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Hillary's Haunting Finance Scandal By: Dick Morris
FrontPageMagazine.com | Monday, April 25, 2005


David Rosen, the national finance Director for Hillary Clinton's 2000 Senate campaign, goes on trial May 3 on charges of breaking federal campaign law. The senator's spokespeople insist that she didn't gain from the alleged crime — that the campaign realized no financial benefit from Rosen's understating the costs of a gala Clinton Hollywood fund-raiser.

Not true. Hillary's campaign realized not just a huge benefit, but one critical to her election chances.

Under the arcane rules of the Federal Election Commission at the time, campaigns could use soft money to pay for fund-raising events — provided the gathering's costs came to 40 percent or less of the total of hard money raised. (Soft money was far easier to raise: Donors could give up to $25,000 of soft money, but only $1,000 of hard money).

Hillary's Hollywood gala that raised $1 million in hard money that August. This meant that the campaign could use soft money to pay for all costs up to $400,000. David Rosen conveniently reported to the campaign treasurer that the event did, indeed, cost $400,000, avoiding the necessity of spending any hard money on the affair.

But the federal indictment of Rosen, FBI affidavits and the testimony of the event organizers — Peter Paul and Aaron Tonkin — all confirm that the extravaganza's true cost was at least $1.2 million. Press leaks suggests that the feds may have Rosen on tape acknowledging that he understated the cost of the event on purpose.

Here's why he would have done it: If the real cost of the event were $1.2 million instead of $400,000, the campaign would have had to use hard money to make up the difference. The Hillary Clinton campaign would have had $800,000 less of hard money to spend running TV ads and funding get-out-the-vote operations.

And, at the time of that fund-raiser, Rick Lazio, the GOP candidate, had challenged Hillary to refuse to accept soft money. He found himself awash in hard money — small checks from Hillary haters across the country. But First Lady Hillary Clinton was heavily dependent on large checks from fat-cat donors whom she and the president wined, dined, photographed, and hosted at the White House. And these folks gave a lot more than $1,000 each.

Hillary temporized and delayed, but the handwriting was on the wall. On Sept. 24, the candidates agreed on a soft-money ban. Now she had to pay for it all with hard money. And she was hard up for hard money.

So if Rosen had owned up to the full cost of the fundraiser, the campaign would have had to cough up $800,000 of hard money at exactly the time that it needed the funds the most.

Did Hillary know? Paul and Tonken say she did, and it seems obvious that she must have: Hillary followed every dime in her campaign, personally calling donors for most of it. How could she possibly not have known of a decision that saved her $800,000?

But the person who knows if she knew is David Rosen. If found guilty, he faces a potential sentence of 15 years. If the feds threaten him with jail — and it's hard to see how they wouldn't —Rosen faces a choice: Tell the truth or go to prison.

Rosen is no long-term Clinton loyalist like Webb Hubbell, nor did he have an affair with a Clinton (as Bill implied to me that Susan McDougal did). And there is no Clinton in the White House to pardon him if he goes to prison.

David Rosen is a young man in his late 30s, with a life ahead of him. He would be a fool to go to jail to protect Hillary.

If he did, she wouldn't even visit him.

Eileen McGann contributed to this column.


Dick Morris is a former adviser to President Clinton. To get all his columns e-mailed to you, register for free at DickMorris.com.


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