WASHINGTON -- Independent Counsel Robert Ray concludes in his final Whitewater report that the Clintons' land venture benefited from criminal transactions but there was insufficient evidence to prove the former president or his wife engaged in wrongdoing.
The report, released Wednesday, also said prosecutors could not rule out the possibility that Hillary Rodham Clinton played a role in the disappearance and mysterious discovery of her law firm billing records. The five-volume report wrapped up a six-year investigation by three different prosecutors of the Clintons' finances and detailed the business transactions they undertook with partners Jim and Susan McDougal.
The McDougals were convicted of crimes and imprisoned in the Whitewater investigation in connection with a failed savings and loan they operated.
The report said Jim McDougal wrongly used funds from the failing S&L to benefit the Whitewater venture in Arkansas that he had created with Bill Clinton, then governor of Arkansas, and Mrs. Clinton, then a lawyer.
"Insufficient evidence exists to establish beyond a reasonable doubt that either Governor or Mrs. Clinton knowingly participated in the criminal financial transactions used by McDougal to benefit Whitewater," the report said.
The Clintons' lawyer, David Kendall, called the report "the most expensive exoneration in history. Their investigation was unprecedented in its seven-year length, $70 million expense and unremitting intensity. But it ends as it began: with no evidence of any wrongdoing by the Clintons." The investigation began in 1994 and ended in 2000.
Part of the investigation focused on a fraudulent $300,000 federally backed loan that a Little Rock judge claimed he was pressured by Clinton to make to the McDougals, who operated the failed Madison Guaranty S&L.
"Insufficient evidence also exists to prove beyond a reasonable doubt that Governor Clinton knew of or approved" the loan, Ray's report said.
"There is some evidence that Governor Clinton knew or should have known that Jim McDougal was not conducting Madison Guaranty's affairs as required by banking rules," it said. The report also focused extensively on Mrs. Clinton's legal work on an Arkansas land development called Castle Grande that was being operated by Jim McDougal and partly financed by his failed S&L. The former first lady is now a senator representing New York.
Her legal work on the project wasn't disclosed until 1996, when her law firm billing records, which had been subpoenaed earlier in the case, were found in the White House family residence.
Prosecutors investigated whether there was an attempt to obstruct by hiding the records. The report said, "The evidence gathered could not exclude the possibility that Mrs. Clinton put the billing records in Room 319A."