Clinton Investigated by the U.S. Attorney's Office

NEW YORK â€“ The U.S. attorney's office is investigating whether former President Clinton commuted the sentences of four convicted swindlers in exchange for votes for his wife's Senate campaign

Friday, February 23rd 2001, 12:00 am

By: News On 6

NEW YORK â€“ The U.S. attorney's office is investigating whether former President Clinton commuted the sentences of four convicted swindlers in exchange for votes for his wife's Senate campaign from their community, The Associated Press learned today.

The Hasidic community, New Square in Rockland County, voted overwhelmingly for Hillary Rodham Clinton when she won her Senate seat in November.

Manhattan U.S. Attorney Mary Jo White and the FBI, in a joint statement last week, announced they were opening a probe into presidential pardons, but declined to provide any specifics.

A source familiar with the case, speaking on condition of anonymity, told the AP on Friday that the probe into the New Square votes was launched this month. The office is also investigating the pardon of fugitive financier Marc Rich, whose former wife, Denise, is a major Democratic fund-raiser, a source has said.

The New York Post, quoting unidentified sources, had reported Friday that White's investigation could be expanded to include the New Square case. But the AP's source said that White intended from the beginning to include the commutations.

Friday, Mrs. Clinton's spokesman, Karen Dunne, said: "Senator Clinton has spoken about this pardon on several occasions and we do not have anything to add at this time." The former president's attorney, David Kendall, did not immediately return a phone message, and the lawyer for the four men, Samuel Rosenthal, said he had no comment because "we have not been made aware of any investigation."

The commutations are part of a burgeoning scandal into several of the 140 pardons the president made on his final day in office, Jan. 20. Also under study are two pardons in which Mrs. Clinton's brother Hugh Rodham received funds, and the possible role of the former president's brother, Roger Clinton.

Many Hasidic communities tend to vote in blocs, and because of that, politicians aggressively court their leaders. Mrs. Clinton received 1,400 votes in New Square; her Republican rival, Rick Lazio, received 12.

The four Hasidic men, Kalmen Stern, David Goldstein, Benjamin Berger and Jacob Elbaum, were convicted of stealing more than $40 million worth of Pell grants, small business loans and housing subsidies by creating a a fictitious religious school to receive government money.

Supporters of the four men have not denied their guilt but said they did not keep the money for themselves, and gave it instead to a school and residents of the village.

The president and his wife, then New York's senator-elect, met for about 45 minutes Dec. 22 with two leaders from the New Square Hasidim. The meeting took place in the White House Map Room.

Mrs. Clinton has said that she sat in on the meeting but said she played no part in her husband's decision to commute their sentences. She also has said she had no conversations about the commutations during meetings with Hasidic leaders before the election.

On Thursday, Mrs. Clinton reacted to the reports about her brother receiving $400,000 for his work on behalf of a requests for two other pardons. She called her brother Hugh's decision to take money to lobby for pardons a "terrible misjudgment."

Mrs. Clinton said she "did not have any involvement" in the pardons her husband granted on his way out of the White House. However, she said she was "very disappointed" with her brother.

Rodham returned the money to the families of the men.

Also Thursday, the House Government Reform Committee sent a letter to the former president's brother, Roger, asking him whether he was involved in any of the pardons.

The former president's office confirmed late Thursday that Roger Clinton lobbied the president on behalf of several friends and associates who were seeking pardons. The president turned down all of them, a Clinton spokeswoman said.

In addition, there was a fresh disclosure Thursday that Mrs. Clinton's campaign treasurer was paid $4,000 in legal fees to prepare two pardon applications that were sent to the Justice Department. William Cunningham III said he had never contacted the White House about the cases, or spoken with either of the Clintons about them.

On Friday, Hollywood TV producer Harry Thomason, a longtime friend of the Clintons from Arkansas, said he pitched the idea for those two pardons that ultimately were handled by Cunningham. James Lowell Manning and Robert Clinton Fain, both of Little Rock., Ark., were convicted in the 1980s on tax charges.

Thomason "was pleased to recommend to the president" pardons for the two and did so for free, the producer's Washington lawyer, Robert Bennett, said in a statement.

Thomason was involved in the 1993 purge of the White House travel office. An independent counsel concluded last year that Mrs. Clinton gave "factually false" testimony when she denied having a role in the firings.