however the Dozier interview provided

the first concrete information in that regard.454 It is clear that Mr.

Stern was concerned from the earliest days of the Management Review about the possibility that Mrs. Clinton’s role would be covered-up: ‘‘if you give answers that aren’t fully honest (e.g. nothing

re HRC) you risk hugely compounding the problem by getting

caught in half-truths. You run the risk of turning this into a coverup.’’ 455

There was an effort from the beginning, at least on the part of

Mrs. Clinton, to blur the facts regarding exactly from whom she

had heard rumors of wrongdoing in the Travel Office. In talking

points prepared by her staff for the release of the White House

Management Review, the summary stated: ‘‘Mrs. Clinton heard

rumblings about problems in the Travel Office as did most White

House staff.’’ 456 In over 75 depositions and interviews, the committee found no basis for the notion that there were ‘‘rumblings’’

known to ‘‘most White House staff.’’ Indeed, the opposite is true.

When asked directly about rumors, most staff stated that they had

heard nothing until the actual firings.

Deputy White House Counsel Foster was reluctant to disclose his

contacts with Mrs. Clinton and President Clinton, or, as he referred to them, ‘‘the clients.’’ On May 13, while waiting to see

McLarty, Foster told Patsy Thomasson that ‘‘his clients, meaning

President and Mrs. Clinton, were concerned about the White House

Travel Office matter.’’ 457 These comments, relayed by Ms.

Thomasson, demonstrate that President and Mrs. Clinton’s interest

in the Travel Office were communicated to Foster by May 13.

When Foster was interviewed in the course of the White House

Management Review, he told John Podesta, ‘‘I assume many of the

conversations I had were privileged.’’ 458 Mr. Foster initially provided all information about the firings, except his contacts with the

‘‘the clients.’’ When Foster was asked in his interview if ‘‘anyone

else’’ was ‘‘involved’’ he responded, ‘‘I think that’s all I should say

about that.’’ 459

In Foster’s June 3, 1993 meeting with the White House Management Review team he omitted his conversations with Mrs. Clinton

about the Travel Office, yet included events as inconsequential as

getting a haircut in between Travel Office meetings.460 David Watkins also carefully omitted the conversation he had with Mrs. Clinton as well as his knowledge of her involvement from the account

he provided to Podesta during his interview on June 3, 1993.461

Eventually, Foster and Watkins were forced to disclose conversations they had with Mrs. Clinton in later interviews with Podesta,

who had learned elsewhere of Mrs. Clinton’s involvement.462 How-
101

463Foster Travel Office notebook, CGE 1047, 1053–1054. 464Foster Travel Office notebook, CGE 1047.

ever, notes from the June 30 meeting, the same day as Mrs. Clinton’s interview with Podesta, show that her role was down-played

as much as possible.463

Mr. Foster’s notebook, which was withheld from investigators for

years, detailed a potential defense for Mrs. Clinton’s involvement:

‘‘Defend management decision, thereby defend HRC role whatever

is, was in fact or might have been misperceived to be.’’ 464 This was

the line of defense used by the White House. It became essential

that the ‘‘management decision,’’ firing Dale and others for ‘‘cause,’’

be defended. Under this ‘‘defend management decision’’ tactic, it

appears Foster thought Mrs. Clinton would be protected whether or

not her true role became known. This would also serve the President and is in fact the defense the White House continues to assert.

The real story was kept from the public. With the Clinton ship

of state barely afloat after a rocky spring of 1993, the review omitted what would have been damaging admissions, including:

• That despite the President’s public denials, he, in fact, knew

about the planned Travel Office firings BEFORE they occurred; he was briefed on the firings by Presidential aide Bruce

Lindsey; and he knew of Thomason’s quest for aviation contracts.

• That the President, himself, approved Harry Thomason’s arrival at the White House for an ‘‘image’’ project and that

Thomason obtained an official ‘‘staff’’ pass, not a ‘‘volunteer’’

pass.

• Harry Thomason’s solicitations were not limited to the Travel Office business, but involved efforts to get a quarter of a million dollar Government contract through an Executive order.

President Clinton spoke with Thomason and assisted him in

obtaining Government business.

• That Mrs. Clinton pressured high ranking White House officials and was a driving force behind the firing of the entire

Travel Office staff on May 19, 1993 and that this pressure

came before any Peat Marwick review or FBI guidance.

• That Chief of Staff Mack McLarty, who responded to Mrs.

Clinton’s pressure, failed to disclose promptly contacts with

Mrs. Clinton while McLarty was supervising the Management

Review.

• That the rumors passed on by Harry Thomason were denied

by the alleged source of those rumors, the President of Miami

Air.

• That initially, in the course of the review, senior White

House aides Foster, Watkins and McLarty tried to conceal the

role of Mrs. Clinton in the firings.

Given these omissions, McLarty was less than honest when he

stood at the White House press podium and declared that the report was ‘‘thorough’’ and ‘‘candid.’’ The report was a whitewash for

the Clinton administration. The report publicly lashed the designated scapegoats, who had only responded to pressure from superiors. As Cornelius explained, ‘‘ . . . I did everything everyone told
102

465 Committee deposition of Catherine Cornelius, April 30, 1996, p. 146. 466Watkins memo, CGE 12286–12294. 467Michael K. Frisby, Clinton Fires White House Travel Office, FBI is Probing Allegations of

Kickbacks, the Wall Street Journal, May 20, 1993, p. A5. 468 Id. 469OPR Report, pp. 68–69; see also ‘‘Clinton Staff Bypassed Reno to FBI, White House Gave

Bureau ‘Guidance’ on Travel Statement,’’ Ann Devroy and Michael Isikoff, Washington Post,

May 25, 1993, pp. A1, A9.

me to do.’’ 465 Mr. Watkins was only following orders that he felt

were impossible to ignore:

I think all this makes clear that the Travel Office incident was driven by pressures for action originating outside

my Office. If I thought I could have resisted those pressures, undertaken more considered action, and remained

in the White House, I certainly would have done so....

I was convinced that failure to take immediate action in

this case would have been directly contrary to the wishes

of the First Lady, something that would not have been tolerated in light of the Secret Service incident earlier in the

year.466

In the end, the White House Management Review had little to do

with the reality behind the firings.

IX. THE WHITE HOUSE’S FAILURE TO ADMIT THOMASON’S BASELESS

‘‘KICKBACK’’ ALLEGATIONS WERE FALSE AND LED TO A FRUITLESS

IRS INVESTIGATION

A. INTRODUCTION

In a May 20, 1993, news account of the May 19 White House

Travel Office firings, the Wall Street Journal 467 reported that the

White House and FBI also were investigating possible kickbacks

involving the seven fired Travel Office employees and UltrAir.

Unnamed ‘‘officials privately said’’ and ‘‘those familiar with [the investigation]’’ indicated that there were improprieties in the Travel

Office’s business dealings with UltrAir which another anonymous

White House source charged ‘‘was all done with a wink and a

nod.’’ 468 At the time of publication, none of these allegations had

been corroborated and, in fact, they subsequently were found to

have been baseless. The White House, so quick to broadcast these

false allegations, made no effort to retract them and correct the

record publicly when it learned, within a month, that they were

without merit.

Attorney General Janet Reno later would chastise the White

House openly for improperly announcing the FBI investigation of

the Travel Office.469 But the White House’s announcement clearly

was calculated to ‘‘dirty up’’ the Travel Office employees in order

to minimize negative reactions to a bald-faced exercise in political

cronyism by which the Clinton administration installed Presidential cousin Catherine Cornelius, Clinton campaign travel agency

World Wide Travel, Clinton charter broker Penny Sample and her

company, Air Advantage, in the Travel Office while raising the possibility of Travel Office opportunities for Harry Thomason, Darnell

Martens and their partnership, Thomason, Richland and Martens,
103

470 Allegations of Inappropriate White House, FBI, and IRS Action Involving UltrAir Company

are Unfounded, GAO draft material, contemporaneous with March 19, 1994 draft of White

House Travel Office Report, p. 1. 471 ‘‘Inquiry of Alleged Misuse of the IRS RE: the White House Travel Office,’’ Robert P. Cesca,

Department of the Treasury, Deputy Inspector General, March 31, 1994.

Inc. (TRM) From the very start, Cornelius and Thomason had been

key players in the Travel Office coup.

The White House’s world-wide broadcast of uncorroborated, and,

in fact, false allegations of criminal conduct against the Travel Office employees and UltrAir would have immediate and ominous

consequences not merely for the Travel Office employees but also

for UltrAir. Its Smyrna, TN, offices would be raided by IRS agents

at 3 p.m. on Friday, May 21, 1993, just 1 day after the false allegations hit newsstands. A former UltrAir executive also found himself

the subject of an IRS audit in the wake of these false allegations.

B. ULTRAIR

UltrAir is an airline charter company founded in 1991 which provided press charters to the White House Travel Office starting in

June 1992. UltrAir was a successor company to White House press

charter carrier Airline of the Americas. Both companies were

founded by employees who previously worked for the now-defunct

Pan Am when it provided White House press charters.

At 3 p.m. on May 21, 1993, three IRS agents ‘‘raided’’ UltrAir’s

offices in Smyrna, TN. There, UltrAir chief financial officer Ed

Hamblin informed the IRS that the firm’s tax records had been

transferred to Houston, TX. Mr. Hamblin phoned UltrAir CEO Rick

Millinor in Houston. Mr. Millinor, on the advice of his attorney,

told the IRS that UltrAir would not surrender its records to IRS.

At that time, IRS served UltrAir with an administrative summons

for its records. UltrAir subsequently turned over all requested

records on June 9, 1993.

Coming within a day of the White House’s uncorroborated allegations of criminal wrongdoing against the Travel Office employees

and UltrAir, the UltrAir raid raised serious concerns of possible

misuse of the IRS. Those concerns led to investigations by the IRS

Inspection Service, the Department of Treasury Office of Inspector

General and the General Accounting Office, which addressed IRS

issues most substantively in its March 1994, draft report on Travel

Office operations.

Predictably, the IRS Inspection Service, in its investigation of the

matter, found that IRS personnel took no inappropriate actions in

the UltrAir matter and concluded that there was no evidence of

any White House contact on the matter.470 The IRS Inspection

Service was a strictly internal review, however, and no one outside

the IRS was interviewed in the course of its investigation.

The Department of Treasury Office of Inspector General Report,

conducted pursuant to the July 14, 1993 request of Congressman

Frank Wolf and released on March 31, 1994, also concluded that

IRS officials took no inappropriate action and found no evidence of

White House contact.471 It did, however, raise additional questions.

The report referred to an August 5, 1993 letter to Congressman

Wolf from IRS Commissioner, Peggy Richardson, in which:
104

472 Id., p. 7. 473 Id., p. 10. 474 Id., p. 10. 475See GAO interview of Agent Tom Carl, October 20, 1993. 476GAO draft report, White House Travel Office Operations, p. 1.

[S]he stated that IRS Revenue Agents generally do not

issue a summons during an unannounced visit in connection with an examination. Taxpayers are notified of an examination through correspondence or by telephone prior to

an agent’s arrival.472

This suggests that the manner of the IRS raid on UltrAir was, in

fact, unusual. Additionally, the report’s conclusion that, ‘‘Based on

our discussions with IRS officials, and corroborating evidence from

records of GAO evaluators, we found no evidence that there were

any contacts generated from anyone at the White House to the IRS

regarding this matter,’’ appears less than categorical.473 If its discussions were, in fact, limited to IRS officials and GAO evaluators,

it is not clear that the investigation exhausted all the available evidence. Such questions are critical in retrospect, given the Clinton

White House’s now well-established practices of withholding documents and coordinating witness testimony.

The Treasury OIG Report also noted that an FBI official, subsequently identified as Supervisory Special Agent Tom Carl of the

FBI Government Fraud Unit:

. . . contacted an IRS National Office Criminal Investigator to obtain some investigative information, if applicable. The IRS Criminal Investigation did not provide the

FBI Official with any material information. (This information was corroborated with the IRS Investigator.) The National FBI Official then contacted a Nashville, Tennessee,

FBI agent to make an investigative inquiry with local IRS

officials.474

Agent Carl, of course, was made aware of the ‘‘highest levels’’ interest in the Travel Office matter by Associate White House Counsel

Bill Kennedy.475 And while Agent Carl made his inquiries in the

week following the IRS raid on UltrAir, his involvement with both

the White House Counsel’s office and the IRS investigation of

UltrAir raises concerns that his understanding of ‘‘highest levels’’

interests led to calls to the IRS in Washington and Nashville concerning UltrAir. While the Treasury OIG Report concluded the IRS

did not provide any material information to the FBI, it did not say

whether the FBI provided material information to IRS.

C. THE ULTRAIR MATTER WAS NOT HANDLED UNDER THE SAME

STANDARDS AS OTHER POTENTIAL TAX VIOLATIONS

While the GAO Draft report also suggested that allegations of

improper contacts among the White House, FBI and IRS were unfounded, it too raised further questions. A GAO footnote stated,

‘‘IRS’ policy is that all referrals of potential tax violations are to be

handled the same, regardless of the source.’’ 476

Yet, the UltrAir raid was not handled in the usual fashion of

other potential tax violations. The 1-day turnaround between the

publication of allegations concerning UltrAir in the Wall Street
105

477Lee A. Sheppard, Was the IRS Involved in ‘Travelgate’?; Tax Notes Today, Vol. 59, June

7, 1993, p. 1301. 478 Id. 479 Id. 480 ‘‘What the IRS Report Does and Does Not Say,’’ Lee A. Sheppard, Tax Notes Today, Vol.

59, June 28, 1993, pp. 1743, 1744. 481 Id., p. 1743.

Journal and the May 21, 1993, raid was highly unusual, if not unprecedented. In a June 7, 1993, article in Tax Notes Today, Lee A.

Sheppard reported that several former IRS executives had found

the raid on UltrAir highly unusual.477 She wrote that:

The usual starting point for an IRS examination is a

[tax] return; without a return, there is nothing for agents

to talk about.478

But UltrAir, which had been founded in 1991, but had not begun

operations until mid-1992, had yet to file an income tax return. On

March 15, 1993, the company had filed for and received an extension on its 1992 return. It had filed no return for 1991, in which

it generated no revenues. Ms. Sheppard added that,

In a normal audit, the IRS calls first, makes an appointment for an agent to visit, and requests documents that it

needs to examine.479

Referring to Internal Revenue Manual chapter 4022.3, Sheppard

noted that standard IRS practice is to exhaust all other means of

obtaining the desired information before issuing an administrative

summons. In other words, the taxpayer must resist IRS requests

for information; records provided must be thought to be incomplete

and/or pertinent details withheld; or the availability of the records

must be in doubt. That was not the case with UltrAir. Ms.

Sheppard adds, ‘‘Aggressive nonfiler procedures, in the sense of

physically going after the nonfiler, are usually only invoked in

criminal cases.’’

In her June 28, 1993, follow-up article entitled, ‘‘What the IRS

Travelgate Report Does and Does Not Say,’’ Sheppard asked:

Could an excise tax dispute justify sending three agents

with an administrative summons on an unannounced visit

to the taxpayer? This requires an assumption that UltrAir

failed to pay excise taxes, had been notified of that failure,

and continued to resist paying. That did not happen.480

Ms. Sheppard found other aspects of the IRS raid on UltrAir unusual. Given the fact that the IRS report indicated that UltrAir

was not the subject of a criminal investigation, Sheppard wrote:

If there is no criminal investigation of UltrAir, why was

the IRS treating the company like criminals? Why did the

IRS send three agents to an airline so small that the

agents outnumbered the airplanes? Why did they make an

unannounced visit, which is normal procedure for criminals? Why did they resort to an administrative summons,

a coercive tool that the Internal Revenue Manual reserves

for uncooperative taxpayers?481

Not only was the UltrAir case not a criminal matter, the IRS had

every reason to believe that the company was an otherwise respon-
106

482GAO draft letter to (then) ranking minority members of House and Senate committees

(Chms. Clinger and Grassley) [never sent], May 1994, p. 9. 483 Id., p. 8. 484GAO draft report, p. 7.

sible corporate citizen. In fact, in October 1992, UltrAir CFO

Hamblin voluntarily approached the IRS with a question concerning excise tax compliance and its White House press charter operations. Mr. Hamblin worked with the IRS on this issue through

early 1993, when the IRS tentatively found UltrAir liable for some

$220,000 in excise taxes related to the White House press charters.482 (Because UltrAir had not calculated excise taxes into its

press charter billings, the White House eventually paid them. The

IRS ultimately would conclude that the Travel Office was responsible for collecting excise taxes from the press corps and paying

them to the IRS.) 483

D. SECURING THE RECORDS

GAO provided some insights into why the IRS issued the highly

unusual administrative summons. GAO reported that once the IRS

became aware of media stories implicating UltrAir in possible

wrongdoing at the Travel Office, it was concerned about maintaining access to UltrAir excise tax records. In particular, it was concerned that if the FBI subpoenaed those documents, it would no

longer have access to them. In short, UltrAir was caught up in a

turf battle between the IRS and the FBI. IRS’ other reported concerns in securing documents, that UltrAir might destroy documents

and that it was in the middle of a corporate move to Houston, appear specious. The committee is confident that the IRS had sufficient Houston-based resources to continue any investigation originating in Nashville, TN.

Ironically, IRS personnel advised committee investigative staff in

an October 23, 1995 briefing that the IRS would not have known

who—or where—UltrAir was had it not been for the fact that CFO

Hamblin voluntarily came forward to the IRS some 7 months before with his questions concerning excise taxes. In other words,

UltrAir’s good faith efforts as a corporate citizen led to its May 21,

1993, mistreatment as a suspected tax criminal.

GAO reports that after an IRS agent in Nashville informed a

group manager and branch chief of the UltrAir media accounts, the

agents determined that UltrAir had not filed 1991 or 1992 income

tax returns.484 In the former case, UltrAir incorrectly assumed that

it need not file a tax return for a year in which it generated no

business revenues. In the latter case, UltrAir had filed for an extension on March 15, 1993 but IRS computers lost the record.

UltrAir filed returns for both 1991 and 1992 on July 1, 1993.

Based on this information, IRS’ Nashville branch chief instructed

agents to prepare an administrative summons for UltrAir and visit

its offices unannounced. It never made any effort to call first to

raise questions and concerns with UltrAir as Sheppard suggested

would be the normal procedure.

GAO noted in its report that UltrAir’s refusal, on May 21, 1993,

to turn over the documents called for in the administrative summons was appropriate given its surprise at the raid and the advice
107

485GAO draft letter, p. 7. 486OPR Report, p. 27. 487GAO draft report, p. 11. 488WHMR interview of Nolan and Sloan, June 28, 1993, CGEPR 0379. 489WHMR interview notes of Ross Fischer, June 17, 1993, CGEPR 0237. 490Podesta deposition, pp. 162–163.

of its attorneys. UltrAir turned over all requested documents to the

IRS on June 9, 1993.485

E. KPMG PEAT MARWICK: BOTH SIDES NOW

Importantly, KPMG Peat Marwick’s Nashville, TN-based certified public accountants gave UltrAir a clean audit opinion in

March 1993, in essence stating that it found no sign of irregularities—such as kickbacks—in UltrAir’s financial records. This is

noteworthy, given the fact that KPMG Peat Marwick management

consultants would be brought into the White House Travel Office

2 months later to look for evidence of kickbacks which could have

implicated another Peat Marwick client. KPMG Peat Marwick

found no evidence of kickbacks in the White House Travel Office,

either.

F. BILL KENNEDY AND THE IRS

In his initial meetings with FBI agents, prior to the Travel Office

firings, Associate White House Counsel Bill Kennedy reportedly

stated that if the FBI could not assist him, that he would go to another agency, in particular, the IRS.486 The investigation of UltrAir

which immediately ensued prompted investigators to question if

Kennedy’s stated intentions were acted upon by him or other White

House officials. But Kennedy has repeatedly, unequivocally, denied

taking action. Specifically, he testified to the GAO that:

[H]e did not say that he would call the IRS directly, and

that he never contacted any IRS official about the White

House Travel Office or UltrAir. [Emphasis added] 487

The preceding remarks appear to contradict the notes of a June 28,

1993, White House Management Review interview of Associate

White House Counsels Beth Nolan and Cliff Sloan. These notes

read, in part:

BK [Associate White House Counsel Bill Kennedy] said

PR [IRS Commissioner Peggy Richardson] on top of it. She

said at party IRS on top of it & some reference to IRS

agents aware or something like that.488

We believe this contradiction has not been adequately investigated.

G. KICKBACK ALLEGATIONS DISPROVED BY THE WHITE HOUSE

In a June 17, 1993, interview with Ross Fischer of Miami Air,

White House Staff Secretary John Podesta, who was in charge of

the White House Management Review, learned that Fischer and

Miami Air were ‘‘never approached for kickback.’’ Mr. Podesta’s

handwritten note underscores the words ‘‘never approached’’

twice.489 In his committee deposition, Podesta acknowledged that

he found no information to substantiate the kickback allegations.490 Similarly, no evidence of kickbacks was found by KPMG
108

491Testimony of Billy R. Dale before the Committee on Government Reform and Oversight,

January 24, 1996. 492Lee A. Sheppard, What the IRS Travelgate Report Does and Does Not Say, Tax Notes

Today, Vol. 59, p. 1743.

Peat Marwick (at the Travel Office or UltrAir), the General Accounting Office, the FBI or the IRS.

Mr. Podesta was aware that the FBI investigation of the Travel

Office—and the White House’s smear campaign against the fired

Travel Office employees and UltrAir—was based in large part on

the kickbacks allegation. But Podesta refused to advise the FBI of

his discovery. The White House’s refusal to inform the FBI, the

IRS, and the press of its discovery immediately, needlessly subjected UltrAir, former UltrAir president Charles Caudle and the

fired Travel Office employees to the threat of investigations, audits

and worse.

In late 1994, the IRS informed UltrAir that it had no additional

income tax liability. At approximately the same time, former

UltrAir president Charles Caudle received a $4,900 tax refund

when the IRS closed his audit. In testimony before the committee

in January 1996, Billy Dale and several of his Travel Office colleagues indicated that they faced the threat of IRS audits for well

over 2 years, but, again, no violations were found.491

H. INTERNAL REVENUE CODE 6103

The committee attempted to determine what precipitated the

highly unusual 1-day turnaround from the publication of a news

article to a full-blown audit of a company that had not yet filed its

first income tax return. However, that attempt was stymied by Internal Revenue Code Section 6103.

For good reason, Section 6103 makes it a crime to disclose tax

records and tax return material without the proper authorities.

Yet, the president of UltrAir and his attorneys provided several

successive 6103 waivers to committee staff precisely because they

hoped the committee’s investigation would uncover the impetus of

the IRS’ audit. Each successive 6103 waiver form was completed

with scrupulous attention to requirements dictated by various representatives of the IRS and the Treasury Department. In the end,

the committee was informed that the IRS was ‘‘not comfortable’’

with releasing the requested information. The committee does not

believe ‘‘not comfortable’’ is a legal term of art which justifies the

withholding of materials an individual or corporate tax citizen

wishes to be released.

Section 6103, at the same time it prevents previous abuses, may

shield IRS abuses from proper congressional oversight. Without the

ability to review relevant tax records pursuant to UltrAir’s own

waiver, too many questions still remain unanswered.

In her June 30, 1993, Tax Notes Today article entitled: ‘‘What

the IRS Travelgate Report Does and Does Not Say,’’ Lee A.

Sheppard wrote: ‘‘Nothing in the redacted IRS report addresses the

exquisite timing of the IRS visit to UltrAir. It seems to be more

than coincidental.’’ 492 She concluded:

As we cannot emphasize too often, the IRS is not a freeranging, all-purpose investigative agency empowered to
109

493 Id. 494 Committee deposition of John Podesta, June 5, 1996, p. 90; committee deposition of Todd

Stern, May 29, 1996, p. 30. 495WHMR interview notes of Foster, June 30, 1993, CGEPR 240–259. 496 Id. 497OPR Report, p. 90. 498 Hearings relating to Madison Guaranty S&L and the Whitewater Development Corporation—Washington, DC Phase, Volume I on the Death of Vincent W. Foster, Jr., July 29, 1994,

p. 185. 499Testimony of Hillary Rodham Clinton before the Office of the Independent Counsel, June

12, 1994 in hearings before the Committee on Banking, Housing and Urban Affairs, U.S. Senate,

103d Congress, 2d Sess., Volume II on ‘‘Death of Vincent Foster, Jr.,’’ July 29, 1994, p. 2106. 500 Committee deposition of Bernard Nussbaum, June 12, 1996, pp. 127–129.

root out crimes and misdeeds wherever they may occur. At

least four people at the IRS had to think that the rough

treatment of UltrAir was warranted.493

The committee concurs in these remarks, and believes that the

answers to these questions, currently sealed behind IRS Code Section 6103, warrant further attention. Moreover, that executive

branch officials were aware of investigations arising from their own

false allegations and took no action to inform the investigators,

constitutes a reckless abuse of the public trust.

X. VINCENT FOSTER BECAME INCREASINGLY DISTURBED BY THE

PROBLEMS GENERATED BY TRAVELGATE—AS DID NUMEROUS HIGH

RANKING WHITE HOUSE OFFICIALS

A. DESPITE FOSTER’S INITIAL EFFORTS DURING THE MANAGEMENT REVIEW, HE WAS UNSUCCESSFUL IN CONCEALING ‘‘THE CLIENTS’’’ ROLE

IN THE TRAVEL OFFICE FIRINGS

On May 13, 1993, almost a week before the Travel Office firings,

Foster disclosed to Patsy Thomasson that ‘‘the clients’’ were interested in this matter. Ms. Thomasson reports that ‘‘the clients’’ was

how Foster referred to President and Mrs. Clinton.

John Podesta and Todd Stern testified that Deputy Counsel Vincent Foster did not inform them of his contacts with Mrs. Clinton

concerning the Travel Office prior to the firings.494 However, Podesta and Stern did learn of Mrs. Clinton’s involvement from other

sources and questioned Foster in a second interview.495 Mr. Foster

raised the issue of privileged conversations in his White House

Management Review interview.496 In the days prior to his death,

Foster expressed his serious concerns about getting outside counsel

for ‘‘the clients.’’ 497

Independent Counsel Fiske concluded in his report: ‘‘Those close

to Foster have stated that the single greatest source of his distress

was the criticism he and others within the Counsel’s Office received

following the firing of seven employees from the White House Travel Office.’’ 498 Mrs. Clinton told Independent Counsel Fiske she

never talked with Foster about the Travel Office in June or July

1993,499 and was unaware of his concerns. In his committee deposition, Nussbaum testified that he thought Mrs. Clinton discussed

the report or related events with Foster at some time at or around

the release of the Management Review.500

Mrs. Clinton’s role in the Travel Office firings became an issue

following the release of the July 2, 1993 Management Review. With

the onset of numerous investigations into the firings, the role of
110

501See e.g. GAO interview of FBI Agent Howard Apple, October 15, 1993, pp. 1, 4.; OPR Report, pp. 82–83. 502OPR Report, p. 27. 503OPR Report, p. 84. 504Kennedy deposition, p. 91. 505 Committee deposition of Matthew Moore, March 26, 1996, p. 98. 506WHMR interview notes. Agent Howard Apple was interviewed first on June 9, 1993 and

then again on June 25, 1993. Agent Wade was interviewed on June 9, 1993 and June 28, 1993;

Agent Tom Carl, was interviewed on June 9, 1993 and again on June 25, 1993. William Kennedy was interviewed first on June 8, 1993 and then again on June 30, 1993. 507OPR Report, p. 84. 508See OPR Report, p. 85, discussion of a conversation Foster had with Webb Hubbell about

his concerns.

President Clinton and Mrs. Clinton was again a problematic issue

in the Counsel’s office.

B. THE MANAGEMENT REVIEW’S INCLUSION OF BILL KENNEDY’S REF- ERENCE TO THE INVOLVEMENT OF ‘‘THE HIGHEST LEVELS’’ OF THE

WHITE HOUSE IN THE FIRINGS RAISED PROBLEMS FOR BOTH PRESI- DENT CLINTON AND MRS. CLINTON

Mr. Foster reportedly was distraught by reports from FBI agents

who said Kennedy informed them the Travel Office matter had the

interest of those at ‘‘the highest levels’’ and ‘‘the highest level’’ at

the White House.501 Mr. Kennedy also was reported saying that if

the FBI didn’t respond quickly, he would call the IRS.502 Mr. Foster strongly opposed including this account in the Management Review.503 The inclusion of the FBI version of events, in effect, verified the agents’ accounts of these discussions. This implicit admission opened the door to consider further both Mrs. Clinton’s and

President Clinton’s involvement in the firings.

Mr. Kennedy denied making these statements to the FBI

agents,504 however, the fact that the Management Review included

a reprimand of Kennedy, acknowledges that the word of four FBI

agents had been implicitly accepted over that of Kennedy. The committee, having interviewed all four FBI agents and reviewed their

sworn statements to OPR, also finds them credible. Mr. Kennedy’s

statements about whether or not he referred to ‘‘the highest levels’’

of the White House being interested in the Travel Office, are in direct conflict with the testimony of the four FBI agents.

In addition to the sworn testimony of four FBI agents, the committee obtained testimony from an additional witness, Matthew

Moore, who was part of Watkins’ team of assistants assembled on

May 13, 1993 to prepare for the Peat Marwick review the next day.

According to Moore, Kennedy told the group, ‘‘something to the degree that you know, this goes to the highest level, the concern

about this, you know, goes to the highest level.’’ 505

It is notable that in the course of the White House Management

Review, Podesta and Stern re-interviewed the FBI agents to be

sure they would uphold their version of events. Messers. Podesta

and Stern also gave Kennedy a second chance to change his account.506 According to numerous White House aides, Foster argued

in vain that these comments should not be included in the report

and that Kennedy’s version of events should be accepted.507 Mr.

Foster also was upset because he felt responsible for Kennedy’s involvement, and expressed remorse at not having handled the matter himself.508 Mr. Foster’s close friend, Webb Hubbell, told OPR

investigators that, ‘‘even after the White House Report was re-
111

509OPR Report, p. 85. 510Foster Travel Office notebook. 511OPR Report, p. 87, discussion of comments by Sheila Anthony. 512OPR Report, p. 89. 513 Id. 514See Watkins ‘‘soul cleansing’’ memo, CGE 12286–12294. 515The committee is in receipt of a memo from the CIA ‘‘Memorandum for the Record, Subject:

Halperin Nomination—Conversation with Bill Kennedy, White House Counsel’s office’’. The

memo discusses Mr. Kennedy’s efforts to keep the Senate Armed Services Committee from obContinued

leased . . . Foster continued to be upset that Kennedy had been

reprimanded.’’ 509

If, as FBI agents stated and now have testified under oath to

OPR, Kennedy did point to the involvement of ‘‘the highest levels’’

of the White House in the Travel Office firings, then future investigations could pose problems for President and Mrs. Clinton.

Would criminal investigators ask Foster or Kennedy about the role

of President and Mrs. Clinton?

If there were misuse of Harry Thomason’s access to the White

House and his status as a special Government employee became an

issue, what would Foster have to disclose regarding the knowledge

of those at the highest levels? What were the liabilities of the

President and First Lady in helping Thomason obtain Government

business, including the Travel Office?

Mr. Foster’s handwritten notebook detailing the Travel Office

saga notes ‘‘misuse of FBI’’ followed by ‘‘they deny’’ and ‘‘HR no

role.’’ 510 In this context, ‘‘HR’’ appears to refer to ‘‘Hillary

Rodham.’’ Was Foster worried that Mrs. Clinton might be dragged

into the ‘‘misuse of the FBI’’ issue? If so, why?

Following the release of the Management Review, Foster talked

with his sister and his brother-in-law, Sheila and Beryl Anthony,

on the occasion of a July 9 dinner. He voiced his concerns with the

report and his belief that the ‘‘FBI lied regarding the Travel Office

matter.’’ Sheila Anthony said she thought that Foster’s ‘‘remarks

regarding the FBI concerned the conversations between the White

House Counsel’s Office and the FBI that had been described in the

White House Report.’’ 511 Mr. Anthony said these remarks made a

‘‘big impression’’ on him because Foster was not ‘‘subject to exaggeration and never made inflammatory remarks.’’ 512

Mr. Foster also told his sister that he was considering resigning

his position at the White House.513 While it is possible that Foster

believed Kennedy when Kennedy said he made no such statements

to the FBI agents, Foster himself, on the same day, informed Patsy

Thomasson that ‘‘the clients’’—the same people who are at ‘‘the

highest levels’’—were concerned. It appears unlikely that Foster

would have shared information about the President and Mrs. Clinton’s interest in this matter with others such as Ms. Thomasson,

but not with Kennedy. Mr. Foster repeatedly told Watkins of Mrs.

Clinton’s interest.514 Since Kennedy was the main person Foster

had tasked with responding to this matter, it is implausible that

he did not inform Kennedy of Mrs. Clinton’s interest.

Perhaps what Foster didn’t believe is that Kennedy would have

been foolish enough to tell outsiders at the FBI of Mrs. Clinton’s

interest. But the committee has obtained new documentation suggesting Kennedy, indeed, was prone to exerting his influence over

outside agencies and engaging in a pattern of intimidation.515 The
112

taining information from the CIA which pertained to Mr. Halperin. Mr. Kennedy was reported

to have told the CIA to ‘‘abstain from doing any file searches: ‘don’t hit a lick,’ to use his precise

words.’’ A CIA official reviewing this memo circled this request and handwrote: ‘‘This is an outrage. The WH [White House] staff does not control our files.’’ Apparently, Mr. Kennedy had a

history of muscling outside agencies. If he would do this to the CIA, the committee, armed with

the testimony of four FBI agents, believes he would do the same thing with the FBI. The committee does note that the FBI agents stated they did not feel intimidated by Kennedy’s remarks

but this does not excuse Mr. Kennedy for making such statements and does not resolve the actual facts behind the statements about the ‘‘highest levels.’’ 516Kennedy’s own indiscretions in failing to report his nanny taxes and not providing this information to the White House raises additional questions about his veracity. 517 Nussbaum deposition, pp. 138–139. 518 Id., p. 139. 519The Supplemental Appropriations Act of 1993 (P.L. 103–50), signed the same day, required

that GAO ‘‘conduct a review of the action taken with respect to the White House Travel

Office . . . ’’ 520Supplemental Appropriations Act of 1993 (P.L. 103–50).

committee’s own experience with Kennedy is consistent with this

pattern.516

Prior to considering resignation, it is significant that Foster himself was considered for a reprimand for his actions in the Travel

Office. Mr. Nussbaum informed the committee that when he heard

that Kennedy was to be reprimanded for his actions, he went to

McLarty and demanded that he and Foster also be reprimanded in

the belief that the Counsel’s office should stick together.517 Mr.

Nussbaum says that when he told Foster of his demand that they

all be reprimanded, ‘‘[Foster] didn’t look about it as happy as I did,

at that point.’’ 518 However, Nussbaum and Foster were not reprimanded. This would have brought matters closer to ‘‘the highest

levels’’ when the White House intended to contain this to mid-level

staff. ‘‘Low-level’’ staff are often available to take responsibility for

mistakes in the Clinton White House.

But it was not low-level staff who were responsible for this blunder, as claimed by the White House. It was not the ‘‘inexperience

and ineptitude’’ of young White House staff who gave Harry

Thomason free reign in the White House. It was the arrogance and

favor-seeking of President Clinton’s friends and family, championed

by senior White House aides, responding to President and Mrs.

Clinton that caused these problems.

C. FOSTER WAS TROUBLED BY THE PROSPECT OF NUMEROUS CONGRESSIONAL AND CRIMINAL INVESTIGATIONS INTO THE TRAVEL OFFICE

FIRINGS

Members of Congress, both from the House and the Senate,

called for the immediate appointment of an independent counsel

and were getting support from the media by mid-July. On July 2,

1993, the very day that the White House Management Review was

released, President Clinton was forced to sign a bill that included

a provision providing for a General Accounting Office review of the

Travel Office firings.519 The GAO review provision was inserted by

Senator Byrd on an appropriations bill.520

The White House already ran into trouble with GAO reviews of

the White House purchase of a new phone system and a resume

reviewing system in 1993. The thought of GAO investigators examining the ‘‘management decision’’ Foster had vowed ‘‘to defend’’ was

another headache for the already overburdened Deputy White
113

521 In testimony before the Senate Whitewater Committee, White House Counsel secretary,

Linda Tripp, testified that Mr. Foster spent most of his time working on personal matters for

the Clintons. Since Ms. Tripp had previously worked at the White House under other Counsels,

she recognized this was unusual and raised it with Mr. Nussbaum who dismissed her concerns.

Senate Whitewater deposition of Linda Tripp, July 12, 1995, pp. 52–53. 522Michael Isikoff, ‘‘Foster Was Shopping for Private Lawyer, Probers Find,’’ Washington

Post, August 15, 1993, p. A20. 523 House Resolution 198, 103d Cong., 1st Sess. (1993). 524Letter from President Clinton to Chairman Brooks, July 13, 1993. 525Phone logs of Webster Hubbell indicate that Chairman Brooks phoned Hubbell on July 13,

1993 and on July 15, 1993, the day after the Resolution of Inquiry was defeated. Chairman

Brooks Counsel, Jon Yarowsky called Hubbell on behalf of Brooks and left the message that

Brooks extended his thanks ‘‘for all your help.’’ Yarowsky is now a White House Associate Counsel who has been one of the key White House lawyers handling the Travelgate investigation. 526Letter from Attorney General Reno to Honorable Jack Brooks, July 14, 1993. 527 House Resolution of Inquiry, H.Res. 198, voted down in the Judiciary Committee, 20–15,

July 14, 1993. 528Webb Hubbell phone logs reflect phone calls from Peggy Richardson to Webb Hubbell on

June 17, 1993—the day after the House Resolution of Inquiry was introduced. Richardson calls

Hubbell again on June 23 and June 25 (with message she will be out of town for 2 weeks and

will call). The House Resolution of Inquiry was scheduled for a vote on July 14, 1993. Richardson calls Hubbell on July 12, July 13 and July 14. Richardson cancelled meetings with Rep.

Frank Wolf regarding IRS/Travel Office matters on both July 14 and July 15, 1993. In reviewing

over 15 months of Hubbell’s phone logs, there are only one or two other phone messages from

Commissioner Richardson in the entire 15 months Hubbell served at the Justice Department.

House Counsel who was spending many of his working hours on

personal matters for the Clintons.521

Senior Democrats in Congress were skeptical about the Management Review and Chairman Jack Brooks was reported to have told

Mack McLarty he should have fired people higher up.522 Chairman

Brooks was faced with fending off a ‘‘House Resolution of Inquiry’’

in the Judiciary Committee.

On June 16, 1993, Republican House leaders and then ranking

minority member of the Government Operations Committee William Clinger filed a ‘‘House Resolution of Inquiry,’’ 523 which was

considered on July 14, 1993. The resolution allowed the House to

ask the President to provide certain documents and answer specific

questions focusing on the possible misuse of the FBI and the IRS.

While the President could not be compelled to respond to a ‘‘Sense

of Congress’’ resolution, it would have put Congress on record as

demanding responses from the White House.

Clinton administration officials were hard at work to ward off

the attempt to open a congressional inquiry. In a July 13, 1993 letter to Chairman Brooks, President Clinton pledged that the Attorney General would have the administration’s ‘‘full cooperation’’ in

a Department of Justice review of the Management Review.524

Chairman Brooks and his staff were communicating with the Associate Attorney General Webb Hubbell in the days leading up to the

July 14, 1993 consideration of the Resolution of Inquiry 525 and a

letter to the committee was received from the Attorney General.526

The ‘‘House Resolution of Inquiry’’ required President Clinton to

turn over all responsive documents and answer questions concerning FBI and IRS actions related to the firings.527 During the days

and weeks leading up to the Resolution, IRS Commissioner Peggy

Richardson made numerous calls to Webb Hubbell.528 The Resolution was defeated but House rules still allowed for the full House

to vote on the inquiry and a plan was in the works for a vote later

in the month.

In the weeks following the Management Review, Foster discussed

his growing concerns about where the investigations would lead
114

529OPR Report, pp. 82–92. 530Deposition of John Podesta, pp. 187–188. 531OPR Report, p. 91. 532 Id. 533 Id., fn. 97. 534Foster Travel Office notebook, CGE 1045, 1047.

with a number of people inside and outside the White House.529

Both Podesta and Stern, co-authors of the Management Review, recall talking with Foster after the report was completed. They were

tasked with responding to congressional efforts in the ‘‘House Resolution of Inquiry.’’ Podesta discussed one such conversation in his

committee deposition:

Question. Can you describe the discussions you had with

him about congressional inquiries?

Answer. I think that he was—I specifically recall driving

him home one evening, obviously prior to July 20th, in

which he expressed concern about the Hill and what was

going on and what was happening on the Resolution of Inquiry, et cetera.

Question. So you place this discussion sometime prior to

the House Resolution of Inquiry, or thereabouts?

Answer. I would place it between July 2nd and July

20th. I think it was before our briefing of the House committee, so it would have been probably the week of the 4th

or something.

Question. Do you recall having any discussion with him

after you briefed the committee, telling him what went on

with the committee or after the vote?

Answer. After the vote of the committee?

Question. Yes.

Answer. I don’t know whether I discussed it with him.

I might have. I generally thought that his concern was serious enough that I needed to let him know what was

going on.530

The timing of a call that Foster made to Jim Lyons is consistent

with concerns that he had about the Resolution of Inquiry. Mr.

Lyons reported that Foster called him in a panic approximately a

week before his death and wanted Lyons to come to Washington as

soon as possible to assist him in the Travel Office matter.531 By the

next day, Foster had called back to inform him that the situation

was not as urgent. Mr. Lyons planned to travel to Washington, DC

the following week and he and Foster made plans to get together

to discuss the Travel Office and other matters.532 This was also the

week in which Foster spoke with Susan Thomases and Jim Hamilton about Travel Office matters.533

Mr. Foster’s notes also indicate that he was preparing for defending these issues in various forums, including congressional investigations, the GAO review, and the Department of Justice. In his

handwritten notes, he did a detailed analysis of ‘‘opponents theories’’ and wrote, ‘‘avoid forcing DOJ.’’ 534 In preparing for hearings

or litigation, Foster identified numerous problems for himself and

other White House lawyers and staff such as: ‘‘5. communications

by joint defense . . . application to Bernie speaking for WH . . .,

6. Witnesses by virtue of participation in mgment review . . . 9.
115

535The committee has subpoenaed all documents related to Harry Thomason including tapes.

Committee staff has particularly asked about Harry Thomason tapes and asked for all tapes

he may have produced or provided. The only tape the committee has received to date is ‘‘The

Man from Hope.’’ 536Foster Travel Office notebook, CGE 1048. 537 A July 9, 1993 Washington Times editorial by columnist Tony Snow was forwarded to Foster by Mack McLarty’s senior counselor Bill Burton and found in Foster’s long withheld Travel

Office file. The column details the legal problems that Harry Thomason might face in the conflicts area and potential problems for other White House officials, including the First Lady. 538Memorandum for John Podesta and Todd Stern from Beth Nolan, Re: Questions from Travel Office Report re Harry Thomason, July 1993, CGE 43223. 539Foster Travel Office notebook, CGE 000965.

Accumulation of add’l evidence, e.g. HT [Harry Thomason] tapes,535

nexis tvl office, news file . . . 13. Does everyone who edited report

become a witness . . . existence of drafts . . . 14. Difficulty of operating prep w/ 3–4 ws [witnesses] in office..’’ One item he noted:

‘‘Communications w/top 2’’ apparently referring to President and

Mrs. Clinton.536

On July 15, 1993, the day after the Resolution of Inquiry was defeated, then Deputy Attorney General Phil Heymann directed the

Office of Professional Responsibility to investigate the FBI’s response to the White House in investigating the firings. The Public

Integrity Section of the Justice Department already had a criminal

investigation underway concerning the Travel Office operations and

allegations of wrongdoing by the White House. Clearly many White

House witnesses, including Foster and others at ‘‘the highest levels’’ would be called upon to testify—and under oath.

While there were numerous other matters arising with respect to

Whitewater—the Clintons’ taxes and other potential problems for

the White House that Foster would be dealing with, it appears that

the Travel Office and the future problems it threatened, weighed

particularly heavily on Mr. Foster.

D. FOSTER WAS IN THE MIDDLE OF PROBLEMS RELATED TO HARRY

THOMASON, WHICH WERE STARTING TO GATHER STEAM

Mr. Foster’s general anxiety about the burgeoning Travel Office

problems included concerns about Harry Thomason. The issue of

whether Harry Thomason was a special Government employee and

whether his actions constituted a conflict of interest was going to

be reviewed by both Congress and criminal investigators and was

generating considerable press attention.537 Mr. Foster in turn

tasked White House Associate Counsels Beth Nolan and Cliff Sloan

with reviewing Thomason’s status as a special Government employee.

During the Management Review, Podesta requested Nolan and

Sloan to review conflicts of interest and standards of conduct issues. Ms. Nolan concluded that Penny Sample of Air Advantage

was a special Government employee and that it was possible that

Harry Thomason was a special Government employee.538 Mr. Foster held several meetings with Nolan and Sloan on July 7 and 8,

1993 about these issues. These meetings are reflected in Foster’s

handwritten Travel Office notebook where potential defenses to

these issues are mapped out.539

On July 7, 1993, Foster’s notes reflect a discussion of Harry

Thomason as an ‘‘SGE who violated ethics rules (criminal?) re promoting his company . . . at least in getting goodwill (—by promot-
116

540Foster Travel Office notebook, CGE 000965. 541Foster Travel Office notebook, CGE 000966. 542Foster Travel Office notebook, CGE 1052. 543Foster Travel Office notebook, CGE 00967. 544Foster Travel Office notebook, CGE 0967. 545Watkins ‘‘soul cleansing memo,’’ CGE 012288. 546Phone records of Cliff Sloan, July 8, 1993, CGE 37130. 547 Committee deposition of Cliff Sloan, June 28, 1996, p. 48. 548Phone logs of Harry Thomason, Thomason document production, Bates Stamp No. 000820.

Thomason had called McLarty on July 6, 1993 and his attorney contacted Cliff Sloan on July

7, 1993.

ing process by which there would be competitive bidding?)’’ 540 On

this same day, Foster’s notes read: ‘‘Need for coordinating litigator.’’ 541

Again on July 8, 1993, Foster’s notes indicate a meeting with

Beth Nolan and Cliff Sloan in which they discussed the status of

Harry Thomason and in which Foster accurately comments, ‘‘cannot evade ‘appointed’ ’’ and points out the 18 U.S.C. 202 definition

of SGE as ‘‘retained . . . to perform formal duties.’’ 542 Learning

the law that applies to special Government employees, Foster recognized there were potential problems.

On July 8, 1993, Peat Marwick auditors brought Foster more bad

news. The auditors strongly disagreed with the conclusions of the

Management Review.543 The seams of the cover-up were beginning

to fray. How would they ‘‘defend the management decision’’ if they

had to worry about Peat Marwick? Would Thomason’s role become

more of a problem if they didn’t have the Peat Marwick report as

an excuse for the firings?

The information regarding Peat Marwick auditors ‘‘disagreeing,’’

which is reflected in Foster’s notebook, appears to have been relayed to him by David Watkins. The notes also appear to discuss

Watkins’ response to the Management Review with Watkins arguing that most managers would make the same decision.544 Mr. Foster’s notes of July 8 reflect sentiments similar to those in Watkins’

‘‘soul cleansing memo.’’ In that memorandum, Watkins’ writes, ‘‘I

. . . explained my decision to terminate them; I explained that

from a management perspective, in this case it was best to relieve

them all immediately from their jobs and provide them an additional two weeks in pay. . . . I explained that in light of the mismanagement, it was best to dismiss the entire office.’’ 545

By this time, Justice Department lawyers were trying to get an

interview with Harry Thomason and Darnell Martens for the ongoing criminal investigation into the Travel Office to no avail. On

July 8, 1993, Thomason’s lawyers contacted the Counsel’s office

and spoke with Cliff Sloan and requested a copy of the notes from

the interview in which Thomason participated with Podesta and

Stern during the Management Review and informed him the Justice Department had requested an interview of Thomason.546 Sloan

did not initially provide the notes, but was later instructed by

Nussbaum to read the notes verbatim over the phone to

Thomason’s lawyer.547

Both Mack McLarty and Rahm Emanuel contacted Harry

Thomason on July 8, 1993.548

On July 9, 1993, there were several news items that directly related to Harry Thomason. The Washington Post carried an analysis

in Al Kamen’s column of Harry Thomason’s status as a special
117

549 ‘‘White House May Clamp Down on Passes,’’ the Washington Post, July 9, 1993. 550 Harold Ickes is currently the Deputy Chief of Staff. His major responsibilities however include handling the damage control matters related to various Clinton scandals from Whitewater

to Travelgate to the various Independent Counsels investigating Clinton officials. Special Counsel Jane Sherburne testified in her committee deposition that she reports to Harold Ickes. 551 ‘‘Ickes, Clinton Insider and Puerto Rico Advocate, Shows Not All Who Lobby Must Wait

in the Hall,’’ Jeffrey Birnbaum, Wall Street Journal, September 21, 1993, p. A24; ‘‘Ickes Has

His Special Pass to the White House Pulled,’’ Wall Street Journal, September 29, 1993. 552Thomason phone logs. 553 ‘‘White House May Clamp Down on Passes,’’ the Washington Post, July 9, 1993. 554 Beth Nolan phone logs for July 9, 1993, Nolan document production, Bates Stamp No.

B00059. 555Memorandum from Nolan to John Podesta and Todd Stern, dated July 1993, Subject: Questions from Travel Office Report re Harry Thomason, CGE 43223–43234; July 10, 1993 draft of

above memorandum, CGE 43235–43246; memorandum from Nolan to Cliff Sloan, July 13, 1993,

Preliminary Thoughts on Travel Office Report re Harry Thomason, CGE 43266–43275; memorandum from Nolan to Sloan, June 20, 1993, Subject: Response to Questions from Republican

Leadership (includes analysis of Thomason as SGE), CGE 043210–43213. 556 ‘‘GOP says Thomason may have broken law,’’ the Washington Times, July 9, 1993. 557 ‘‘GOP says Thomason may have broken law,’’ the Washington Times, July 9, 1993. 558 ‘‘Travelgate Far From Over,’’ the Detroit News, Gannett News Service, July 9, 1993.

Government employee. The article noted that Thomason had a

‘‘special assignment’’ at the White House and was one of the ‘‘couple handfuls’’ of Clinton pals with ‘‘the ultimate power symbols in

Washington: a permanent White House pass that allows free access

to much of the compound. . . .’’ 549 Two other people with White

House passes were Harold Ickes 550 and Susan Thomases. Ickes

and Thomases were exchanging phone calls with Thomason during

this time.551 Harry Thomason called Harold Ickes at 3:50 p.m. on

the afternoon of July 9, 1993.552

Harold Ickes and Susan Thomases, two powerful New York attorneys, were regularly working at the White House throughout the

spring without the benefit of any conflicts of interest analysis or review of their status. Clearly they could be open to many of the

same problems as Thomason.

The Washington Post article also stated that, when asked if the

White House examined this issue, ‘‘a senior official there said the

lawyer in charge of ethics, Beth Nolan, looked into it and concluded

Thomason was not covered by the law.’’ 553 However, Nolan’s phone

logs from the same day show that she had a ‘‘telephone conference

with Vince Foster,’’ which notes that she left a message with Ricki

Seidman, then Communications Director for McLarty, talked with

Podesta and Stern, and planned to call Arthur Jones, a White

House press spokesman. Nolan also had notes which contradict this

statement: ‘‘not clear HT [Harry Thomason] had no official status

(Got it from Mack).’’ 554 Furthermore, the committee is in receipt of

numerous analyses in which Nolan did indicate Harry Thomason

could be viewed as a special Government employee.555

The Washington Times also had an article on July 9, 1993, which

discussed the fact that Republican leaders were investigating

whether Thomason ‘‘used his quasi-federal officer status to steer

White House travel business to his company in violation of federal

law.’’ 556 In this article, White House spokesman Arthur Jones

claimed Thomason never held any official status at the White

House . . . ‘‘He’s not a federal employee . . . He’s just a friend.’’ 557

A hard hitting column in the Detroit News also highlighted the

conflicts of interest problems of Harry Thomason and the role of

high ranking White House officials as well as Mrs. Clinton.558 This
118

559 Both Harry Thomason and Harold Ickes share the same lawyer—Bob Bennett. Mr. Bennett

is also representing the President in the Paula Jones sexual harassment lawsuit. 560Thomases’ Senate testimony regarding this evening meeting with Foster was inconsistent

with previous testimony she had provided to Independent Counsel Fiske on June 14, 1994 in

which she had recounted that she had lunch with Foster and some other people on the Wednesday or Thursday before his death and ‘‘she noted no change in his demeanor or physical appearance but was aware that he was working very hard and was under considerable pressure.’’

‘‘Hearings related to Madison Guaranty S&L and the Whitewater Development Corporation—

Washington, DC Phase,’’ 103d Congress, Volume II, July 29, 1994, pp. 1777–78. 561 Harold Ickes phone logs, Ickes document production, Bates Stamp No. HR–0036. 562 Cliff Sloan phone logs, CGE 037130. Cliff Sloan did eventually read over the phone to

Thomason’s attorney the White House Management Review interview notes from Thomason’s

interview with Podesta and Sloan. Committee deposition of Cliff Sloan, June 28, 1996, pp. 49,

54–56 563 Harry Thomason phone logs, Thomason document production, Bates Stamp No. 0822. 564 Id. 565 CGE 2649–2654. 566 Committee deposition of Harold Ickes, June 14, 1996, p. 90; Thomason deposition, p. 205. 567See hearing on Investigation into the Whitewater Development Corp. and Related Matters,

May 14, 1996. 568 Harry Thomason phone billing records.

column was forwarded to Foster’s attention from Mack McLarty’s

Chief of Staff, Bill Burton.

Mr. Thomason made phone calls to New York lawyer and First

Lady confidante Susan Thomases as well as, Harold Ickes on a

number of occasions in July 1993.559 Susan Thomases, in turn, testified that she talked with Foster about the Travel Office on July

14. Ms. Thomases came to Washington, visited Nussbaum at the

White House, and told him she was worried about Foster.560 Harold Ickes has a July 14, 1993 message from Susan Thomases which

reads, ‘‘1) Alan Barnes—more 2) Vince Foster.’’ 561

On July 14, 1993, Harry Thomason’s attorney was again checked

with Cliff Sloan about obtaining documents related to the White

House Management Review. Mr. Sloan noted that Carl Rauh, one

of Thomason’s attorneys, ‘‘called and talked to him—suggested that

we could discuss matter but I didn’t want to turn over docs. He

agreed.’’ 562

On July 15, 1993, the day after Susan Thomases’ visit with Foster, she called Harry Thomason. Harry Thomason later placed a

call to Thomases at 3:40 p.m. on July 15, 1993.563 At 5:20 p.m. that

evening, Harold Ickes called Thomason.564 At 6:53 that evening,

Foster’s brother-in-law, Beryl Anthony, faxed the names of six attorneys, as was requested by Foster earlier that month.565 Consistent with the lack of recall among senior officials close to the Clintons, neither Harry Thomason, nor Harold Ickes, could remember

anything about these phone calls or ever talking about any concerns about Foster prior to his death.566 Ms. Thomases’ recollections are hazy.567

The next day, Friday, July 16, started out with another flurry of

calls back and forth. Harry Thomason called Harold Ickes at 9:14

a.m. and Susan Thomases at 9:17 a.m. Harold Ickes had a 12:30

p.m. message from Susan Thomases who also called Harry

Thomason that day. On Sunday, July 18, 1993, two calls were

placed to the White House from Harry Thomason’s California residence—one to Mrs. Clinton’s office and the other to the main White

House number.568 Again, no one recalls any details of these conversations. However, from the timing of the calls, the events which

were going on at the time, and the disclosures by Ms. Thomases

that she did speak with Foster about his grave concerns over the
119

569 Committee interview of Webster Hubbell, June 16, 1995. 570The OPR Report notes that Foster spoke with Jim Lyons, Jim Hamilton, Susan Thomases,

Bruce Lindsey and others at the White House about his concerns. OPR Report, p. 91, fn. 97. 571 Informal committee interview, June 16, 1993. 572Foster Travel Office notebook, CGE 001050. 573OPR Report, p. 33. 574OPR Report, p. 85; committee interview of Hubbell, June 16, 1995.

Travel Office, it is very probable these individuals at least addressed matters related to the Travel Office or Mr. Foster’s concerns and depression.

In the days leading up to July 20, 1993, Mrs. Clinton was staying

with the Thomasons at their home in California. Therefore, some

of the phone calls that involved Mr. Thomason also could have included Mrs. Clinton. There may have been discussions about these

matters between or among Thomason, Susan Thomases, Harold

Ickes and Mrs. Clinton.

Over the weekend, Friday, July 16—Sunday, July 18, 1993, Foster decided to go on a weekend trip to the Maryland shore with his

wife. He was joined by Webb and Suzie Hubbell and Michael and

Carolyn Cardozo. Mr. Hubbell testified that he never discussed the

Travel Office with Foster over this weekend, ‘‘even though you may

find that hard to believe.’’ 569 Mr. Hubbell also claims he and Foster never had any conversations about the Travel Office prior to

the firings, and only a few very general conversations after the

firings. Since Foster was such a close friend of Hubbell’s it is difficult to believe that Hubbell didn’t have any conversations about

the Travel Office with Foster over that weekend since he had been

talking with so many other people about this topic at that time.570

Mr. Hubbell also has maintained that he never spoke with Foster

about the Travel Office prior to the firings.571

But there appears to be a cryptic, but logical, reference in Foster’s Travel Office notebook to a conversation that Foster had with

Hubbell on May 13, 1993; a critical day in the Travelgate saga. In

a section where Foster lays out a detailed chronology, on Thursday,

May 13 after he has met with the FBI agents in the afternoon, he

has the reference, ‘‘WH & I, he agrees.’’ 572 The context of the notes

and the timing of these comments suggest that Foster may have

called Webb Hubbell after the FBI agents left that afternoon. Mr.

Foster said he had to check with ‘‘higher ups’’ to see if they wanted

to have the FBI present for the Peat Marwick review. Later in the

evening of May 13, the FBI agents were informed that they should

not plan on attending the ‘‘audit.’’ 573

Mr. Hubbell maintains that he never discussed the matters with

his close friend, Mr. Foster, even though they were together at the

height of the controversy. Mr. Hubbell, at least, acknowledged that

Foster had expressed some general concerns about the Travel Office and his concerns with the workload in the Counsel’s office prior

to this weekend.574 Mr. Hubbell informed the committee that Foster was generally anxious, even paranoid, during this time. Mr.

Hubbell attributed this to Foster’s ‘‘illness.’’ But it also appears

there were real reasons for his concerns about the Travel Office

and that they led directly to White House officials at ‘‘the highest

levels.’’

On the evening of Foster’s death, Mrs. Clinton was travelling to

Little Rock from California. Upon learning of Mr. Foster’s death,
120

575See Final Report of the Special Committee to Investigate Whitewater Development Corporation and Related Matters, June 17, 1996, p. 46. 576OPR Report, p. 90. 577OPR Report, p. 90. 578OPR Report, p. 90. 579OPR Report, p. 90. 580OPR Report, p. 91.

Harry Thomason—who met Foster for the first time in May 1993—

was the second person Mrs. Clinton called. The first person Mrs.

Clinton called was her Chief of Staff, Maggie Williams. Upon concluding her call with Harry Thomason, Mrs. Clinton called Susan

Thomases.575

E. FOSTER STRONGLY ARGUED FOR PRIVATE ATTORNEYS TO ASSIST

THE WHITE HOUSE IN HANDLING THE COMING INVESTIGATIONS BUT

NUSSBAUM REBUFFED HIM. FOSTER DISCUSSED THE ISSUES WITH

OUTSIDE ATTORNEYS AND FRIENDS

On July 9, 1993, the day after Thomason received a call from

McLarty and Thomason’s lawyers informed the White House of the

Justice Department’s request for an interview with Thomason, Foster was seeking outside attorneys to assist White House staff in anticipation of future problems. Foster spoke with his brother-in-law,

Beryl Anthony, asking for names of attorneys.576 Mr. Anthony explained that Foster’s concerns ‘‘might stem from the fact that some

White House staff may have reported information to Foster that

had not been made public but that he would be asked to testify

about.’’ 577

Mr. Foster spoke with Jim Lyons about the need for outside

counsel in this matter. Mr. Lyons is the Denver attorney who did

the ‘‘Lyons report’’ on the Whitewater investments during the 1992

campaign. Foster and Lyons got to know each other through working together on the campaign and throughout the transition.

Mr. Lyons reported that Foster was:

concerned that he was so involved in the Travel Office

matter that it had affected of his objectivity in advising

‘his clients,’ the Clintons, on how to handle the matter.

Foster thought it might be necessary for them to have

independent/outside counsel to advise them on this matter.578

Mr. Lyons also reported that Foster claimed there was something

in the report which concerned him, and he sent the report to Lyons

to see if Lyons could find the source of Foster’s concern.579 Lyons

told Foster that while he saw no apparent problems in the report,

he would be happy to discuss it with him further.580 They spoke

again on the evening of Sunday, July 18, 1993 to plan a meeting

later in the week. Lyons was going to meet with Foster on Wednesday, July 21, 1993.

Mr. Foster repeatedly suggested to Nussbaum that President and

Mrs. Clinton needed outside counsel in this matter. These were not

the rantings of a man losing touch with reality. In fact, it appears

that, despite his depression, Vince Foster was one of the few White

House officials who saw matters clearly.

Mr. Lyons said that Foster discussed the issue of outside counsel

for the President concerning the Travel Office matter with Lyons,
121

581OPR Report, p. 91, footnote 97. Mr. Hamilton has always been represented as the attorney

for Mr. Foster and the Foster family and the impression has been given that Foster had gone

to Hamilton for his own personal legal concerns. But Foster was not seeking Hamilton out as

a personal lawyer but as a lawyer to represent the White House and/or President and Mrs. Clinton. Mr. Hubbell hired Jim Hamilton on the evening of Foster’s death as the family’s attorney.

Initial press reports acknowledged that Foster was looking out ‘‘for the interests of the entire

White House counsel’s office’’ and was not seeking his own attorney. ‘‘Foster was shopping for

private lawyer, probers find,’’ the Washington Post, August 15, 1993, p. A20. 582 ‘‘Excerpts of Remarks in a Meeting with White House Staff on the Death of Deputy White

House Counsel Vincent Foster, Jr.,’’ July 21, 1993, 29 Wkly Comp. Pres. Docs 1351, 1411.

Lindsey, Susan Thomases and Washington attorney James Hamilton.581 Clearly, matters were heating up and talented lawyers were

being sought. Now the White House had to cover-up the cover-up.

XI. FOSTER’S DEATH GENERATED ANOTHER LAYER OF A COVER-UP

OVER A COVER-UP

A. FOSTER’S DEATH SHATTERED A WHITE HOUSE JUST RECOVERING

FROM AN ABYSMAL FIRST 6 MONTHS OF ADMINISTRATION

The President’s popularity polls were just inching over 40 percent when Vincent Foster’s death shattered the White House.

President Clinton’s 36 percent approval rating in May 1993 was

the lowest for any Postwar-President at that point in his administration. The urgency for the need to cover up must be viewed in

the context of a time when the media driven Clinton administration was facing the worst first year of any administration in recent

history. In 1993, President Clinton had fallen fast and the dreams

of a Camelot reprise were vanishing.

For the same reasons that the White House had to keep the lid

on the true Travel Office story and related events, the curtains had

to be drawn around the death of Vincent Foster. If it were learned

that Foster despaired over an out-of-control cover-up of the Travel

Office matter, those at the ‘‘highest levels’’ would not only have to

shoulder the weight of a Travel Office scandal but the responsibility for contributing to Foster’s despair. After Foster’s death, President Clinton strangely and calmly declared, ‘‘no one can ever know

why this happened . . . what happened was a mystery about something inside him.’’ 582

Sadly for the Foster family, efforts to protect the Clinton political

family exposed them to countless and continued investigations into

Mr. Foster’s death that have gone on far longer than they would

have if the President had offered any modicum of cooperation from

the start. What was in Foster’s office that the President wanted to

keep hidden? As the years have passed, we have learned there was

a lot to hide: a lot about Whitewater; a lot about the Clintons personal taxes; and a lot about the Travel Office. What we do not

know is what may be missing. We do, however, have some ideas

about who had the now missing documents. We also have reasons

as to why those documents remain ‘‘missing.’’
122

583Foster Travel Office notebook, CGE 894–1240. 584 It appears that Mr. Nussbaum first disclosed the existence of the Foster Travel Office notebook during a Grand Jury appearance in May 1994. White House Counsel’s Office notes which

were initially withheld from the committee under a claim of executive privilege indicated that

Nussbaum called Eggleston after his Grand Jury appearance. 585This investigation has been hindered by numerous ‘‘lost’’ documents. For example: The

notes of an interview with the First Lady in preparation for her answers to the GAO inquiries

taken by White House Associate Counsel Neil Eggleston are missing. Mr. Eggleston said he left

them at the White House with Special Counsel Jane Sherburne who heads up document production. Ms. Sherburne could not locate the documents left in her custody. An approximately 10

page memo which described allegations against the Travel Office is also missing as is a memo

from Mack McLarty to senior staff describing Harry Thomason’s job while at the White House.

The ‘‘missing’’ billing records which turned up in the White House residence are another example of the migrating records in this White House. 586See generally The Final Report of the Senate Special Committee to Investigate the

Whitewater Development Corporation and Related Matters. July 17, 1996.

B. AT THE TIME OF FOSTER’S DEATH ON JULY 20, 1993, HIS OFFICE

CONTAINED DAMAGING EVIDENCE ABOUT THE TRAVELGATE MATTER

AND RELATED EVENTS. INDIVIDUALS WITH A REASON TO HIDE OR

COVER-UP DOCUMENTS WERE AT OR AROUND FOSTER’S OFFICE

PRIOR TO THE OFFICE BEING SEALED

Mr. Foster was a key attorney involved in the Travel Office matter and, as it turned out, he kept a detailed notebook describing the

events that led to the firings and what occurred in the aftermath

of the firings.583 Since it took almost a year before White House

Counsel Bernard Nussbaum revealed the existence of this document to any law enforcement authority,584 we will never be able to

know if the records are complete. Certainly, the White House has

shown itself capable of misplacing and losing records.585

The facts surrounding Mr. Foster’s death and the handling of his

office and papers have been addressed at length by the Senate

Whitewater Committee.586 Regarding the facts relevant to the

Travel Office, it is particularly interesting that on the evening of

Foster’s death, all three of the individuals who were in his office

before it was sealed had a Travelgate connection:

• White House Counsel Bernard Nussbaum—his office

oversaw the initial requests to the FBI to investigate the Travel Office. Messers. Nussbaum, Foster and Kennedy also sat in

on the meeting where the FBI Public Affairs spokesman was

asked to revise a statement meet the liking of the White

House. In the days before his death, Foster had urged Nussbaum to get outside counsel for President and Mrs. Clinton

and others at the White House.

• Mrs. Clinton’s Chief of Staff Maggie Williams—Ms. Williams had received a copy of the May 17, 1993 memo from

David Watkins, which was ‘‘cc’d’’ to Mrs. Clinton, and helped

prepare talking points with Mrs. Clinton when the Management Report was released. Mrs. Clinton’s role in the firings

had become a key issue following the issuance of the Management Review.

• Patsy Thomasson—Ms. Thomasson was the assistant to

David Watkins and had worked on the Travel Office review by

Peat Marwick. Ms. Thomasson attempted to coerce Catherine

Cornelius and Clarissa Cerda to misrepresent Watkins’ knowledge of their memo proposing a takeover of the Travel Office.

Foster had told Thomasson about ‘‘the clients’ ’’ interest in the

Travel Office.
123

587See The Final Report of the Senate Special Committee to Investigate Whitewater Development Corporation and Related Matters, July 17, 1996. 588Senate Whitewater Final Report, pp. 44–46. 589Senate testimony of Detective Sgt. Cheryl Braun on July 20, 1995, the Washington Times,

July 21, 1995, p. A12. 590Testimony of Detective Sgt. Cheryl Braun, the Washington Times, July 21, 1995, p. A21. 591Foster Travel Office notebook, CGE967. 592 ‘‘Justice was wary of Foster probe,’’ the Washington Times, July 26, 1995, p. A1. 593 ‘‘Investigation of Whitewater Development Corporation and Related Matters,’’ Final Report

of the Special Committee to Investigate Whitewater Development Corporation and Related Matters, June 17, 1996, p. 55. Mr. Hubbell said he had been told by Mack McLarty’s Chief of Staff

Bill Burton that McLarty took care of sealing the office. Mr. Burton claimed not to recall this

even though he had contemporaneous notes that were consistent with this information. In addition Major Hines of the Park Police also testified that he requested Burton on the night of July

20 seal the office. In a 10 a.m. meeting on the morning of July 21, White House officials assured

Chief Langston that the room had been sealed the night before even though it was not.

It is clear that Foster’s office was never properly sealed following

his death; that an inappropriate search of his office was conducted

by Patsy Thomasson, Maggie Williams and Bernard Nussbaum on

the evening of his death; that files may have been removed from

his office, and that Bernard Nussbaum changed the ground rules

for the review of Foster’s office after frantic phone calls to, from,

between and among, Mrs. Clinton, Susan Thomases, Maggie Williams, Bernard Nussbaum and perhaps others in the Chief of

Staff’s office and the Counsel’s office prior to the July 22, 1993

search of Foster’s office.587

Park Police Detective Sgt. Cheryl Braun testified she clearly remembered asking White House Administrator David Watkins to

seal the office on the evening of Foster’s death.588 Sergeant Braun

met with Watkins because she and her partner were requested to

pick up Watkins ‘‘to allow him and his wife to assist us with the

notification to the Foster family.’’ 589 When Watkins introduced

himself he provided Braun with his business card. Braun unequivocally testified that she asked Watkins to seal Foster’s office that

evening. This did not occur.590

When Sergeant Braun requested Watkins to seal the office, Watkins was well aware that his assistant Patsy Thomasson was on

her way to the White House to go into Foster’s office, ostensibly

looking for a note. Mr. Watkins, however, never informed Braun of

this information. Again, the roles of Watkins and Thomasson in the

Travel Office debacle raise questions. Had Watkins provided any

documents to Foster that he wanted to retrieve? In Foster’s Travel

Office notebook there is a reference to a July 8, 1993 meeting

which appears to be with David Watkins. The notes appear to discuss Watkins’ complaints about the Management Review.591

The purpose behind Sergeant Braun’s request, with which Watkins agreed to comply, was essentially being violated at the very

same time. In response to this assertion, Watkins claims, ‘‘I did not

hear such a request . . . If I had been asked, I would have acted.

That was my job.’’ 592 Additional testimony indicated that other

White House officials had claimed to have taken responsibility for

securing the office, however, nobody did.593

By failing to seal Foster’s office that evening and by instead

sending in Patsy Thomasson to rifle through the office, Watkins

and other senior White House officials irreparably harmed any legitimate review process.

One of the key records in Foster’s office at the time of his death

was a Travel Office file which addressed the Travel Office firings
124

594Letter to Chairman Clinger from then-Counsel to the President, Abner Mikva, August 30,

1995. Judge Mikva claimed that the Foster file was first found on July 22, 1993, despite the

fact that Nussbaum, Maggie Williams, Patsy Thomasson and perhaps others had entered Foster’s office on July 20, and July 21, ostensibly to search for a suicide note. Moreover, Nussbaum’s claims that he described the file to investigators and staff present on July 22 are not

credible, as no investigation has found a witness to corroborate his account. 595Letter to committee Investigative Counsel Barbara Comstock from the Clintons’ personal

attorney David Kendall, September 5, 1995. Mr. Kendall explains that there was a file folder

labelled ‘‘White House Project’’ which was empty except for an envelope in it which was addressed to Foster from David Watkins. The envelope was a Brookings Institution envelope. Mr.

Kendall represented that the firm received the file empty on July 27, 1993, when Mr. Barnett

had obtained the files from the White House. 596The White House first released the Foster Travel Office notebook to the press in early July

1995 prior to the Whitewater hearings. This document was responsive to a June 14, 1995 document request that the White House had failed to comply with at that time because the committee would not provide armed security guards and a special room in which to place the

Travelgate documents. On July 13, 1995, the chairman requested a copy of the Foster Travel

Office file that the White House had provided to the press. The committee received the file on

July 19, 1995, and then requested a chain of custody explanation on July 20, 1995. 597Letter to Chairman Clinger from Judge Mikva, Counsel to the President, August 30, 1995;

letter to Barbara Bracher, chief investigative counsel from Jane Sherburne, September 15, 1995. 598See memorandum to Jane Sherburne, ‘‘Foster Travel Office File: Custody and Disclosure

Issues,’’ July 9, 1995, DF 780008–18.

and related issues—particularly issues related to potential conflicts

of interest problems for Harry Thomason. Mr. Foster’s records also

contained a file on a ‘‘White House Project’’—another one of Harry

Thomason’s efforts at the White House.

From the information the committee has to date, it is not clear

where the Foster Travel Office notebook was at the time of Foster’s

death although it does appear likely it was in Foster’s office at that

time. Whether it stayed there until July 22, 1993 is another question because the White House ‘‘chain of custody’’ on the file only

accounts for July 22, 1993 forward.594 The ‘‘White House Project’’

file was one of the 24 files placed in a closet in the White House

residence on July 22, 1993—following Nussbaum’s sham review of

the documents.595

The committee has met with a great deal of White House reluctance in explaining the ‘‘chain of custody’’ of the Foster Travel Office file as well as other files. By July 1995, the White House Counsel’s office had carefully detailed a ‘‘chain of custody’’ analysis of

the Foster Travel Office notebook, yet when the committee made

requests for this explanation, it took the White House almost 2

months to produce information that was clearly available to them

in July 1995.596

In a July 25, 1995 letter to the chairman, former Clinton White

House Counsel, Judge Mikva wrote: ‘‘The actual documents in Mr.

Foster’s Travel Office file remained in the custody of the Counsel’s

Office from the time of his death on July 20, 1993 until they were

provided to Independent Counsel Kenneth Starr.’’ No information

was provided at this time about all of the people who had learned

of the file and how they had come to learn about it. That information was not provided until the committee received additional letters on August 30, 1995 and September 15, 1995.597

It is worth noting that the White House Counsel’s office appears

to have been in close contact with Mr. Nussbaum’s attorneys

throughout the summer of 1995.598 This was a time when Mr.

Nussbaum was also explaining the withholding of this file to the

Senate during Whitewater hearings. This is just one of many examples where the White House Counsel’s office intentionally withheld
125

599Letter to Chairman Clinger from White House Counsel Abner J. Mikva, August 30, 1995. 600 Id. 601Final Report of the Special Committee to Investigate Whitewater Development Corporation

and Related Matters, June 17, 1996, pp. 53–55. 602Letter from Abner Mikva to Chairman Clinger, July 25, 1995; letter from Abner Mikva to

Chairman Clinger, August 30, 1995; letter from Abner Mikva to Chairman Clinger, September

18, 1995.

information from this investigation and provided it with their own

timetables and press strategy.

The documents the committee eventually obtained dealing with

the chain of custody of the Foster Travel Office file were among

those withheld from the investigation until August 1996 due to the

President’s claim of executive privilege. These documents demonstrate how the Counsel’s office worked with Mr. Nussbaum to

craft his explanations for withholding this document.

According to the White House, at least at the time Mr. Nussbaum conducted the search of Foster’s office on July 22, 1993, the

Vince Foster Travel Office notebook was in Foster’s briefcase: ‘‘The

documents were located in Mr. Foster’s briefcase on July 22, 1993

by Mr. Nussbaum . . . ’’ 599 The White House has made no representations as to where the documents were before that time: ‘‘We

have no knowledge of how or where Mr. Foster maintained this

material prior to this date.’’ 600

Since Mr. Foster obviously did not maintain ‘‘this material’’ between the time of his death on July 20 and July 22, 1993, when

Mr. Nussbaum reviewed the material, there is an unaccounted for

lapse of approximately 2 days in the chain of custody for the file.

Did anyone remove this file on the evening of Foster’s death? Secret Service Agent Henry O’Neill did report seeing Mrs. Clinton’s

Chief of Staff removing documents from Foster’s office on the

evening of July 20th.601 Ms. Williams denies removing any documents from Foster’s office that evening. Yet why was Nussbaum so

secretive with this document that he refused to tell his own staff—

staff who were working on Travelgate document requests and documents related to Foster’s death?

When the committee asked for a ‘‘chain of custody’’ explanation

for the file, after the Counsel had thoroughly analyzed this issue,

the White House responded with a cryptic and nonresponsive answer. The committee had to write several more letters before obtaining the appropriate information.602 It is this kind of ‘‘hide the

ball’’ tactic pursued by the White House Counsel’s Office, which

has made this committee question the candor and cooperation of

the President.

C. WHITE HOUSE COUNSEL BERNARD NUSSBAUM OBSTRUCTED NUMEROUS INVESTIGATIONS INTO THE TRAVEL OFFICE AND THE DEATH OF

VINCE FOSTER, BY WITHHOLDING THE VINCE FOSTER TRAVEL OFFICE NOTEBOOK

The withholding of the Vince Foster Travel Office notebook by

White House Counsel Bernard Nussbaum is one of the most blatantly obstructionist actions taken by the White House Counsel’s

Office given both the numerous investigations into the Travel Of-
126

603The discussions between and among White House and Justice Department officials about

the review of Vince Foster’s office following his death have been extensively reviewed in the

course of the Senate Whitewater investigation and will not be re-examined here.

See ‘‘Investigation of Whitewater Development Corporation and Related Matters,’’ the final report of the Special Committee to Investigate Whitewater Development Corporation and Related

Matters, June 17, 1996, ‘‘The Foster Phase,’’ pp. 1–134. 604Memorandum to Jane Sherburne, ‘‘Foster Travel Office File: Custody and Disclosure Issues,’’ July 9, 1995, DF 780008–18. 605FBI interview of Bernard Nussbaum by SA Charles K. Dorsey and SA Scott Salter, July

30, 1993, WMFO 175B–WF–187743. 606Memorandum to Jane Sherburne, ‘‘Foster Travel Office File: Custody and Disclosure Issues,’’ draft, July 9, 1995, DF 780011. 607 Committee deposition of Cliff Sloan, June 28, 1996, pp. 72–78; committee deposition of Neil

Eggleston, June 3, 1996, pp. 94–95. 608 Eggleston deposition, p. 95. 609 Eggleston deposition, p. 97.

fice and the intersection of this matter with the various investigations into Mr. Foster’s death.603

There were numerous investigations underway into the Travel

Office at the time of Foster’s death: 1) the GAO investigation that

was initiated by law on July 2, 1993; 2) the Office of Professional

Responsibility investigation which was initiated by Deputy Attorney General on July 15, 1993; and 3) the Public Integrity investigation of the Travel Office which included both allegations of wrongdoing against the Travel Office employees, as well as, allegations

of conflicts of interest violations of law by Harry Thomason.

Mr. Nussbaum was clearly aware of all of these investigations.

A July 1995 memo to Special Counsel Jane Sherburne, indicates

that ‘‘Nussbaum says he took the file because it concerned an active matter for which he would be responsible.’’ 604 The fact that he

recognized it was ‘‘active’’ indicates that he knew this file was responsive, yet he kept it from numerous investigations.

Following the death of Vince Foster there were additional investigations including: 1) an FBI investigation into the delay in finding the Foster ‘‘suicide’’ note; and 2) Park Police and FBI investigations into Foster’s death. By January 1994, Independent Counsel

Fiske’s investigation was added to this list. As discussed above, investigating the delay in turning over the Foster ‘‘suicide’’ note is

the first investigation for which the Foster Travel Office file would

have been relevant. Nonetheless, Nussbaum very deliberately withheld this vital information from the law enforcement officials who

interviewed him just days after the finding of the Foster Travel Office file and the Foster ‘‘suicide’’ note.605

In July 1995, Nussbaum’s lawyers told the White House Counsel’s office a curious story. They claimed that Nussbaum did not recall any of the document requests but that he did not believe the

Foster Travel Office file was responsive to any of the requests, he

couldn’t remember! 606 Both Cliff Sloan and Neil Eggleston, Associate Counsels who worked on the Travelgate investigations while in

the Counsel’s office, testified that Nussbaum had not informed

them of the existence of this document.607

When Nussbaum called Eggleston in May 1994 to inform him of

the existence of the document, Eggleston asked Nussbaum why he

did not know about it before. Nussbaum did not answer.608 Mr.

Eggleston said, ‘‘why am I just now hearing about this . . . how

could I just now be learning about this. . . .?’’ 609 Mr. Eggleston
127

610 Eggleston deposition, p. 96. 611 Nussbaum deposition, p. 123. 612Sloan deposition, p. 72. 613Foster Travel Office notebook, CGE 894–1240. 614 Eggleston deposition, p. 99. Mr. Eggleston testified that he rarely utilized these files. 615 Eggleston deposition, p. 94. 616 Eggleston deposition, p. 95. 617 Eggleston deposition, p. 96. 618 Eggleston deposition, pp. 132–133. 619Memorandum to Jane Sherburne, ‘‘Foster Travel Office File: Custody and Disclosure Issues,’’ draft July 9, 1995, DF 780008–18. 620 Id., 780013.

agreed that Nussbaum was ‘‘well aware of the type and nature of

documents that were being requested.’’ 610

While Mr. Nussbaum has recently suggested that Cliff Sloan

knew about the Foster Travel Office file, and would remember it

because he has a ‘‘photographic memory,’’ 611 Sloan clearly stated

that he did not have any knowledge of this file and had never seen

it until his committee deposition.612

Furthermore, Nussbaum’s suggestion that Sloan knew about the

file does not explain why Nussbaum would have to call Neil Eggleston to inquire about it. In May 1994 when Nussbaum made his

call to Eggleston, Sloan still worked at the White House. Mr. Sloan,

who initially had worked on the Travelgate document requests had

passed his duties on to Eggleston. If Mr. Sloan had known of the

file as Nussbaum suggests, he certainly would have informed

Eggleston by this time. Why then did Nussbaum consider it necessary to inform the White House about the document? The answer

is that, most likely no one knew it was there and Nussbaum knew

that. Representations made to the committee by the Foster family

attorney, indicate that Nussbaum did not even tell Mr. Hamilton

about this file even though it had been marked ‘‘attorney client

privileged in anticipation of litigation.’’ 613

And where was this mystery document in May 1994 when Nussbaum finally informed someone of its existence? Mr. Eggleston testified that it was filed under the general files in the secretarys’

suite under ‘‘T for Travel’’! 614 Mr. Nussbaum had kept the file in

his office during his tenure. When he left the White House in

March 1994 he apparently placed it in the general alphabetical

files without telling anyone.615

Mr. Eggleston testified he had daily meetings with Nussbaum

from September 1993, when he first joined the White House,

through April 1994 when Nussbaum left.616 Mr. Eggleston would

‘‘discuss with him regularly document requests from GAO and

what we were doing to respond.’’ 617 Mr. Eggleston, a top law school

graduate and Supreme Court clerk, testified about his job as an Associate Counsel under Nussbaum: ‘‘I was a grunt working on this.

Mr. Nussbaum was the decision maker.’’ 618 Mr. Nussbaum made

the decision to keep this highly relevant document under wraps

and away from investigators.

According to a White House analysis, even the White House

Counsel’s office had a hard time explaining this blatant action of

obstruction.619 The White House Counsel’s Office analysis of Nussbaum’s actions shows that the Foster Travel Office file was responsive to at least five requests from GAO 620 yet it was never turned

over. More surprisingly, there was never even any discussion about

the document. The committee has no doubt that the Foster Travel
128

621Testimony of Nancy Kingsbury before the Committee on Government Reform and Oversight on October 24, 1995. 622Memorandum to David Margolis, Associate Deputy Attorney General, from Michael E.

Shaheen, Jr., Counsel, OPR, subject: Undisclosed Foster notebook re the White House Travel

Office Matter, July 24, 1995. 623Testimony of Michael Shaheen before the Committee on Government Reform and Oversight, October 24, 1995. 624 Eggleston deposition, p. 99. 625Shaheen memo, July 24, 1995. 626 Id. 627 Id.

Office file was responsive to GAO requests and GAO confirmed this

in the committee’s October 1995 hearing.621

The Foster Travel Office file was also responsive to an OPR request in August 1993. In July 1995, when OPR Counsel Michael

Shaheen learned of the Foster Travel Office file in the same manner in which the committee learned about it—reading about it in

Newsweek—he wrote a memo in which he complained:

We were stunned to learn of the existence of this document since it so obviously bears directly upon the inquiry

we were directed to undertake in late July and August

1993, by then DAG Philip Heymann . . . the White House

was less than fully cooperative and forthcoming. The fact

that we have just now learned of the existence of obviously

relevant notes written by Mr. Foster on the subject of the

FBI Report is yet another example of the lack of cooperation and candor we received from the White House

throughout the inquiry.622

Mr. Shaheen also testified before the committee in October 1995,

that the lack of cooperation and candor from the White House in

this matter was ‘‘unprecedented’’ in his over 20 year career in Government.623

The White House Counsel’s Office had provided the White House

Management Review interview notes of Mr. Foster to OPR based

on the fact that Foster was not available as a witness.624 If notes

of an interview with Mr. Foster were relevant clearly his own notes

of events would have been even more pertinent. The White House

was also keenly aware of OPR’s mandate to investigate the meaning of Foster’s suicide note which addressed many Travel Office issues. At the outset of the OPR inquiry, Philip Heymann wrote to

Nussbaum and McLarty requesting that the White House assist in

arranging interviews of relevant witnesses in the matter.625

OPR requested that Nussbaum provide notes taken during the

White House Management Review. Mr. Shaheen stated, ‘‘the White

House declined to provide the notes and failed to mention the existence of any handwritten notes by Mr. Foster on the subject.’’ 626

OPR investigators also carefully explained to each witness the purpose of the inquiry and asked for any information they were aware

of—‘‘through conversations with Mr. Foster or otherwise’’—that

might shed light on Foster’s ‘‘suicide’’ note.627 The Foster note read

as follows:

I made mistakes from ignorance, inexperience and overwork

I did not knowingly violate any law or standard of conduct
129

628OPR Report, tab A. 629 Id. 630See Final Report of Special Committee on Whitewater Development Corporation and Related Matters, June 17, 1996, ‘‘The Foster Phase.’’

No one in the White House, to my knowledge, violated

any law or standard of conduct, including any action in the

travel office. There was no intent to benefit any individual

or any group.

The FBI lied in their report to the AG

The press is covering up the illegal benefits they received from the travel staff

The GOP has lied and misrepresented its knowledge and

role and covered up a prior investigation

The Ushers Office plotted to have excessive costs incurred, taking advantage of Kaki and HRC

The public will never believe the innocence of the Clintons and their [loyal or legal] staff.628

Foster’s Travel Office notebook clearly detailed most of the issues

outlined in this note. The notebook would have been the single

most instructive record in explaining the meaning of Foster’s note.

Shaheen concluded:

. . . we believe that our repeated requests to White

House personnel and counsel for any information that

could shed light on Mr. Foster’s statement regarding the

FBI clearly covered the notebook, and that even a minimum level of cooperation by the White House should have

resulted in its disclosure to us at the outset of our investigation.629

Furthermore, the note had been found in Foster’s briefcase, exactly where the Foster Travel Office notebook was found. The note

may very well have been part of the notebook—in fact it was in

many ways a summary of the notebook. In trying to justify withholding this notebook, Nussbaum’s only defense to date for his apparent obstruction, is that everyone in the room on July 22, 1993,

when Foster’s documents were reviewed knew about this particular

document. As is set out extensively in the Whitewater report, no

one else in the room on that day has any recollection of this document.630

Mr. Nussbaum is directly responsible for obstructing the GAO

and OPR investigations. Along with others who had relevant information about the Foster ‘‘suicide’’ note, Nussbaum also obstructed

the FBI investigation into why there was a delay in turning over

the Foster note after it was found on July 26, 1993. (See discussion

below.)

Finally, the DOJ Public Integrity criminal investigation had an

interest in obtaining all documents that related to Harry Thomason

and the work he was doing at the White House. Beginning in the

summer of 1993, Public Integrity began to investigate the issue of

whether Harry Thomason was a special Government employee and

whether or not he had any criminal conflicts of interest problems.

Mr. Foster had been keenly aware of this problem as is evidenced

throughout his Travel Office notebook. There had been a flurry of

phone calls between and among various parties to these concerns
130

631Final Report of the Whitewater Committee, p. 8. 632Memorandum for Lloyd Cutler from W. Neil Eggleston, Re: Foster File, July 10, 1994, CGE

005909–5918. 633 Eggleston deposition, p. 102. 634 Eggleston deposition, pp. 102–103. 635 Committee deposition of Neil Eggleston, June 3, 1996.

as discussed in a previous section. That Nussbaum withheld these

documents from a criminal investigation, is the most clearly obstructionist act of all.

The consistent pattern of withholding information about the existence of this file—even from his own staff—demonstrates a clear

intent on Nussbaum’s part to keep this file away from investigators. This report has already discussed at length the highly relevant information in this file, particularly regarding the role of

Mrs. Clinton and the activities of Harry Thomason in connection

with the Travel Office firings. These facts were highly relevant to

numerous ongoing investigations of which Nussbaum was well

aware.

That Nussbaum never discussed this document with anyone indicates that it was a record that he did not dare discuss even with

his colleagues. After the sham search of Foster’s office on July 22,

1993, then Deputy Attorney General Phil Heymann asked Bernard

Nussbaum: ‘‘Bernie, are you hiding something?’’ 631 The answer

was then and remains today: YES.

D. NEIL EGGLESTON WITHHELD THE FOSTER TRAVEL OFFICE FILE

FROM RELEVANT INVESTIGATIONS EVEN AFTER IT WAS BELATEDLY

DISCLOSED TO HIM BY BERNARD NUSSBAUM

In May 1994, when Eggleston was belatedly informed about the

Foster Travel Office file by Nussbaum, he proceeded to review the

file for an outstanding document request from Independent Counsel Fiske and decided it was not responsive.632 Despite an outstanding document request from the Public Integrity investigation

for all documents related to Harry Thomason, Eggleston ignored

this request entirely. Mr. Eggleston testified that after he reviewed

the Foster Travel Office file, he determined it was not responsive

and placed it back in the ‘‘T for Travel’’ file.633

Mr. Eggleston, who had been involved with narrowing the Fiske

subpoena claims he never discussed the Foster Travel Office file

with any of his colleagues before dismissing it as nonresponsive to

the Fiske subpoena in May 1994.634

Mr. Eggleston’s actions in withholding the Foster Travel Office

from Independent Counsel Fiske cannot be viewed in isolation. By

the spring of 1994 Eggleston had spent months either delaying or

denying sensitive records regarding Harry Thomason to investigators. Mr. Eggleston was in charge of document production on

Travelgate matters beginning in September 1993 throughout his

tenure which ended on September 1994. (The discussion in Section

XII of this report extensively details the delays and dilatory tactics

engaged in by Mr. Eggleston under the direction of Nussbaum.)

Mr. Nussbaum had directed Eggleston not to turn over documents related to Harry Thomason’s attempts to get GSA/ICAP contracts over to the GAO investigation.635 In an April 11, 1994 memo

to the then new White House Counsel Lloyd Cutler and John Pode-
131

636 CGE 7719. 637See deposition of Neil Eggleston, June 3, 1996. 638 July 10, 1994 memorandum for Lloyd Cutler from Neil Eggleston, re: Foster file, CGE

005910–5918. 639Senate Whitewater deposition of Craig Livingstone, July 10, 1995, p. 46. 640Livingstone Senate deposition, p. 53. 641Livingstone Senate deposition, p. 68.

sta, Eggleston noted the White House had not addressed ‘‘the effort

by Martens to get a contract to conduct an accounting of the federal aircraft fleet’’ in responding to GAO.636 The White House did

not end up providing the GSA/ICAP documents to GAO even

though they would have been responsive to GAO’s requests.

When Independent Counsel Fiske published his report on the

death of Vince Foster in June 1994, it focused on Foster’s concerns

about the Travel Office. Mr. Eggleston was asked about Foster’s

Travel Office files by Lloyd Cutler. It was at that time that Eggleston says he realized that the Foster Travel Office file was possibly

responsive to other document requests.637

Mr. Eggleston then wrote what can best be described as a ‘‘CYA’’

memo, explaining why he had not previously disclosed the Foster

Travel Office file to all of the various Travel Office investigations.638 Even though the July 10, 1994 memo clearly indicated

that the Foster Travel Office file should be provided to Public Integrity, it was not turned over for another month. Even at that

time, only portions of the Travel Office file were turned over to

Public Integrity. When the Justice Department asked for an explanation for the delay, Eggleston claimed it was his fault. He resigned shortly thereafter. Mr. Eggleston under the supervision of

two White House Counsels engaged in dilatory delaying tactics in

turning over the Foster Travel Office file. There was a concerted

effort at the White House to keep this document from being public.

Even after Eggleston left and a subpoena was issued for all documents relating to Harry Thomason, relevant documents such as the

Watkins memo was withheld. The pattern of obfuscation continued.

E. CRAIG LIVINGSTONE PROVIDED TESTIMONY ABOUT HIS ACTIVITIES

ON THE MORNING AFTER FOSTER’S DEATH WHICH IS INCONSISTENT

WITH LAW ENFORCEMENT OFFICIALS AND NEW WHITE HOUSE DOCU- MENTS WHICH WERE WITHHELD UNDER A CLAIM OF EXECUTIVE

PRIVILEGE UNTIL AUGUST 1996

Craig Livingstone went with Bill Kennedy to identify Foster’s

body at Fairfax Hospital on the evening of July 20, 1993 upon

learning of Foster’s death from the Secret Service at approximately

9 p.m.639 That evening upon leaving the hospital, Livingstone and

Kennedy went to the Foster home.640 Mr. Livingstone arrived at

his home late that evening after returning Mr. Kennedy to his

home.

The next morning, Livingstone awoke early and made the decision—he claims unprompted—to go over to the Foster home and

watch for any press presence at the home. Mr. Livingstone has testified that he believes he arrived at the White House at 8:14 a.m.

based on the Secret Service logs of when he clocked in to the White

House.641

Exactly when Livingstone arrived at the White House has become an issue in both the general investigation of Foster’s death
132

642Senate Whitewater deposition of Bruce Abbott, June 23, 1995, p. 42. 643Senate Whitewater deposition of Peter Markland, June 28, 1995, pp. 85–88. 644Livingstone Senate deposition, pp. 64–65. 645Livingstone Senate deposition, p. 68.

and the issue of whether any documents were removed from Foster’s office. The latter is significant because a Secret Service agent

testified that he saw Livingstone the morning after Foster’s death

(July 21) coming down from the area of the Counsel’s office with

records.642 Secret Service Agent Bruce Abbott testified that he saw

Livingstone passing his post at the West Wing basement entrance

approximately four times that morning. Mr. Abbott estimates the

time when he saw Livingstone at or around 7 or 8 a.m.

On one occasion Abbott saw Livingstone carrying a briefcase accompanied by a man in his 20s carrying an open box with binders

on the top. Mr. Abbott then spoke to his supervisor, Agent Dennis

Martin, relaying this information about Livingstone.

Mr. Abbott also informed Detective Markland of the U.S. Park

Police about Livingstone. Detective Markland confronted Livingstone and asked him whether or not he had taken boxes down from

area of the Counsel’s office. Mr. Livingstone did not deny that he

had done so but did deny removing any documents from Foster’s

office.643 In testimony before this committee Livingstone stated

that he does not recall ever carrying boxes out of the West Wing.

Mr. Livingstone has reported that he arrived at the White House

at 8:14 a.m. the morning of July 21, 1993 on numerous occasions

throughout his Whitewater deposition:

Question. . . . What’s the next thing you recall, Mr. Livingstone, in connection with Mr. Foster’s death?

Answer. Getting up a couple hours, a few hours later,

and doing my best effort to get to his house around what

time I would have thought the morning news shows would

be, which I seem to remember being around maybe a little

before.

Question. Your chronology says ‘‘on Wednesday July 21st

I drove by the house at 6:30 a.m. and stayed until 8:00

a.m. There was no press activity.’’ Is that your recollection

today?

Answer. Yes, I can’t recall if there was or wasn’t.644

Question. . . . what time did you arrive at the White

House that morning?

Answer. I believe that I arrived at the White House at

around 8:14, something like that, because the Secret Service said that that’s when my pass showed me as entering

the White House. And I don’t believe that I entered the

White House at any other time; therefore, I believe that’s

an accurate accounting of my arrival at the White

House.645

Question. Did you ask them [the Secret Service] to

search their records and see what time you arrived that

morning?

Answer. I did I asked if it was possible.

Question. Who did you ask that?

Answer. Arnold Cole, the Secret Service agent.

Question. Why did you ask Mr. Cole to do that?
133

646 Id., pp. 68–69. 647 Id., p. 71. 648 Id., pp. 73–74. 649Memorandum to the file from Jane Sherburne, subject: Senate deposition of Craig Livingstone (a debriefing of Livingstone’s deposition from his attorney, Randy Turk) attached to a one

page summary, ‘‘Livingstone Deposition.’’ DF781649–50 and a Draft ‘‘Privileged and Confidential’’ Chronology on Foster, dated May 15, 1996 [note: this date may be inaccurate and be the

date of the print of the document rather than when it was written] DF781054–95. 650Memorandum from Livingstone to William Kennedy, ‘‘Re: Extension of Nancy Gemmell’s

employment’’, May 10, 1993. ‘‘I would like to bring on my receptionist . . . salary would be

$17,000. On August 1, 1993, my salary would increase to $50,000 from $45,000 based on the

reduction of salary for the receptionist.’’ CGE 47884.

Memorandum from Livingstone to Abner Mikva, ‘‘Subject: Follow-up to pay adjustment request’’, May 30, 1995. ‘‘I am well deserving of a pay increase to 65K . . . I have done my best

to be a good soldier. I am facing living pay-check-to-pay-check.’’ CGE 48059.

Memorandum from Livingstone to Abner Mikva, ‘‘Subject: Personal Security office issues’’, August 28, 1995. ‘‘I hope to increase the present payroll by $14K the bulk of which $12.5k, would

be used to adjust my salary to $70K. The remaining $1.5k would bring my exec. assistant up

to 30K.’’ CGE 48058.

Memorandum from Jodie R. Torkelson to Kelli McLure, ‘‘Subject: Counsel Office $’’, May 14,

1996. ‘‘Livingstone’s at it again. He’s submitted paperwork for signature giving himself a raise

and saying that he was promised the money by Ab. It’s to go to $70,000. . . . Thanks much.

I’d like to kill this before I leave.’’ CGE 53840.

Answer. Because I could not specifically remember exactly when I arrived, and I knew that I had only come in

once, and I wanted to know when I arrived? 646

Question. Okay. Whatever the reason, your best recollection today is you arrived at the White House around 8:14?

Answer. Whatever the report says, I feel comfortable

that that’s right. I think give or take a minute or two. I

don’t remember the exact time they said.647

Question. How many times were you in the White House

counsel’s reception area before the meeting that began at

approximately 11:00 a.m. that morning?

Answer. I don’t recall specifically. I think—for sure once,

maybe twice.

Answer. I work with these people. I mean, particularly

Ms. Pond I knew. It’s my office. Just to visit.

Question. When you say it’s your office, what do you

mean?

Answer. It’s the office I report to, that I work under.648

However, a new White House document—1 of the 2,000 over

which the President had claimed executive privilege until August

15, 1996—indicates that Livingstone arrived at the White House

that morning between 7:15 and 7:20—not 8:14 a.m. as Livingstone

has contended.649 Thus, the White House had information that was

consistent with the account of the Secret Service agent—not the account of Craig Livingstone. Nonetheless, throughout the past 3

years the White House has bolstered Livingstone’s position and

given him a 40 percent raise in the process.650

Given Livingstone’s highly suspect role in the FBI Files matter,

the committee is skeptical of Livingstone. For example, Livingstone

testified before this committee that he was not Anthony Marceca’s

supervisor. Mr. Marceca was a political operative who helped gather FBI files with Livingstone in 1993.

Mr. Livingstone’s history as a former bar bouncer and political

operative who boasted of such accomplishments as ‘‘deploying

Chicken George’’ at President Bush campaign events made him a

highly dubious choice for heading up the White House Office of
134

651Whitewater deposition of Linda Tripp, July 12, 1995, p. 74. 652White House directory. 653Senate Whitewater deposition of McLarty, July 6, 1995, p. 65.

Personnel Security. The extensive documents the committee has

obtained about Craig Livingstone raise serious questions: Why was

he able to demand substantial raises in the face of so little experience and a checkered background? What prevented the White

House from firing Livingstone?

Linda Tripp, a secretary in the Counsel’s suite provided testimony that Livingstone was not a regular presence in their office

but ‘‘became more a presence thereafter than prior. Bernie used to

call him ‘Cliff ’.’’ 651 Mr. Livingstone reported directly to Bill Kennedy not Vince Foster or Bernard Nussbaum. Mr. Kennedy’s office

was in the Old Executive Office Building, not the West Wing as

were the offices of Foster and Nussbaum.652 Why did Livingstone

become more of a presence in the Counsel’s office after Foster’s

death? Why did Bernie Nussbaum ‘‘promise’’ him a raise that subsequent counsels felt compelled to pay? Why couldn’t anyone fire

Craig Livingstone?

The committee believes there is far more to the Craig Livingstone story than anyone has disclosed to date.

F. EVIDENCE OF MRS. CLINTON’S INVOLVEMENT IN THE RESPONSE TO

THE FINDING OF FOSTER’S ‘‘SUICIDE’’ NOTE. HER DIRECTION NOT TO

TELL THE PRESIDENT ABOUT THE NOTE, ON JULY 26, 1993, WAS

WITHHELD FROM INVESTIGATORS

On the afternoon of July 26, 1993—6 days after Foster’s death,

and 4 days after the search of his office—Associate Counsel Steve

Neuwirth while searching Foster’s briefcase, found a writing by

Foster which was torn up into 28 pieces. Shortly after finding the

note, Mr. Neuwirth was joined by Nussbaum, Bill Burton (from the

Chief of Staff’s office) and Mrs. Clinton. They all viewed the note

and Nussbaum placed a call to Mack McLarty who was travelling

with the President in Chicago.653 It took another 30 hours before

the note was turned over to the proper law enforcement authorities

on the evening of July 27, 1993.

The ‘‘public,’’ sanitized White House version of this story to date

has been that Mrs. Clinton was in the room only briefly, became

upset about the note and quickly left the room. What had not been

revealed to date was that Mrs. Clinton had weighed heavily in on

how to substantively handle this document.

A new and disturbing revelation about omissions in the testimony of Nussbaum, McLarty, Gergen, Burton and Neuwirth has

emerged in light of the committee obtaining the 2000 pages of documents over which President Clinton had claimed executive privilege until August 15, 1996.

A White House Counsel’s office document indicates that these

same individuals who initially failed to tell the FBI of Mrs. Clinton’s being present upon the finding of the note also failed to point

out that one of the reasons for the delay in turning over the ‘‘suicide’’ note—the main reason—was because Mrs. Clinton instructed

Chief of Staff Mack McLarty not to tell the President about it on
135

654Memorandum for the file from White House Counsel Miriam Nemetz, July 13, 1995. This

was a White House debriefing of David Gergen’s attorney. This document was 1 of 2,000 over

which President Clinton claimed executive privilege. DF 781220. 655Memorandum for the file from Miriam Nemetz, July 13, 1995, Re: Gergen deposition. The

debriefing took place 1 day after Mr. Gergen’s July 12, 1995 deposition with the Whitewater

Committee. DF 781220 656 Id.

July 26, 1993.654 White House notes indicate that former Chief of

Staff Mack McLarty said that Mrs. Clinton wanted to delay breaking the news of the Foster ‘‘suicide’’ note to President Clinton.655

In a debriefing conducted of Gergen’s attorney, he told Ms. Nemetz:

Giuffra [Robert Giuffra, Counsel to the Whitewater Committee] did not elicit testimony regarding a second conversation Gergen had with McLarty. According to Burt

Rein, in the later conversation, McLarty said he had decided to wait until the next day to decide whether to turn

over the note. McLarty said that the First Lady was very

upset and believed the matter required further thought

and that the President not yet be told. She said they

should have a coherent position and should have decided

what to do before they told the President.656

But the testimony of David Gergen, as well as others privy to

this information, suggests that they were asked questions which

should have elicited this information if the witnesses had been at

all forthcoming. In Gergen’s deposition he was asked:

Question. Do you have any reason to believe that he [the

President] was advised of the note’s existence prior to 6:00

o’clock on the 27th?

Answer. I have no reason to believe either way. He did

not say in the meetings I attended that he already knew

about it to the best of my knowledge.

Question. I believe you’ve testified that as far as you

know, Mr. McLarty first advised the President of the discovery of the note at 6:00 o’clock on the 27th?

Answer. So far as I know. Mr. McLarty did not tell me

one way or the other that he may have told him about it

prior to that time.

Surely, the fact that McLarty had informed him that Mrs. Clinton

did not want President Clinton to be told about the note gave

Gergen a reason ‘‘to believe either way’’ about whether the President was informed prior to this time. In McLarty’s deposition of

July 6, 1995, he is similarly ‘‘vague and protective’’:

Question. Did you tell the President on Monday night

that something had been found?

Answer. No I did not.

Question. Why not?

Answer. For the reasons, really, that I’ve already suggested. I wanted to see the note, and I wanted to have all

of this in reasonably good order when it was related to the

President. And it just didn’t seem to me that we had this

matter in good order to give him half information about

what the note was and so forth.
136

657 No attempts were made to contact Mrs. Foster on July 26th and Mrs. Clinton specifically

instructed McLarty not to inform the President about the note. 658 Investigation by Special Agent Scott M. Salter, Title of Case: Vincent Foster, Jr.; Deputy

White House Counsel to the President—Victim; 7/20/93; investigative period 7/29/93–8/9/93, CZ

000753–000754. 659See Final Report of the Special Committee To Investigate Whitewater Development Corporation and Related Matters, June 1996. 660 Investigation by Special Agent Scott M. Salter, Title of Case: Vincent Foster, Jr.; Deputy

White House Counsel to the President—Victim; 7/20/93; investigative period 7/29/93–8/9/93,

interview of Bernard Nussbaum conducted on 7/30/93, CZ00707.

The White House story over the past 3 years has been that the

reason the Foster ‘‘suicide’’ note was not turned over to law enforcement authorities for almost 30 hours was because of the need

to contact Mrs. Foster and to inform the President. Yet on the day

the note was discovered neither Mrs. Foster nor President Clinton

were informed.657 The operative phrase in this communication appears to be: ‘‘McLarty said he had decided to wait until the next

day to decide whether to turn over the note.’’

Senior White House officials, including McLarty, have always indicated that there was never any question but that this document

was going to be turned over to authorities. These notes indicate

otherwise.

Senior White House officials, as well as Mrs. Clinton, also have

insisted that Mrs. Clinton had no role in the handling of Foster

documents. These notes clearly indicate otherwise.

It also should be noted that the White House has always claimed

that the President could not be informed about the note until late

the next day because his schedule was so full. However, the schedule produced for the FBI report, addressing why there was a delay

in turning over the note, indicates that the President had a fairly

open schedule that afternoon.658

In light of this new information, a scheduled meeting the next

day—July 27th at 2:30 p.m.—with Mrs. Clinton, Bernard Nussbaum and Steven Neuwirth takes on new significance. Mr. Nussbaum had instructed Neuwirth to research the executive privilege

issues regarding the note. Were executive privilege issues regarding the note discussed in this meeting? July 27th is the day when

there is an almost universal lack of recall among the individuals

who had any contact with Mrs. Clinton on this day.

On July 28, 1993, the day after the Foster ‘‘suicide’’ note was

turned over to law enforcement authorities, then Deputy Attorney

General Philip Heymann instructed Associate Deputy Attorney

General David Margolis to ask the FBI to conduct a thorough and

aggressive investigation into the discovery of the note.659 This investigation was undertaken both because of the failure to find the

note in the course of the July 22 search of Foster’s office, and because of the 30 hour delay in turning it over to law enforcement

authorities.

It is significant, that on July 30, 1993 when Nussbaum was

interviewed about the delay in turning over the note, FBI officials

report that he was aware of ‘‘no other notes or messages left by

Vincent Foster which would be relevant to the investigation of his

death.’’ 660 Mr. Nussbaum never told Agent Salter, the FBI agent

in charge of the investigation, or anyone else about the Travel Office file, yet he claims to have informed them in his Whitewater
137

661Senate Whitewater deposition of Bernard Nussbaum, July 17, 1995. 662See Final Report of the Senate Whitewater Committee, June 17, 1996, ‘‘The Foster Phase.’’ 663FBI Report of SA Scott Salter, August 9, 1993. Investigative period 7/29/93–8/9/93. 664Senate Whitewater deposition of David Gergen, July 12, 1995, p. 145. 665 ‘‘Justice war wary of Foster probe,’’ the Washington Times, July 26, 1995, p. A1.

testimony.661 There has been no testimony from any Justice Department official which supports Nussbaum.662

Mr. Nussbaum and his colleagues who were involved in the review of Foster’s note omitted the fact that Mrs. Clinton had reviewed the note on the afternoon of July 26, 1993. This information

was finally obtained last summer in the course of a deposition of

Bill Burton during the Whitewater hearings. The information

about Mrs. Clinton weighing in on the Foster note was disclosed

only to the Counsel’s office and was studiously withheld from all

investigations.

The FBI interviewed Bill Burton, David Gergen, Mack McLarty,

and Steven Neuwirth about the circumstances surrounding the discovery of the note. These interviews were just days after the finding of the note 663 so these witnesses had no reason to universally

forget information about Mrs. Clinton unless it was by design.

None of the reports of these interviews included the fact that Mrs.

Clinton had been brought in to review the note even though all of

the above individuals were aware of that fact. Mr. Neuwirth, in

testimony before the Whitewater Committee attempted to claim

that he did in fact tell the FBI that Mrs. Clinton had been made

aware of the note but neither the typed account or the FBI agent’s

handwritten notes recorded this information.

Withholding the Foster Travel Office notebook and the information about Mrs. Clinton’s reviewing Foster’s note have one thing in

common: protection of Mrs. Clinton and avoidance of full disclosure

of her role in these matters.

When the note was finally turned over, David Gergen noted that

‘‘Reno questioned the group as to why the note had not been turned

over sooner and she was advised that the only reason that the note

was not turned over sooner was that it had been decided to notify

President Clinton prior to turning over the note and that the first

opportunity to meet with President Clinton occurred at approximately 6 p.m., on July 27, 1993. It was explained that the contents

of the note had potential implications regarding executive privilege.

In addition it was explained to the AG that it had been decided to

meet with Lisa Foster prior to the note being disclosed.’’ 664 Notes

from Mark Gearan regarding the finding of the note indicate that

Attorney General Reno was displeased with the delay. Mr.

Gearan’s notes indicated that Reno was ‘‘worried’’ about the ‘‘lateness’’ in finding the Foster note and the ‘‘length of time’’ the White

House took in disclosing the fact of its existence to any law enforcement officials.665 Cynthia Monaco, an assistant to Deputy Attorney

General Philip Heymann, also confirmed that both Reno and

Heymann were annoyed that the note had not been turned over

sooner. Ms. Monaco noted that Heymann told her he was ‘‘proud’’
138

666 Committee staff interview with Cynthia Monaco, summer 1995. The committee notes that

Ms. Monaco appears to be one of the rare Clinton appointees who had a semblance of a memory

about these events. Ms. Monaco’s testimony was a rare exercise in candor and completeness.

of Reno for taking the White House to task on the tardiness of disclosing this relevant information.666

CONCLUSION

Following the death of Vincent Foster, Jr., the White House deliberately and immediately set upon a pattern of concealment and

obstruction concerning Foster’s documents. That pattern exists to

this day. Senior White House aides implicated in the Travelgate affair were involved with improper searches of the office on the

evening of July 20, 1993 as well as the sham ‘‘official’’ search of

July 22, 1993. Mrs. Clinton also played a role in trying to avoid

‘‘unfettered access’’ to Foster’s office and now we know she also

weighed in on discussions regarding the turning over of the Foster

note. Significantly, Foster’s office contained a large Travel Office

file in his briefcase which was withheld from numerous investigations for years.

XII. THE WHITE HOUSE HAS STONEWALLED ALL PREVIOUS INVESTIGATIONS AND ENGAGED IN AN UNPRECEDENTED DAMAGE CONTROL OPERATION RUN OUT OF THE WHITE HOUSE COUNSEL’S OFFICE

For more than 3 years, the Republican members of the committee—both as minority members and majority members—have attempted to get to the bottom of this matter and faced a White

House intent on withholding key documents and obscuring the

truth. By subpoenaing documents from both the White House and

the individuals involved and by piecing together the documentary

record, it is clear that the White House’s initial ‘‘mea culpa’’ regarding the Travel Office was a whitewash—a ‘‘limited, modified

hangout’’ that was misleading at best.

A. HEARINGS WERE REQUESTED IN 1993 ON THIS MATTER

Providing oversight of 1600 Pennsylvania Avenue entails unique

challenges. More than 3 years ago, Chairman Clinger requested

Travel Office hearings after the White House’s investigation was

led by the Chief of Staff who approved the firings in the first place.

Far from standing the test of time, the White House Management

Review’s credibility did not even survive its first news cycle.

B. WHITE HOUSE HISTORY OF STONEWALLING

The White House response to the various investigations into the

White House Travel Office matter has been a history of 3 years of

stonewalling. Despite a GAO investigation which was mandated by

law—a law which President Clinton himself signed—and an OPR

investigation conducted by the President’s own political appointee,

and a criminal investigation conducted by the Justice Department,

the White House has continued to withhold documents relating to

Travelgate. An abbreviated history of the stonewalling follows.
139

667P.L. 103–50.

1. GAO Investigation

On July 2, 1993, a law was signed by the President which included a provision mandating the GAO review of the Travel Office.667 The report originally was to be completed by September 30,

1993, but due in part to numerous White House delays, interviews

were not completed until March 1994. Furthermore, the White

House repeatedly delayed productions of records critical to the congressionally mandated investigation. In some cases, GAO never

was informed of the existence of key documents responsive to its

requests. In the committee’s October 24, 1995, hearing, a GAO representative testified that the measure of cooperation received from

the White House was less than optimal and that all documents requested were not produced.

The following is an overview of White House delays and denials

in dealing with the investigation of the General Accounting Office’s

congressionally mandated review of the White House Travel Office

matter.

• July 2, 1993: President Clinton signs into law, P.L. 103–50,

Fiscal Year 1993 Supplemental Appropriations Act, which,

among other things, mandates a GAO investigation of the

White House Travel Office matter. The report is due to be completed on September 30, 1993.

• August 11, 1993: GAO held an opening meeting with the

White House to explain the statutory requirements and scope

of its investigation. White House Deputy Chief of Staff Roy

Neel arrived 1 hour late, asked what GAO would do if the

White House refused to provide documents and whether Congress would have access to GAO work papers, including material Neel said, ‘‘could be explosive.’’ Mr. Neel said he considered GAO’s work a ‘‘nuisance’’ he wanted done as soon as possible.

• August 17, 1993: GAO’s Director of Federal Human Resource

Management Issues Nancy R. Kingsbury writes Associate

White House Counsel Clifford M. Sloan GAO’s first document

request covering 20 categories of records concerning Travel Office operations before and after the firings; White House Management Review records; White House press releases, personnel and performance records; records concerning Harry

Thomason and Darnell Martens, among others. A list of 17

White House staff to be interviewed also is attached.

• August 26, 1993: White House (Mr. Sloan) writes GAO (Ms.

Kingsbury) in response to August 17 letter promising to do

‘‘our best to respond expeditiously’’ but provides no documents.

Also agrees to address the timing of any interviews during the

week of August 30, 1993.

• September 14, 1993: GAO Assistant Director John S. Baldwin, Sr., writes White House (Mr. Sloan) with four additional

records requests, including a list of Presidential trips and, trip

files, and procedural and computer manuals relating to the

new Travel Office’s management system.
140

• September 15, 1993: White House (Mr. Sloan) cover letter

provides GAO (Ms. Kingsbury) documents related to the new

Travel Office management system.

• September 23, 1993: Matt Moore meets with Cliff Sloan

about GAO records at 2 p.m. in the White House. [White

House Travel Office Chronology, prepared by Government Reform and Oversight Majority Staff.]

• September 23, 1993: GAO (Ms. Kingsbury) writes White

House (Mr. Sloan) with additional request for Travel Office’s

bank and financial records. Reiterates the need to promptly review documents.

• September 24, 1993: White House (Mr. Sloan) writes GAO

(Ms. Kingsbury) with a document responsive to GAO’s August

17, 1993, letter’s request #3.

• September 27, 1993: White House (Mr. Sloan) writes GAO

(Ms. Kingsbury) four separate letters. Two provide a total of 12

trip files for Presidential trips taking place between April 1992

and April 1993. The other two letters provide documents related to the Travel Office’s Riggs National Bank account.

• September 29, 1993: White House (Mr. Sloan) advises GAO

(Ms. Kingsbury)—in response to GAO’s September 14, 1993,

request—that it is seeking ‘‘an audit report done in 1981 or

1982’’ from Reagan and Bush Presidential archives.

• September 30, 1993: GAO Interim Report on the White

House Travel Office matter was due to the House and the Senate. The report noted the problems GAO was having with the

White House in getting access to documents.

• October 1, 1993: White House (Mr. Sloan) advises GAO (Ms.

Kingsbury) that it is making available White House canceled

checks for May through October 1992.

• October 7, 1993: GAO (Ms. Kingsbury) writes White House

(Associate Counsel W. Neil Eggleston) a 10-page letter reviewing, ‘‘the status of our requests for documents and interviews

from the White House.’’ This letter states that: 16 of 20 requests made in its August 17, 1993, letter were not provided

or were only partially provided; 2 of 3 requests made in its

September 14, 1993, letter were incomplete; 7 of 10 requests

made in its September 23, 1993, letter were not provided or

only partially provided. This letter indicates that the White

House has yet to provide any documents pertaining to

Harry Thomason.

• October 8, 1993: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) providing copies of an anonymous 1988 complaint against Travel Office employees and documents relating

to a 1981 Travel Office internal review.

• October 14, 1993: White House (Peter C. Pappas) writes

GAO (Ms. Kingsbury) two letters, attaching financial disclosure filings of three White House staff and various documents

related to Air Advantage.

• October 14, 1993: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) a letter providing additional documents relevant to a 1981 Travel Office internal review and the 1988

anonymous complaint.
141

• October 15, 1993: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) two separate letters. The first states that the

White House is continuing ‘‘in as expeditious a manner as possible’’ to photocopy Travel Office trip files but notes that the

White House’s understanding of GAO’s statutory authority limits GAO’s trip files request to trips from January 1992 through

May 1993, and refers to redactions of material the White

House considers privileged, relevant to Presidential security, or

not germane. The second letter states that the White House

has been unable to locate any Travel Office petty cash journals.

• October 19, 1993: White House (Mr. Pappas) sends GAO (Ms.

Kingsbury) four letters concerning: 9 trip files; President Clinton’s Travel Office remarks on May 21, 1993, and George

Stephanopoulos’ Travel Office responses in a May 20, 1993,

press briefing; a Bush administration document on ‘‘Prohibited

Contacts with Agencies,’’ and ‘‘In the spirit of cooperation,’’ an

August 6, 1993, copy of a Travel Office Policies and Procedures

Review prepared by GSA.

• October 20, 1993: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) two letters. Letter requests ‘‘narrow and specific requests for the time period after May 19’’ which the

White House will consider in light of the statutory definition

of GAO’s scope. The second declines to provide a copy of the

White House telephone directory and states that interviews

with various White House staffers have completed the White

House response to Paragraph 7 of GAO’s October 7, 1993, letter.

• October 22, 1993: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) letter with four additional trip files.

• October 26, 1993: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) letter with the trip file for President Bush’s

October 25–November 4, 1992, ‘‘campaign swing.’’

• October 28, 1993. White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) letter with enclosures it contends complete

Paragraph 28 of GAO’s October 7, 1993, request.

• November 2, 1993. White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) letter with five additional Travel Office trip

files dated September through November 1992.

• November 3, 1993: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) letter with four additional Travel Office trip

files dating from December 1991, through October 1992.

• November 4, 1993: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) letter with airline ticket reports for 1992 and

travel agent coupons for periods from December 1991, through

June 1992.

• November 5, 1993: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) letter with six additional trip files from February and March 1992.

• November 10, 1993: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) letter with copies of travel agent coupons for

various time periods from February 1992, through March 1993.

• November 10, 1993: GAO (Mr. Homan) facsimiles White

House (Mr. Eggleston) handwritten memo stating that GAO is

available for interviews ‘‘on Friday between 8 a.m.–12 noon
142

and 2–4 p.m.’’ Still to be interviewed: Jeff Eller, Mark Gearan,

John Podesta, Todd Stern, Chris Vein, Jack Kelly (6 of the

original 17 requested interviewees).

• November 12, 1993: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) letter with five further trip files for January

and February 1992.

• November 15, 1993: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) letter with two additional trip files from January and September 1992. Attached to this document are three

letters addressed to the Internal Revenue Service attaching

trip files.

• November 18, 1993: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) three letters with: additional copies of travel

agent coupons for March/April 1993; and documents relevant

to Paragraph 2 of GAO’s October 7, 1993, request.

• November 23, 1993: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) two letters with: eight further trip files from

June through August 1992, and Travel Office itineraries for

January 1992.

• November 29, 1993: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) two letters with: Travel Office itineraries for

February 1992, and a copy of a newspaper article attached to

Catherine Cornelius’ and Clarissa Cerda’s February 15, 1993,

Travel Office reorganization memo.

• November 30, 1993: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) two letters: one includes additional trip files;

the second includes a 1987 study of White House Facilities and

Operating Units.

• November 30, 1993: White House (Mr. Eggleston) writes

GAO (Ms. Kingsbury) letter confirming GAO’s withdrawal of a

request to interview a representative of the Vice President’s

National Performance Review (NPR) ‘‘setting forth the relationship between the Review and the actions taken with respect to the Travel Office.’’

• December 1, 1993: White House (Mr. Pappas) forwards Travel Office itineraries for March 1992, to GAO (Ms. Kingsbury).

• December 2, 1993: White House (Mr. Pappas) sends GAO

(Ms. Kingsbury) two additional letters. One encloses Travel Office itineraries for April 1992. The second enclosed five additional trip files.

• December 3, 1993: GAO (Ms. Kingsbury) writes White House

(Mr. Eggleston) a 15-page letter updating the status of GAO’s

work, White House document productions and interviews. It

reviews some 27 of 36 document requests not yet provided

or only partially provided by the White House as of that date—

5 months into the investigation. It further notes that 4 White

House staffers and 1 GSA staffer have yet to be interviewed:

Gearan, Eller, Podesta, Stern and Kelly (GSA). It closes with:

‘‘If the White House does not intend to arrange these interviews, or does not possess or intend to provide any of the documents requested, we respectfully request that you explain the

circumstances or reasons in writing to us by January 10,

1994.’’
143

• December 4, 1993: Neil Eggleston meets with Bernie

Nussbaum, John Podesta, Cliff Sloan and Todd Stern

concerning how to deal with GAO. Among those issues

discussed was whether GAO should be provided access

to White House Management Review documents. Mr.

Nussbaum decided, ‘‘No.’’ Mr. Eggleston notes dated December 4, 1993, discuss Travel Office issues including

ICAP, say not to provide GAO the Management Review

interview notes.

• December 6, 1993: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) contending that GAO’s ‘‘December 3, 1993, Request Compilation unnecessarily introduces a measure of confusion into the process of requesting documents and interviews

and responding to such requests’’ and that it ‘‘undermines our

effort to cooperate in this matter.’’ It suggests that GAO has

‘‘chosen to alter the requests and the completeness of the responses’’ and requests that GAO redraft the December 3, 1993,

letter.

• December 7, 1993: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) with eight additional trip files.

• December 7, 1993: GAO (Ms. Kingsbury) writes White House

(Mr. Eggleston) a 16-page letter superseding its December 3,

1993, letter updating the status of document requests and separating new requests from outstanding requests. This letter indicates that the White House still has provided no Harry

Thomason documents to GAO.

• December 8, 1993: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) two letters with: six further Travel Office trip

files and Travel Office itineraries for May through August

1992, respectively.

• December 9, 1993: David Watkins is interviewed by

GAO with Watkins’ attorney Ty Cobb and Associate

White House Counsel Neil Eggleston in attendance. It is

at this interview that GAO learns of First Lady Hillary

Rodham Clinton’s involvement in the White House Travel Office matter.

• December 14, 1993: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) with five further trip files.

• December 14, 1993: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) four letters regarding, respectively, December

7, 1993, Paragraphs 5 (‘‘fully complied with’’), 7 (‘‘fully complied with’’), 37 (‘‘decline to provide a briefing about the general procedures for the granting of access passes’’ . . . but

agree to provide a witness to explain how the procedures applied to Messrs. Thomason and Martens) and 41 (declining to

respond to a request for current legal conclusions).

• December 15, 1993: Neil Eggleston writes a memo for

the White House’s GAO/Travel Office file outlining,

‘‘GAO Themes in Questioning.’’ Several of the themes

deal with Mrs. Clinton, including: ‘‘Mrs. Clinton—the

Management Report omits earlier involvement by her in

the matter and fails to report her conversation with

David Watkins on the night of Friday, May 14th.’’ Also

notes, ‘‘The authors of the Management Review were
144

pressured to omit embarrassing details about Mrs. Clinton or the Administration from the Report.’’

• December 15, 1993: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) two letters. In one, the White House claims to

have complied with Paragraph 6 of GAO’s December 7, 1993,

letter, ‘‘to the extent that we believe the request is relevant to

the GAO inquiry’’ and declining further response without

GAO’s establishing the relevance of materials withheld. This

request involved resumes, applications, appointment documents and financial disclosure filings of Kennedy, Watkins,

Cornelius, Cerda and Eller. In the second, it claims to have

provided what was requested of Paragraph 32 of the December

7, 1993, letter, the article attached to Cornelius’ and Cerda’s

February 15, 1993, memo.

• December 16, 1993: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) two letters enclosing Travel Office itineraries

for September through November 1992, and providing additional trip files.

• December 16, 1993: GAO (Ms. Kingsbury) writes White

House (Mr. Eggleston) clarifying outstanding requests and adding others arising from the GAO’s interview of David Watkins,

including a request that Mr. Eggleston arrange for GAO to

interview Mrs. Clinton, whose name came up in the Watkins

interview. GAO noted it only asked whether or not the

White House had made a determination. GAO adds that

its ‘‘normal procedures . . . when someone reports to us

that another party made certain statements, we arrange

an interview . . . ’’ The letter notes that the White

House has refused to provide information on whether or

not the White House had determined Harry Thomason

and Darnell Martens’ status as Special Government Employees.

• December 19, 1993: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) letter with December 1992, Travel Office itineraries.

• December 21, 1993: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) letter with further Travel Office trip files.

• December 29, 1993: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) six separate letters claiming to complete its

responses to Paragraphs 1, 9, 11, 14, 17, 31. Per Paragraph 1,

Eggleston claims that GAO’s failure to address a White House

letter dated October 20, 1993, leaves the White House unable

to comply with this request concerning White House Travel Office management since May 19, 1993, and interviews with

Foucart and Riewerts. Responding to a GAO inquiry concerning lower charter costs under new Travel Office management,

two Brian Foucart memos dated May 27 and May 31, 1993.

The other five letters claim prior completion or completion

based on attached documentation.

• December 30, 1993: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) two letters. One declines to produce the White

House phone book and the second claims to complete the White

House response to Paragraph 50. attaches a memorandum

from Matthew Moore to David Watkins circa February 15,
145

1993. This includes a chart that identifies Billy Dale and his

staff as ‘‘Bush Person[s]’’.

• January 3, 1994: White House (Mr. Pappas) forwards GAO

(Ms. Kingsbury) additional Travel Office itineraries for January and February 1993.

• January 4, 1994: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) two letters including the March 1993, Travel

Office itineraries and additional trip files, respectively.

• January 7, 1994: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) letter enclosing miscellaneous travel data and

binders.

• January 8, 1994: White House (Mr. Pappas) writes GAO

(Ms. Kingsbury) letter enclosing miscellaneous travel binders.

• January 13, 1994: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) two letters making more Travel Office worksheets, binders and trip files.

• January 18, 1994: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) letter responding to a request on Page 15 of

GAO’s December 7, 1993, request compilation for information

concerning the Vice President’s National Performance Review

(NPR) and the review of the White House Travel Office. Attached to this letter is a memo to Ms. Kingsbury from Todd J.

Campbell, Counsel to the Vice President, stating that there

was no connection between them.

• February 3, 1994: White House (Special Hearings Counsel

Matthew Moore) writes GAO (Ms. Kingsbury) letter providing

a list of Presidential trips from May 22 through December 31,

1993.

• February 9, 1994: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) letter enclosing copies of the cover and title

page of a book on bookkeeping for small business.

• February 14, 1994: GAO (Ms. Kingsbury) writes White

House (Mr. Eggleston) two letters concerning ‘‘a compulsively

complete list’’ of what GAO still needs to complete its work by

the end of the month. Some 21 items, identified as ‘‘A’’ through

‘‘V,’’ are attached.

• February 14, 1994: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) two letters. One challenges the relevance of

request ‘‘M’’ from GAO’s February 14, 1994, letter. This referred to several people identified on several passenger lists as

Travel Office staff and requests they be identified as civilian

or military personnel and that the White House arrange interviews with them. Mr. Eggleston requests that GAO indicate

how the request ‘‘would contribute to the statutorily defined

scope of the GAO review.’’ The second encloses information

concerning checks and deposit slips missing from a previous

production.

• February 17, 1994: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) nine separate letters responding to various of

February 14, 1994’s compiled requests. These letters: 1) seek

to limit Paragraphs ‘‘A’’ and ‘‘B’’ [respectively: post-May 19 trip

files and operations records; and all records pertaining to the

decision to bring World Wide Travel and Penny Sample into

the White House] per issues of GAO’s ‘‘scope’’; 2) note that the
146

White House has provided all relevant documents it could locate for item ‘‘C’’ [documents describing policies and procedures

in place before May 1993, including all financial management

records]; 3) enclose White House’s KPMG Peat Marwick payment documentation per ‘‘G’’; 4) confirm that Travel Office

records in FBI custody do not include complete copies of press

billings from March 1992 through May 1993; 5) ask that GAO

provide copies of its documents to assist the White House in

fulfilling a request; 6) names the five fired non-supervisory

Travel Office employees and their new Federal employers; 7)

clarify a request concerning relevant and irrelevant documents

in a Gary Wright briefcase; 8) address 9 World Wide Travel file

folders; and, 9) make limited production of documents from a

‘‘Presidential and Vice Presidential Visit Manual.’’

• February 18, 1994: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) six letters responding to various of February

14, 1994’s compiled requests. They include: 1) ‘‘Trust Travel

Fund Reconciliation;’’ 2) press information; 3) travel guidelines;

4) billing for various trips; 5) refund log; and, 6) bus contacts

and master call-out list with phone numbers.

• February 23, 1994: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) two letters explaining that it cannot comply

with two separate requests because: 1) Travel Office documents [documentation of who paid for new ticketing equipment

installed in May 1993, before American Express entered the

Travel Office] ‘‘were not kept in the form reflected in the inventory and are no longer identifiable’’; and, 2) the 15 to 20-yearold documents requested are ‘‘far beyond the scope of GAO’s

original request.’’

• March 4, 1994: Bernard Nussbaum resigns as White House

Counsel.

• March 9, 1994: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) letter attaching Harry Thomason and Darnell

Martens White House pass applications.

• March 14, 1994: GAO (Ms. Kingsbury) writes White House

(Mr. Eggleston) three letters. They request: 1) ‘‘copies of processing documents used’’ to further its understanding of Travel

Office financial management’’; 2) authorization to ask Riggs

National Bank questions concerning the Travel Office Press

Fund, whether Travel Office payments are subject to the

Prompt Pay Act and State and local tax issues; and, 3) copies

of trip files for the new Travel Office management.

• March 16, 1994: GAO (Ms. Kingsbury) writes White House

(Mr. Eggleston) letter with questions to be asked of First

Lady Hillary Rodham Clinton, Leon Panetta, Patsy

Thomasson and Margaret Williams. She requests that the

written responses to these questions be provided to GAO by

March 25, 1994.

• March 19, 1994: GAO’s Ms. Kingsbury completes a draft of

the Travel Office report. [White House Travel Office Chronology, prepared by Government Reform and Oversight Committee majority staff.]
147

• March 25, 1994: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) to state that it ‘‘anticipates’’ being able to respond to requests due that day the following week.

• March 25, 1994: GAO (Ms. Kingsbury) writes White House

(Mr. Eggleston) letter beginning, ‘‘I understand that you are

busy these days, but I am concerned that we have not been

able to be in contact at least by telephone . . . ’’ and adding,

‘‘Finally, I must express serious concern about our recent experiences with obtaining clearance for staff on this assignment.’’

• March 25, 1994: White House (Mr. Eggleston) responds to

GAO (Ms. Kingsbury) letter on access.

• March 30, 1994: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) four letters which respectively: 1) request that

someone call Matt Moore for William Kennedy’s notes of his

conversations with FBI agents prior to the Travel Office

firings; 2) direct GAO to seek drafts of KPMG Peat Marwick

from Peat Marwick itself; 3) state that a briefing paper referenced in paragraph 6 of GAO’s mid-March document request

cannot be located; and, 4) responds to GAO written questions

directed to Watkins and McLarty on their behalf. States that

Watkins recalled, ‘‘his conversation with Mrs. Clinton on this

issue was on the evening of May 14, 1993;’’ and that McLarty

recalled meeting with the First Lady on May 13, 1993.

• March 31, 1994: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) regarding a June 3, 1993, memo from Vince

Foster to David Watkins regarding 14 C.F.R. 121.

• April 1, 1994: White House (Mr. Moore) facsimile transmittal

cover sheet to GAO (Nancy Kingsbury) regarding ‘‘Letters in

Response to Travel Office Review Requests. Attached is an

April 1, 1994, White House memo (Mr. Eggleston) to GAO (Ms.

Kingsbury) regarding Paragraph E of GAO’s February 14,

1994, request (granting White House passes in general and

Thomason/Martens White House passes in particular) which he

said were forwarded to GAO on March 9.

• April 4, 1994: Neil Eggleston writes a memo to White House

Counsel Lloyd Cutler, Joel Klein, John Podesta and Todd Stern

regarding Travel Office issues involving IRS. Mr. Eggleston

discusses the issue of IRS taking the position that the White

House is obligated to pay excise taxes on Travel Office press

charters. Attached to this memo is a draft copy of the GAO

Travel Office Report on the IRS.

• April 11, 1994: Neil Eggleston writes a memo to White

House Counsel Lloyd Cutler and John Podesta concerning the

GAO Travel Office document requests, noting that the White

House had not addressed ‘‘the effort by Martens to get a contract to conduct an accounting of the federal aircraft fleet . . .’’

because it previously had decided that the documents were not

responsive.

• April 12, 1994: GAO representatives Nancy Kingsbury,

David Clark, and others meet with White House staffers Neil

Eggleston, Patsy Thomasson, Brian Foucart, Steve Riewerts,

Kim Johnson and Matt Moore to discuss completion of the

GAO report and outstanding issues.
148

• April 13, 1994: White House (Mr. Moore) facsimile transmittal cover sheet to GAO (Nancy Kingsbury) followed by White

House (Mr. Eggleston) letter to GAO (Ms. Kingsbury) listing

individuals responsible for baggage security.

• April 13, 1994: GAO (Ms. Kingsbury) writes White House

(Mr. Eggleston) letter stating GAO’s need to ‘‘verify that the

copies of documents we have received are authentic,’’ and ‘‘survey the universe of documents to determine if any classes of

records were withheld.’’ The letter includes a listing of documents to be verified.

• April 16, 1994: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) letter responsive to Paragraph D of GAO’s

February 14, 1994, request compilation, with attached memorandum to Harry Thomason and Markie Post concerning their

meetings at the White House on April 30 and May 1, 1993, and

the White House Project. These documents were withheld for

almost 10 months from GAO even though they were available

immediately.

• April 22, 1994: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) two letters. One breaks down administrative

leave costs of the five fired non-supervisory White House Travel Office employees. The second addresses the status of a Department of Agriculture detailee to the Travel Office.

• April 23, 1994: White House (Mr. Eggleston) writes GAO

(Ms. Kingsbury) letter confirming that ‘‘GAO has not requested

documents prepared in connection with the White House Management Review,’’ and adding that the White House did not

provide attorney notes and analysis prepared after the events

in the Travel Office. GAO had been told by Podesta and Stern

that they only took a ‘‘thimblefull of notes’’ in the course of

their review.

• May 2, 1994: GAO issues its final Travel Office Report. • May 3, 1994: David Watkins writes a letter to Mrs. Clinton:

‘‘Hillary—The GAO erred in stating that I said that you urged

me to replace members of the travel office with ‘our people.’

‘Urge’ is not a word I commonly use. Additionally, as I know

you have experienced many times, the statement was reported

out of context without my complete response to their questions

being reported. Obviously, I regret any and all press references

and their innuendoes as it related to your involvement in this

affair. I have always known who my ‘client’ is.’’

• July 10, 1994: Neil Eggleston writes a memo to the file regarding the Vince Foster Travel Office file and how it may or

may not be responsive to numerous investigations including

GAO, OPR, Public Integrity and Independent Counsel Fiske.

He subsequently decides it is responsive to Public Integrity but

only portions are provided 1 month later. Mr. Eggleston says

that there is no need to tell GAO and OPR because they have

completed their reports.

• September 7, 1994: Neil Eggleston writes a memo to Patsy

Thomasson and Jodie Torkelson about Travel Office issues and

the status of GAO documents, IRS audit and FBI investigations into Billy Dale, Harry Thomason and Darnell Martens.

This memo is copied to White House Counsel Lloyd Cutler,
149

668 July 14, 1993, letter from Attorney General Janet Reno to the Honorable Jack Brooks.

Joel Klein and Chris Cerf. A day later, Eggleston writes a letter to Stuart Goldberg at Public Integrity announcing his resignation, effective immediately. A clear pattern emerges in the

course of this document production: documents that were potentially damaging to Billy Dale were the first out the door,

while those that deal with Harry Thomason or ‘‘high level’’

White House officials were deliberately and extensively delayed. Documents re: Harry Thomason clearly were requested

in the first GAO request on August 17, 1993. Yet no Harry

Thomason documents were produced until March 9, 1994, several days after Independent Counsel Fiske subpoenaed records

from the White House and several days after the resignation

of Bernard Nussbaum. The withholding of documents re: Harry

Thomason and Darnell Martens and their business ventures

was deliberate and consistent with attempts to withhold these

documents from all other investigations.

2. OPR investigation

Following the issuance of the White House Management Review,

the Attorney General committed to reviewing the report and following up on any aspects necessary.668 By July 15, 1993, then Deputy

Attorney General Heymann tasked the Office of Professional Responsibility to conduct a review of ‘‘the conduct of the FBI in connection with its contacts with the White House on the Travel Office

matter and to report its findings and recommendations. The report

was completed on March 18, 1994 but never released by the Justice

Department.

Initially the Justice Department was requested to delay the release of the report due to the Independent Counsel investigations—

both by Independent Counsel Fiske and Independent Counsel

Starr. By the summer of 1995, OPR realized it, too, had been

stonewalled for 2 years by its own White House, which refused to

provide access to Vince Foster’s Travel Office notebook. The Foster

notebook was concealed from all previous investigations for 2 years.

In a scathing July 24, 1995, Justice Department internal memo,

OPR Counsel Michael Shaheen wrote:

[W]e were stunned to learn of the existence of this document since it so obviously bears directly upon the inquiry

we were directed to undertake in late July and August

1993 . . . we believe that our repeated requests to White

House personnel and counsel for any information that

could shed light on Mr. Foster’s statement regarding the

FBI clearly covered the notebook and that even a minimum level of cooperation by the White House should have

resulted in its disclosure to us at the outset of the investigation.

In fact, as early as December 1993, OPR considered approaching

Attorney General Reno to request a full Travel Office investigation

because ‘‘very dangerous signals’’ suggested possible obstruction of

its investigation.
150

• July 15, 1993: Then-Deputy Attorney General Philip

Heymann decided to call on the Justice Department’s Office of

Professional Responsibility to conduct a review of the FBI’s

role in the Travel Office firings. Later, after Vincent Foster’s

death and the discovery of his ‘‘suicide note,’’ Mr. Heymann

added to the investigation a review of the comments in Vincent

Foster’s note about the ‘‘FBI lied.’’

• July 28, 1993: Then Deputy Attorney General Heymann publicly announced a review of the FBI’s role in the Travel Office

firings and included a review of the comments in Vincent Foster’s note about the ‘‘FBI lied.’’ The FBI had also been tasked

on this date with investigating the delay in the turning over

of the Foster ‘‘suicide’’ note.

• August 1993: First letter to Nussbaum requesting documents.

• Summer 1993: White House failed to provide the Vince Foster Travel Office file. OPR Counsel Michael Shaheen wrote a

scathing memo in July 1995 about not receiving this document

for OPR’s investigation. Mr. Shaheen wrote: ‘‘we were stunned

to learn of the existence of this document since it so obviously

bears directly upon the inquiry we were directed to undertake

in late July and August 1993 . . .’’

• The White House only provided the White House Management Review notes from the interview with Vincent Foster to

OPR. OPR had asked for all of the interview notes. Mr.

Shaheen wrote: ‘‘The White House declined to provide the

notes and failed to mention the existence of any handwritten

notes by Mr. Foster on the subject.’’

• Mr. Shaheen also stated in his memo: ‘‘we believe that our

repeated requests to White House personnel and counsel for

any information that could shed light on Mr. Foster’s statement regarding the FBI clearly covered the notebook [the

Vince Foster Travel Office notebook] and that even a minimum

level of cooperation by the White House should have resulted

in its disclosure to us at the outset of our investigation.’’

• Shaheen noted that the Vince Foster Travel Office notebook

also had been withheld from the Independent Counsel.

• Mr. Shaheen and members of his staff informed committee

Counsel in an interview in August 1995 that by December

1993, OPR was considering going to the Attorney General to

request a full investigation into the Travel Office matter because of the ‘‘very dangerous signals’’ sent to the investigators

which indicated possible obstruction of its investigation.

Shaheen and his investigators noted that the memories of

White House witnesses were very vague and this was only several months after the events in question. Mr. Shaheen’s investigation was cut short by the appointment of the Independent

Counsel.

JUSTICE DEPARTMENT, PUBLIC INTEGRITY SECTION

While the Clinton White House cooperated fully with the Public

Integrity Section’s investigation of Billy R. Dale, its refusal to provide documents relevant to Public Integrity’s investigation of Harry

Thomason and Darnell Martens for more than a year was so egre-
151

gious that the Chief of Public Integrity, Lee Radek, concluded on

September 8, 1994:

At this point, we are not confident that the White House

has produced to us all the documents in its possession relating to the Thomason allegations. . . . [T]he White

House’s incomplete production greatly concerns us because

the integrity of our review is entirely dependent upon securing all relevant documents.

The following week, the Clinton administration’s own Public Integrity Section was forced by these concerns to subpoena all documents responsive to its investigation of Thomason and Martens.

Even then, the Clinton administration refused to produce some 120

responsive documents. Due to White House obstruction, Public Integrity had prosecuted—and lost—the Dale case before it even had

received all documents relevant to its investigation of Thomason

and Martens.

• May 1993: Public Integrity began a criminal investigation

into the Travel Office matter and shortly thereafter began an

investigation into the roles of Harry Thomason and Darnell

Martens at the White House.

• July 1993: The Department of Justice began trying to get an

interview with Harry Thomason while Thomason’s lawyer

began trying to get access to the White House Management

Review interview notes of Harry Thomason.

• Summer 1993: Public Integrity began seeking documents

from the White House in the summer of 1993 but received little information. As of September 30, 1993, Prosecutor Goldberg

wrote to the White House ‘‘to confirm that the White House

had only located two documents related to Harry Thomason.’’

• October 12, 1993: White House Counsel sent an agreement

which would allow Public Integrity Prosecutor Goldberg to

‘‘view’’ the two Harry Thomason memos.

• November 12, 1993: Goldberg signed an agreement to view

two Harry Thomason ‘‘White House project’’ memos but not

take any notes or make copies. At this point, almost 6 months

after the firings and 6 months after the initiation of an investigation into Travel Office related matters, no one at the White

House appears to have mentioned the GSA/ICAP contracts

Harry Thomason and Darnell Martens generated while seeking

business for their company, TRM.

• January 1994—Spring 1994: Public Integrity continued to

seek documents about Harry Thomason’s activities at the

White House and received its first ICAP/GSA contract documents regarding efforts by Harry Thomason and Darnell

Martens to seek Government contracts.

• March 14, 1994: Public Integrity wrote to White House

Counsel Eggleston asking for confirmation in writing that the

White House had searched for all Harry Thomason files.

• April 5, 1994: Neil Eggleston distributed a memo to gather

all Harry Thomason and Darnell Martens documents by April

7, 1994. It requires a signed certification stating: ‘‘I have

searched my files and I have no documents responsive to the

requests set forth in this memorandum.’’
152

• April 5, 1994: An FBI e-mail on this date titled: ‘‘WHTO Update’’ states: ‘‘there has been some problem in obtaining

records from the White House regarding Thomason’s duties

and responsibilities. Goldberg is considering issuing a subpoena . . .’’

• Spring 1994: Production of Harry Thomason documents to

Public Integrity continues. Matt Moore and Neil Eggleston

were involved in document production. (Matt Moore possessed

copies of the Watkins memos that were never turned over.)

• May 11, 1994: Neil Eggleston, Joel Klein and Marvin Krislov

(all in the White House Counsel’s office) wrote a letter to the

Independent Counsel addressing how the White House would

comply with the Independent Counsel’s grand jury subpoena.

(Their letter narrowed the scope of the Independent Counsel’s

initial request.)

• May 1994: Neil Eggleston reviews the Foster Travel Office

file to determine if it is responsive to the Fiske subpoena. He

decides that it is not. Eggleston apparently ignores the fact

that the Foster Travel Office file, which mentions Harry

Thomason and Darnell Martens throughout, is responsive to

the Public Integrity document requests.

• June 24, 1993: Neil Eggleston writes a letter to Stuart Goldberg informing him that Public Integrity has all of the Harry

Thomason documents as of this date. (Vince Foster Travel Office file is not included.)

• July 10, 1994: Neil Eggleston writes a memo to Lloyd Cutler

about the Vince Foster Travel Office file and why it wasn’t produced to any investigation to date. Eggleston recommends producing only portions of the Foster notebook to Public Integrity

by that Tuesday (July 12, 1994). Those portions are not provided until 1 month later.

• August 30, 1994: Neil Eggleston provides the additional documents from Foster’s Travel Office notebook to Public Integrity

(approximately 20 pages of the 100-plus page document are

provided.).

• August 30, 1994: Public Integrity prosecutor Goldberg writes

the White House to ask why Harry Thomason documents were

withheld and asks for an explanation by September 8, 1994.

• September 8, 1994: Neil Eggleston writes Goldberg explaining why he failed to turn over all of the Harry Thomason documents saying ‘‘I sincerely apologize for the oversight and hope

that the delay in production of these documents has not caused

you any inconvenience . . . please be advised that I have resigned effective September 8, 1994.’’

• September 8, 1994: Public Integrity Chief Lee Radek writes

a memo to Jack Keeney stating: ‘‘At this point we are not confident that the White House has produced to us all documents

in its possession relating to the Thomason allegations . . . the

White House’s incomplete production greatly concerns us because the integrity of our review is entirely dependent upon securing all relevant documents.’’

• September 13, 1994: A Grand Jury subpoena for documents

from the White House relating to Harry Thomason and Darnell
153

Martens is served on the White House with a September 30,

1994, due date.

• September 30, 1994: All Harry Thomason and Darnell

Martens pursuant to the September 13, 1994, subpoena are

due to the Grand Jury. The White House produced a ‘‘PRIVILEGE LOG’’ which identifies more than 120 documents that

the White House refuses to turn over to its own Justice Department in the course of a criminal investigation involving activities at the White House.

• July 6, 1995: White House provides complete Vince Foster

Travel Office file to the press.

• July 28, 1995: White House, in responding to Public Integrity Prosecutor Goldberg, sends more pages of Vince Foster

Travel Office notebook.

• August 17, 1995: Public Integrity prosecutor Goldberg reviews more Vince Foster documents at the White House with

White House Associate Counsel Natalie Williams.

• November 4, 1995: In the midst of the Billy Dale trial, a

White House Associate Counsel faxes a memo on the Travel

Office files that is dated 5/21/93. The memo was from a member of the White House Records Management staff who expressed concerns about the handling of the documents in the

Travel Office after the firings. The memo had not been provided previously to Public Integrity or to defendant Billy Dale,

whose criminal trial was under way.

• November 6, 1995: The White House sends additional unknown documents to Public Integrity Prosecutor Goldberg.

In summary, nearly 6 months had passed before the White

House allowed Public Integrity prosecutors to see any documents

related to Harry Thomason and nearly a year to provide most of

the ICAP/GSA documents. The White House refused to provide the

Vince Foster Travel Office file in its entirety until July 1995, after

it released the file to the press. Portions of the file had been provided to Public Integrity in August 1994. A September 1994, subpoena failed to produce this document in its entirety.

The White House also failed to provide the Watkins ‘‘soul cleansing memo’’ which was in Patsy Thomasson’s files despite numerous

document requests and the September 1994, subpoena. At the very

least, David Watkins, Matt Moore and Patsy Thomasson were

aware of the existence of this document throughout the course of

document requests.

Even after the September 1994, subpoena from Public Integrity,

the White House produced a privilege log of 120-plus documents it

refused to provide to its own Justice Department in the course of

a criminal investigation. White House production of documents to

Public Integrity continued throughout the course of the Billy Dale

trial in October-November 1995. Since these documents belatedly

were provided to Public Integrity, they also belatedly were provided

to the defendant during his trial instead of before the trial began.

Public Integrity does not appear to have sought documents directly from Harry Thomason until after the Billy Dale trial ended

and after both the Committee on Government Reform and Oversight and the Independent Counsel had sought documents from

Thomason and Martens. New documents regarding efforts by
154

Thomason and Martens to seek business for TRM were included in

these productions to the Justice Department after Billy Dale’s trial.

Public Integrity’s tolerance of White House foot-dragging was in

stark contrast to the aggressive pursuit of Billy Dale and his family

throughout the course of the criminal investigation of Mr. Dale.

The contrast is stark between Public Integrity Section’s prosecution of Billy Dale and its utter passivity while the White House

stonewalled its investigation of Thomason and Martens. Its criminal investigation of Billy Dale was compromised from the beginning. The FBI relied on uncorroborated—and false—allegations of

kickbacks against the Travel Office employees in launching a criminal investigation. But for nearly a month, it ceded control over

Travel Office documents to a White House that pledged to secure

them while allowing numerous individuals with and without White

House passes free reign to review and destroy documents critical

to its investigation.

In the midst of the Dale investigation, FBI Supervisory Special

Agent Bowie was unaware the White House ordered a ‘‘Management Review’’ of the Travel Office matter which provided a ‘‘headsup’’ of sort. The Management Review provided political cover to the

Clinton administration while forewarning the White House of potentially embarrassing discoveries and ‘‘explosive documents’’ in

the words of Deputy Chief of Staff Neel. The Management Review’s

discovery that the kickback allegations against the Travel Office

employees were baseless is a prime example: the White House refused to inform the FBI or Public Integrity of this fact.

In Dale’s case, an FBI e-mail stated that Justice inexplicably intended to indict ‘‘before the November elections.’’ In addition, prosecutor Stuart Goldberg was well-aware that Travel Office records

it was obligated to secure had been lost. As Goldberg himself informed IRS agents: ‘‘Records that were there at one time are now

missing and they don’t know who took them. Mr. Goldberg stated

that it may have been Catherine Cornelius.’’ Even so, Justice prevented Dale from using this information at trial in his own defense.

Yet in its investigation of Thomason and Martens, even after

Justice attempted to end the White House’s year-long stonewall

with a grand jury subpoena, it passively acceded to a White House

privilege log of 120 withheld documents.

Public Integrity’s experience with the Clinton White House offered further evidence of administration obstruction while providing critical insights into its own tale of two very different investigations.

XIII. STONEWALLING THIS COMMITTEE’S INVESTIGATION

A. HISTORY OF SEEKING TRAVELGATE DOCUMENTS FROM THE WHITE

HOUSE

1. Chairman Clinger’s efforts to investigate while in the minority

Chairman Clinger began the investigation into the Travel Office

matter while he was the ranking minority member of the committee. Ranking Member Clinger’s efforts in the minority from 1993–

94 included:

• June 16, 1993: Chairman Clinger joins Republican leadership in requesting documents and responses to questions re-
155

669GAO notes on meeting with Roy Neel, August 1993.

garding the Travel Office. (No substantive response ever was

provided.)

• August 6, 1993: Chairman Clinger joins Republican leadership in requesting information on the IRS investigation and

other Travel Office questions. (No substantive response ever

was provided.)

• October 15, 1993: Chairman Clinger writes Bernard Nussbaum concerning the status of Harry Thomason as a special

Government employee. (No substantive response ever was provided.)

• September 13, 1994: Chairman Clinger requests that the

White House provide access to GAO documents maintained at

the White House. (Access never provided—later memo shows

White House Counsel Neil Eggleston recommended denying

the request after the Appropriations bill for the White House

had passed.)

• September 20, 1994: Chairman Clinger again requests access

to GAO documents at the White House.

• October 1994: Chairman Clinger issues a report analyzing

the GAO report on the Travel Office and calling for hearings

on the discrepancies found in the GAO work papers versus the

final report, and other outstanding issues.

2. Committee efforts in the 104th Congress

In the beginning of the 104th Congress, Chairman Clinger committed to a full investigation into the Travel Office matter and

began making inquiries of the White House in the spring of 1995.

The White House initially would not even provide the GAO working papers which Roy Neel had described as ‘‘explosive,’’ and recommended against congressional review.669

The committee initiated document requests on the Travel Office

matter beginning in June 1995. Initially, the White House conditioned its compliance on the provision of armed security guards to

protect the ‘‘explosive’’ documents. The foot-dragging that followed

is outlined below.

• June 14, 1995: Committee makes first document request to

White House focusing on White House Management Review

documents and documents related to Harry Thomason’s activities at the White House.

White House Response:

• Throughout June and July 1995, White House fails to

produce any documents and requests that the committee

hire security guards to protect any documents provided to

the committee.

• July 18, 1995: White House produces the Vince Foster

Travel Office file several weeks after providing it to the

press.

• August 2, 1995: White House produces documents, 90

percent of which have been previously made publicly available (i.e. White House Management Review copies, GAO

report copies, press conference transcripts).
156

• August 9, 1995: White House produces more copies of

the Management Review from various files and several

miscellaneous documents.

• August 28, 1995: White House produces miscellaneous

handwritten notes by White House employees.

• September 5, 1995: White House produces a privilege log

identifying 900 pages of documents from the White House

Management Review.

• September 13, 1995: After negative press reaction to

White House privilege log, the White House produces approximately 400 pages of interview notes from the 900

pages of Management Review documents.

• September 18, 1995: White House produces Bruce

Lindsey documents regarding efforts by Harry Thomason

and Darnell Martens to obtain GSA consulting contracts

for their business, TRM. These documents had not been

identified previously as documents that were being withheld in the privilege log. (On this same day, Harry

Thomason cancels a previously scheduled interview with

committee staff.) • September 18, 1995: Committee makes second document request to White House requesting all White House Travel Office

documents from all of the various investigations.

White House Response: • September 25, 1995: White House produces more notes

from the White House Management Review.

• September 28, 1995: White House produces more documents from Bruce Lindsey’s office, Counsel’s office and Office of Administration.

• October 4, 1995: White House produces additional White

House Management Review documents.

• October 5, 1995: White House produces documents from

Neil Eggleston and Bill Kennedy.

• October 13, 1995: White House produces documents from

Counsel’s office, Office of Administration and Records

Management.

• October 17, 1995: White House produces documents from

Cliff Sloan, Neil Eggleston and various White House Management Review files.

• October 24, 1995: Committee holds first hearing on the

Travel Office matter.

• October 26, 1995: Billy Dale embezzlement trial begins.

• November 14, 1995: White House produces more White

House Management Review documents, including lengthy

chronologies and drafts, but still does not provide the legal

analysis done by Beth Nolan about Harry Thomason’s status as a special Government employee.

• November 16, 1995: Billy Dale acquitted.

• December 19, 1995: White House Counsel sends out

memo to all staff in response to committee document requests.

• December 22, 1995: White House produces more documents from Joel Klein, Office of Records Management,

Cliff Sloan, Patsy Thomasson and Counsel’s office.
157

• December 29, 1995: Watkins memo ‘‘found’’ at the White

House.

• January 3, 1996: White House produces more documents

from various White House offices. Watkins memo is produced. • January 5, 1996: Committee issues personal subpoenas to

David Watkins and Harry Thomason for all Travel Office documents.

• January 11, 1996: Committee issues subpoenas to White

House for all outstanding documents and to six individuals at

White House (due on January 22, 1996).

White House Response: • January 22, 1996: White House produces documents

from Counsel’s office, Chief of Staff’s office, Office of Administration and other offices.

• January 29, 1996: White House produces documents

from miscellaneous files including those of Patsy

Thomasson and Catherine Cornelius.

• February 1, 1996: White House Counsel sends out memo

to all staff requesting all documents responsive to the January 11, 1996 subpoena due on January 22, 1996.

• February 14, 1996: White House produces documents

from various individual files. • February 7, 1996: Committee sends individual subpoenas to

more than 25 present and former White House staff (due February 26, 1996).

• February 15, 1996: Committee issues interrogatories to Mrs.

Clinton due on February 29, 1996. (Subsequent request for an

additional 3 weeks to respond is granted.) • February 15, 1996: White House distributes a memo to

present and former staff, volunteers and others who received personal subpoenas requesting that they turn over

their documents to the White House and stating that the

White House in turn will produce relevant documents to

the committee.

• February 22, 1996: White House produces documents

from various White House offices, including notes taken by

a White House intern monitoring the Billy Dale trial and

documents related to Billy Dale trial. White House represents that responsive documents have been produced

and this should complete production but that there are

documents they believe are subject to privilege which they

are withholding. No privilege log is provided.

• March 4, 1996: White House produces additional documents.

• March 8, 1996: White House produces documents from

Cliff Sloan, Todd Stern, Matt Moore, Dee Dee Myers, Natalie Williams and Counsel’s office.

• March 15, 1996: White House produces a small number

of documents including a never before produced letter to

Mrs. Clinton from David Watkins dated May 3, 1994—the

day after the GAO Travel Office Report was issued.

• March 21, 1996: First Lady provides responses to committee’s interrogatories regarding the Travel Office.
158

• April 1, 1996: White House produces additional documents including the first e-mail produced by the White

House.

• April 2, 1996: White House produces additional documents from Cliff Sloan’s records and Office of Personal

Correspondence.

• April 18, 1996: White House produces documents from

Dee Dee Myers that were left out of earlier productions

(documents are notes from May 1993, concerning the Travel Office).

• April 24, 1996: White House produces several pages of

additional documents from Tom Castleton, David Watkins

and Information & Systems Technology. • May 9, 1996: The committee held White House Counsel Jack

Quinn and White House aides David Watkins and Matthew

Moore in contempt for failing to turn over documents. • May 9, 1996.—White House Counsel writes Chairman

Clinger a letter claiming blanket executive privilege on behalf of President Clinton over 3,000 pages of documents

being withheld from the committee. Attached is a letter to

the President from Attorney General Reno endorsing that

claim. The Attorney General had not reviewed any documents at that time. The committee votes to hold Messrs.

Quinn, Watkins and Moore in contempt of Congress.

• May 30, 1996: The White House delivers to the committee 1,000 of the 3,000 pages over which it previously had

claimed executive privilege and a privilege log for the remaining documents. The committee postpones a scheduled

contempt vote on the floor of the House against White

House Counsel Quinn in order to review the documents

and log. Included in these documents was a December 20,

1993 request for Billy Dale’s FBI file. • June 5, 1996:—In light of the committee’s discovery of the

White House’s December 20, 1993, request of Mr. Billy Dale’s

confidential FBI background file, Chairman Clinger writes

President Clinton to request that the remaining 2,000 pages of

documents over which he has claimed executive privilege be

produced.

• June 10, 1996.—White House Counsel advises Chairman

Clinger that the 2,000 pages still withheld under a claim

of executive privilege are ‘‘unquestionably within the scope

of this privilege.’’

• June 18, 1996.—Chairman Clinger writes a letter to Ranking

Member Cardiss Collins, who has agreed to act as an

intermediary to the White House concerning the 2,000 pages.

This letter lists documents the committee deems essential to

obtain from the remaining 2,000 pages and asks the White

House to certify that no other documents remain outstanding.

• June 25, 1996.—White House Counsel Quinn agrees to

Chairman Clinger’s proposal as contained in the chairman’s letter of June 18, 1996, to Ranking Member Cardiss

Collins.

• June 27, 1996.—Chairman Clinger and committee staff

begin review of remaining 2,000 pages of documents at
159

committee offices in the presence of White House personnel.

• June 28, 1996.—Chairman Clinger writes White House

Counsel Quinn, raising the issue of White House

redactions and insufficient detail in the White House privilege log as it relates to the review of the 2,000 pages.

• July 10, 1996.—White House Counsel Quinn writes

Chairman Clinger suggesting protocols for deposing White

House lawyers, and recommends confirming White House

redactions with the assistance of a neutral third party.

• July 12, 1996.—White House Counsel Quinn writes

Chairman Clinger a letter memorializing his interpretation of an agreement to interview White House attorneys.

It suggests that Chairman Clinger has agreed to provide

White House lawyers, in advance, with notification of subjects that will or will not be covered.

• July 18, 1996.—White House Counsel Quinn writes

Chairman Clinger concerning the reviewing of redacted

documents accompanied by one majority staff member,

Ranking Member Collins or her designee and one minority

staff member. This letter also acknowledges that Chairman Clinger has reserved the right to request any material relating to Mr. Craig Livingstone.

• July 24, 1996.—Chairman Clinger clarifies White House

Counsel Quinn’s misinterpretation of agreements outlined in

Counsel Quinn’s July 12, 1996, letter, suggesting that White

House lawyers be advised in advance of subject matters to be

covered or excluded in depositions. Under separate cover,

Chairman Clinger writes Counsel Quinn a letter indicating

more than 200 pages of documents unidentified in the White

House privilege log.

• July 31, 1996.—Chairman Clinger writes White House Counsel Quinn, after personally having spent 6 hours reviewing redacted White House documents, requesting that the White

House produce all responsive documents in three categories: 1)

communications with outside attorneys relating to interviews,

depositions or Grand Jury appearances; 2) briefing materials

and questions prepared for Congress; and, 3) the review of Mr.

Foster’s office.

• August 15, 1996.—White House produces 1,400 of the

2,000 pages of documents it had withheld under claims of

executive privilege.

The above chronology demonstrates the dramatic lengths to

which the committee had to go to assure that the White House

would provide all responsive documents. Even after 3 years of effort, we know there are still missing documents that are relevant

to this inquiry that have been ‘‘lost’’ at the White House or by outside parties.
160

670The committee had been repeatedly informed by the White House Counsel that the January 29, 1993 memo simply didn’t exist. 671March 5, 1993 memo to Harry Thomason from Darnell Martens with attached memo on

the Travel Office. 672 Handwritten notes of Jane Sherburne, undated, discussing Travel Office issues and Harry

Thomason liability, DF 781903. 673February 11, 1993 memo seeking Federal Government contracts, CGE 2223.

B. WHITE HOUSE PROTECTION EFFORTS WERE PARTICULARLY KEYED

TO WITHHOLDING DOCUMENTS POTENTIALLY DAMAGING AND

SHIELDING KEY PLAYERS

1. Harry Thomason Role

Time and again, the committee has been denied critical documents responsive to the investigation. Sometimes, we were told

documents did not exist only to later have those documents appear

when we subpoenaed the right people. This happened with two critical documents: a January 29, 1993 memo from Darnell Martens to

his partner Harry Thomason and a March 5, 1993 memo. These

documents establish that the idea of seeking Government business,

including that of the Travel Office, for their company, TRM, was

explored by the two.670 Harry Thomason finally turned over this

document under threat of a subpoena in December 1995. The

March 5 memo to Harry Thomason discussed Martens’ efforts to

gather incriminating information on the Travel Office employees

while promoting TRM for a plan to take over the Travel Office.671

These documents suggest that long before Harry Thomason promoted rumors of wrongdoing in the Travel Office, he was seeking

Government business for TRM. This information was shielded from

the public for the past several years by Thomason’s White House

allies.

The President withheld notes by Special Counsel Jane Sherburne

concerning how the White House responded to various requests for

Harry Thomason documents. Ms. Sherburne noted:

Only DOJ knows this . . . not GAO or Hill. Relevance

is if SGE, wld [would] be conflict. Route to their indictment is from here—which wasn’t part of Mgmt Review.

Problem: allegations that GAO didn’t get it and we not disclose.672

Mr. Thomason used his access to the White House to discuss opportunities for Federal Government contracts with the President in

February. President Clinton forwarded Harry Thomason’s business

proposal to McLarty, Gearan and Watkins after writing ‘‘these guys

are sharp.’’ 673 The ‘‘ICAP’’ documents which discussed this proposal were the records that were withheld from GAO and Congress.

Curiously, the documents the committee obtained from Harry

Thomason were never even requested by the Justice Department,

which was charged with investigating Thomason’s activities at the

White House. Only after the committee obtained these and many

other documents regarding Harry Thomason, Darnell Martens and

TRM did the Justice Department in turn seek to obtain documents

this committee already had received. Had the Justice Department

been conducting a thorough investigation, it would have sought

documents from Harry Thomason.
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674Mr. Eggleston believes it is most likely that he did take notes and says he left them at

the White House with Special Counsel Jane Sherburne who has headed up the document production for the White House in response to the committee’s requests and subpoenas. See committee deposition of Neil Eggleston, June 3, 1996. 675 Committee deposition of Neil Eggleston, June 3, 1996. 676OPR interview of Howard Apple and Patrick Foran. 677OPR interview of Howard Apple and Patrick Foran. 678 Harry Thomason’s phone logs. 679 Handwritten notes of David Watkins, May 31, 1993, PM 00169. 680 Harry Thomason phone logs. 681See Chairman Clinger letter of December 14, 1995, to White House Counsel Jack Quinn

and response from Counsel Quinn to Chairman Clinger on December 20, 1995, in Correspondence between the White House and Congress in the Proceedings Against John M. Quinn, David

Watkins and Matthew Moore.

2. Notes of Interview with Mrs. Clinton—Missing

The committee also learned that documents that once existed

now supposedly are among the missing. Also missing are notes

taken by Neil Eggleston of his interview with Mrs. Clinton in response to GAO questions about Mrs. Clinton’s role in the firings of

the Travel Office employees.674 The White House has informed us

it had not been able to locate these critical notes. Mr. Eggleston

testified that he probably did take such notes and that he left all

of his notes in the custody of Special Counsel Jane Sherburne.675

Who had access to this critical evidence in addition to Sherburne

and why has it disappeared?

3. Missing Memo in Kennedy’s office which was reviewed by FBI

agents

The committee also has identified another key missing Travel Office memo identified by two FBI agents who said it was shown to

them by Bill Kennedy when he summoned them to the White

House to initiate the FBI investigation of the Travel Office employees. According to the FBI agents, Kennedy told them that a friend

of the President’s was unsuccessfully trying to get business.676 Mr.

Kennedy pulled out a memo that detailed alleged wrongdoing by

Travel Office employees—kickbacks, lavish lifestyles and the

like.677 This approximately 10 page memo was shown to the

agents, but they were not provided with a copy. These same agents

were told of ‘‘highest levels’’ interest in the White House.

That same morning, Harry Thomason was scheduled to meet

with President Clinton.678 Harry Thomason had been in touch with

Mrs. Clinton prior to his meeting with the President according to

documentary evidence the committee has obtained.679 Mr. McLarty

and Susan Thomases also were on Thomason’s White House schedule in this timeframe.680

The White House claims the missing 10 page document allegedly

shown to FBI agents doesn’t exist—another mystery document that

the White House and Kennedy claimed to know nothing about.681

The White House asks that the committee take Kennedy’s word

over that of two FBI agents after he left the White House under

an ethical cloud. This is yet another situation in which the White

House contradicts the recollections of career public officials who

have no reason to provide incorrect information.
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682Public Integrity interview of Jennifer O’Connor, August 1993. 683 Id. 684 Response to committee interrogatories for Mrs. Clinton, March 21, 1996. 685 Id. 686Foster Travel Office file, CGE 1003. 687See committee depositions of John Podesta, June 5, 1996, and Todd Stern, May 29, 1996. 688WHMR interview of Harry Thomason, May 27, 1993, CGEPR 451–465.

4. Missing Mack McLarty Memo

Another ‘‘missing’’ document is a document that first was identified by Jennifer O’Connor in the summer of 1993.682 Ms. O’Connor

recalled a memo that Mack McLarty had sent to senior staff explaining what Harry Thomason would do at the White House.683 A

directive from the Chief of Staff explaining the purpose of

Thomason’s efforts would be logical since Harry Thomason made

requests of dozens of staffers to meet with him on ‘‘the White

House Project.’’ The McLarty memo, as described, would explain

Thomason’s official role at the White House.

C. WHITE HOUSE RESPONSE ON MATTERS RELATED TO MRS. CLINTON

Particularly as regards the role of Mrs. Clinton, Watkins was not

alone in being ‘‘vague and protective.’’ Mrs. Clinton herself could

remember little of substance about communications regarding the

Travel Office, except for derogatory information about its fired employees.684

Mrs. Clinton recalled derogatory information with a specificity altogether lacking in her other recollections. She had no clear recollection who provided her with this information. Under oath, however, she acknowledged, ‘‘I became aware from Vincent Foster or

Harry Thomason of concerns about financial mismanagement in

the White House Travel Office.’’ 685 Since Mr. Foster’s notes seem

to indicate that he first learned of this matter from Mrs. Clinton,

not the other way around, it appears that only leaves Harry

Thomason as the likely source of Mrs. Clinton’s information.686

When it comes to the role of Mrs. Clinton, the hazy memories of

the various players in the Travelgate saga exhibit a striking pattern of obfuscation and obstruction. This has been the case in each

successive investigation, from the White House itself to congressional committees and the GAO to the Independent Counsel.

The following are just some of the instances where White House

staff airbrushed Mrs. Clinton out of the Travel Office picture and

related events:

• When Podesta and Stern were initially tasked with conducting the White House Management Review, notes from the authors indicate that Chief of Staff Mack McLarty did not immediately disclose conversations he had with Mrs. Clinton in

which she had urged action on the Travel Office matter. Nor

did McLarty immediately provide them with the May 17 memo

regarding the firings which was ‘‘cc’d’’ to Mrs. Clinton and

which discussed Harry Thomason bringing the allegations to

light.687

• On May 27, 1993, just a week or so after the firings, Harry

Thomason in an interview for the White House Management

Review failed to discuss any of the conversations he had with

Mrs. Clinton about the Travel Office.688 (Mrs. Clinton has
163

689 Handwritten notes of Natalie Williams, DF 780464–780465. 690 Responses to committee interrogatories for Mrs. Clinton, March 21, 1996. 691WHMR interview of Vincent Foster, June 3, 1993, CGEPR 240–259. 692WHMR interview of Vincent Foster, June 30, 1993, CGEPR 258–259. 693WHMR interview of David Watkins, June 3, 1993, CGEPR 487–508. 694Watkins memorandum, CGE 12286–12294. 695GAO interview of Mack McLarty, March 24, 1994. 696 ‘‘Chronology of Travel Office firings,’’ May 25, 1993, CGEPR 563–564. 697Final Report of the Special Committee on Whitewater, pp. 83–90.

made public statements that she did not think it was Harry

Thomason who brought the Travel Office issue to her attention. But notes in the 2,000 pages indicate that Thomason’s attorneys acknowledged he did have conversations with Mrs.

Clinton: Document DF 780464 reads, ‘‘Harry ‰ conversations

with her in passing ‰ 1 or 2 in passing ‰ he recalls being in

office abt Little Rock/Inauguration. Travel Office comes up ‰ Status report. Told her abt things he believed were wrong.

They should be replaced disloyalty ‰ —remembers telling DW

should be replaced, and that FC shares his view.—could ‰ did

this during the campaign ‰ could do the job ‰ ‰ probably

told her about plans.’’ 689 And under oath in answers to interrogatories submitted to the committee, Mrs. Clinton acknowledged that Harry Thomason or Vincent Foster brought the

matter to her attention.690) • On June 2, 1993, in Vince Foster’s White House Management Review interview,691 he made no mention of his numerous conversations with Mrs. Clinton about the Travel Office.

But he did note that he considered some of his conversations

to be privileged. He later relayed contacts in a June 30, 1993

meeting but downplayed them.692 At this time or sometime

shortly thereafter, Foster started keeping a detailed notebook

in which he outlined the conversations he had with Mrs. Clinton about the Travel Office. This notebook was kept from investigators for years. Notes in the 2,000 pages of withheld documents refer to entries in the notebook which could be used to

suggest Mrs. Clinton urged hasty action by Watkins and others.

• On June 2, 1993, in Watkins’ White House Management Review interview, Watkins made no mention of his conversations

with Mrs. Clinton about the Travel Office.693 Indeed in his

‘‘soul cleansing’’ memo, Watkins noted he had been ‘‘vague and

protective’’ and that there would be ‘‘hell to pay’’ if things were

not done as Mrs. Clinton wanted.694

• In a March 21, 1994, GAO interview, McLarty recounted one

meeting that he had with Mrs. Clinton on May 13, 1993, about

the Travel Office. Mrs. Clinton says she ‘‘stopped by McLarty’s

office to say that she had heard about inefficiencies in the

Travel Office and asked him to look into it.’’ 695 Mr. McLarty

did not discuss a later May 16th encounter with Mrs. Clinton

which was explained in his copy of a Travel Office chronology

as ‘‘HRC pressure’’ and which McLarty has now acknowledged.696

• On July 26, 1993, the Foster ‘‘suicide’’ note was found.697 In

FBI interviews several days later, the three attorneys—Bernard Nussbaum, Bill Burton and Steve Neuwirth—who had

been present when Mrs. Clinton viewed Foster’s note failed to
164

698FBI interview of Special Agent Scott Salter, August 9, 1994. 699Final Report of the Special Committee on Whitewater, p. 89. 700FBI interview of SA Scott Salter. 701Memo to the file from Miriam Nemetz re: Gergen deposition, July 13, 1995, DF 781222. 702 Informal interview of David Gergen, September 13, 1995. 703Memorandum for the file from Miriam Nemetz re: Gergen deposition, July 13, 1995. DF

781222. 704White House residence logs, July 27, 1993. 705White House residence logs, July 27, 1993.

acknowledge that Mrs. Clinton had been present shortly after

the discovery of the note.698 In a pattern emanating from the

White House of late, associate counsel Steve Neuwirth, one of

those present when Mrs. Clinton looked at Foster’s note, said

the FBI agent took bad notes and claimed he told about Mrs.

Clinton’s presence when they reviewed the Foster note.699 In

the interview of Bill Burton, there was also no mention of Mrs.

Clinton being present in the room.700

• On July 26, 1996 David Gergen had a conversation with

McLarty in which McLarty said that Mrs. Clinton was very

upset, believed the matter [the ‘‘suicide note’’] required further

thought and that the President should not yet be told.701 She

said they should have a coherent position and should have decided what to do before they told the President. (DF781222)

Gergen DID NOT relay this conversation in questioning under

oath in the Whitewater Committee, nor did he relate this conversation in his informal interview with the Committee on

Government Reform and Oversight.702 This conversation was

relayed in one of the debriefings that White House Counsel did

of Gergen’s attorney.703 If this was relevant enough to tell the

White House, why was this information withheld from the

Whitewater Committee?

• On July 27, 1993—the day after Foster’s suicide note was

found and the day the Clintons’ personal files were turned over

to the law firm of Williams and Connolly—virtually no one who

was recorded as being in the White House residence that day

has a memory of discussing anything about documents or the

Foster suicide note with Mrs. Clinton even though records

show Mrs. Clinton never left the residence all day. White

House records show that Bernard Nussbaum, Bob Barnett,

Susan Thomases, Webb Hubbell, Steve Neuwirth, and Maggie

Williams were in the residence that day.704 Interestingly, the

so-called personal documents turned over to Williams and

Connolly on this day included documents relating to Harry

Thomason and the White House Project.705 Mr. Foster’s suicide

note contained numerous references to the Travel Office.

The apparent efforts to ‘‘airbrush’’ out Mrs. Clinton’s role in this

matter or her presence on certain occasions has been a consistent

theme throughout this investigation as well as other investigations.

This even was apparent in the production of a White House privilege log in which the White House mischaracterized documents directly related to or mentioning Mrs. Clinton.

For example, a document identified on its face as ‘‘Foster conversations with HRC re: Travel Office’’ was characterized in the

privilege log provided to the committee prior to the document re-
165

706September 5, 1995, letter to Barbara Comstock from David Kendall producing documents

from the Clinton’s ‘‘personal’’ files that related to Harry Thomason or the White House project. 707DF 780050–780051. 708DF 780086–780092. 709DF 780712–780717. 710 Committee on Government Reform and Oversight hearing, January 17, 1996, p. 16.

view as ‘‘Memorandum analyzing Foster communications re: Travel

Office.’’ 706

Why did the Counsel’s Office misrepresent this document in a log

of documents over which the President was claiming executive

privilege? Was this done with the President’s knowledge or approval? Under the Reagan executive privilege memorandum, the

President must personally assert the privilege, but only over a very

limited universe of documents such as those involving the national

security, not debriefings of witnesses appearing before the House or

Senate committees or Independent Counsels, for example.

Another document entitled on its face ‘‘HRC Travel Office Chronology’’ was labeled in the privilege log as ‘‘chronological analysis

of Travel Office events.’’ 707 Still another document entitled ‘‘HRC

Role’’ which outlined what various reviews and investigations said

about Mrs. Clinton’s role in the Travel Office firings was identified

by the White House as: ‘‘Draft chart analysis and comparison of

various Travel Office investigations.’’ 708

Why, even when producing a privilege log, did the Counsel’s office continue to engage in such obfuscation? Who is the White

House Counsel’s office responding to when it takes such actions?

Did the President know of these misrepresentations?

In what apparently must have been off-message scripts, several

Democrat members of the committee noted Mrs. Clinton’s role. Rep.

Waxman stated, ‘‘the First Lady said something or other to the effect that the administration ought to put its own people in or ought

to make some change, presumably. What is wrong with that?’’ 709

Rep. Kanjorski offered that ‘‘we did probably have a sensitive First

Lady’’ who remembered his investigation of the Bush White House

into travel matters. Rep. Kanjorski explained Mrs. Clinton’s involvement as ‘‘a normal interest of a protective wife.’’ 710

D. PATTERN OF OBSTRUCTION

1. Delays in document production

As in any other investigation, the committee depended on White

House cooperation to obtain access to documents and witnesses to

ascertain what led to the Travel Office firings and the actions

which followed. Unfortunately, the Clinton administration proved

singularly uncooperative on both fronts just as it had—the committee learned—with all previous investigations of the Travel Office

matter. The White House claimed as recently as September 1995,

that all relevant documents had been produced.

When it surfaced 3 months later, the Watkins ‘‘soul cleansing

memo’’ belied those claims and led the committee to issue bipartisan subpoenas for all remaining documents relevant to the Travel

Office investigation. Even after the subpoenas were issued, however, the White House delayed the production of responsive documents for months, claiming executive privilege and leading the

committee to vote White House Counsel Jack Quinn in contempt of
166

711 Committee on Government Reform and Oversight hearing, January 17, 1996. 712White House Counsel was in contact with former White House staffer Janet Greene in August 1995. Ms. Greene had agreed to meet with committee staff and cancelled her interview

with the committee after the Counsel’s office objected to the interview because they were not

allowed to attend. Ms. Greene’s phone logs indicate numerous phone calls from both White

House Counsel and minority staff of the committee in August 1995.

Congress. Of 3,000 documents over which the White House had

claimed executive privilege, 1,000 were produced to the committee

in late May 1996, on the very day that the committee’s contempt

resolution against White House Counsel Quinn headed to the

House floor for a vote. Following months of negotiations, the White

House produced 1,400 additional pages to the committee on August

15, 1996.

The committee believes that the Clinton administration’s timehonored strategy of delaying and obfuscating legitimate investigations of possible administration misconduct—very likely intended

to avoid responsibility and accountability for its actions—in fact

has compounded the difficulties it faces today.

The events leading up to the Travel Office firings, reflective of

cronyism, self-interest and bad faith among Clinton administration

appointees and volunteers, are disturbing in themselves. But the

administration’s determined efforts to obstruct investigations by

the GAO, Justice Department, this committee and others invites

justifiable criticism and corrective action.

The committee’s decision to continue its Travel Office investigation followed its finding in its first Travel Office hearing on October

24, 1995, that the Clinton administration in fact had not cooperated with any of the previous independent investigations of the

Travel Office. In fact, the administration clearly limited the scope

of its own White House Management Review—refusing it access to

such key documents as the Vince Foster Travel Office diary (and

even the very knowledge of its existence).

2. Reluctant Witnesses

In its efforts to complete the work of the previous investigations

and learn once and for all exactly what had happened at the Travel

Office, witness interviews were a necessary complement to the committee’s review of contemporaneous White House documents.

When the committee sought to conduct witness interviews, however, the White House proved no more cooperative than it had in

document production. It sought, unsuccessfully, to have representatives of the White House Counsel’s office sit in on committee interviews as it had done with GAO Travel Office and OPR interviews

and even criminal FBI interviews.711 The White House in fact

interfered with interviews scheduled by the committee with former

White House staffers, leading at least one to cancel an interview

already scheduled with the committee.712

Key witnesses such as David Watkins and Patsy Thomasson also

refused to appear before the committee voluntarily and it became

apparent that the committee would not be able to complete the investigation without requiring individuals to testify under oath.
167

E. COMMITTEE MOVED TO DEPOSITIONS UNDER OATH

In March 1996, the House of Representatives voted to provide

the committee with limited deposition authority for the purpose of

completing its Travel Office investigation. Since that time, committee staff has taken sworn depositions from more than 70 witnesses.

1. ‘‘I don’t recall . . .’’

Even under oath, however, many witnesses have proved less

than forthcoming. Many of the key players in the Travel Office case

appear to have suffered massive, if specific, memory losses regarding their role in the matter. Unfortunately, this repeats a long-established pattern among senior White House officials and outside

advisors to President and Mrs. Clinton. Whether in testimony before Senate or House subcommittees, countless senior advisers acclaimed for their intelligence have no ‘‘specific’’—or general—recollection of any matter under review at any given time by the Congress. This is a most troubling pattern which has prevented the

Congress from fulfilling its constitutional obligation to oversee the

executive branch.

The extent to which many key witnesses in the committee’s depositions did not recall, did not know, did not remember and/or did

not recollect critical events in which they participated and/or documents which they created or reviewed sufficiently concerned the

committee that it calculated the incidence of memory lapses and

outright loss among all the witnesses who testified before it. This

was accomplished by searching each deposition for such key

phrases as: ‘‘I don’t recall,’’ ‘‘I don’t know,’’ ‘‘I don’t remember’’ and

‘‘I have no recollection.’’ Slight variations of these phrases also

were counted into the totals for each witness. Examples of these include: ‘‘Not that I recall,’’ ‘‘Not to my recollection,’’ ‘‘I have no specific recollection,’’ and so forth.

The committee understands it is possible that, over the course of

31⁄2 years, witnesses in fact would forget some details surrounding

their involvement in the White House Travel Office matter. However, senior administration officials of the Clinton White House

who participated in the Travel Office firings and subsequent coverup would still have the benefit of personal and White House

records to refresh their memories in advance of committee depositions and the obligation to fully and accurately respond to committee inquiries to the best of their abilities.

2. Who couldn’t ‘‘recall’’

Not surprisingly, the worst memory losses were incurred by

those nearest to and most responsible for the Travel Office firings

and investigation, those who presumably would have the best recollections and greatest access to documents which might refresh

their recollections. The best memories were reserved for those not

in authority in the White House or elsewhere who may have observed or participated only tangentially in the White House Travel

Office matter. These include longstanding Federal employees whose

service predates the arrival of the Clinton administration.

[The information referred to follows:]
168
169

713WHMR, p. 20. 714May 13 talking points, Jeffrey Eller, CGE 7933. 715WHMR interview of Jeff Eller, CGEPR 0230. 716 Committee deposition of Jeff Eller, pp. 82–83.

In an effort to further explore this pattern, the committee categorized witnesses who were deposed under oath in categories according to offices in which they worked/volunteered or with which

they were affiliated in some way, as follows:

—White House Travel Office—those who participated most

directly in the Travel Office firings and aftermath;

—White House Management Review—those who conducted

the review of the Travel Office matter which was released on

July 2, 1993, and described as a ‘‘stealthy, evasive confession’’

by the New York Times in a July 11, 1993, editorial;

—White House Counsel’s Office—those who have worked on

the Travel Office (and other) investigations in any capacity;

—White House—those not known to be directly involved in

the decisionmaking in the Travel Office firings, Management

Review, Counsel’s office or FBI files matter but who otherwise

played advisory or other roles in it;

—Miscellaneous—three individuals not affiliated with the

White House but who testified to their respective roles in the

Travel Office and/or FBI files investigations.

White House Travel Office

White House Media Director Jeff Eller proved the most forgetful

of all of his former colleagues who were deposed by the committee,

and perhaps not without reason. As a boyfriend of Catherine

Cornelius, Eller was aware of her plans to head a reorganized

White House Travel Office and was among those who advocated

early action on the firings of seven long-time Travel Office employees.713

Mr. Eller could not recall talking points that several of his colleagues ascribed to him.714 In the course of the White House Management Review, it was learned that Eller threw away his Travel

Office notes.715 Most ironically given the extraordinary level of his

forgetfulness, Eller told the committee under oath that he does not

keep a lot of paper/notes because he prefers to keep things in his

memory.716

Patsy Thomasson’s memory or knowledge betrayed her some 420

times in the course of her deposition. She, too, had much to forget,

including her role in KPMG Peat Marwick’s review of the Travel

Office, her changing of the locks to the Travel Office, threats she

allegedly made against Catherine Cornelius and Clarissa Cerda in

order to ensure they would not challenge assertions that David

Watkins never read their February 15, 1993, Travel Office reorganization memo, and her activities in Foster’s office on the night of

Foster’s suicide.

Jennifer O’Connor, Deputy Director of the Office of Management

and Administration at the time of the Travel Office firings, currently is a Special Assistant in the Office of the White House Chief

of Staff. She tallied up some 343 memory lapses concerning her

role as an assistant to Ms. Thomasson and David Watkins at the

time of the firings. Ms. O’Connor drafted the May 17, 1993,
170

717WHMR interview of Jennifer O’Connor, pp. CGEPR 384–385.

McLarty memo which was copied to First Lady Hillary Rodham

Clinton. She met with Harry Thomason on the subject of the 25

percent staff cuts in the White House and she recommended to

David Watkins that Larry Herman and KPMG Peat Marwick be

hired to conduct a review of the Travel Office.717

Mr. McLarty who had repeated contact with Mrs. Clinton over

the Travel Office matter, had 233 instances where he could not recall key events. While McLarty did finally ‘‘recall’’ a previously

omitted meeting with Mrs. Clinton about the Travel Office in light

of the committee’s documentation of that contact, there were still

numerous other instances where McLarty forgot.

White House Management Review

Those involved in preparing the White House Management Review arguably should have had as clear an understanding as any

exactly what happened in the White House Travel Office matter

and why it happened.

In short, the memories of those most closely involved with the

White House Management Review had difficulty recalling key

events under oath: Dwight Holton, former Special Assistant to Deputy Chief of Staff Mark Gearan, now a recent law school graduate

(348 instances); former Staff Secretary turned law school professor

John Podesta (264); former Deputy Chief of Staff turned Peace

Corps Director Mark Gearan (221); Staff Secretary Todd Stern

(133); former Special Counsel to the Office of Management and Administration and assistant at the creation of David Watkins’ ‘‘soul

cleansing memo’’ Matthew Moore (130).

White House Counsel’s Office

Several attorneys affiliated with the White House Counsel’s Office played key roles at the time of the White House Travel Office

firings. Others have been central to the White House response to

the committee’s requests for documents. They have every reason to

be very fully aware of the details of the White House Travel Office

matter. Yet their individual memories also come up short.

Neil Eggleston, who prepared First Lady Hillary Rodham Clinton’s responses to a series of GAO questions after interviewing

Mrs. Clinton and who handled all of the various document productions for Travelgate matters, could not recall, did not know, could

not remember or recollect on some 250 occasions. Bill Kennedy,

former Associate White House Counsel, who summoned the FBI to

investigate the Travel Office at the behest of ‘‘the highest levels’’

could not recall 233 times in his April deposition and 116 in a June

deposition related to the FBI files matter and the hiring of Craig

Livingstone. Beth Nolan, who reviewed SGE and ethics issues in

the Travel Office matter, registered 179, while Cliff Sloan tallied

173.

Bruce Lindsey, a long-time Assistant to the President and Senior

Advisor turned Deputy White House Counsel, scored some 161

lapses. Bernard Nussbaum, whose claims that all who watched him

divide Vince Foster’s papers into three stacks were contradicted by
171

718Deposition of Maggie Williams, July 29, 1996, pp. 15, 20–22, 28. 719Watkins memorandum, CGE 12286–12294. 720Statement of Patsy Thomasson, January 5, 1996, CGE 36932. 721 Id.

all those alleged witnesses, registered 158 memory outages, and

another 60 lapses in a subsequent FBI files-related deposition.

Memory or knowledge failed current White House Deputy Chief

of Staff Harold Ickes some 148 times; Senior Advisor to the President George Stephanopoulos some 142 and 102 times in two separate depositions; former White House Deputy Chief of Staff Roy

Neel some 135 times; and, Assistant to the President for Special

Projects Rahm Emanuel on some 102 occasions. Again, given the

position of these individuals and their access to White House colleagues and records, the committee believes they had every reason

to be cognizant of far more than admitted in their depositions. Mrs.

Clinton’s Chief of Staff Maggie Williams had some 82 lapses, and

particularly couldn’t recall anything related to conversations she

had with Mrs. Clinton about the Travel Office.718

In Conclusion

This is the administration which brought, ‘‘I have no specific

recollection’’ and ‘‘vague and protective’’ into the political lexicon.

This is the administration in which one’s capacity to remember diminishes dramatically as one’s authority and responsibility increases. Our analysis suggests that the nearer to the events and

the higher up they are in the ‘‘chain of command,’’ the more likely

these men and women conveniently forget.

The committee is troubled and cannot help but conclude that the

memory lapses of numerous senior White House officials—who otherwise exhibit no incapacity or impairment and in fact appear highly regarded—appear in large part to be deliberate, not accidental.

XIV. THE STONEWALL BEGINS TO CRACK

A. WATKINS MEMO BEGINS TO EXPLAIN THE TRUE STORY

One document—the Watkins ‘‘soul cleansing’’ memo—was discovered after 2 years of investigations among documents belonging to

Patsy Thomasson who long before had signed an internal White

House document claiming she had searched all her files for Travel

Office documents.719 The ‘‘soul cleansing’’ memo went a long way

in explaining the real Travelgate story and should have been

turned over years earlier to numerous congressional and criminal

investigations. Ms. Thomasson’s explanations as to why she didn’t

turn over the Watkins memo are unconvincing.720 Rather than conduct a search of her records for responsive documents, Ms.

Thomasson stated that she was ‘‘absolutely positive’’ that she didn’t

have any documents and when a copy was mysteriously found in

her records she was at ‘‘a complete loss’’ to explain how it got

there.721 No explanation is offered to explain how she happened to

forget that she had a copy of this document.

Clearly neither Watkins nor others at the White House ever

wanted this version of events to see the light of day. Mr. Watkins

explained in his memo he had been ‘‘as protective and vague as

possible’’ when talking with investigators. Indeed Watkins was
172

722Mr. Watkins testified before this committee that all the information contained in his

memorandum was true. He denied under oath that he had ‘‘lied to his memorandum.’’ 723 Committee deposition of Matthew Moore, March 26, 1995, p. 56. Mr. Moore testified that

we worked on 10 different drafts of the Watkins memo. 724Letter to Chairman Clinger from Jack Quinn, January 17, 1996. 725 Committee deposition of Mack McLarty, July 12, 1996, p. 42. 726GAO interview of Mack McLarty, March 24, 1994. 727 Committee deposition of Mack McLarty, p. 42. 728 CGEPR 563–564. 729 Committee deposition of Mack McLarty, p. 41. 730 Id., p. 42.

forced most reluctantly to become a witness against himself and his

former colleagues as a result of this discovery.722

The Watkins ‘‘soul cleansing’’ memo surfaced despite the fact

that Watkins’ assistant, attorney Matthew Moore, removed the document from the hard drive of his computer and downloaded it onto

a disk for Watkins before Watkins left the White House.723 But

Watkins had left a copy with Patsy Thomasson in whose records

it eventually was discovered by career White House recordkeeping

officials reviewing old files.724

The memo provides a candid, unvarnished, and contemporaneous

account of the behind the scenes maneuvering and pressures that

led to the Travel Office firings. The White House tried to distance

Watkins, a former close ally, from the actions of others at the

White House but this cannot be supported by the documentary

record. The committee obtained considerable evidence of meetings,

phone calls and contacts that support the version of events relayed

in Watkins’ ‘‘soul cleansing’’ memo. In addition, some of the deposition testimony has also supported events as recounted in the

memo.

1. Pressure from First Lady and Mack McLarty

In his deposition, Mack McLarty said he never saw Watkins’

memo, but acknowledged a never before disclosed conversation

with Mrs. Clinton on May 16, 1993—3 days before the firings.725

Mr. McLarty previously told GAO that he only had one meeting

with Mrs. Clinton about the Travel Office.726

Now, 3 years later and after the committee obtained documents

indicating a May 16 contact between Mrs. Clinton and McLarty, he

acknowledges an additional conversation with Mrs. Clinton concerning the Travel Office.727 On one of the chronologies of Travel

Office events, which the White House initially represented was

subject to executive privilege, McLarty made a handwritten notation: ‘‘May 16: HRC pressure.’’ 728

Mr. McLarty testified that this notation either reflected something that somebody said at a meeting or ‘‘may reflect my exchange

with the First Lady on the 16th that we had a pressure to act

about this matter.’’ 729 Mr. McLarty now acknowledges ‘‘I believe I

felt a responsibility, and indeed a pressure, to act, given the information I had, and I believe Mrs. Clinton had a serious concern

about this matter and I felt a pressure from her to take it seriously

and to act upon it, if necessary.’’ 730

Mr. McLarty acknowledged that Mrs. Clinton was encouraging

action be taken: ‘‘I think that was really what she was saying, let’s

make a decision, you and others charged with this responsibility,
173

731 Committee deposition of Mack McLarty, pp. 38, 57. 732 Id. 733See July 2 press conference. 734 Committee deposition of Mack McLarty, p. 25. 735 Handwritten notes of Natalie Williams, undated, DF 780463. 736 Id. 737 Committee deposition of Natalie Williams, July 31, 1996, pp. 46–48, 55–56, 70–71. 738Watkins ‘‘soul cleansing’’ memo, CGE 12286. 739 Committee hearing, January 17, 1996, p. 94.

make a decision and take appropriate action.’’ 731 Mr. McLarty had

this conversation with Mrs. Clinton in the residence on May 16

where he was present for a dinner with the President and First

Lady.732

Mr. McLarty provided a more extensive account of his May 13,

1993 conversation with Mrs. Clinton. Previously McLarty had

passed off this meeting as a ‘‘stand-up’’ 5 minute meeting of little

consequence.733 In his deposition, however, McLarty acknowledged

that Mrs. Clinton had called to specifically meet with him in his

office about the Travel Office. Mrs. Clinton came to his office to

specifically discuss this matter.734

In documents which were long withheld from the committee,

McLarty’s attorneys discussed these meetings with White House

Associate Counsel Natalie Williams at or around the time of the release of the Watkins memo.735 In the notes, Williams writes ‘‘Conversation w/ First Lady, updating her Peat Marwick audit, told her

on top of it, handling situation.’’ Mr. McLarty’s attorneys also told

Williams of McLarty’s May 16 conversation with Mrs. Clinton.736

The White House asserted executive privilege over these conversations and refused to allow Williams to testify about any conversations contained in her notes.737

Mr. Watkins described the pressures he felt from Mrs. Clinton

and Mr. McLarty in his memo:

I would have much preferred to have my staff carefully

review the Travel Office and make a detailed business

plan for the new fiscal year. This proved impossible,

though, when the pressure for action from Mrs. Clinton

and you became irresistible. . . . If I thought I could have

resisted those pressures, undertake more considered action, and remained in the White House, I certainly would

have done so.738

Mr. Watkins testified before this committee that he considered

‘‘there would have been a great price to pay and perhaps my removal from the White House’’ if he didn’t fire the Travel Office employees.739 ‘‘After the Secret Service incident, it was made clear

that I must forcefully and immediately follow the direction of the

First Family,’’ Watkins explained in his memo.

Under questioning about his actions during the week leading up

to the firings, Watkins testified that ‘‘the direction of the First

Family was to take swift and responsive action . . . we should reduce the travel—we should get our people in and get those people

out.’’ Congressman Shays asked Watkins just what he meant by

that statement. Watkins replied: ‘‘It means fire them.’’ Rep. Shays
174

740 Committee hearing on January 17, 1996, p. 95. 741 Handwritten notes of David Watkins, May 31, 1993, PM 000170. 742FBI 302 interview of Patsy Thomasson, September 22, 1993, CZ 00561. 743Watkins memorandum, undated, CGE 12287. 744 Committee deposition of Bonnie Berry, May 21, 1996, p. 20. 745 Committee deposition of Bonnie Berry, p. 32. 746 Committee hearing, January 17, 1996. 747 Committee deposition of Bonnie Berry, pp. 33, 36. 748 CGE 2931–2933. 749 Committee deposition of Harry Thomason, pp. 136–137, 188. 750 Committee deposition of Harry Thomason, p. 228.

inquired further: ‘‘It means get rid of them; doesn’t it?’’ Mr. Watkins confirmed: ‘‘That is what it means.’’ 740

In other handwritten contemporaneous notes, Watkins wrote

about a meeting that he had with McLarty and Patsy Thomasson

on May 17, in which they talked about McLarty’s dinner with the

President and First Lady the night before.’’ 741 Patsy Thomasson

testified that Vincent Foster told her on May 13 that ‘‘the clients’’—

as Foster referred to the President and First Lady—were very interested in the Travel Office.742

2. Pressure from Harry Thomason

Mr. Watkins also detailed the central role of Harry Thomason in

initiating Mrs. Clinton’s interest in this matter and generating

pressure throughout the White House: ‘‘Mrs. Clinton took interest

in having the Travel Office situation resolved quickly, following

Harry Thomason’s bringing it to her attention. Thomason briefed

Mrs. Clinton on his suspicion that the Travel Office was improperly

funnelling business to a single charter company, and told her that

the functions of that office could be easily replaced and reallocated.’’ 743

Mr. Watkins account of Thomason’s central role is supported by

numerous others within his office. Bonnie Berry who worked as a

secretary in Watkins’ office stated that Harry Thomason would call

about two or three times a week, leaving either a Washington or

Los Angeles phone number. Ms. Berry remembered him meeting

with Watkins on more than one occasion between May 1st and May

19th.744

Ms. Berry testified that she arranged for the office space and

White House passes for Harry Thomason and his assistant, Bobbie

Ferguson, at the request of David Watkins.745 Watkins testified

that he did so at the request of Mrs. Clinton’s office.746 From Berry’s testimony it appears that there may have been a different pass

application for Harry Thomason that was signed by David Watkins.747 The copy of the form the committee has received was

signed by Clarissa Cerda, a Watkins assistant.748

Mr. Thomason testified there was a ‘‘buzz in the air’’ 749 of rumors about the Travel Office employees. However, the consensus

from the vast majority of the dozens of witnesses who testified in

committee depositions only described rumors coming from

Thomason’s contacts with Mrs. Clinton, Foster, Watkins and

Cornelius.

While Harry Thomason never disclosed his discussions with Mrs.

Clinton to those conducting the White House Management Review,

he admitted in committee depositions that he was: ‘‘sure that [he]

brought it to her attention.’’ 750 Furthermore, in notes withheld
175

751 Handwritten notes of Natalie Williams, DF 780464. 752Public Integrity interview of David Watkins, August 10, 1993. 753 Committee deposition of Natalie Williams, July 31, 1996, pp. 55–62. 754 Handwritten notes of David Watkins, May 31, 1993, PM 169. 755Phone logs of Harry Thomason, Thomason production, pp. 108–109. 756February 17, 1993 memo attached to February 11, 1993 memo of Darnell Martens to Harry

Thomason, CGE 002296–98. 757Secret Service logs and White House residence logs for May 13, 1993. 758Public Integrity interview of Patsy Thomasson, September 27, 1993. 759 Vince Foster Travel Office notebook, May-July 1993, CGE 1039. 760Watkins memorandum, CGE 0012286. 761 Committee deposition of Maggie Williams, July 29, 1996, pp. 47, 58.

from this committee, one of Thomason’s attorneys told White House

Associate Counsel Natalie Williams that Harry had one or two conversations with Mrs. Clinton and remembered telling Watkins that

the Travel Office employees should be replaced because they were

disloyal and that Mrs. Clinton shared his view.751 This information

coincides with the information that David Watkins relayed in an

FBI interview in August 1993 when he stated: ‘‘She [Mrs. Clinton]

stated action needed to be taken immediately to be certain those

not friendly to the Administration were removed and replaced with

trustworthy individuals.’’ 752

In a committee deposition, Associate Counsel Natalie Williams

refused to answer any questions about the notes she took of conversations with Thomason’s attorney.753

Mr. Watkins’ contemporaneous handwritten notes detail a conversation that he had with Harry Thomason on May 12:

‘‘Thomason comes back in DW’s [office]—says he bumped into Hillary and she’s ready to fire them all that day.’’ 754

Mr. Thomason’s own records show numerous phone calls to and

from Mrs. Clinton and President during this week.755 Harry

Thomason’s records show meetings with the President on May 12

and May 13. Long before this time, Harry Thomason had pitched

his proposals for TRM with a memo that the President subsequently forwarded to White House senior management with the notation: ‘‘These guys are sharp.’’ 756

White House records indicate that Thomason had dinner in the

residence on a key day—May 13—the day the FBI was called in

and told that this matter had the attention of those at the ‘‘highest

levels’’ of the White House, and the day Mrs. Clinton requested a

meeting with Mack McLarty to discuss the Travel Office and the

pressure was on Vincent Foster and Bill Kennedy to find a solution.757 On this day Foster told Patsy Thomasson that ‘‘the clients’’—as he referred to the President and First Lady—were very

interested in the Travel Office.758 During that evening, Foster also

placed a call to Mrs. Clinton according to his calendar notes.759

3. Secret Service Incident

Mr. Watkins also wrote that ‘‘after the Secret Service incident,

it was made clear that I must more forcefully and immediately follow the direction of the First Family.’’ 760 In her deposition with the

committee, Maggie Williams has confirmed that Mrs. Clinton indeed was upset about a ‘‘Secret Service incident’’ in which Newsweek magazine reported Mrs. Clinton was rumored to have thrown

a lamp in the residence. Ms. Williams personally addressed this

situation by calling the Secret Service.761
176

762 U.S. v. Nixon, 483 U.S. 683, 705–706, 708 (1974).

B. WHITE HOUSE MADE INEFFECTIVE CLAIMS OF ‘‘EXECUTIVE

PRIVILEGE’’ OVER DISCUSSIONS ABOUT ‘‘WATKINS MEMO’’

Overall, the supporting documentation that coincides with the

revelations in the Watkins memo show that the official White

House story glossed over significant contacts with both the President and First Lady. The President was actually informed of the

firings by Bruce Lindsey on May 17—a fact omitted in the Management Review even though the authors now acknowledge they were

aware of that fact and probably should have reported it. In a disturbing development, the White House has asserted executive

privilege over conversations that White House attorneys or staffers

for Mrs. Clinton had with Mrs. Clinton regarding the Watkins

memo.

C. CONGRESS HOLDS WHITE HOUSE ACCOUNTABLE

Should a lower standard of accountability be accorded for the

highest office in the land? We often hear ‘‘nobody cares’’ and it’s

clear enough that in this White House nobody does care about following the rules.

Whether announcing an FBI investigation of employees whose

‘‘crime’’ was to hold jobs coveted by Clinton family and friends, or

improperly requesting and receiving hundreds of FBI background

files that they had no business with, or sending a cozy ‘‘heads up’’

from the FBI to the White House about sensitive information, this

administration consistently has engaged in activities that, at the

least, give the appearance of abusing the power entrusted to it by

the country. We should never get used to or tolerate the

politicization of law enforcement even if nobody cares.

XV. PRESIDENT CLINTON HAS ABUSED EXECUTIVE POWER AND EXECUTIVE PRIVILEGE AND MISUSED THE COUNSEL’S OFFICE IN ORDER

TO EFFECTUATE A COVER-UP OF THE TRAVEL OFFICE MATTER

A. THE LONG ROAD TO GETTING WHITE HOUSE DOCUMENTS—FROM

FOOT DRAGGING TO EXECUTIVE PRIVILEGE

Executive privilege is a doctrine of clear necessity, created out of

the need to protect the Government’s most sensitive Government

information. The need to protect some military, diplomatic and sensitive national secrets is not in dispute. Furthermore, the privilege

is fundamental to Government operations and is borne out of the

constitutional recognition of the separation of powers.762 Use of the

privilege must always be balanced against the congressional oversight prerogative, and the democratic need for accountability. However, it was not meant to be used for purposes of political expediency, as a convenient cloak to shield the Presidency from possible

embarrassment.

The committee believes that President Clinton has abused this

privilege. The Clinton administration, over the past year, has

shielded more documents under an executive privilege claim than

those shielded in the 12 years of the Reagan and Bush administrations combined. By asserting executive privilege over documents re-
177

763 Numerous witnesses who were deposed by the committee claimed executive privilege in regard to conversations that they had with Mrs. Clinton. Some of those who refused to answer

questions and invoked executive privilege on the advice of the White House included Mrs. Clinton’s Chief of Staff Maggie Williams, Mrs. Clinton’s Press Secretary Lisa Caputo, Special Counsel Jane Sherburne, Associate Counsel Natalie Williams and Associate Counsel Jon Yarowsky. 764 Committee deposition of Cliff Sloan, June 28, 1996, p. 49.

vealing embarrassing events in the White House Travel Office matter, President Clinton used the privilege as a tool in a larger

scheme to deprive the public of the truth of his own misdeeds and

those of his administration.

Throughout the investigation into the Travel Office matter, the

White House delayed the release of documents and denied the committee access to the information it sought. Finally, when the committee tried to call an end to its stonewalling, the White House

claimed executive privilege over relevant documents and refused to

allow witnesses to testify to certain events when they appeared for

committee depositions.763 The committee only received the remaining, responsive documents to its January 11, 1996 subpoena on August 15, 1996, after a long and protracted effort to obtain these documents from the White House.

After a review of the 2,000 pages of documents which the White

House withheld for months from the committee under a claim of

executive privilege, it is clear that most of these documents were

never subject to any reasonable reading of executive privilege doctrine.

Within the 2,000 pages of documents is a disturbing pattern of

collaboration by the White House Counsel’s office with outside attorneys. There is an apparent attempt to develop a consistent

story-line on critical areas of controversy, including the ‘‘Watkins

memo’’, Harry Thomason’s role at the White House, relevant documents that the late Vincent Foster had on these matters and Mrs.

Clinton’s role in the firings.

The Counsel’s office is acting as an adjunct criminal defense

team, rather than as legal and ethical advisors to the highest office

of the land. The activities that the committee has discovered raise

troubling questions. For instance, the committee has yet to determine whether there were additional witnesses with whom the

White House shared information. In particular, Harry Thomason,

a major character in the committee’s investigation, was also the

subject of a Justice Department investigation. Associate Counsel

Cliff Sloan testified that he was directed by Bernard Nussbaum to

read the notes of Thomason’s White House Management Review

interview to Thomason’s attorney.764 The White House attempted

to claim executive privilege over this document when the committee first sought it.

The President claims to be following the executive privilege doctrine as established in President Reagan’s 1982 Executive order:

Executive privilege will be asserted only in the most

compelling circumstances, and only after careful review

demonstrates that assertion of this privilege is necessary.

Congressional requests for information shall be complied

with as promptly and as fully as possibly, unless it is determined that compliance raises a substantial question of

executive privilege.
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765 Executive order, Memorandum from President Ronald Reagan for the Heads of Executive

Departments and Agencies on Procedures Governing Responses to Congressional Requests for Information, November 4, 1982. 766DF 780463–780465, 780467–780469. Natalie Williams handwritten notes of conversations

with attorneys for Harry Thomason and Mack McLarty.

A ‘substantial question of executive privilege’ exists if

disclosure of the information requested might significantly

impair the national security (including the conduct of foreign relations), the deliberative process of the executive

branch, or other aspects of the performance of the executive branch’s constitutional duties.765

Claims of privilege under this doctrine would be waived by the

President if there were any credible allegations of wrongdoing. For

example, President Reagan waived all claims of executive privilege

during the Iran-Contra investigation.

In light of the expansion of the Independent Counsel’s jurisdiction into the Travel Office matter and, more recently, the FBI files

matter, the President’s actions were particularly troubling. The

President insisted on keeping thousands of pages of documents

from public scrutiny while criminal investigations were ongoing.

Witnesses in the White House have remained silent under apparent claims of executive privilege.

B. THE PRESIDENT ENGAGED IN AN UNPRECEDENTED USE OF EXECUTIVE PRIVILEGE IN THE COURSE OF THE COMMITTEE’S DEPOSITIONS

The White House insisted that witnesses claim executive privilege, thereby preventing a discussion of these documents during

depositions. White House Counsel staff Jane Sherburne, Jon

Yarowsky, and Natalie Williams, as well as members of the First

Lady’s staff, Chief of Staff Maggie Williams, and former Press Secretary Lisa Caputo and numerous others, have asserted executive

privilege on dozens of occasions in depositions before this committee.

The assertion of executive privilege over conversations with Mrs.

Clinton was made with troubling frequency. No constitutional basis

exists for the President to assert executive privilege claims over

conversations that Mrs. Clinton had with staff.

C. EXECUTIVE PRIVILEGE CLAIMS ARE BEING ASSERTED FOR POLITICAL

SECURITY NOT NATIONAL SECURITY

The President persists in his efforts to shield documents under

a seriously flawed assertion of executive privilege absent any national security interest or cited domestic policy matter. For example, there is no justification for a claim of executive privilege over

notes that a White House Counsel took of discussions with attorneys for Harry Thomason or Mack McLarty regarding conversations each had with Mrs. Clinton about the Travel Office.766

These notes are among those the White House insisted on withholding under the umbrella of executive privilege until August of

this year. They were key to the investigation, as they supported

Mr. Watkins’ account of Travel Office matter, which the White

House has sought to discredit.
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767DF 780533–780535, Natalie Williams handwritten notes of conversations with Larry Herman’s attorney. 768 Committee deposition of Jon Yarowsky, July 25, 1996, pp. 38–39.

1. Conversations with Mrs. Clinton = executive privilege?

It is unrealistic to presume that conversations between committee witnesses and Mrs. Clinton about the Travel Office matter are

of a national security concern or otherwise matters central to the

constitutional duties of the Presidency. The White House Counsel’s

office was used to coordinate the stories of various key witnesses,

including Harry Thomason, who was being investigated by the Justice Department for possible conflicts of interest. Many of these

witnesses may have appeared before the Grand Jury in conjunction

with the Independent Counsel’s investigation.

2. Executive privilege for debriefings with outside attorneys?

Another category of documents which the President withheld for

months from the public under a claim of executive privilege included dozens of interviews with the attorneys representing Clinton

White House staff and friends deposed in this investigation, as well

as the Whitewater matter. Even the ‘‘independent’’ Peat Marwick

employee, Larry Herman, appears to have submitted to a debriefing concerning his interview with this committee.

The President misused executive privilege when he exerted it

over notes that are clearly debriefings of individuals or attorneys

whose clients were questioned in the course of this or other related

investigations.767 These actions may waive the attorney-client

privilege of the individuals involved when their attorneys transmit

the information to the White House.

3. Executive privilege over White House briefing papers created for

Congress?

Extensively detailed briefing papers and a series of questions

that were prepared to script the Democrat members of the Committee on Government Reform and Oversight for hearings on the Travel Office are included in the 2,000 pages over which executive privilege was claimed. These documents outlined attacks on the Travel

Office employees, attacks on the idea of conducting this investigation and even attacks on the committee’s staff. These scripts had

detailed responses, for example, to any claims that Mrs. Clinton

was involved with the firings, providing explicit White House instructions to use such scripts only if the issue was raised during

the hearing.

During a committee deposition, the attorney for Jon Yarowsky,

Associate White House Counsel, claimed that it was entirely appropriate for the White House Counsel’s office to script Congress and

cited ‘‘the White House submitting the proposed questions for John

Dean’’ during the Watergate hearings as his defense.768

4. Executive privilege over information regarding Vincent Foster?

Documents relating to Vincent Foster were another key area

where the White House took extraordinary efforts to keep the information from the public. The White House initially redacted hundreds of pages relating to Foster’s documents and the debriefings
180

769Washington Post, ‘‘The Man Behind the President’’ July 1, 1993. 770Washington Times, ‘‘Bernard Nussbaum’s novel view of executive privilege’’ August 30,

1995.

of witnesses that the Counsel’s office obtained regarding Foster’s

documents. These documents were clearly responsive to our subpoena but were almost entirely redacted.

D. THE MISUSE OF THE COUNSEL’S OFFICE BEGAN UNDER THE TENURE

OF BERNARD NUSSBAUM AS PRESIDENT CLINTON’S FIRST WHITE

HOUSE COUNSEL

Bernard Nussbaum, the first of four White House Counsels, exhibited a fundamental misunderstanding of the role of the Counsel

to the President. Mr. Nussbaum established the Clinton White

House Counsel’s Office as a taxpayer funded legal team, whose job

was defending the President, rather than the office of the Presidency.

Mr. Nussbaum was well known to President and Mrs. Clinton,

having worked with Mrs. Clinton on the House Judiciary Committee Impeachment Inquiry, better known as the Watergate Committee. He was a senior attorney on the committee when Mrs. Clinton

began as a young lawyer just out of law school. President Clinton

conferred the title of ‘‘Assistant to the President’’ on Mr. Nussbaum, officially validating his access to the Clinton ‘‘inner circle.’’

Mr. Nussbaum publicly voiced his belief that the President’s lawyer must ‘‘represent his client [the President] faithfully and zealously.’’ He hung a black and white picture of the Nixon impeachment committee staff on his White House office wall located next

to Mrs. Clinton’s office. Ruth Marcus wrote that Nussbaum is ‘‘the

$500-an-hour corporate litigator’s approach to battle’’ which he carried into the White House in his representation of the client: Bill

Clinton.769

Under Bernard Nussbaum, the Office of Counsel to President

Clinton prevented the access of investigators undertaking legitimate oversight of the executive branch. Mr. Nussbaum worked to

stonewall substantive investigations into matters such as the death

of Vince Foster, Whitewater, RTC, and Travelgate. President Clinton, meanwhile, publicly proclaimed that the White House is ‘‘committed to fully support and cooperate’’ with all investigations as

well as Special Counsels.

Mr. Nussbaum took the unprecedented position that the Attorney

General was forbidden to see Deputy White House Counsel Vince

Foster’s papers. One writer noted that this desperate view of executive privilege ‘‘would make Richard Nixon blush.’’ 770 In response to

the manner in which Nussbaum handled the review of Vince Foster’s White House documents, Justice Department’s No. 2 lawyer,

Deputy Attorney General Heymann, publicly proclaimed: ‘‘Bernie,

are you hiding something?’’

As an attorney in private practice, a lawyer has an obligation to

his client to advocate the client’s position as strenuously as the law

will allow. The duties of a Government attorney, however, are quite

different. Even the Counsel to the President ultimately serves more

than just a single client. Although he provides Counsel to the

President of the United States, it does not include legal defense

work for the President, if his actions are outside the scope of the
181

771Lloyd Cutler’s ‘‘Remarks Announcing the Appointment of Lloyd Cutler as Special Counsel

to the President and an Exchange with Reporters,’’ 30 Weekly Comp. Pres. Document 462, 465

(Mar. 8, 1994). 772 ‘‘Task list, December 13, 1994,’’ by Jane Sherburne, DF 780643–654. This list was among

those withheld under a claim of executive privilege by the President on May 30, 1996 with approximately 2,000 other pages of withheld documents. Responding to the committee’s demands

to provide the documents, the White House made an offer for the chairman and designated staff

to review redacted copies of the 2,000 pages. The Counsel’s office provided heavily redacted versions of this document. Responding to an August 1996 demand for the documents under a threat

of contempt of Congress, the White House Counsel finally relinquished the documents on August

15, 1996. 773President Clinton’s ‘‘Remarks on the National Performance Review and an Exchange with

Reporters,’’ 30 Wkly Comp. Pres. Documents 375, 421 (Mar. 3, 1994). 774 Id.

Presidency. The Counsel to the President, like any other Government attorney, has a responsibility to uphold the Constitution and

laws of the United States.

E. PRESIDENT CLINTON’S SECOND COUNSEL, LLOYD CUTLER, SUSTAINED THE PATTERN OF OBSTRUCTION SET BY NUSSBAUM

Following Nussbaum’s resignation, Lloyd Cutler agreed to serve

as Special Counsel to President Clinton on March 8, 1994. Mr. Cutler quickly proclaimed that matters would be handled differently.

Lloyd Cutler’s first press conference with President Clinton focused

on his prior White House experience and that White House matters

would be given more scrutiny, especially when it came to ethical

matters. Mr. Cutler opined,

The Counsel is supposed to be Counsel for the President

in office and for the Office of the Presidency. . . . I don’t

think there is much of a dichotomy between the two. When

it comes to a President’s private affairs, particularly private affairs that occurred before he took office, those

should be handled by his own private counsel and, in my

view, not by the White House Counsel.771

To implement these goals, Cutler brought his former law firm

partner, Jane Sherburne, into the White House Counsel’s Office.

Ms. Sherburne began her White House service as a Special Government Employee and became Special Counsel to the President in

1995.

F. PRESIDENT CLINTON’S SPECIAL COUNSEL BEGINS HER ‘‘TASK LIST’’ OF OVERSIGHT OF ALL CONGRESSIONAL AS WELL AS INDEPENDENT

COUNSEL INVESTIGATIONS

A document which defines Ms. Sherburne’s responsibilities to

President Clinton is the December 13, 1994 ‘‘task list’’ she created.772 As an initial matter, the sheer volume of ethical and legal

issues identified in Sherburne’s memo is a powerful statement. It

stands in stark contrast to President Clinton’s statement to the

public that ‘‘these investigations should go forward, unimpeded and

as quickly as possible.’’ 773 President Clinton assured the press that

his White House staff did not ‘‘need to have any implication that

we are in any way trying to manage or affect this process.’’ 774

In contrast to President Clinton’s promise to allow investigations

to go forward ‘‘unimpeded,’’ Special Counsel Sherburne created this

task list of no fewer than 39 separate ‘‘issues’’ of alleged wrongdoing by members of the Clinton administration. These issues were
182

775DF 780643–654, task list, December 13, 1994. 776 Id.

to be reviewed, assigned and followed by the White House Counsel.

Ms. Sherburne managed the team of Government attorneys mobilized in the personal defense of President and Mrs. Clinton.

The Sherburne ‘‘task list’’ is impressive for its breadth. It is an

indepth list of all possible investigations, regardless of how remote,

for which attorneys in the White House were to have been prepared. The widely publicized investigations into Whitewater, Vince

Foster document handling, and Travelgate are included among a

myriad of other items. Many of the scandals are assigned a specific

lawyer and apparently binders with relevant information are assembled for each issue.775

Ms. Sherburne’s task list also assigns President Clinton’s lawyers the duty of ‘‘monitoring’’ the criminal investigations of other

Independent Counsels: 776

• Independent Counsel Donald Smaltz’s criminal investigation

of Agriculture Secretary Espy. Task # 7 assigned White House

Associate Counsel Cheryl Mills to examine possible ethics violations involving Secretary Espy. White House Associate Counsel Beth Nolan also is listed as tasked to look at the ethics portion of this investigation.

Other aspects of the Independent Counsel’s inquiry ‘‘beyond

Espy ethics’’ such as Hatch Act violations and contacts with

Tyson Foods executives were listed to have a lawyer determine

the charter and scope of inquiry, press strategy, congressional

interest, assemble a record of what information was already

public and then start ‘‘fact gathering.’’

• Independent Counsel David Barrett’s criminal investigation

of HUD Secretary Henry Cisneros’s alleged payment to a mistress far in excess of the amounts he told the FBI. Ms.

Sherburne had not yet assigned a White House lawyer with

the stated duties: ‘‘gather facts,’’ ‘‘establish contact’’ with Secretary Cisneros’s counsel, ‘‘determine press strategy’’ and ‘‘develop talking points,’’ ‘‘identify the source of congressional interest’’ in the investigation, and to ‘‘assemble a binder’’ in the

White House with a ‘‘summary and key documents.’’

• Independent Counsel Daniel Pearson’s criminal investigation

of Commerce Secretary Ron Brown’s financial dealings also

had not been assigned by Sherburne. However, the task list

outlined that President Clinton’s lawyers should ‘‘establish contact with counsel,’’ ‘‘determine press strategy,’’ ‘‘develop talking

points,’’ ‘‘identify source of congressional interest,’’ and finally

to ‘‘assemble binder with summary and key documents.’’

The nature of the task list evolved. By December 1994, for example, Webb Hubbell had already pled guilty to felony counts of mail

fraud and tax evasion. The only tasks remaining for Sherburne’s

‘‘team’’ of lawyers was to ‘‘monitor’’ his cooperation with Independent Counsel Kenneth Starr, ‘‘determine press strategy’’ and ‘‘develop talking points.’’

Ms. Sherburne had the insight to put other Clinton staff ‘‘problems’’ that were likely to be investigated on her task list. It in-
183

cluded ‘‘monitoring’’ and assembly of a ‘‘binder’’ with summary and

key documents for: • Deputy Chief of Staff Harold Ickes’ representation of the Laborers’ International Union, under investigation by the Justice

Department for 3 years concerning their ties to organized

crime;

• George Stephanopoulos’ receipt of a Nationsbank loan under

the prime interest rate for his Washington townhome;

• FDIC Chairman Ricki Tigert confirmation was put on hold

until her contacts with David Gergen and Joel Klein could be

reviewed concerning her recusal on matters involving President Clinton;

• GSA Director Roger Johnson’s issues were tasked to ‘‘identify

issues,’’ ‘‘determine congressional interest,’’ and ‘‘assemble

binder with summary and key documents,’’ regarding the Justice Department investigation of his use of Government employees for his own personal business.

Ms. Sherburne’s task list included other tasks to be assigned to

White House lawyers by topic rather than by the name of the individual Clinton administration official. They tasked lawyers to

‘‘identify issues,’’ ‘‘determine congressional interest,’’ and ‘‘assemble

binder with summary and key documents’’ for: • ‘‘FEC Audit’’ of irregularities with the Clinton ’92 campaign

settlement of sexual harassment charges against Clinton’s

close advisor and White House Director of the Office of Administration, David Watkins. The campaign also reportedly lost

rental cars, laptop computers, cellular telephones, and other

equipment that had to be accounted for;

• ‘‘PIC surplus’’ involved what the Clinton White House could legally do with the $10 million surplus left over from the President’s Inaugural Committee. President Clinton’s advisor and

PIC official, Michael Berman, was looking into the possibility

of placing these PIC funds in a tax exempt organization established to hire personnel that would then volunteer to work in

the White House offices as volunteers;

• ‘‘Mena Airport’’ allegations of drug smuggling to points south

of Mexico;

• ‘‘ADFA’’ the Arkansas Development Finance Authority created by President Clinton to provide a finance authority in Arkansas which came under scrutiny for political patronage;

• ‘‘State Department (passport files)’’ and ‘‘Archives (abuse of

personnel system)’’ concerned the Justice Department’s investigations of Clinton State Department officials who pulled 160

files of former Bush administration employees and leaked the

contents to a Washington Post reporter;

• ‘‘SBA (improper electioneering)’’ concerned use of taxpayer

dollars to distribute Democratic campaign literature pamphlets

on health care issues.

Under the heading of ‘‘Negative Associations’’ the task list identifies: ‘‘Jim Guy Tucker’’ former Governor of Arkansas most recently

convicted in Whitewater trial; ‘‘David Hale (SBA)’’ pled guilty to

making fraudulent Small Business Administration loans to Susan

McDougal under pressure from then Governor Clinton; ‘‘Jim

McDougal’’ former partner of President Clinton and most recently
184

convicted in Whitewater trial; and ‘‘Dan Lasater (bond deals, cocaine, Roger Clinton)’’ was one of the underwriters for bonds,

served prison term for social distribution of cocaine, provided President Clinton’s brother, Roger Clinton, $8,000 to pay off a drug debt. • ‘‘Commodities’’ task list heading involved Mrs. Clinton’s

foray into the commodities market while still in Arkansas

where she made a $100,000 profit on a $1,000 initial investment;

• ‘‘Paula Jones’’ tasks were to ‘‘assemble binder with summary

and key documents’’ concerning the sexual harassment suit

currently pending against President Clinton by a former Arkansas State employee;

• ‘‘Presidential immunity’’ was assigned to White House Associate Counsel Cliff Sloan. President Clinton’s personal lawyers

have successfully claimed Presidential immunity over the

pending sexual harassment lawsuit;

• ‘‘Troopers’’ task lists possible issue to be ‘‘job for silence’’ as

well as ‘‘other’’ issues to be identified, congressional interest to

be determined, and ‘‘assemble binder with summary and key

documents.’’ Allegations made in public that then-Governor

Clinton promised Government positions to Arkansas State

troopers for their silence;

• ‘‘White House operations (drugs, passes, helicopters)’’ was

tasked to White House Associate Counsels Cheryl Mills and

Beth Nolan to review issues relating to White House staff recent drug use prompting the instigation of a special random

drug testing program, the failure of the White House to process

its staff to receive clearance for a permanent White House

passes, and David Watkins’ ‘‘helicopter’’ trip to play golf that

led to his resignation;

• ‘‘Residence renovations’’ was assigned by Sherburne to Associate White House Counsel Steve Neuwirth. The issue was

mentioned in Foster’s suicide note involving a dispute over the

payment of moneys to Kaki Hockersmith for renovations to the

Clintons’ residence.

Ms. Sherburne also includes several items on her task list with

the notation, ‘‘identify issue; determine congressional interest; assemble binder with summary and key documents.’’ They are: • ‘‘Use by Governor Clinton of loans to further legislative initiatives;’’

• And under the heading of ‘‘women,’’ President Clinton’s personal lawyers David Kendall and Robert Bennett are listed

with ‘‘**’’ a notation that the issue has yet to be assigned;

G. PRESIDENT CLINTON PUSHES THE BOUNDARIES OF HIS CLAIMS OF

EXECUTIVE PRIVILEGE AGAINST PRODUCING RELEVANT DOCUMENTS

TO CONGRESS

Several of the efforts on the ‘‘task list’’ reflect efforts by the

White House to conceal information from Congress and the American public. Ms. Sherburne noted the need to conduct research on

(1) how far executive privilege can be extended to justify withholding materials, and (2) what the limitations are on the ‘‘legislative

power to investigate.’’ Ms. Sherburne indicates in her memoranda

that there is a need to research the ‘‘entitlement of Congress to
185

777 ‘‘Remarks Announcing the Appointment of Lloyd Cutler as Special Counsel to the President and an Exchange with Reporters,’’ 30 Wkly Comp. Pres. Documents, 441, 467 (Mar. 8,

1994). 778 Id.

HRC [Hillary Rodham Clinton]/WJC [William Jefferson Clinton]

transcripts of depositions given to [Whitewater Independent Counsel] Fiske.

President Clinton’s attorneys have ventured far from his original

statements on executive privilege. On March 8, 1994, President

Clinton stated that it was ‘‘hard for me to imagine a case in which

I would invoke [executive privilege].’’ 777 President Clinton concluded his remarks about cooperating with the current ongoing investigations saying, ‘‘[I]t’s hard for me to imagine a circumstance

in which that [an executive privilege claim] would be an appropriate thing for me to do.’’ 778 President Clinton personally claimed

executive privilege over Sherburne’s December 13, 1994 task list as

well as 2,000 pages of documents detailing conversations that

Travelgate and Whitewater attorneys had with President Clinton’s

lawyers about the course of these investigations.

The hundreds of pages recorded by White House lawyers reveals

a systematic program whereby the attorney for each witness testifying under oath before a congressional committee or before the

Independent Counsel asks the White House to outline what questions were asked and what answers were provided. These

debriefings provide a clear map of what the White House knew and

who the White House told.

Among the executive privilege documents are chronologies and

reviews created with the aid of information provided in these

debriefings. The President’s staff was able to construct, from the

debriefings of witnesses that went before each investigative body,

a single cohesive review. The White House Counsel’s Office thus

operated as the compiler of all of the pieces of information gathered

as a result of the myriad of investigations of the Clinton administration.

H. THE PRESIDENT HAS INSISTED THAT ALL OF HIS COUNSEL’S

MAINTAIN AN OBSTRUCTIONIST POSITION WITH CONGRESS

After 5 months of service, Abner Mikva stepped down from the

bench at the U.S. Court of Appeals for the District of Columbia to

become President Clinton’s third White House Counsel on August

11, 1994. Mr. Mikva remained as Counsel to the President for less

than 1 year, when he suddenly resigned to ‘‘spend more time with

his family.’’ Mr. Mikva resigned shortly after delivering to this

committee, a document production which had been withheld under

a vague ‘‘protective’’ claim of executive privilege. After producing

the documents, the Clinton administration asserted executive privilege had never been claimed. The production of these documents

further defined the role of the President and his staff in the

Travelgate matter and outlined actions taken by the White House

to conceal their involvement to previous investigators.

Former Vice Presidential Chief of Staff John Quinn replaced

Mikva as the fourth Counsel to the President. Mr. Quinn resumed

document production to the committee and ultimately had to claim

executive privilege over the remaining subpoenaed documents in
186

order to prevent their production to the committee. After it became

clear that there was no valid privilege over the categories of documents called for, Mr. Quinn turned over most of the withheld documents to this committee rather than face a criminal contempt

charge for failure to respond to a valid subpoena.

CONCLUSION

The President committed, over 3 years ago, to full cooperation

with investigations into the Travel Office matter. While the committee does not believe it has been able to fully disclose all of the

facts in this case, a partial disclosure has implicated the President

in a cover-up that was base and broad. The culture of secrecy in

which President Clinton insists upon operating is destructive to

both public confidence and to an open and efficient Government.

When the President fails to comply fully with investigations

mandated by Congress or ordered by senior Justice Department officials, the oversight role critical to our system of checks and balances is compromised. It is incumbent upon this committee to assert and to uphold its jurisdiction and prerogatives of the legislative branch.

In its attempt to obfuscate wrongdoing in the Travel Office affair,

President Clinton and high ranking members of his administration,

including four successive White House Counsels, engaged in unprecedented abuses of executive power and executive privilege.

President Clinton’s executive privilege claim over documents relating to the firing of seven Travel Office employees, was in no way

based on protecting national security interests, had no bearing on

the deliberative process of the President, and had no relation to the

constitutional duties of the executive branch. It was a frivolous use

of the President’s executive privilege.
(187)

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Æ